The 2015/2016 Ministry of Training, Colleges and Universities (MTCU) operating budget for the University of Guelph has been approved by the Board of Governors.

A special B of G meeting was held today via teleconference to allow members to discuss agenda items — including the operating budget — that were not addressed due to a disruption caused by student protestors at the April 16 meeting of the Board.

B of G had previously moved its regular meeting to April 16 to enable students to attend before the end of examinations. The Board includes three student representatives.
Following the meeting, President Franco Vaccarino said:

“Today’s Board approval is another important step toward developing a sustainable operating platform that helps us move forward in a fiscally stable position,” he said.

“Facing funding constraints and other changes in post-secondary education, we must continue to improve our students’ education and university experience.”

Vaccarino added that the University is beginning a strategic plan renewal process, and will seek further input and discuss options in the fall.

The MTCU operating budget is the largest component of the University’s $750 million in revenue, accounting for $470 million. Grants and tuition make up about 70 per cent of the MTCU operating budget income base.

Besides funding nearly 90 per cent of compensation for faculty and 80 per cent for full-time staff, the budget covers utilities and capital infrastructure, debt repayments, and funding for critical investments, academic programs and administrative support services.

Budget planning includes not only preparing annual assumptions but also preparing multi-year projections, said John Miles, associate vice-president (finance and integrated planning). Among this year’s assumptions is that revenues will continue to lag behind expenses.

U of G is anticipating an enrolment decline next year of about 350 students, or 1.6 per cent in 2015/2016, which will affect revenues.

Declining university enrolment due to changing demographics is a system-wide reality, said Serge Desmarais, interim provost and vice president (academic). Across Ontario and Canada, the number of 18-to 20-year-olds, the main age group of students entering higher education, is expected to fall by about 10 per cent during the next eight years.

U of G is not expected to experience such a significant decrease, Desmarais said. However, in order to maintain enrolment, the University will need to diversify its recruitment efforts.

Balancing the budget this year means sticking to the University’s multi-year financial plan including increasing tuition rates as allowed under the provincial framework and continuing the task of finding efficiencies within all unit budgets, Miles said.

This year, U of G colleges and units are being asked to find $10 million in cost savings or about 2.5 per cent for 2015/2016 as part of the multi-year plan to help cover cost increases.
The provincial tuition framework allows program fees for domestic students to increase by up to three per cent. Within that cap, fees for professional and graduate programs may increase by up to five per cent, depending on the year of study.

Tuition at U of G will increase by 2.95 per cent for most entering and continuing undergraduate domestic students, with students in professional programs paying five per cent more. Graduate tuition will increase by one per cent. No provincial framework exists for international student tuition rates. University fees for new international students will increase by five per cent; there will be no increase for continuing international students.

During the meeting, Board members and Vaccarino expressed commitment to student accessibility and high-quality university programs, and continued support for advocacy efforts that enhance sustainability and ensure affordability.

“We are also frustrated by the limited options available to ensure our continued ability to meet the expectations of our students, staff and faculty,” Vaccarino said. “We will continue to work together with all members of our community to advocate for more flexibility and new funding solutions.”

Board of Governors also received an update on the University’s pension plans. U of G currently contributes $45 million annually to its pension plans. With plan costs rising due mainly to increasing liabilities, the University’s contribution levels are projected to almost double to more than $80 million a year starting in 2017, Miles said. Much of this projected increase reflects continuing low interest rates, lower-than-expected returns, longer life expectancies and provincial “wind-up” provisions for funding pension plans.