Suspending admission to 17 programs, looking critically at course offerings with low enrolments, negotiating with government and a university-wide hiring freeze are among the ways Laurentian University is tacking a $7.4 million projected 2020-2021 budget shortfall.
This as the university struggles with the cost of the COVID-19 pandemic, which was around $5 million in the last fiscal year, as well as pre-existing financial pressures.
“In the first instance, all universities in Ontario are really feeling the pinch of COVID, and Laurentian is within that,” said Laurentian president Robert Haché, in a recent interview with Sudbury.com.
“Two and a half years ago the government cut tuition by 10 per cent, and has frozen tuition for the past couple of years before that. So that’s a 16-per-cent overall reduction in where our tuition levels would be expected today.”
Haché outlined for the university’s Senate late last month how the university is planning on tackling this budget shortfall, and he recently spoke with Sudbury.com over the phone to share a few more details.
According to a high-level budget provided to the university’s board of governors just prior to the school year, the draft financial statements showed an operating deficit of $5.4 million ($5.1 million due to COVID-19), pushing Laurentian’s accumulated operating deficit to just under $20 million.
This exceeds the 2019 Laurentian board-mandated maximum allowable cumulative operating deficit of $15 million, and is a particular concern given the absence of cash reserves at Laurentian, Haché said.
A final budget will be brought to the board of governors in December, with an expectation of a balanced projection.
He said he wanted to emphasize that in discussing the university’s financial issues, students are “first and foremost.”
“We’re in the process of fixing it,” he said. “We have plans in place, and we will get it fixed. It’s just taking a little bit more prominence because it’s happening during a pandemic.”
The largest area of savings the university is looking at is $4.4 million in “academic savings,” Haché said. It also expects $1.8 million in “non-academic savings” and $1.2 million in advocacy surrounding its strategic mandate agreement with the province.
In terms of academic savings, Haché said quite a bit of progress has already been made.
Most controversial has been the suspension of admission to 17 academic programs by the university, a move that has been fought by the university’s faculty association.
The university cited low enrolment and overlapping content in these programs as its rationale.
Haché said the university is also looking at “how can we improve our student experience while we look at how we can reduce the total number of course offerings that we have.
“We have a lot of courses that have very few students,” he said. “I know because the students tell me that when you’re in a course with only two or three students, you lose that peer-to-peer, student-to-student experience that’s so important to learning.”
Haché said non-unionized staff, up to and including himself, have taken unpaid furlough days, and $1.5 million in savings as a result of an early negotiation with the Laurentian University Staff Union. The union’s collective agreement was not due to expire until June 30, 2021.
Laurentian is also currently in negotiations with the Laurentian University Faculty Association (LUFA), although Haché said he can’t release details of those negotiations at this time.
Hiring has also been frozen across the institution, except in cases that are “very critical,” said the university president.
Other savings include no travel and less office expenses due to the pandemic and people working remotely.
In terms of advocacy surrounding the university’s strategic mandate agreement with the province, Haché explains that universities receive funding from the province based on their enrolment.
Much of that issue surrounds the phasing out of the university’s Barrie campus over the last several years, which was just supposed to hit Laurentian’s government funding fully this year.
Haché hoped to advocate with the government to receive $1.2 million of that money anyway due to its current financial pressures, and the university has been successful in re-establishing half of that total.
Last month, Laurentian announced it had hired external financial advisors Ernst & Young to assist in a review of its finances in light of its financial challenges.
“Periodically, it’s just important as an institution to bring in some external eyes, not really to validate what we’ve done, but to say ‘Here’s a few additional ideas you may not have thought of,’ ” Haché said.
There is some good news when it comes to Laurentian’s budget.
As of the end of the summer, the university had estimated a $5-11 million risk to its budget due to lost tuition because of lower enrolment and ancillary revenues (such as food services and residence fees) owing to the pandemic.
Despite most classes being delivered remotely, Haché said Laurentian’s domestic student enrolment was actually up on the first day of class.
Much of that increase is actually in online programming (those are programs that are designed to be delivered online, as opposed to the adapted remote delivery of most of Laurentian’s programs due to the pandemic).
Haché said first-year international student enrolment is down three per cent over last year, but enrolment in upper years has increased.
“I would say our overall international enrolments are almost flat,” he said. “A little bit of decrease in new undergraduate, and a little bit of increase in people that are coming back, and I think the overall number is flat.
“We did invest a lot of resources to try and grow our international (student population). Historically, Laurentian has a smaller proportion of international than many other universities, about eight per cent. Some universities are up in the 20th percentage. We were looking at that as an opportunity to grow, and so I think the consequence is that what we’ve actually done is had a better outcome than other universities, in that others are significantly down in their international enrolment, and we’ve been able to hold.”