Archive for W.D. Smith

Tuition rises, class size grows, and the bureaucracy gets big

The annual tuition fee debate has begun. This is the war dance that takes place every winter, when senior university administrators announce that students yet again face substantial hikes. Those administrators roll out the rationale they use every year: the increases are necessary to protect educational quality, top faculty costs top dollar, and the only alternatives are declining quality and staff layoffs or increased government funding. Students get angry. They claim that university is becoming a place for only the wealthy, that quality has suffered enough, and that debt loads are becoming unmanageable. Boards of governors—the guardians of public interest when it comes to the operation of universities—wring their hands and voice genuine empathy. They hope for solutions but find none. And then, as they always do, they approve the increases proposed by senior administration.

Here’s the thing: the students have a point—at least according to a detailed analysis of the finances of Canada’s largest 25 universities. A study of 21 years of data compiled annually by StatsCan for the Canadian Association of University Business Officers (CAUBO) reveals some startling trends. In 1987-88, the top 25 universities spent $6 billion across all their activities; by 2007-08, that had increased by almost four times inflation, to $21 billion. That equates to about 13 per cent of Canada’s health care budget, or more than the entire defence budget. And that’s only the top 25 schools.

Funding trends have driven a stronger focus on research. In 1988, sponsored research—commissioned by governments and corporations—accounted for 14.9 per cent of top 25 expenditures; by 2008, it consumed 24.7 per cent. A parallel decline (from 67.1 per cent to 54.8 per cent) occurred in general operating expenditures. This includes the areas central to undergraduate teaching and student life: instruction, the library, student services, and other functions such as central administration.

The analysis suggests teaching has not just fallen down the priority list; it has been pushed there by conscious resource allocation decisions. Less money is reaching the classroom. In 1988, almost 65 per cent of operating funds were directed to instruction and non-sponsored research, where the teaching happens. By 2008 this had fallen to 58 per cent—an effective cutback of $30 million a year at the average top 25 school. Within the G13 group of Canada’s largest, research-focused universities, the cutback averages $35 million, and $45 million for the top 5 (Toronto, UBC, Alberta, McGill and Montréal).

Why the declines? In large part, they’re because of skyrocketing central administrative costs. Shockingly, 20 cents is now spent on central administration for every dollar spent on instruction and non-sponsored research; back in 1987-88, 12 cents went to administration. At the average top 25 university, central administration (including external relations) now consumes $18 million that previously would have flowed to instruction. (For a G13 school, it’s $20 million; for the top 5, $39 million.)