University Budget Issues

By Mike McIntyre, Psychology

In our discussion following our meeting with the administration on April 6, I made two general comments about budget issues.  These generated some interest and raised some questions. The first issue had to do with the size of our administration and the second with the ways that the University has retrenched in the past.

With respect to the size of the administration, it is my opinion that utilizing small percentage increases or decreases as a touchstone is not as meaningful as some other possibilities.  If, for example, we are told that the cost of administration declined by 2% while academic expenses increased by 1%, then should we breathe a sigh of relief?  I don’t think so.  For one thing, I’m not inclined to debate numbers that reflect, of necessity, sometimes arbitrary assignment of expenses and revenues.  UWFA has already experienced difficulty reconciling budget numbers used in the meeting with our own numbers.  In any case, such numbers tell us very little about the appropriateness and efficiency of any unit. 

During the time when I served as Dean of Arts and Science (1982-1992), the University Grants Commission (UGC) mediated funding of universities.  The UGC often compared the size of a unit with the units in similarly sized and mandated universities across the country.  The University of Winnipeg benefited from this in several ways.  For example, these comparisons revealed that student services here were comparatively under-funded and this was at least partially redressed.  The fact that our administration was comparatively lean in the terms of Presidents Duckworth and Farquhar seemed to be one of the factors that resulted in favourable UGC regard and larger increases to our base budget than those provided to the other institutions. 

If, as academics, we wish to comment upon administrative size and structure, then comparing the size and scope of responsibilities of a unit here with similar institutions may be revealing.  Should it turn out that in both size and seniority, a unit at the University of Winnipeg were an outlier, I would like to know what we expect of our unit that is beyond the norm or how the functions of our unit are more complex or difficult than elsewhere or how we are more successful.  We may, of course, find that in some areas we are understaffed.  I have long suspected that we do less in helping students find employment upon graduation than we ought.  More than one of us has expressed the view that attention to improving existing facilities is urgently needed.  The upshot of my comment at the meeting was that meaningful comparisons with similarly sized and mandated institutions are possible and may be very informative.  These comparisons, like salary comparisons, help us and our funders understand how we function relative to other universities.

My opinion on our present budgetary situation is that it reflects many more problems than the two that were focused upon: financial markets and the apparently surprising news that our pensions were not handled as they ought to have been.  Beyond the pension and the markets, I am much more concerned that our accumulated surplus is now gone and that we are accumulating an ever growing deficit.  This issue has to be understood and corrected.  I am hopeful that thawing the tuition freeze will help. 

I am also concerned about the relationship between capital and operating budgets.   Capital expenditure requires operating funds for maintenance and replacement.  My worry is that there are no increases in operating associated with the many exciting capital developments.  Operating really does bear the brunt of capital and I am not convinced that we are prepared for this.  So, it seems that we have been getting in the habit of running deficits and that these are growing apart from any emergent circumstances. 

On the other hand, I also believe that there are many sources of potential savings beyond the reincarnation of “Filmon Fridays” available to us.  My optimism derives from my time as Dean of Arts and Science and observing how we were able to adjust to difficult times.  In 1982, the Province introduced a payroll tax that added, quite unexpectedly, a 2.15% tax on our salary budget, requiring an unforeseen expenditure of approximately $600,000 in 1982 dollars.  In fact, we were able to exceed our targets and add back selected new expenditures that were badly needed. 

The faculty made this possible.  At the time, there were three Associate Deans.  We met collectively with each of the departments and heard from all members.  We heard of a great variety of possible savings and goals that each department hoped to accomplish.  The savings possible differed from department to department in both substance and amount.  Examples of savings included smoothing out leave eligibility to reduce the need for replacement, sometimes waiting to advertise and replace especially when resignations came relatively late, and using capital (a separate budget) to reduce operating.  In some cases, curriculum reforms were initiated, labs were restructured, and staff replacement was delayed.  We focused on increasing revenues as well.  Following the meetings with all members of the Faculty, we met with the Chairs and worked out a set of reductions that seemed distributively just.  We used the same system for the add backs.

In looking back at this process, several things stand out.  We heard from every member of the Faculty in the meetings.  In so doing, we learned about little things that could make a difference and had a very broad base of suggestions for savings and add backs.  That we were examining possible cutbacks and possible improvements at the same time fueled the process.  There were common threads in the suggestions but also input that pertained to individual departments. 

Two aspects of the process were absolutely critical.  The first was that it was bottom up as opposed to top down.  The range and creativity of the suggestions never would have occurred by an edict from above.  The second was that the process was open – every department knew what the other departments were contributing and had received.  Eliminating uneasiness about the distributive justice of the process energized it. 

At the meeting, I expressed the opinion that there were options for savings that hadn’t been explored.  They would require close collaboration between administration, faculty and staff, and won’t be achieved by administrative fiat.  When members of the University community are appreciated and given a voice, the results can be innovative and energizing.