The 2003-2004 budget for U of T shows the school has been living beyond its means, and a round of belt tightening will be needed to bring down spending.
Approved at a Planning and Budget Committee meeting yesterday, the budget predicts a $22.2-million shortfall for the year, unless spending is cut by almost 4.5 per cent, combined with a one-time-only clawback of about $7.3 million next year.
The budget blames reductions in funding from the provincial government, beginning under the NDP and increasing under the Progressive Conservatives, for much of the shortfall.
“The practical effect of the government funding policy has been that the university has had to internally absorb a significant portion of cost increases for compensation, library acquisitions and utilities by way of budget reduction,” the document said.
The report also said U of T’s commitment to student aid is starving it of funds: “in effect, the increase in expenditures on student financial aid is approximately 40 per cent of the increase in tuition revenue, making the University of Toronto one of the most accessible in the country.”
The budget said library acquisition costs have shot up in the past decade, from $9 million in 1991 to a predicted $22.2 million next year.
Deregulation of professional programmes has given U of T the ability to raise tuition for degrees leading to high-paying jobs, and the budget said in the MBA programme, medicine, dentistry, law, engineering and information technology, “the revenue from larger increases is being used to enhance quality in these programmes.”
U of T’s revenues from government grants are slated to drop by $4.4 million more than previously budgeted, but tuition revenue is up $21.6 million higher than last year’s predictions. Money for research is also up, but the $400 million loss suffered by the university’s asset management arm means revenue from the endowment fund is $2.4 million lower than predicted.
The budget said assumptions of higher government grants had not come true. “Not realizing a 1 per cent inflation increase in government operating grant funding” and “not realizing the assumption that funding for the indirect cost of federal research would increase from the current 20 per cent to a level of 30 per cent” put the university’s budget assumptions into the red.
According to the Graduate Student Union’s Elan Ohayon, the U of T budget makes the same assumptions every year: “They’re premising the budget on gains in the stock market,” he said, adding that was “a serious mistake.”
Ohayon said the university assumes it cannot get more money out of the provincial and federal governments: “They’re relying on tuition to fund the university… an ill-advised route.” He added “By just focussing on tuition, they’re not going after the government.” He said the move could alienate the public from the university.
“By taking this route, they’re undermining accessibility of the institution, they’re undermining the financial security of the university, and the public nature of the institution.”
Ohayon said students should “take a serious look at what [the budget committee’s] priorities are,” noting if the money spent on renovating the Governing Council chambers last summer was invested back into education, each law student could have had their tuition reduced by $3,000.
