University Funding Cuts

Shortchanging Ontario Students
April 29, 2002
105.18 KB14 pages

Declining Levels of Support

Since the election of the Conservative Government in 1995, university finance has been radically undermined. Measured on a consistent basis, and allowing for inflation and enrolment growth, Ontario's operating support for universities declined by $348 million, or 17%, between 1995-6 and 2000-1.

A level of support that was already below that of every province except for Nova Scotia on a per-student basis, and the lowest in Canada on a per-capita basis, has declined even further. The funding gap between Ontario and the average of the nine other provinces widened from $1,114 per student in 1995-6 to $1,734 per student in 2000-1.

To maintain the real per-student value of Ontario's 1995-6 operating grant commitment to universities in Ontario, grants would have had to increase to $2.050 billion. The actual figure of $1.703 billion represents a cut in real terms and allowing for enrolment growth of $348 million, or 17%, compared with the adjusted 1995-6 figure. Based on preliminary Ministry grants data for 2001-2, which show a slight cut in grants from 2000-1 to 2001-2, the corresponding total for 2001-2 will be an estimated $404 million. In other words, provincial grants to universities for 2001-2 were more than $400 million below their 1995-6 level, after adjustment for inflation and enrolment growth.

Students: Bearing the Financial Burden

In the 1999 election platform document, the government credited itself with having achieved the following target: "Tuition fees are an important part of the way we fund a healthy post-secondary education system. ... To restore the balance in funding for colleges and universities, we brought tuition fees back to the reasonable and affordable 35% [of the cost of providing university and college courses]."

In reality, the Tories' target for the student tuition burden has been "overachieved" by a substantial amount. From levels of 22% in 1991-2 and 29% in 1995-6, the year of the change in government in Ontario, tuition increased to 41% of operating revenue by 2000-1.

Since the Conservatives' 1992 target of 25%, this represents an additional burden on students of $375 million and a corresponding reduction of $375 million in provincial support.

After correcting for enrolment growth, tuition and fees increased by $656 million or 86% between 1995-6 and 2000-1. Even after allowing for inflation, tuition and fees increased by $579 million, or 69%.

Ontario Universities: How Do Their Finances Compare?

The 11 Ontario universities with enrolment over 10,000, which together account for 86% of total university enrolment in the province, lost an absolute total of $89 million between 1995-6 and 2000-1. Adjusted for inflation and enrolment growth, the loss comes to $324 million for these 11 institutions.

The biggest losers, on an adjusted basis, were the Universities of Toronto ($127 million), Waterloo,($31 million), Western ($30 million), Guelph ($30 million) and Queen's ($29 million).

On a per-student basis, the biggest losers were the Universities of Toronto ($2,578) and Guelph ($2,092). Major universities typically lost between $1,500 and $2,000 per student in grants.

The 11 largest universities increased tuition by a total of $513 million, with a net benefit of $423 million after the student aid hold-back.

With the hold-back, the 11 largest universities as a group raised approximately $100 million more from tuition and fee increases than they lost from provincial grants reductions.

The largest tuition increases were at Queen's ($2,851); York ($2,734); Wilfrid Laurier ($2,353); and Western ($2,060).

Tuition varies substantially as a share of operating revenue from university to university: in 2000-1, the share ranged from a low of 32% to a high of over 50%. All but two institutions were above the Tories' 1999 target of 35%.