U of S cuts leaders’ pay, approves deficit budget
President not ruling out layoffs in effort to deal with funding crisis
The University of Saskatchewan is cutting the salaries and benefits of 75 senior leaders and will run a deficit budget this year as the institution struggles to cope with an $18-million reduction in provincial funding.
In a note sent to media, the university said its reserves are “all but depleted” and it doesn’t have enough money to cover its roughly $500-million operating budget this year.
The 2017-18 budget approved by the U of S board of governors this month includes a $16.7-million deficit.
“Approving a deficit budget at this stage gives us time to make strategic, deliberate decisions in the months ahead that will align with our vision and our service to the province, and find sustainable answers to the serious financial challenges we currently face,” the university said in a release.
“We have drawn on our reserves to manage previous budget pressures, so our reserves have been significantly reduced and, as we have always said, this is not a sustainable solution ... Our reserves are now at levels that fall below best practice and are no longer a viable option to manage reductions in funding of this magnitude.”
The province announced this spring that the university’s operating grant would be reduced by 5.6 per cent and told the university to take $20 million from that grant to cover a funding shortfall for its College of Medicine, further reducing the money available to the institution.
Over the last three months, the university has taken steps to manage its financial situation, including closing the International Centre for Northern Governance and Development and cutting funding to colleges, including to the College of Agriculture and Bioresources, which will take an 11 per cent funding reduction next year.
It has not yet been determined how much the university will save by trimming the salaries, benefits and bonuses of its senior staff. While all staff members will be affected differently, the overall reduction to salaries will be five per cent.
Some staff are eligible to apply for voluntary buyouts until the end of June and the program is expected to open up to other employees later this summer.
As of Tuesday, about 40 people had applied for buyouts.
Interim provost and academic vice-president Michael Atkinson said there are no targets for the voluntary buyouts, but he expects more than 100 people to eventually apply.
The total savings from the buyouts will not be known until all applications have been received and processed.
While the university will try to avoid layoffs, president Peter Stoicheff said “everything is on the table.”
Atkinson said it will be up to the university’s individual colleges to determine whether layoffs are needed to deal with tough budgets.
“It could be that there will be things like layoffs in certain parts of the institution, but we’re not planning massively centrally directed layoffs or anything like that,” he said.
Stoicheff said upcoming cuts do not mean the university is returning to “Transform US,” the wildly unpopular cost-cutting initiative that aimed to save money by, in part, merging some faculties.
That program was scrapped in 2014 after a rocky few months for the university, when a tenured professor who spoke out about the cuts was fired and then reinstated — moves that sparked international outrage.
Former president Ilene BuschVishniac was fired over the incident and subsequently launched an $8.5 million lawsuit against the U of S board of governors, Premier Brad Wall and former advanced education minister Rob Norris.
“Transform US was a system that was put in place that reflected a central administration that was trying, with the best information that it could gather, to make decisions across the university and we’ve moved from that to a very decentralized one where the colleges make their decisions themselves based on the budgets that they are given by central administration,” Stoicheff said.
“So, in that sense, that’s an enormous difference from the way Transform US was set up and that’s because the whole budgeting system at the university has changed since that time.”
Atkinson said the university’s budget challenges may jeopardize the accreditation of its College of Medicine.
The college was taken off probation in October 2015 and accreditors are expected to visit this fall.
“We’re very concerned about the accreditation,” Atkinson said.
“We’ve been through episodes over the last decade or so where our accreditation’s been at risk, so with this accreditation team arriving in the fall, they will take a look at the financial viability of the province and we expect them to ask some very tough questions about it.”
Tuition for the 2017-18 academic year has already been set and will not change, but tuition increases beyond then may be considered. However, Stoicheff said the institution will do everything it can to keep the university affordable.
“We have principals that we put in place to try to ensure, as much as possible, that there’s accessibility, that there’s affordability, that quality is maintained, that we do not get ahead of other comparable tuitions for comparable degree programs with our comparator institutions,” he said.