The funding crunch is coming
Like all public institutions, universities are facing many challenges from the COVID-19 pandemic. They have responded by closing their campuses, moving all classes online, asking their faculty and staff to work from home, and postponing convocation ceremonies. It is not business as usual.
But how are they planning for the future, most importantly for the resumption of classes in September?
And how can provincial governments support this planning?
There are many issues to consider, but one critical issue has not yet drawn public scrutiny: the impending disruption to enrolment.
Every year, three groups of students walk onto university campuses for the first time. One group, new students, who can comprise 20 per cent of our universities’ population, often arrive relying on the financial support of their parents. With the enormous job losses associated with the pandemic control efforts stretching into an indeterminate timeframe, the pool of financial support for new students has been suddenly and dramatically upended. Who will now fund these students’ education?
A second group includes returning students, who rely on three sources of income to sustain their studies: their parents and partners, their summer employment, and scholarships and financial support from their universities and (mostly) their provincial government. With work-related income of nearly all types completely disrupted, they will now be overwhelmingly reliant on financial support of any kind, but most critically from their provincial governments. Will provinces step up?
A final group of students comes from abroad. The extent to which universities rely on international students varies widely across Canada, but it usually falls somewhere between 10 and 20 per cent of their student populations. These students face a double challenge, insofar as they also rely on financial support from their parents, who may have been affected by the global spread of the pandemic. But they face a further hurdle just getting into Canada, and it is completely uncertain how international student visas will be processed over the coming months.
The steepest drop-off in September enrolments at Canadian universities may well come from this group, and those universities who are more reliant on international students, such as many in the Maritimes and McGill University in Quebec, are particularly vulnerable.
If Canadian universities may face a drop in enrolment of between 10 and 25 per cent in September, how do they plan for that possibility?
Keep in mind that student tuition fees represent approximately 50 per cent of operating revenue, on top of which we need to add provincial operating grants, which are themselves tied to domestic enrolment numbers.
In a worst-case scenario, some universities may face a revenue drop of up to 20 per cent come September. A revenue interruption of that magnitude will have immediate ripple effects that will quickly engulf the capital cushions all universities maintain. So, the planning for September to which all universities are now turning their attention must involve provincial governments. What can they do?
They must do more than offer, as Ontario recently did, an extension on student loan repayments. While useful, this does not address the enrolment and revenue crisis on the horizon. Tuition freezes or rollbacks are also not enough here because that cuts into university revenues and so erodes the quality of post-secondary education.
The only recourse will be for provincial governments to put more financial support into the hands of students, simply so that they can attend university. In this, they can reach out to the federal government, which should see this also as a top priority to help restart the Canadian economy after the pandemic.
There will be no other way to avoid the enrolment crisis facing universities, and the sooner governments recognize this challenge, the sooner universities can play their part in our post-pandemic world.