The trouble with universities

Excerpt form: CBC News & Financial Post Saturday, January 09, 2010

Full article at:

For students at Lakehead University in Thunder Bay, Ont., the semester ended on Dec. 20. In a desperate bid to save about $1-million, the university decided the same would be true for its faculty and closed the campus. “Their concept of the closure was the students weren’t here so you don’t need to work,” said Joey Farrell, president of the Lakehead University Faculty Association. “There’s no way people would be up-to-date with their research and ready to teach if they took two weeks off.”

The faculty union, upset the university did not try to negotiate other options before making the cost-saving decision, has taken the school to arbitration and staged a protest. Fred Gilbert, president of Lakehead, and
Michael Pawlowski, the university’s vice-president, administration and finance, declined interviews. However, in a prepared statement, Mr. Pawlowski said that Lakehead lowered its budget by 6% for the year and instituted a hiring freeze, but has avoided any layoffs. “No other bargaining unit at Lakehead has grieved the four-day closure,” Mr. Pawlowski said.

Considering the rocky time Canada’s universities have had navigating the recession, union tussles may be the least of their worries. Whether it is plunging endowment funds, skyrocketing debt or tightrope budgets, the list of financial problems is long and not particularly distinguished … higher revenue efforts are clearly in order for Canada’s universities because the status quo is not working.

A major problem, exacerbated by the recent market meltdown, has been shrinking endowment funds, on which universities depend …

Queen’s University, whose endowment fund dropped 22% as markets bottomed in 2008, faces a reported $8.3-million operating deficit in next year’s budget. The school asked its faculty late last year to accept a 2% reduction in salary increases for 2010-2011, but the proposal was shot down.

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