UVic budget framework focuses on the fiscal challenges of uncertain times

The University of Victoria’s Board of Governors this week approved a $314-million operating budget framework for the university for 2013/14. The framework maintains student financial aid and library acquisitions, while implementing elsewhere the four per cent across-the-board cuts for which university units have been planning since spring 2012.

The cuts were required to eliminate a projected $4-million shortfall for the fiscal year beginning April 1 and to prepare for additional financial challenges that are anticipated over the next year. The factors involved include inflationary cost increases, reductions in provincial government funding to the post-secondary sector, unfunded annual progression increases in salaries for faculty and staff, the cost of across-the-board salary and wage increases in the agreements negotiated with staff last year, and a pending arbitrated general salary increase for faculty members.

“The cumulative impact on university operations of several years of cuts isn’t trivial,” says UVic President David Turpin. “I want to express my appreciation to faculty and staff across campus for their hard work and support in these very challenging times.”
The 2013/14 budget framework has been developed in the context of a period of high uncertainty about both its future revenues and expenditures, and in two areas in particular:

• A total of $50 million in provincial cuts to post-secondary education funding have been announced—$5 million for 2013/14 and $45 million more in the next two years, but following the May 14 provincial election the newly-elected government may introduce new budget plans and priorities.
• This fall an arbitrator will rule on a salary settlement for UVic faculty. Faculty salaries are one of the largest items in the university’s operating budget and, while assumptions about the possible cost of the settlement have been built into the 2013/14 framework, the award, once made, could have a major influence on the university’s bottom line.

The 2013/14 budget framework was developed through the university’s integrated planning process led by Vice-President Academic and Provost Reeta Tremblay. Its goal is to ensure that the university’s financial resources are aligned with institutional priorities and areas of strategic focus.

The total number of students served by the university in government-funded credit programs in 2013/14 will remain at 16,528 full-time equivalents (FTEs) for the year—14,488 undergraduate FTEs and 2,040 graduate FTEs. UVic will also add 100 FTEs to its complement of international students and 60 FTEs in a new cohort of undergraduate business students.

While every effort has been made in the framework to minimize the impact of the budget reductions on the quality of the educational experience for students and on people, the reductions will be felt. The specific implications at the unit and class level will not be clear until the fall.

Larger class sizes and reductions in teaching assistants, academic advising programs and field-based learning experiences are expected. On the administrative side, management positions have been eliminated and service levels in areas that have less impact on teaching and research, such as janitorial service, have been adjusted.

In addition, 82 FTE positions out of the university’s total faculty and staff complement of 4,500 employees will be eliminated. Of these positions, 36 are already vacant due to retirements or departures. Vacancy management and attrition is expected to keep the number of actual layoffs to a minimum.

Some vital areas such as student financial aid, student recruitment, fund-raising, and privacy protection are receiving funding to support specific initiatives.

In addition to budget reductions, the university is mitigating the drop in government funding and rising costs through a 2-per-cent increase in tuition, equal to the increase in the consumer price index last year, and an equivalent $1.50 per term increase in the athletics and recreation fee. Fees in some ancillary areas outside of the university’s general operating budget such as housing, parking and child care are being increased by similar amounts to account for cost increases and to support programs such as a residence resource centre, the student and employee bus pass program, and other transportation demand management programs.

The extent of further budget reductions at UVic in the future will depend on the faculty salary arbitration award, decisions by the new provincial government on operating grants to universities, and settlements in upcoming negotiations with a variety of employee groups on collective agreements which expire in 2014/15. The university community will be updated as the specific impact of these factors is determined. In the meantime, university budget planning for 2014/15 will have to proceed in the context of these significant unknowns.

More detail about the university’s priorities, the components of the budget framework approved by the board on March 25, and the budget planning process can be found in the 2013/14 planning and operating budget framework document and on the budget planning website.