‘Unusual’ cuts ahead for Laurier’s finances

With academic units at Wilfrid Laurier University being asked to model cuts of five and seven per cent for the upcoming year, the constituents of the university find themselves in an unfamiliar place.
“It’s a little unusual,” Jim Butler, vice-president of finance and administration said. “Laurier has been pretty insulated from major cuts … we’re now getting into it, largely because of many factors.”

Flattening enrolment, constrained tuition, cuts to provincial operating grants and large pension deficits are among the reasons that the university is faced with large cuts.

Since Butler has been at the university, this is the first time they’ve dealt with major cuts.

The only other time major decreases to the budget occurred was in the 1990s, when Bob Rae and Mike Harris were in provincial office.

“There have been minor cuts of one per cent, two per cent [since then] and it’s been handled generally across the board.”

According to Butler, Laurier has one of the lower operating grants per student in Ontario compared to other universities. The reasoning behind this is a mix of programming, which is in the process of being evaluated.

“It’s pretty much to do with what’s happening with enrolment and provincial funding,” Butler said, regarding the cuts.

According to Butler, last year the university signaled cuts were going to be needed to break even. For the 2014-15 budget, each vice-president was asked to deliver a two per cent cut for their respective area. The vice-presidents were free within their respective portfolios to make differentiated cuts to make up the cut they were given.

For the 2015-16 budget, academic units have been asked to “model” where the cuts will come from by giving an outline of where decreases in the budget can be made to meet the end goal. In the meantime, town halls and consultations will take place.

Enrolment numbers should be available by the end of September, which will help determine how big of a cut is needed, and the Integrated Planning Resource Management initiative should be drafted by then.

Butler said the university will be in a place to determine how the cuts will be made by early 2015.

“[Right now] we simply want to know from a qualitative standpoint what would happen to the units if [the cuts] would take place,” Butler explained.

The academic units, as well as the non-academic units, which need to exercise cuts of five, eight and 10 per cent, seem to recognize that the cuts are necessary, according to Butler.

“I think they’re patiently waiting to see how we’re going to go about it,” he said. “There will be another discourse around that. But right now, people are modelling the cuts as we’ve requested.”

The total cut for this year could translate to approximately five per cent of the university’s operating budget, or up to $15 million.

$12 million will allow Laurier to break even, and the additional $3 million could be necessary if the enrolment target is not met when the numbers come out at the end of September.

With such an abnormal situation for Laurier, Butler stressed that the university is trying to take care of the cuts “fairly and strategically” so they can accomplish their mission.

“In order to maintain quality and preserve what Laurier is, this is what we want to do and position ourselves coming out.”