Malaspina Administrators Prepare for Budget Shortfall, Next Year

Malaspina University-College administrators are anticipating a major budget shortfall, next year.

"Based on current projections, we're anticipating to be short between $1.2 and $1.6-million for the 1998/99 fiscal year," said Malaspina University-College president Rich Johnston.

The new fiscal year starts April 1, 1998.

Johnston said that the projected shortfall is the result of the tuition fee freeze; reductions in funding for apprenticeship training programs; increased costs for janitorial services as a result of new buildings built in the last few years; increases in employer contributions to Canada Pension Plan (CPP); lack of funding for faculty and staff collective agreements which were negotiated by the provincial government, last year; as well as costs associated with a gender-neutral job evaluation for administrators, required by the provincial government through the Post-Secondary Education Council (PSEC).

Johnston said that, this year, Malaspina has lost $500,000 in potential revenues as a result of the tuition fee freeze, and a similar loss is anticipated in 1998/99 if the freeze continues. He is expecting a further loss of up to $300,000 in tuition fees if program reductions are necessary.

Unlike school districts, the B.C. College and Institute Act prohibits post-secondary institutions from planning for an operating budget deficit; instead, cuts have to be made, or revenues have to be increased to meet budget expenditures.

Edwin Deas, Malaspina's vice-president of administration and bursar said that "early preparation of planning assumptions for the 1998/99 budget allows for a thoughtful and orderly budget process."

To assist in the budget planning process, Malaspina administrators are using "key performance indicators" (KPIs) which measure student demand for programs, quality of programs, and cost efficiency and effectiveness of programs.

Glenn Johnston, vice-president of instruction, said that Malaspina will be forced to cut programs and cancel classes, again, next year.

"We're examining all programs to determine how we can maintain quality while continuing to meet our mission and goals. There will likely be fewer options, fewer programs, and fewer students will be served, next year," Johnston said.

Last year, as a result of a similar $1.6-million budget shortfall, Malaspina canceled 2 programs, reduced 3 programs, cut 54 academic classes, laid off 2 regular instructors, and reduced working hours for instructors, support staff, and administrators.

"In the coming weeks we'll be examining the broad picture and looking at the effects of program and service cuts on students. We'll be working closely with our Education Council and our unions, and we're exploring a number of options, including early retirements, as a way to avoid potential lay-offs," he said.

"We're at a crossroads, said Johnston. The kind of budget shortfall that we're anticipating--based on the preliminary information received from the Ministry of Education, Skills and Training--will have a profound effect on the quality of programs and services we're able to offer. It will also have a significant bearing on the economic contribution that Malaspina makes to the Central Vancouver Island and Powell River regions," he said.

Johnston referred to a recently completed study which examined the impact of changes in B.C. government policies and funding for post-secondary education.

The report entitled Critical Issues in Financial British Columbia's College and Institute Systemacknowledges that the B.C. government has attempted to cope with the cuts in federal government transfer payments and, at the same time, has taken an initiative to keep education affordable for students by freezing tuition fees.

The report also states that "the college and institute system has done an extraordinary job in responding to the government's new challenges of increased access and services at a time when funding was limited."

The report concludes, however, that "The college and institute system has exhausted its capacity to deliver further economies; institutional based responses to government's operating funding decisions can no longer cope with the size of the challenge."