Notes from the April 30 meeting of the Board of Trustees.
The Board of Trustees approved the University’s budget for 2010-2011 at its quarterly meeting Friday night.
The budget projects a $3.8 million deficit, but forecasts much larger shortfalls in future years unless Ontario’s post secondary education sector gets solvency relief from required payments against unfunded pension liability from the province.
Principal Daniel Woolf and V-P (Finance and Operations) Caroline Davis detailed Queen’s financial situation over a 5-year horizon, which was accepted by the Board. “Without the unfunded pension liability, we would be heading toward the elimination of the deficit within that timeframe,” said Ms. Davis.
Starting in fall 2011, after the next required pension valuation, Queen’s must set aside funding for additional special pension payments to address the growing gap between employee and employer contributions to the plan and the current and future payout obligations. A large portion of these payments are required by regulations that treat universities as organizations that could go out of business at anytime – these are called solvency payments. Five other provinces exempt their universities from these regulatory provisions but so far, Ontario does not.
The Principal, along with the heads of other Ontario universities, will continue to press Queen’s Park for help.
“I must emphasize that even were this solvency relief granted, it would not fix all the pension plan’s problems,” Principal Woolf told trustees. “It’s clear that a major restructuring of the plan will be needed. This will have to occur within the context of the next rounds of collective bargaining.”
Principal Woolf stressed that faculty and staff should not worry about their pensions. “The plan is protected by law. Everyone will get their pension when they retire. The issue is how we fund it.”
The budget also assumes compensation costs will be limited to 2.5 per cent growth. A recently introduced provincial law freezes wages for non-unionized employees in the public and broader public sectors.
“The government has also expressed the expectation that new collective agreements should contain no net compensation increases for two years,” said the Principal. “As a result, we will have to negotiate with employee groups in the context of the new requirements.”
Student leader reports:
The new Rector, the incoming AMS president and the SGPS president addressed the Board about budget cuts, the academic planning process, sustainability initiatives, and the need for action on issues of diversity and equity.
SGPS president Jawad Qureshy expressed disappointment with the administration for a lack of consultation with the SGPS regarding a preliminary framework agreement with the AMS for the management of the student life portion of the Queen’s Centre. Undergraduate students are contributing $25.5 million to the cost of the complex. The SGPS membership voted against making a financial contribution earlier this year. The agreement outlines principles for a negotiation process about how the day- to-day operations of the student life facilities will run. It provides for an SGPS representative to be part of a Joint Liaison Committee that will “consider and advise on issues of mutual interest.”
The Board also heard from Professor Mark Jones (English) who presented a petition signed by 210 employees that calls on the Board to “stop the current academic planning exercise and the budget cuts from which it is driven.”
“We do not say no budget cuts,” says Professor Jones, “but academic planning first. Otherwise, it’s amputation not triage.”
In his report to Board, Principal Woolf said he’d be conducting academic planning regardless of university finances. “In good times and in bad, our academic considerations must lead our financial decision-making -- we are, after all, an academic institution.”
The Principal acknowledged that some people feel there has been insufficient consultation so far. “This is a year-long process and there will be many more opportunities for input and discussion,” he said.
The Board also approved:
-the creation of the Queen’s University Planning Committee composed of Trustees and Senators that will ensure that academic planning and the management of university resources are fully integrated,
-tuition fees for the next two years that conform with the extended provincial framework that overall increases not exceed an average of 5 per cent per year,
-the Isabel Bader Centre for the Performing Arts after the City confirmed its $6 million contribution to the project last month,
-the construction of a fully funded reactor materials research lab, and
-renovations to Faculty of Law classrooms in McDonald Hall financed by the Faculty and fundraising.