Board of Governors approves budget

The Dalhousie Board of Governors approved a balanced budget of $325.7 million at Tuesday’s annual meeting, signing off on a document that reflected the Budget Advisory Committee’s recommendations for fiscal prudence in the face of continued uncertainty.

To deal with a $6.8 million cut in its provincial operating grant, the university has approved a 3.5 per cent reduction in the base funding for all budget units on campus. Though not insignificant by any stretch, that number was reduced by higher-than-expected enrolment last year, which will help balance the coming year’s books alongside $3.6 million from previously approved tuition fee increases.

“This is a cautious budget, no question about it,” says Ken Burt, vice-president finance and administration. “The silver lining is the student growth from last year, which helped reduce the amount of the cuts. It’s much better than it could have been. That said, managing our grant cut alongside inflation, especially in light of the uncertainty in our economic model, requires some tough choices.”

Uncertainty

He lists off the elements of that uncertainty: pending discussions with the provincial government to determine the funding arrangement for 2012/13 and beyond; the need to implement changes to Dalhousie’s pension plan; negotiations with three of the university’s four collective bargaining units over the next year; and a competitive recruitment environment, though he mentions that initial projections for this fall’s incoming class are promising.

“None of those have really changed in this budget. We did obtain solvency relief on our pension plan from the provincial government, which buys us a couple of years. This and the student growth make a big difference this time around. But these cuts—across the board, applying to all units, academic and administration—are needed to start to address the realities of our operating environment.”

As for how the cuts will be managed, Mr. Burt says the university will have a better picture once deans and managers complete their individual budgets over the next couple of months. Depending on the individual circumstances, areas may incorporate service reductions, implement new efficiencies and find non-salary cuts, though Mr. Burt cautions that, in some cases, layoffs may be necessary.

“Those are the most unfortunate, and I know that all our units will look at all other alternatives. But salaries are, by far, our largest expensive as a university, and a significant reduction in our funding is undoubtedly going to lead to some difficult decisions.”

He explains when units make such decisions, they do so considering the university’s strategic focus, which is designed to provide direction and ensure that Dalhousie achieves its university-wide goals. To that end, the university will continue to invest in its strategic initiatives fund, though in a smaller amount than previous years. Still, the $2.4 million added to the available pot will help Dalhousie spend over $4 million in new efforts in mission-critical areas such as student assistance, academic support and campus renewal. Some of this year’s largest investments will be towards international students, with more than $430,000 being spent on new support services, funded by an increase in the international differential fee.

“These sorts of strategic investments are necessary to ensure that we get where we’re going as an institution,” adding that recent success in areas like recruitment and fundraising is a direct result of strategic funding. When this year’s budget is included, Dalhousie will have spent $36.6 million in strategic initiatives since 2003/04.

“We continue to invest, even in spite of difficult times, because it’s an investment in the future that will come back to us in our enrolment numbers, the quality of the students we recruit, our fundraising, our facilities and many more core elements of Dalhousie’s success.”

Other items of note from the budget:

• It includes an additional $1.15 million more for student assistance: $700,000 from the provincial bursary program for Nova Scotia students, and $450,000 from endowment spending.
• One of the larger areas identified as a cost savings: the move to natural gas. The university estimates it will save $450,000 next year from the recent switch.
• The previously-approved tuition increases include a three per cent general increase across all programs; a 10 per cent increase to the international differential fee; and increases of six, 10 and 14 per cent in law, medicine and dentistry respectively. The fees for those three professional programs were approved by the board’s executive committee following April’s meeting.

READ MORE: Tough choices to balance the budget | Dalhousie approves tuition increase