Terahertz

Further to my comments yesterday about the University of Alberta’s Engineering Student Society endorsing plans to tax students, Brendan Taylor, with the Student Worker Action Group of APIRG has linked me to his complete financial analysis of the operating budgets of the UofA (plus many other institutions) over the past decade. To complement his analysis, I thought I’d highlight some striking differences between the UofA and Simon Fraser University (my current school).

First, If we look just at surplus, until 2008, the UofA had a steadily increasing budget surplus while SFU has actually been running a deficit for the past 8 years, only getting the deficit under control in the past year. So while this current deficit may seem radical for the UofA, it seems peculiar and more likely to be in part due to a one-off lost in investments as opposed to evidence that they aren’t ripping students off enough.

Next, we can see that SFUs funding has been mainly attacked by a 12% reduction in provincial funding over 10 years, while the UofA has maintained a constant proportion of provincial funding. That last data point for the UofA getting 15% more funding in 2007-08 represents a large sum of money going only to capital projects. SFU clearly made its budget losses from the provincial government up by raising tuition while the UofA shows a small drop in percentage funding from tuition. However, non-tuition fees at the UofA have nearly doubled in the past decade, and with the proposed COSSS fee and “Market Modifiers” tuition will increase by roughly 20% or more in the next five years.

The UofA has also shifted its budget from the academic ranks and increased benefits and non-academic salaries. The largest increase is the doubling of expenses on external contractors. Meanwhile, SFU slashed academic funding from its budget in roughly 2003-05 and cut other salaries equally. We do notice with SFU a steady increase in student support that is absent from the UofA. This funding likely explains SFUs consistent top-notch performance in comprehensive university rankings.

As I mentioned, the UofA got 15% more provincial funding in 2007-08 than average, but similarly capital costs were up 15% as well, so that more likely represents singular grants for construction costs. This does help confirm the scenario where the UofA tried too hard to expand too fast under the “Top 20 by 2020” mandate that the administration has now disowned.

Brendan’s best graph for the UofA compares the runaway costs to students to cover the runaway costs of the university executive:

Tuition is legislated to rise no faster than CPI, hence the nearly perfect correlation, meanwhile, we can see that before the market modifier tax is applied (which will raise engineering student’s tuition by an additional 10-15% per year) students are already being forced to pay almost exponentially increasing amounts to cover salaries that are fast outgrowing inflation.

Education may cost money, but it’s clear that education is no more expensive then it was a decade ago, the only change has become this competitive drive to “be the best” school which has brought on overpaid bureaucracy and unaffordable expansion.

The free market model of competition between universities does not seem to make them any more efficient, in a story almost identical to Wall Street, we see corporate execs earn top dollar while those on the bottom continue to suffer.