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The double whammy of defunding universities

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As I've blogged about here, federal funding for post-secondary education (PSE) in Canada is decreasing. Between 1985-1986 and 2007-2008, annual federal cash transfers to Ontario for PSE (in constant 2007 dollars) decreased from roughly $1.4 billion to just under $1 billion. (Yet, during that same period, PSE enrolment in Ontario increased by more than 60 per cent).

And as I've written about here, during Dalton McGuinty's time as premier of Ontario, Ontario PSE enrolment has increased at a greater rate than provincial funding increases for PSE.

In addition to the obvious impact that this defunding can have on quality (i.e. larger class sizes, which I've blogged about here), I believe that such defunding can also exacerbate at least two types of inequities.

First, it can exacerbate inequities between students, based on both class and race. I blogged about the latter yesterday; some students have more money than others, and therefore have an easier time coping with the higher tuition that has accompanied this defunding.

Second, it can exarcebate inequities between institutions, as some post-secondary institutions have an easier time making up the funding shortfall than others. Sometimes, these differences stem from how old the institution is (which impacts the pool of wealthy alumni). It can also stem from how much emphasis the university places on recruiting a president who's believed to be a skilled fundraiser, rather than a president deemed to be a good, all-round leader, able to work effectively with many campus stakeholders, including faculty associations, staff associations, unions and student groups.

(Needless to say, intense competition for more funding isn't always a good thing. As a recent legal case illustrates, intense pressure to raise more funds for a university can lead to charges of corruption.)

Evidence from the United States suggests that the potential for increased inequity between institutions is no small matter. Jeffrey Selingo is the editor of The Chronicle of Higher Education. In a recent piece looking at universities in the United States, he argues the following:

"Among the wealthiest private four-year institutions (in the top quartile of endowments), the median increase in instructional spending per full-time equivalent student from 2003-4 to 2008-9 was 10 per cent. The growth in the bottom quartile (colleges with the smallest endowments) was only 3 per cent.

Among colleges with the largest endowments in 2008-9, the median instructional spending per student was $17,934. That's about $10,000 more than at institutions in the bottom quartile. In sum, this means that the top quartile is continuing to pull away from the bottom quartile in this measure of spending."

While I suspect that the gulf between the wealthiest and poorest universities in the United States is larger than in Canada, I worry that this same trend is indeed present in Canada.

In terms of a policy response, I think elected officials should pay attention to the concept of a federal Post-Secondary Education Act, as proposed by both the Canadian Federation of Students and the Canadian Association of University Teachers. In effect, both groups advocate in favour of:

"the adoption of legislation or other binding forms of agreement that would establish conditions for federal postsecondary education transfers. These conditions must commit the provinces to upholding principles similar to those of the Canada Health Act: public administration, affordability, comprehensiveness, democratic governance, and academic freedom. In return for upholding these principles, provincial governments would receive increased and predictable funding from the federal government."

This article was first posted on The Progressive Economics Forum.

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