Budget Briefing Focuses on Enrolment, Pensions, Benchmark Data and Corrective Actions

From the Offices of the Provost & Vice President Academic and Vice President Administration

Thursday, December 16, 2010

 “This is not the time for a ‘business as usual’ approach”

At a budget information session held at the Symons campus on December 16, 2010 faculty and staff were provided an extensive overview of the university’s financial situation including being briefed about enrolment, pensions, the projected budget gap for the 2011-12 fiscal year, benchmark indicators and corrective actions under consideration.

Employees gathered in Wenjack to receive the information from Dr. Gary Boire, Provost and Vice-President, Academic, Don O’Leary, Vice-President, Administration and Garth Brownscombe, Associate Vice-President, Financial Services.

Vice-President O’Leary highlighted a number of key facts about Trent’s current financial situation:

• Enrolment growth for 2010-11 is flat against a projected increase this year of 378 full time equivalent students. 
• Between 2004-05 to 2009-10, Trent’s enrolment grew by 0.8 per cent – while total full time equivalent enrolment in Ontario grew 12.3 per cent for the same time period.  Between 2004-05 to 2010-11, student enrolment at Trent grew by only 191 full time equivalent positions in total.
•  The projected increase in enrolment for 2011-12 is 152 full time equivalent students.  Of this amount, an increase of approximately 90 students is targeted for the Oshawa campus.
• Between 2004-05 to 2010-11, a total of $25.7 million in expenditure reductions have been required in order to balance in-year budgets. 
• Approximately $51 million of Trent’s total revenues flow from government grants.  Of this amount, $21 million flows from stable, predictable funding: the balance, approximately $30 million, is ‘performance based’ funding that changes from year-to-year and is not guaranteed.  In addition to government revenue, Trent receives approximately $45 million from tuition. 
• In the 2010-11 fiscal year, two reductions to the operating budget were implemented totalling $6.7 million, in response to the lower than anticipated student registrations in September, 2010.
• Projections indicate a budget deficit of $4.2 million for 2011-12 and another $4.8 million for 2012-13.
• To meet pension obligations for TUFA and OPSEU, the 2011-12 operating budget must be increased by a minimum of $842,000 and $570,000 respectively.  These figures may increase.
• In 2010, employer pension contributions represented 8.6 per cent of the total operating budget – up from 2.4 per cent in 2001. Strategies to control pension costs will continue to focus on a combination of increased employer/employee contributions, and future benefit reductions.
• In response to misinformation about salary increases, it was noted that the average increase in salaries for TUFA members during the last four years was 4 per cent.  The average for OPSEU/Exempt members was 3.5 per cent. 
• Trent’s capital debt has grown from $23.617 million in 2004 to $68.528 million.  Over $95 million of new construction has been completed adding 270,000 square feet of new space to the campus.  Of this amount, approximately $60 million was sourced through financing, with approximately $36 million supported through government revenues and fundraising.
• Trent’s debt service ratio is within manageable limits, compares favourably to other universities’ debt loads, and includes the $20 million renovation of the Stan Adamson Powerhouse which will secure an in-house electrical supply for the University for the next 100 years, thereby reducing costs.
• A series of benchmark indicators showing Trent’s expenditure patterns in relation to Basic Income Units (BIUs) was shared by Garth Brownscombe, Associate Vice-President, Financial Services.  BIUs are ‘weights’ that government attaches to different types of students, i.e. a student enrolled in a science or professional program generates a higher government grant (BIU) compared to an arts student.

“The value of the benchmarking is that it allows for an understanding of current investment patterns and how budget reductions might be differentiated (versus one-across-the-board cut), said Brownscombe.  “The data, which has been compiled for the last seven years into a central database, is reviewed by a quality committee allowing for accurate comparisons of institutions’ spending patterns.” 

The benchmarking data confirms that Trent invests heavily, beyond the average,  in a number of areas including:

• Academic and Research Salaries per BIU (faculty – tenured and LTA – CUPE, teaching assistant salaries)
• Academic Support Expenses (Nursing, Education, Graduate and TIP programs, VP Academic, VP Research, Registrar’s Office, academic secretaries)
• Library non-acquisition Expenses per BIU (Library salaries and benefits and non-acquisition expenses)
• External Relations and Advancement per BIU (Advancement Office, Alumni Office, Marketing and Communications)

Dr. Gary Boire, Provost and Vice-President Academic, reviewed a number of corrective actions under consideration.  Dr. Boire stressed that no decisions have been taken yet but that now is the time for action, “This is not the time for a ‘business as usual’ approach or top-down decision making.”  The Provost noted that he is meeting with his direct reports to discuss their staffing plans and wish lists, and that all of the deans will meet collectively to share their plans and understand the competing priorities. 

“Don O’Leary and I will be leading a collective form of budgeting and leadership,” said Boire.  He stressed that his team will be meeting with the Vice-President of Administration’s team to finalize the budget and make recommendations to the Board of Governors.

A copy of the slide presentation including benchmark data is available for download (myTrent login required).

The presentation concluded with a request to members of the University community to forward their thoughts and suggestions about the budget to Dr. Boire or Don O’Leary for consideration.