Friday, April 8, 2011

Staff reductions again seen as last option in face of 2011-12 budget cuts

Provost Carl Amrhein and vice-president (finance) Phyllis Clark have provided an update on expected 2011–12 budget cuts.

The provost and vice-president (finance) confirmed that, based on current assumptions, all faculties and administrative units across the University “should expect an average of two percent budget cuts for the 2011–12 year.” This follows the recent Alberta budget which verified that the university will receive a zero percent provincial operating grant increase for 2011–12.

“The bottom line is that while the university’s budget will not decrease, it will also not increase fast enough to keep pace with the cost of doing business,” Amrhein said. “What it means will be different for each dean.”

In a letter to deans, chairs and directors, Amrhein and Clark indicated that all units have been asked to begin developing budget scenarios based on the two percent cut assumption. As is normal, deans, chairs and directors will be responsible for how cuts are made in their own areas.

Amrhein and Clark urged faculties and units to consider position reductions as the last resort. They went on to say that “talented people are without question the university’s greatest asset,” pointing out that it is difficult to rebuild following reductions in positions.

Each vice president will also be expected to make a two percent cut overall in their areas of responsibility.

“Please be reminded that budget reductions are by no means the only solution being pursued by the university in the face of resource pressures,” Amrhein and Clark concluded in their letter to the deans. Further, citing significant “success with finding new administrative efficiencies over the past several years,” they said the university “will continue to seek additional ways to achieve further efficiencies.”

8 comments:

  1. It is very simple. It is completely unreasonable to expect that public sector workers subidize public services with a reduction in their salaries. This logic would necessarily result in an infinite level of public service being provided by a public sector workorce working for zero dollars. Whom ever remains needs to be compensated as an approppriate wage. And this needs to be thought out by the powers at be. And if there is a reduction of service - so be it!

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  2. Thanks for the update! Is it true that there was an 11 million dollar surplus last year, as stated in the Institutional Plan? I'm curious to know where this unexpected bonus came from. Thanks in advance!

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  3. First year (and many second year) class sizes are already ridiculous large in many cases. I certainly hope that further staff reductions do not take place. If anything, more staff should be hired, so that class sizes can become smaller. There are other places where cuts can occur if savings are needed (ie. streamline and reduce some of the administration).

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  4. Thanks for the update! Is it true that there was an 11 million dollar surplus last year, as stated in the Institutional Plan? I'm curious to know where this unexpected bonus came from. Thanks in advance!

    Yes, the University has forecast an $11 million surplus on its operating budget. That is about 1.5% of our operating budget, which is a $900m budget. There are two main reasons for this surplus. The first is a reevaluation of our assets. This improvement in the value of our assets was due to the improving economy, and as the economy continues to improve we might see additional gains of this type. This has not lead to an increase in the University’s income, however. It similar to when the value of your house increases. It’s good news, but you don’t have access to the extra value. The second reason is also an improvement on paper, with no real dollar gain, as it relates to our pension obligations. The “charge” to the University for our pension obligations was less than we expected due to the improving economy. We still have to make the same payments to the plan,though, even though we are in a better position overall.

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  5. Sorry, that's not making sense. If the charge for pensions was less, why are we making the same payments and, if we are making the same payments, why does this contribute to the surplus?

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  6. Colloquy: Your reply makes little sense — assets are not part of the operating budget, and if as you say the pension payments were the same as before, then there are no savings there either. I am looking forward to a more accurate response from the President at her Town Hall next week. This is an extremely serious matter, that a positive variance of $25m and an $11m surplus can magically appear at the end of a year that saw staff take furloughs and students charged arbitrary new CoSSS fees. Moreover, why should we now be expected to believe the latest $4.9m budget deficit forecast and agree to sub-inflation salary increases?

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  7. I am more interested in knowing how the individual authorities responsible for executing the budget cut make the decisions. Will you direct us to the appropriate source where this information will be made available?

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  8. oh dear. The English and Film Studies Department lost their phones last year due to budget cuts. I am dreading what else will be cut next. Staff? Faculty?

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