One of the things about writing SRBP is that posts sometimes show changes in thinking as your humble e-scribbler gains more information.
Over the last few posts and on Twitter, some of you may have seen a comment to the effect that you could replace the government subsidy to the university with a tuition hike and be cash to the good. Well, that just is’;t the case. As Tuesday’s post showed, the government grant covers about 71% of the university’s operating revenue every year. Tuition covered about the same percentage (11%) as it did in 1977.
Taking a hard look at the current numbers showed that tuition and fees from the 18,700 graduate, undergraduate, and distance students at the university, full- and part-time brings in slightly less than $60 million annually.
What hasn’t changed, though, is the starting point of this mini series from last Friday: the university needs cash. The question is how to get it.
The starting point isn’t just about giving more cash or hiking tuition. In order to fix the problem you have to sort out what caused the problem in the first place.
The root cause of the current financial problem is the same as the cause of the presidential debacle a few years ago. Both were caused by unnecessary, self-interested political interference from the provincial government in the university’s internal affairs. Both have damaged the university.
Thus, the first step in revitalizing Memorial University is to end political interference in the university.
There are several aspects to this:
- A simple amendment to the Memorial University Act can transfer responsibility for selecting the president to the board of regents.
- To go with that, a second amendment should remove cabinet’s power to appoint the chancellor.
- The public interest in the university can be represented by the members of the board of regents who are currently appointed by cabinet.
- As a novel approach, eight of the 17 public members of the board should be elected in a series of districts across the province.
- The four student members should be elected directly and not take their seats – as currently is the case – by cabinet appointment.
- The chair of the board of regents should be elected by the board itself, not appointed by cabinet as it is currently.
The second part of fix is financial.
The provincial government should guarantee a two percent increase in the government’s direct grant to the university.
At the same time, another amendment to the Act should give the board of regents all the necessary powers with respect to the administration of the university. That includes setting tuition fees.
The sole condition on the power to set tuition and fees would be a limit for the first 10 years on increases to a base of two percent per year from whatever year this starts. You could also give the board an option of going with the two percent base or of taking a rate that is the average rate of inflation in St. John’s over the preceding four years. If they went with that option, the board of regents would have to lock in at that rate for two years.
Of course, the board could also opt not to raise tuition at all. It would have full autonomy to set rates for out-of-province and international students with only prevailing market forces as the governor. Foreign and out-of-province students currently number about 4,000, or 21% of the total enrolment.
Based on current figures that would give the university an additional $9.0 million in 2014. That wouldn’t wipe out the current operating deficit but it would be a start to delivering some extra cash to the university in a predictable way. These numbers are just for discussion. They are actually pretty conservative. You could reasonably raise rates upwards of five percent a year for a number of years without causing a significant drop in enrolment.
This approach recognises the university’s need for more money while acknowledging that rapid and large increases could seriously affect enrolment. That was the experience in Ontario and in this province in the 1990s.
Pretty simple, eh? That’s the thing to bear in mind: most of this policy stuff is actually pretty simple if you keep a few basic points in mind.
Politicians don’t usually take up these new causes for one of two reasons. For the most part, politicians never bother to think new thoughts because they prefer the comfortable sameness of going around in the same old circles over and over. Most times, you can hear the bleating of the flock from a mile and a half away over the roar of the ambulances on the Outer Ring Road.
If a black one ever shows up in the flock and the pols start to get it in their heads that things should change, you can always bet that some bureaucrats or gang of political types will give them a good dose of the frights.
Henry Kissinger used to say that he could count on bureaucrats to give you three policy choices: surrender, nuclear war, or the option the bureaucrats want. In Newfoundland and Labrador, the bureaucrats can fight off any uppity ideas with just two options. Either the politicians support the bureaucrats’ view or face the legions of unhappy people who will clog up the local open line shows with their complaints. The pols will cave faster than you can call Bill or Paddy.
If you think all that is just too funny and couldn’t possibly be real, just notice how many politicians are talking about education reform these days.