Demetrios Nicolaides

By Canadian Press

"'This will not be easy, simple, or painless"

Alberta says universities over-budget; need to freeze travel, hiring, hosting

Jan 16, 2020 | 12:59 PM

Alberta’s advanced education minister says post-secondary schools are going over budget and he’s urging them to immediately freeze hiring and stop spending on travel and hosting.

Demetrios Nicolaides says, in a letter to Alberta’s 21 largest post-secondary schools, that his ministry is starting to get year-end financial statements and spending is not meeting expectations.

“Expenditures are forecasted to be much higher than anticipated,” Nicolaides said in the letter sent Wednesday to the board chairs of the schools, including the University of Alberta, University of Calgary, University of Lethbridge and Athabasca University.

“I have been very clear from the beginning that institutions were to exercise fiscal restraint and prudence when making spending decisions.

“This will not be easy, simple, or painless. However we must take action immediately to improve the financial state of our province before it’s too late.”

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The letter does not give financial details, breakdowns or estimates on the overspending.

Along with the freeze on hiring, hosting and travel, Nicolaides has asked the schools to defer all other expenditures where possible until April 1 after the current budget year ends.

His ministry wants to see monthly reports from the schools to ensure they stay on track, and is asking departments to not allow egregious last-minute expenditures of unused funds, known colloquially as “March Madness.”

“Officials from Advanced Education and Finance and Treasury Board will be closely monitoring March spending levels,” he said.

The government also wants each school to deliver by April 15 an interim financial statement “that clearly articulates an expenditure reduction and a diligent, thoughtful attempt to bring costs in line.”

Premier Jason Kenney’s United Conservative government has reduced operating spending by five per cent for post-secondary education and lifted a freeze on tuitions.

The government says Alberta spends more on post-secondary students than most other provinces and that reforms are needed. It says Alberta remains one of the national leaders in per-student spending even with the funding cuts.

This year’s advanced education operating expense is $5.1 billion and is to be reduced over four years to $4.8 billion, seven percent cut. That’s expected to be achieved through departmental savings and reducing grants to the schools.

The province plans to introduce a new funding model starting later this year that would link funding to accountability, service for students and job creation.

There were five independent academic institutions that did not get the letter as their spending does not impact the government’s bottom line. They are: Ambrose University, The King’s University, St. Mary’s University, Concordia University of Edmonton and Burman University.

(Dean Bennett)