PSE needs total overhaul to control costs

Revenues are declining and students are paying for it unless administrations start taking necessary initiative


Deloitte Canada issued a damning report about the financial state of Canada’s universities on Tuesday.

Pressed by declining government revenue, declining private donations, rising pressure on students to make up the difference, universities across Canada are being forced to take a hard look at their accounts.

According to the report, the top 10 financial challenges universities will face in the coming year are:

1. Over budget and under-funded: As funding declines, cost management is key
2. The rivalry intensifies: Competition to attract the best students heats up
3. Setting priorities: The danger of making decisions in the dark
4. Moving at the speed of cyberspace: Technology upgrades are needed across the board
5. Rethinking infrastructure: A renewed focus on asset optimization
6. Linking programs to outcomes: Where training and market demand intersect
7. The best and the brightest: Attracting and retaining talented faculty
8. A sustainable future: Enhancing environmental performance
9. Education for all: Tackling diversity, accessibility and affordability
10. Regulations and reporting: New responsibilities require better disclosure

The problem is that governments and private donors are free to reduce their contributions to universities when times are tough. Students are not. When income declines and — as the report notes — costs of program delivery climb, students are on the hook for the remainder.

What universities need to do is start taking a stern look at their expenses, figuring out who is paying for them and cut where necessary. No longer can schools be all things to all people. Streamlining of core programs, focusing efforts — even at the cost of the peripheral programs — is going to become increasingly necessary.

“Despite the merits of a world-class liberal arts education, there is a danger in supporting a curriculum that is too theoretical. Today’s fast-paced world needs construction crews, hospital workers and people to build cellphone towers. Institutions must respond to these realities by ensuring their educational agendas are in sync with forecast marketplace demands,” Arsh Maini, a senior consultant with Deloitte India wrote in the report.

While there will undoubtedly be a massive outcry as universities keen on research and engineering cut their arts programs, other schools are likely to cut expensive science and engineering programs in favour of robust arts programs. This is a good thing, a healthy thing, as each school becomes the best at what they do.

This streamlining — a complete overhaul of how higher education is financed in Canada — is necessary to the continued survival of our diverse education system.


PSE needs total overhaul to control costs

  1. “Today’s fast-paced world needs construction crews, hospital workers and people to build cellphone towers”

    Yes, and that training can be provided ON THE JOB in apprenticeship programs or short term technology oriented programs, not in university settings that offer degrees.

    Universities produce and distill knowledge, they provide an education, not entry level vocational skills. That is not their purpose and nor should it be. A civil and advanced society has a well educated population. Education comes from being taught to think critically, to read widely, to understand knowledge from a vast array of perspectives, theories, and disciplines. It has tremendous value, even if you can not personally understand it because you were never exposed to it.

  2. While more analysis of higher education is required, and I value the perspectives of organizations outside of the sector (particularly during this time of impending change), this report from Deloitte is of little value.
    It is not, in fact, a report on the Canadian higher education, but an international report that has been mildly tweaked to appeal to local (i.e. Canadian tastes). The analysis slides between situations in a variety of nations, and consequently, glosses over fundamental differences between them.
    More troubling is the quality of the analysis itself: it reflects a very limited understanding of higher education. Consider the following passage, for example:
    “In addition to system upgrades, higher education
    institutions must also respond to the growing
    demand for web-based training. To attract a wider
    range of students and meet the needs of disparate
    student groups, many organizations are already
    considering the viability of offering online courses,
    webinar instruction and other forms of virtual or
    remote education. Beyond lowering the costs of
    delivering education, reducing infrastructure
    demands and offering programs to higher volumes
    of students, this type of online education has
    interesting implications for declining enrolment. In
    some scenarios, it may even help improve student
    Thus far, online higher education in North America has led to greater costs and will continue to do so until the institutions change their business models in order to actually leverage the potential of technology. But then, any analyst that refers to online higher education as “training” – a term unofficially “forbidden” in the halls of academe – obviously has no familiarity with the field whatsoever.
    What we have, in fact, is a “report” that seeks to identify problems to be solved in higher education that, surprise, surprise, Deloitte is capable of solving for its clients. Much like any ad, it tells us that we have problems and then offers to solve them.
    Yes, there are serious problems with higher education, and yes, I respect the right of anyone to promote their services, but we need as consumers of these solutions to be more sophisticated in making distinctions between thinly veiled advertisements and actual insight. It is disappointing that a number of news organizations across Canada thought it wise to help promote this material.