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Vice-President (Operations and Finance)

Operational Excellence

Financial Sustainability

In a recent financial update to the McMaster community, senior university leaders invited faculty, staff and students to submit their thoughts, comments and questions.

More than 50 submissions have been received so far through our feedback form. There was a range of feedback and, in general, they can be categorized as questions related to the budget, to the timing of our efforts to reduce costs and find new sources of revenue, as well as suggestions for improving efficiencies and reducing bureaucracy.

The FAQ below is based on the submissions and on conversations with members of our community.

Visit Daily News for the message on supporting McMaster’s financial stability, from McMaster’s Provost and by the Vice-President (Operations and Finance).

 

 

1. Where can I find information that will help me understand McMaster’s budget? 
McMaster introduced an activity-based Budget Model in 2014, which has been consistently reviewed and updated since its implementation. Visit the Office of the Provost’s website for overview information and for an FAQ that is specific to the Budget Model.

2. Who manages the university’s budget and how can I get involved? 
McMaster’s Board of Governors is responsible for approving the yearly consolidated budget. The Provost oversees the budget process to ensure the needs of McMaster’s Faculties and support units are met in alignment with the university’s strategic priorities and funding.

McMaster’s Budget Committee is responsible for reviewing the budget framework and responding to budget submissions from all areas of the university. McMaster faculty, staff and students can join the Budget Committee through an election that is promoted annually through the Office of the Secretariat.

3. I want to review the university’s budget. Where can I find it?  
McMaster’s consolidated budgets are made public each year following approval by the university’s Board of Governors in June. They are available online for anyone to review on the Financial Affairs website.

4. Why are faculty and staff being asked to find cost savings and new sources of revenue now if there have been funding freezes for years? 
The current focus on cost savings and revenue generation is a continuation of McMaster’s long-term financial strategy. Proactive planning by so many across the university for the past few years has allowed McMaster to produce a near-balanced budget in an environment of decreasing revenues.
The use of reserve savings (appropriations) are a temporary measure and are not a sustainable solution, thus we need to focus our efforts now more than ever on identifying efficiencies and exploring new revenue opportunities to ensure our spending does not exceed our resources.

5. What are the main financial pressures impacting Ontario universities?  
There are five main challenges.
-Ontario has the lowest funding per student among all Canadian provinces.
-The number of students eligible for government funding in Ontario has been capped since 2016.
-Tuition fees were reduced by 10% in 2019 and frozen in 2020.
-The federal government’s cap on study permits has had a negative impact on international enrolment.
-Rising costs and inflation continue to put additional financial strain on universities.

6. Why aren’t universities putting more pressure on government to increase funding?  
Senior leaders at McMaster have been actively meeting with government representatives at all levels to advocate for sustainable institutions and for our students. This includes meetings in Ottawa and at Queen’s Park, direct discussions with policy makers and participating in advocacy efforts with other post-secondary institutions. This work is ongoing and supported by Public Affairs staff at McMaster and through participation in sector associations.

7. What can I do as a member of the McMaster Community? 
We heard ideas from many of you on how to cut costs or increase revenues, many of which will be explored. While solutions will vary from one unit to another, each contributes to the overall goal of ensuring that McMaster is able to deliver on its core academic and research priorities and does not fall into a deficit position. Actions may include:
-Staff attrition
-Delayed hiring/salary gapping
-Streamlining software licences
-Improved procurement processes
-Reduced travel or project funding
-Identifying new sources of revenue
All savings count and we encourage you to bring ideas to your supervisor to explore.

8. What did you mean by salary gapping in the last financial update? 
Salary gapping in this context means deliberately leaving some roles unfilled for a period of time after someone leaves. This results in short-term cost savings, as funds budgeted for salaries remain unused during the gap period.

9. What should I do if I feel my workload is increasing due to cost savings?  
Faculty and staff at McMaster are known for their dedication to students and to the university’s mission and we appreciate all your efforts to continue making our university one of the best in the world. If workload concerns arise, however, please have open discussions with your department leaders to explore efficiencies, prioritize critical activities and identify supports through available resources. Your well-being is critical, and university leaders are committed to mitigating workload challenges as much as possible.

10. Will there be any more opportunities for further engagement with the McMaster community regarding the university’s financial strategies? 
We will continue to reach out to the community with updates and we encourage all senior leaders to be transparent with faculty and staff in regard to financial management. We understand some in the McMaster community may continue to have questions about the future of higher education in Ontario and we will do our best to be as open and transparent as possible during this time.