The University of Waterloo announced in a fall budget update released to employees on Nov. 8 that it is now projected to incur a $15-million deficit for the 2023-2024 operating year.
The university began the fiscal year with a $4 million operating deficit which was approved by the Board of Governors on April 4 of this year, with the condition that an update would be given later regarding external factors like student enrollment. According to the Board of Governor’s Oct. 31 meeting agenda, base salary amendments of $16 million caused the increase to the deficit.
The amendments stem from the resolution of the conflict regarding Bill 124, which was slated as a way to “protect the sustainability of public services” and passed in 2019 by Premier Doug Ford’s government.
The bill capped wage increases for public sector employees at one per cent every three years, and was eventually ruled as unconstitutional. As a result of the ruling, the university proposed the retroactive salary amendments for eligible UW faculty and staff to compensate for lost wages.
Another reason given by UW vice-president and provost James W.E. Rush for the deficit, in an opinion piece published Monday, is the lack of sufficient funding from the provincial government over the last decade. Provincial funding currently represents roughly a third of university operating revenues.
At UW, 2009-2010 was the last fiscal year during which grants (including operating government and non-government grants and contracts) as a source of operating revenue outpaced academic fees, at 45.1 per cent to 44.1 per cent respectively. For the 2022-23 fiscal year, 27 per cent of UW’s operating revenue was sourced from grants, with academic fees making up 63.7 per cent.
Rush also cited an additional loss of $250 million due to the Ford government’s 2019 domestic tuition freeze, now in its third straight year, for which Ontario institutions have not been compensated.