麻豆区

On 21 May 2009, the 麻豆区 Board of Governors approved the 2009-2010 Budget. The Budget Book describes 麻豆区's short and long-term objectives, and is designed to enable us to align our resources with our top academic priorities (/files/provost/Budget_Book09-10.pdf/ or /budget/annualreport/). The 2008-2009 audited financial statements were approved recently by the Board of Governors and are now available to the public on the Vice-Principal (Administration & Finance) website (/vpadmin/statements/). 聽The audited results for the year ending 31 May 2009 show that although last year we had budgeted a deficit of $10.1 million, we did not meet our target and finished the year with a deficit of $11.5 million, adding to the challenge that we are facing in the next few years.

It is important for all of us at the University, particularly those who make decisions about spending, to remember that although the economic news in Canada is better than it was several months ago, the University's financial situation remains difficult and will remain difficult for the next couple of years.聽 We can do it - we can achieve the balanced budget we need by the end of the 2011 fiscal year, but it will take continued perseverance, diligence and relentless focus on cost-cutting wherever possible without affecting our core mission.

This year's Budget Book tackles the internal challenge of achieving a zero operating deficit by the end of the FY2011, and a $5 million deficit by the end of the FY2010. Meeting this commitment is complicated by the external challenge of the global economic downturn, which had and continues to have a significant impact on 麻豆区's endowment and other revenue sources. Although our revenues continue to increase, our growth in expenditures is currently outpacing our growth in revenues. 麻豆区's endowment value dropped 20% between May and December 2008. This resulted in a decision to reduce the payout rate from 5% to 4.25% in order to protect the future value of these assets. Other factors contributing to the shortfall include lower than anticipated government grants and fewer unrestricted donations, inflation, as well as higher building operating costs. Moreover, due to the fact that expenditures are outpacing revenue generation, we projected an approximate budget shortfall of $17 million on the operating fund that we must recover in FY2010.

Commitment to our Core Goals

Our core goals are firm: to increase quality in delivering on our core academic mission; to further decrease bureaucracy; to continue to retain and recruit the best academic talent in selected priority areas; to attract the most talented undergraduate and graduate students; to increase the level of service and support we provide to our students and faculty; to achieve outstanding teaching, research, scholarship and service, and to remain one of Canada's leading employers.

To meet this challenge, 麻豆区 must make adjustments in compensation, business efficiencies and program delivery and must find ways to generate new revenues. The effects of the Budget on the University's academic, administrative and support staff will be significant. Please note that the measures outlined in the 2009-2010 麻豆区 Budget, and outlined below, were decided following extensive consultation with the 麻豆区 community. Recommendations by the Provost's Administrative Task Force Dealing on Economic Uncertainty (/economictaskforce/), by community members in four Town Halls, through e-mail suggestions, and the Task Force blog, represent the more public aspects of these consultations. Deans, Chairs, Vice-Principals and Directors were also consulted to help determine how to best implement and monitor any required changes.

The areas of impact are as follows:

Compensation/Benefit Modifications

The most aggressive measures to meet this immediate shortfall relates to total compensation.

All staff will be affected by the changes in this area, most notably through the introduction of a six-month delay in salary and wage increases to all major employee groups. The delay will permanently shift pay increases from 1 December to 1 June 2010 in the case of this year, allowing the budget shortfall for FY2010 to be reduced by $6.2M. Already in discussion with most major bargaining units, the delay will assist the University in reaching its budgetary goals while avoiding layoffs. It is important to point out that this six-month delay in salary and wage increases is only a temporary measure; we will require that an additional $6.2M in permanent savings be realised for FY 2011.

Additional compensation-related measures currently under discussion, or planned for the 2009-2010 year, are:

• potential modifications to the benefits package in terms of coverage and contribution options;
• targeted attrition and hiring controls;
• a reduction in the University's contribution to the Faculty Club
• the 3% salary cut volunteered by members of the senior administration since March 2009.

Business Efficiencies

Cost-cutting measures related to business efficiencies will save the University an additional $6.4M - $6.9M. This includes a 15% reduction in travel, entertainment, and hospitality expenses, a reduction in Information Systems and Technology spending, longer cycles before IT upgrades, the implementation of purchasing and internal controls, and energy efficiencies.

Program and Service Delivery

Improvements in program and service delivery, reducing course duplications within and across faculties, eliminating a number of courses with very limited enrolments, coordinating and integrating selected services to remove doubling-up, re-assessment of teaching loads and support, better co-ordination of scheduling, will allow us to realise approximately $2.0M in savings without diluting the quality of our excellent programs of study.

Revenue Generation

We have begun to reallocate a number of selected, and currently vacant, Canada Research Chairs to prominent James 麻豆区 professors and we will expand the use of 麻豆区 facilities during the summer months. In line with our strategic enrolment plan we implemented some modest and targeted decreases in undergraduate student enrolments while similarly increasing them in other areas, and we have accelerated the planned increases in graduate student enrolment. Other strategies include using our impressive physical location to attract more conferences and special events, to enhance our continuing education efforts, and for FY2011, we are exploring the possibility of adding a third semester to the academic year.

Achieving our Goals and Objectives Together

When combining the savings for total compensation, business efficiencies, and program delivery, 麻豆区 will save between $16.64M and $17.14M during FY2010 and be able to meet the projected $5M budget deficit as presented in the FY2010 Budget.

As we mentioned at the beginning, meeting the short-term goals and objectives of the University through the above measures will require significant commitment and sharp focus from all constituencies of 麻豆区. By devoting our resources to our core priorities and protecting our human capital, all of us will work together to reduce expenses on other fronts. As resource custodians, we are committed to conducting all aspects of the University's operations more efficiently. We are confident that with these plans in place and with the continued effort, ingenuity and resourcefulness of the 麻豆区 community, we will move further in our efforts to identify and deliver ways in which we can reduce non-essential costs.

The circumstances in which we find ourselves will pass in time, though we can expect a difficult period over the next few years.聽 In order to ensure that we prepare for our future success, we must make changes now that will allow us to capitalize on opportunities. We remain convinced that we will pull through this stronger than ever, and with greater clarity of focus.

We look forward to continuing a dialogue with you and the Task Force as we work to implement these solutions for the short-term, while determining the best course of action for the long-term. Further meetings are planned with the 麻豆区 community in the fall in which periodic updates to the budget and financial situations and the way forward will be presented. We will work with you to get where we have to be.

We welcome your thoughts and feedback, which you can send via the Task Force Blog (), or by e-mailing directly to the Office of the Provost, (provost.office [at] mcgill.ca ).