An ambitious and responsible 2022-23 budget
Message from the Chief Financial Officer
May 20, 2022
The 2021-22 fiscal year was another challenging budgetary environment for Concordia. For the second consecutive year, we had to operate with COVID-19 ambiguity, unanticipated events and frequent adjustments. Our students, faculty and staff responded with great agility and resilience, but also needed additional support to maintain and advance their next-gen academic and research goals. Despite the challenges, we closed on a solid footing from which we can anticipate another ambitious and responsible year ahead.
The road to a new normal
It is too early to confirm when we will be “back to normal” but we can already reassure our community that the 2022-23 academic and fiscal period is heading in the right direction. Still, we will need to continue to adapt to new ways of living, working, studying and conducting research. Our post-pandemic reality will no doubt be quite different from the pre-pandemic environment.
We are thrilled that a record number of students are graduating from Concordia in spring 2022. At the same time, we are taking note of the unusual drop in enrollments we witnessed in the 2021-22 term — particularly among Quebecers. Because this drop is our first in a decade, we hope it is just another COVID-19 symptom from which we will quickly bounce back.
Individuals have experienced the stressors of the last two years differently and we recognize the need to continue to do our part in supporting their resilience. The additional resources we invested during the most challenging periods of the pandemic are likely to be maintained for a while and adapted, as needed. For now, we are also maintaining certain financial supports we put in place to help our community members advance along their academic and research paths.
We are also excited to be completing some major administrative milestones: the launch, implementation and adaptation of the UNITY project to the needs of the user community will put us on a solid footing where Human Resources, Procurement and Financial Services are concerned. We are optimistic that the long-term benefits of this major transformation will enhance our support to our faculty and staff.
Targeting a return to a balanced budget
The budget version of long-COVID
The last two years of the pandemic as well as the exceptional reduction in student numbers during the 2021-22 academic year have created a financial challenge for Concordia. There was a point where we were at risk of ending the fiscal year with a deficit of $20.5 million. Fortunately, the Government of Quebec delivered on non-recurrent grants. The $23 million allocated to Concordia allowed us to reimburse a portion of the $37 million in costs directly related to the impact of COVID-19. The grant is even allowing us to close the 2021-22 fiscal year with an expected small surplus of $2 million.
It should be noted that these adjustments are to cover expenses incurred between 2019-20 and 2021-22. They are not built into the base budget of the university. Therefore, structural challenges remain for 2022-23 and future years. Still, we believe we will reach our target of returning to a balanced budget within the next few years through our integrated planning framework: we aim to reduce the deficit for 2022-23 by $5.5 million, leaving us with a manageable forecasted deficit of $15 million for the year.
A multi-dimensional strategy
Our integrated approach will be based on a multi-dimensional strategy that will cover many key components of our complex environment, including the following:
- student population forecast and strategic enrollment
- post-COVID-19 structural changes
- design and review of academic programs
- digital learning and technology
- workforce planning and management
- support for our students, employees and community
- research activities
- space acquisition and management
- ancillary services, etc.
It bears repeating that critical components linked to today’s university life such as mental health, sustainability, equity, diversity and inclusion, cybersecurity, recruitment and retention will also be included in this integrated planning.
To support this strategy, the position of associate vice-president, integrated planning, has been created. Reporting to the provost and vice-president, academic, with a dotted line to the chief financial officer, this new role will be supported by an Integrated Planning Committee representing the major sectors of the university.
Combining prudent expense management and revenue diversification
With total forecasted revenues of $586.5 million and expenses of $601.5 million, the year 2022-23 represents a first step in returning to a balanced budget by 2025-26. This objective will be achieved with a combination of prudent management of expenses and additional growth and diversification of revenues. The Finance Committee and the Board will be instrumental in providing support, guidance and assistance. Just as we were able to achieve a similar objective between 2015 and 2020, we are confident that we can achieve the desired result at the end of this new cycle.
Returning to a balanced budget in the next five years can be achieved while continuing to invest in key strategies and infrastructure. In fact, we propose to invest more than $470 million in infrastructure and technology over the next four years. Our Capital, Asset Management, Funding and Financing Policy (CFO-4) continues to guide us in maintaining our long-term financial sustainability.
We have learned to expect the unexpected. We know that the 2022-23 fiscal year will include direct, indirect and long-term impacts of the pandemic. They will continue to influence our academic and research models for years to come. Faced with these challenges, we will continue to demonstrate creativity, resilience, teamwork, resourcefulness and agility. Fortunately, being ambitious is part of Concordia’s DNA. In the past, we demonstrated our capacity to rise to challenges. Going forward, we can be confident in our ability to continue to position Concordia as a great university.
Chief Financial Officer