Graham Carr: ‘We are managing prudently to invest for the future’
One of Concordia’s nine strategic directions is to Take Pride — and our community indeed has much to be proud of despite operating during one of the most challenging periods in our lifetime.
Under extraordinary conditions, our faculty and staff responded with great creativity and agility to offer a rich academic and research experience to our students.
Faculty, staff, students and alumni have also been instrumental to many transformative new initiatives launched this past year, as we unveiled the Next-Generation Cities Institute and Jonathan Wener Centre for Real Estate, launched the Equity Office and President’s Task Force on Anti-Black Racism, introduced our Sustainability Action Plan and opened our Applied Science Hub.
Important under any circumstances, these initiative are especially meaningful because we undertook them against the backdrop of economic uncertainty caused by the pandemic when, as I informed the community last October, we knew we would have to significantly alter our budgetary expectations midstream.
Throughout, our Board of Governors has asked good questions and provided good advice in support of the approach the university has taken to manage the challenge.
Reporting on 2020-21
At the Board meeting on May 19, 2021, we reported a deficit of $29.7 million for 2020-21, the year just ending. That deficit is solely attributable to the impact of the pandemic — namely increased costs associated with improving our capacity to support and deliver remote learning and work, cybersecurity protection, increased health measures, on top of revenue losses from closing our residences and canceling activities and space rentals. Indeed, prior to the pandemic the university was en route to achieving a surplus.
Although the 2020-21 deficit is not a trivial amount, it was also lower than anticipated. This is because of the careful approach to budget management taken by sector leaders across the university, but also because we experienced a 4.2 per cent growth in student full-time equivalents — over 31,000 FTEs — and the highest level of student retention in many years.
With regard to the current fiscal year, 2021-22, I’m very happy to report that the Board approved our recommended budget which combines prudent management with investments to address priority needs but also to support our institutional momentum. In short, the deficit is both structural — reflecting the impact of COVID-19 — and strategic — investing in the future of Concordia.
Our anticipated deficit for 2021-22, is $17 million. This represents 3 per cent of our total budget of $572.7 million, which is a significant decrease from last year, when our deficit was 5.4 per cent of our total budget. While we expect the effects of the pandemic to lessen over the coming year, it will still take some time for our usual revenues and expenses to return to pre-pandemic levels.
The projected deficit takes into account planned salary increases — including new collective agreements with the vast majority of our bargaining units — contractual obligations and the indexation of current contracts, the implementation of Project UNITY on a new delivery timeline, increased cybersecurity and the impact of ongoing COVID-19 expenses. Anticipating that our fall term will be a mixture of in-person and online course delivery, our revenue assumptions are predicated on conservative enrolment projections consistent with the upward patterns we have experienced in recent years.
Also embedded in our budget estimates is spending for key recurring and new activities in areas such as:
- student mental health and other components of student success
- support of our Indigenous Directions Action Plan and initiatives to advance Equity, Diversity, Inclusion and Accessibility
- additional scholarships and bursary programs for our graduate students
Finally, the projected deficit includes up to $12.9 million of new investments designed to address urgent challenges and to support strategic initiatives that will continue to position Concordia as a next-generation university.
Specifically, these investments are:
- $5.6 million to improve academic and research delivery models, in line with our Digital Strategy and the teaching and research needs of our community
- $2.6 million in faculty budgets to enable strategic investments
- $2 million to provide greater administrative and technical support for research across the university
- $1.7 million to support the ongoing work of the new Next-Generation Cities Institute, as well as the potential development of an Institute for Applied Artificial Intelligence and a School of Health
- $1 million to launch the phase-one delivery of our Sustainability Action Plan
Looking beyond 2021-22, we recognize that we must return Concordia to a balanced budget. Here, it is important to emphasize that, COVID excepted, the fundamentals of the university’s financial position are very strong and remain very stable.
Indeed, the financial framework we have developed is designed to manage our deficit threshold through to fiscal 2023-24. That said, working with the oversight of the Board’s Finance and Audit Committees, our approach is flexible enough to allow us to adapt to changing circumstances while protecting the university’s long-term financial health.
Even with a deficit, we believe that in the current changing context of higher education it is more important than ever to trust our capacity to grow smartly, to adapt and to innovate. This is why the 2021-22 budget recognizes the importance of investing for the future as part of our long-term vision.
I thank the Board of Governors for continuing to show confidence in what we do. And I especially thank our faculty, staff, students and entire community for allowing Concordia to thrive and continue to move forward.
President and Vice-Chancellor