UNB’s Fiscal Environment – revenue and expenses

As we all know, collective bargaining does not take place in a vacuum. Rather the university takes many considerations into account in trying to balance myriad priorities that all come together to deliver on a collective objective of building UNB’s reputation as one of Canada’s top comprehensive universities.

Many people, faculty in particular, serve a critical role in shaping UNB’s reputation and in delivering an exceptional, transformational experience for our students.

In recent weeks, there has been discussion about university resources and allocation choices, as well as the outlook for future funding.  The purpose in sharing this information is to shed light on how UNB balances a multitude of needs within the university environment and within the broader economic and fiscal context.

UNB’s Historical Resource Allocation

UNB allocates more resources than the Canadian average and the average of peer universities to:

  • Instruction and non-sponsored research
  • Academic salaries
  • Libraries

UNB has a smaller student-to-faculty ratio than many other universities.  The most recent figures from Maclean’s illustrate the number of students for every faculty member at UNB was 16.5, whereas the average for the G14 group was 21.5.  The average for the comprehensive group of universities in Maclean’s was 25.3.

UNB allocates less resources than the Canadian average and the average of peer universities to:

  • Administration and general expenses
  • Non-academic salaries and wages

 

Outlook for Future Operational Funding

UNB’s operating budget includes revenue and expenses related to the day-to-day activities and operations of the university.  It includes salaries and benefits for faculty and staff, heating, electricity, maintenance, cleaning, library acquisitions, classroom and laboratory supplies, telephone, communications and other non-salary costs associated with university operations. 

The operating budget is funded from three primary sources:

  • The unrestricted operating grant from the Province of New Brunswick (approximately 60 per cent of funding)
  • Tuition fee revenues (approximately 32 per cent of funding)
  • Other sources of operating revenue (nearly 8 per cent of funding)

The current outlook for UNB’s two primary sources of revenue is as follows:

Provincial Operating Grant

The Province of New Brunswick recently announced that New Brunswick universities will receive a 2 per cent increase to ongoing operating funding in 2014–15 and 2015–16.  This follows two years of freezes to ongoing operating grants.

Tuition Fee Revenues

The provincial government has implemented a suggested cap on the level of tuition fee increases for New Brunswick universities.  For UNB, this amounts to a 3 per cent increase in each of the next three years.  This follows tuition fee increases of 3 per cent and 2.56 per cent in each of the last two years respectively.

Overall full-time equivalent (FTE) student enrolment at UNB was 9,290 as of November 14, 2013. This was a decrease of 203 students (or 2 per cent) from last year, which itself was 183 (or 1.9 per cent) less than the previous year.  Current estimates are that FTE student enrolment could decrease by 1.5 per cent in 2014-15.

 

Regional and National Context

UNB operates within a broader economic context. The following is a summary of two commonly used economic indicators, as presented by BMO Capital Markets Economics (November 29, 2013):

bg info gdp.png
bg info cpi.png

 

These key indicators illustrate that UNB is not operating in a business-as-usual economic environment.  All sectors have been affected, including higher education.

According to the Conference Board’s Global Economic Outlook 2014 (November 2013), global GDP adjusted for inflation will only rebound moderately from 2.8 per cent in 2013 to 3.1 per cent in 2014.

The Conference Board indicates that the major economies of the world still face structural flaws and policy constraints that hinder more investment and faster productivity growth.