In October, Vancouver Island University shared its plan to manage a $20.2-million deficit for the 2023-24 academic year. It lays out how VIU will return to a balanced budget in three years.
We sat down with VIU’s Provost, Dr. Mike Quinn, who oversees all academic programming at VIU to ask him about VIU’s deficit and what impact it will have on your programs and courses.
First of all, can you explain what a deficit is and why VIU needs to take steps to get rid of it?
A deficit is how much more you are spending than you are making. It is similar to your own personal budget. If you spend $200 more than you earn in a month, you have a deficit of $200 that month. Over time, if you keep spending more than you earn, you will have a large deficit that can either be made up with money from your savings or by going into debt.
Income for universities only comes from a few places, and there are not a lot of opportunities to make more money on university campuses. Universities get money from the following sources:
- an operating grant from the province,
- tuition from domestic (increases are limited by the province) and international students,
- program fees,
- revenue sources such as parking fees, the bookstore and food services
- grants from the province for specific programs or projects
- and philanthropic gifts from the community.
In BC, all public universities (universities that get funding from the provincial government) are the responsibility of Province of BC. The Province of BC is aware of VIU’s deficit and Deficit Mitigation Plan and expects us to return to balanced budgets as soon as possible.
How did VIU end up with a deficit?
Enrollments at VIU have been declining since 2014-15; however, VIU saw a steep decrease in enrollments following the pandemic at the same time as inflation rose quickly. Enrollments have still not returned to pre-pandemic levels while the costs of running the university, for a significantly smaller number of students, have gone up. As a result, the cost of running the university has been more than what the university collects in revenue for several years, resulting in a deficit.
Is VIU the only university in BC with a deficit?
No, since the pandemic, several universities in BC have been in the same position, with fewer students and higher costs, resulting in those institutions running deficit budgets as well. This is also a trend for post-secondary institutions across Canada.
Quest University in Squamish and Laurentian University in Ontario went bankrupt. Could VIU go bankrupt too?
No.
Quest was a private post-secondary institution and as a result, they did not receive funding from the Province of BC, unlike BC public post-secondary institutions.
In BC, public post-secondary institutions are managed differently than Ontario and are a provincial liability. This means VIU’s deficit and outstanding debt would become the province’s responsibility if VIU could not pay its bills and the province would be responsible for VIU.
VIU’s Deficit Mitigation Plan is specifically designed to make sure that does not happen, and our operations are resilient and sustainable in the long term – and that we are able to provide an even better education experience for students by proactively addressing our financial situation.
What does this mean for student services and courses and programs at VIU?
You – our students – are the reason that VIU exists, and I am confident the measures we are putting in place will allow VIU to continue to meet our students’ needs and deliver the high-quality education that they expect for many years to come. We are committed to making sure all students can meet the required credentials to graduate from VIU.
We do need to ensure that classes are being offered with enough students to justify the cost of delivering that course. This means that most first and second year classes will have a minimum enrolment of 15 students. This may mean joining one or more scheduled classes to meet the minimum required class size. Some upper-level courses with very low enrolments may be offered every second or third year. We will ensure that this is communicated early so students can plan accordingly. Exceptions may be made, and other arrangements may be looked at to allow students to graduate on schedule.
In terms of course offerings, it is not unusual for VIU to not run classes that do not have sufficient enrolment, but there will now be a proactive approach to identifying such courses and increased rigour in determining if a class will go ahead with low enrolment. Going forward, we are basing future budgets on actual enrolment, not projected, to be conservative and cautious so that we can continue to offer the best education possible to you, our students. If any changes are made to VIU’s program offerings, existing students will still be able to complete the requirements of the program they are currently registered in.
VIU is looking at all programming that is not part of our mandate from the provincial government. That includes any spending or programming that is outside of what the province has asked us to focus on as a post-secondary institution. You can read that mandate on the Government of BC’s website.
The measures we are putting in place with our Deficit Mitigation Plan are all focused on helping VIU continue to meet your needs and continue to deliver the high-quality education you expect. In fact, I believe that this is a perfect time to ensure that we are offering programs that best meet the needs of our students. This requires a thorough review of both our current offerings and student demand. We remain fully committed to ensuring all VIU students are fully supported to meet their program requirements.
Dr. Mike Quinn
Provost and Vice-President Academic
Vancouver Island University