Information about budget planning

Jun 9th, 2015

Memorial University

Information about budget planning

The Vice-Presidents Council (VPC) is working to address the serious and complex budgetary challenges facing Memorial University. As this important work continues, VPC is committed to listening to the questions and concerns of the university community and sharing information whenever possible. 

An update on the budget planning and approval process has been posted to the VPC website. The update includes information on the process to develop proposals and contextual information on the university's revenue and expenditures, student demographics, tuition fees, employee demographics and salary levels, pensions, infrastructure deficits, the core science building and the Battery Facility. 

Guiding principles

  • Minimize the impact of budgetary measures on students, employees, university programs and operations.
  • Share the contribution to solving this serious challenge among all people and units at Memorial.

Process

  • VPC works closely with deans and the Senate Budget and Planning Committee to develop proposals to address the budget shortfall.
  • University Pension Committee considers issues related to the $20.9-million special payment and how they might be addressed and will provide a recommendation to the Board of Regents. 

Highlights from VPC update

  • Memorial has three primary sources of revenue to fund operations: operating and infrastructure maintenance grants from the provincial government (83 per cent); tuition paid by students (13 per cent) and revenue generated from other sources (4 per cent). Memorial's expenditures are approximately $491 million, of which 66 per cent is for academic operations.
  • Should any budget proposal include a potential tuition increase, it will not happen before the 2016-17 academic year. 
  • While the number of employees at Memorial has increased by 23 per cent in the past five years, the number is misleading. For example, 10.8 per cent of the increase is in casual standardized patients (aged 2 to 90) in the Faculty of Medicine who might be required only a few hours per year. The next largest increase at 4.7 per cent represents clinical faculty in the Faculty of Medicine who are not paid by the university but must have a title for academic purposes. 
  • The ratio of faculty members to staff members is unchanged over the past five years; 41 per cent of employees are faculty while 59 per cent are staff.
  • Memorial's pension fund is 92 per cent funded. To address the deficit, the university is legislatively obligated to make "going-concern" payments. This can be done by using funds from the university's operating budget or requesting from government a deferral of the payment for this year. Government has signalled its willingness to grant a deferral, provided Memorial requests this and agrees to review its pension plan and consider changes to ensure the plan's future sustainability. 
  • Through the guidance of the University Pension Committee and the Board of Regents, the pension plan is on solid footing. 
  • Life safety issues on all Memorial campuses are the first priority for infrastructure spending and the university will address all life safety concerns. 
  • The provincial government has invested $43.8 million in deferred maintenance from 2010-11 to 2014-15 and has provided $13.5 million in laboratory safety funding. However, Memorial continues to have major challenges regarding aging infrastructure, particularly on the St. John's campus which was built in the 1960s and not significantly retrofitted since that time. 
  • The core science infrastructure is a new $325 million teaching, learning, research and engagement space which will allow Memorial to continue to attract and retain world-class faculty who will provide the best possible education for undergraduate and graduate students. 
  • The core science project is funded with $25 million from the Memorial Matching Fund; $125 million from the Hebron settlement with the provincial government; and $175 from borrowing. The payment on the loan portion of the cost will be approximately $10.3 million annually over a 30-year period. Funding in the budget from the government's grant-in-lieu of tuition and savings generated by the ongoing operations and budget review will make up the annual payment. 
  • The Battery Facility will include student accommodations, public engagement programming, conference and meeting spaces and services and more (planning and public consultation is still underway). The graduate student housing will help address identified needs in this area. The facility will ease the space crunch and parking challenges on the St. John's campus. 
  • The Battery was purchased for $9.5 million in 2013, with up to $16.2 million approved for renovations as needed. Funds for these expenses, along with day-to-day operating costs, will be provided through redirected lease expenditures for off-campus space, philanthropic funds, accommodation rentals and revenue generated from activities and tenants at the facility. 

To read the complete update and to access further information, including the 2013 Auditor General Report Responses, Findings and Recommendations and the presentation delivered by President Gary Kachanoski and Kent Decker, vice-president (administration and finance), to Senate, please visit: www.mun.ca/vpc/budgetupdate2015-16.php

 

Contact

Vice-Presidents Council

230 Elizabeth Ave

St. John's, NL A1B 3X9 CANADA

Tel: (709) 864-2530

Fax: (709) 864-2552

becomestudent@mun.ca