November 7, 1996

The Principal's column

Again this year the McGill community is very concerned with the need to manage on fewer budget resources as we try together to cope with declines in the University's revenues. In the process of discussing the various options that might be open to us, quite a number of my colleagues within the faculty and administrative staff have asked me why I as Principal am imposing such cuts on McGill's departments, centres and administrative units.

In response, I would like to make it as clear as I can that I am not choosing to impose these budget constraints. Rather, I--and we--are simply responding to both the continuing freeze of student tuition and the cuts in grants which have been imposed upon us in each of the past four years by the provincial government.

The actual facts are quite stunning, and I would like to share them with you:

The challenge of sustaining academic quality in the face of this fiscal decline is daunting. In the long run, we simply cannot sustain ourselves by continuous cost-cutting--additional revenues will be absolutely essential.

Indeed, the very nature of the partnership that has sustained Quebec higher education in recent decades is changing as the proportion of our revenue represented by the provincial operating grant has declined over the last five years from 74.55% to 71.91%. In the face of this constraint--again imposed by the provincial government--we must seriously consider all potential sources of additional revenue, whether in the form of tuition fees, expanded philanthropy, contract research, etc. We will need, for example, to find additional resources for fundraising and for student recruitment.

The choices made in these and other areas will have substantial consequences--both intended and unintended--in terms of the kind and size of university McGill is to become. None of this will be easy, but I am convinced that we will simply have to become less dependent on government grant revenue than is now the case--even after the precipitous drops we have recently experienced.

My own vision of McGill is that it must remain a relatively comprehensive university, one with a series of professional programs built around a core in the arts and sciences. It should also remain a relatively research-intensive university, where the advancement of knowledge and understanding is the hallmark of all of our programs. As an anglophone institution in an essentially francophone environment, what we can continue to offer--indeed all that we have to offer--is an unsurpassed standard of excellence.

Achieving such a goal with the fiscal constraints that I outlined above is the task. Development of new revenue will be important, but it is unlikely to entirely solve the problem. We will also have to find ways to operate more efficiently on both the administrative and the academic side. This means that we will have to discontinue some of our services and activities; learn where, how and with whom we might productively act in concert; and, as well, reimagine how to deliver those programs that are simply too central for McGill to put aside.

I recognize that great efforts have been made by all units and departments so that the effects of the almost 20% drop in revenue per student have been minimized. However, more will be required if we are to remain both fiscally and academically solvent at the same time.

Since I cannot believe that there is much simple "efficiency" to wring out of the system, the only alternative seems to be the redesign of how we do what we do. This is awkward, since the need does not arise from the inadequacy of what we are doing. If that were the case, the task would be relatively easy. The need arises instead from the lack of resources to support the way in which we do our work.

The budget experience of the past five years indicates more or less clearly that although we have been able to reallocate resources as between faculties to respond to enrolment pressures, we have been much less effective in reallocating resources with respect to other academic values and considerations. In the coming budget exercises, we will have to turn our attention to these issues.