Now is the time to address chronic underfunding

Over the past 20 years, demographic and inflationary pressures and a decline in average student income have forced postsecondary institutions to seek new funding sources.

The downward trend in budgetary allocations for higher education in many provinces and territories in Canada does not bode well for university funding in the long run. Many universities looking to fill financial gaps are increasing their enrolment of international students, who in most cases pay far more in tuition than local students. The gradual deregulation of international tuition fees has allowed many universities to dedicate more resources to international student recruitment, resulting in more internationalization on campuses.

According to Statistics Canada, between 2005 and 2019, the number of international students in Canada increased by 223 per cent. Universities have relied on international enrolment – the goose that lays the golden eggs – to cope with the serious consequences due to funding cuts. Unfortunately, after COVID-19 crashed the party, international enrolment dropped by almost 58 per cent at some institutions in 2020-21, dealing a severe blow to college and university enrolment and revenue. According to a Royal Society of Canada report released in March 2021, between $377 million and $3.4 billion in revenue could have been potentially lost for colleges and universities in 2020-21.

It seems that the Quebec government has answered its universities’ cries for help, promising to allocate $1.3 billion to higher education in its 2022-23 budget. However, elsewhere in Canada, institutions are still waiting for more public funding.

Until governments step up to the plate, international students remain crucial to the survival of higher education in Canada. The overdependence on international students even has some arguing that charging higher international tuition contradicts Canada’s principle of equal access to public services. For example, in 2020-21, international tuition fees accounted for 25 per cent of the University of British Columbia’s operating revenue, while international students represented only 28.6 per cent of the student body. One can easily imagine how international tuition fees contribute to the budget at the University of Toronto or McGill University, where international students represent 26.8 per cent and almost 31.8 per cent of the student body, respectively. This unprecedented situation of course comes with some risks.

Now that the pandemic is on its way to being contained, and travel restrictions and public health measures have been lifted, there is hope for universities, which anticipate a jump in international enrolment and a large-scale return of students to campus. However, can Canada handle an influx of international students? Our immigration system is on its last legs, totally ill-equipped, plagued with bureaucratic mismanagement, and reliant on outdated technologies that have been neglected for many years.

The fact is, Immigration, Refugees and Citizenship Canada cannot keep up with visa applications, resulting in processing delays and endless wait times for potential students. Over the past several years, Canada rejected almost 70 per cent of student visa applications for international students who had already been accepted to a Canadian higher education institution. This situation created a heavy financial burden for some universities, plummeting their enrollment numbers and revenues.

Without sufficient funding, higher education in Canada cannot fulfill its mission to bolster Canada’s well-being and prosperity, development and professional specialization, and socioeconomic mobility and social cohesion. On the contrary, underfunding creates a domino effect of dwindling knowledge production, lagging innovation, and stagnant specialization. Here’s how:

Dwindling knowledge production. Without considerable investment in higher education, we cannot achieve our desired productivity growth and competitiveness, especially in our knowledge-based economy. While the Canadian economy ranks high among G7 countries, our research and development spending is at around 1.8 per cent of the GDP compared to an average of 2.3 per cent in other OECD countries.

Lagging innovation. It goes without saying that less knowledge leads to less innovation. Research underfunding is a significant barrier to realizing Canada’s innovation potential. The fact is, we have fallen behind in innovation. Due to decreased research spending, Canada produces fewer patents per capita than its peers. According to Deloitte, “Canada has dropped in the Global Innovation Index over the past 10 years, from eighth in 2006 to 18^th in 2018.”

Stagnant specialization. The innovation index also measures a country’s capacity to produce specialized knowledge. Our increasingly complex world demands more and more expertise. Universities serve as incubators to produce specialized knowledge essential to emergent global technologies. However, Canada is ranked 11^th among its peers in technology exportation, even though we have an export-based economy.

There is no denying the importance of higher education. Their vitality is critical to the health and well-being of our country. Now is the time to address Canada’s chronic underfunding of higher education. If we wait any longer, it may be too late. Our collective future, as well as that of future generations, depends on it.

Sanni Yaya is vice-president, International and Francophonie, at the University of Ottawa, where he holds the Senghor Research Chair in health and development. He is a member of the Royal Society of Canada.