McMaster aims to balance budget

McMaster University's Board of Governors today approved a 2007/08 budget that is the cornerstone of a conservative financial strategy that could see the University eliminate the operating in-year deficit within three years. The approved budget is part of a three-year financial plan that will achieve its objective by 2009/10.

Acting Provost Bob McNutt said there are several key qualifications that affect the success of the plan. “Let me stress that this is a conservative budget in its estimate of income that focuses on a reduction in all budget envelopes as well as faculty renewal in strategic areas.”

The budget sees the University's units continue to absorb inflationary increases, including salary and wage increases. It does not include the possibility of flow through funding from the federal government nor full accessibility funding from the province for the growth in undergraduate enrollment.

McNutt reported to the Board that 55 people plan to take the offer of early retirement that achieves both budget savings and allows for faculty renewal.

President Peter George said, “This has been a difficult task that has taken a great deal of work by many people. While the journey is not complete and the impact of the plan not yet realized, we should not lose sight of the long-term vision for McMaster and our commitment to the goals outlined in Refining Directions. This plan respects the fiscal challenges, while investing in strategies that further the long-term vision of the institution.”

McNutt said that while this budget is now in place, the work will continue. The long-term strategy includes new revenue generation, academic and non-academic program review and prioritization, Inspiring Change (the operational process reviews started earlier this year), a review of budget models and attention to student enrolment targets.

President George said that the 2007/08 budget is a starting point and that implementation and monitoring of budget metrics by the Provost and Vice-President Administration will be critical to the plan's success.

In thanking the Board for their support of the budget, President George said he especially appreciated their recognition that too precipitous an approach to cost reduction would do severe damage to the academic mission and that elimination of the deficit must be balanced against delivery of educational goals and faculty renewal.

The 2007/08 operating budget includes objectives to: