A Challenge for Higher Education in Ontario
Charles M. Beach (ed.), 2005 (Paper ISBN: 1-55339-074-1
$24.95) (Cloth ISBN: 1-55339-073-3 $32.95)
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| Contents | |
| Introduction | |
| Acknowledgements | . . . | v |
| Introduction Charles M. Beach |
|
|
| The Rae Review and the Structure of Postsecondary
Education in Ontario Michael L. Skolnik |
|
|
| Assessing the Revenue Framework and Multi-year Planning
in the Rae Report Ken Snowdon |
. . . |
|
| The Rae Report and the Public Finance of Postsecondary
Education Robin Boadway |
. . . |
73 |
| Accessibility in the Rae Report Lorne Carmichael |
. . . |
97 |
| Contributors |
INTRODUCTION
In February 2005, Bob Rae presented Ontario: A Leader in Learning —
Report
and Recommendations to the premier and the minister of training,
colleges
and universities of Ontario following from the Rae Review of higher
education in Ontario. Within short months, in May 2005, the Government
of
Ontario brought down a budget containing substantial increases in
postsecondary funding in the province and indicated their intention to
adopt many of the major recommendations of the report. Since the
demographic and funding environments in Ontario are shared by many other
provinces, it can be expected that the Rae Report will have a major
influence on the future of higher education, not just in Ontario, but in
Canada as a whole. The report addresses concerns of accessibility to
postsecondary education in the province, quality of the higher education
and training that is provided, current underfunding of universities and
colleges, availability of funds for eligible students, and
accountability
in the postsecondary sector.
In light of the importance of the Rae Report, the John Deutsch
Institute at Queen's University approached several leading experts in
the
areas of postsecondary education and its funding environment in Canada
to
write informative reviews of the report. This volume presents their
commentaries. The objectives of the reviews are, first of all, to
provide
a critical evaluation of the report's stance and recommendations for
reform of the postsecondary sector in Ontario. But the authors also
seek
to provide a broader context in which to undertake such an evaluation
and
to suggest alternative perspectives and recommendations to address the
report's concerns. Earlier this year, the John Deutsch Institute
published a major volume of studies on issues of postsecondary education
in Canada — Higher Education in Canada (2005), edited by C.M.
Beach, R.W.
Boadway, and R.M. McInnis — that effectively set the scene for the Rae
Report. The present volume of reviews complements the above collection
and
should be viewed in the context of the major issues examined there of
underfunding, student access, and faculty shortage.
The second paper in the volume, by Ken Snowdon, assesses the
revenue framework and funding proposals of the Rae Report. Snowdon notes
that, over the past 40 years or so, the higher education system in
Ontario
has become "mass education" as participation rates in universities and
colleges have increased dramatically. The government is thus faced with
the challenge of how to fund a mass education system while ensuring
accessibility, affordability (to both government and students), and an
acceptable level of quality. The Rae Report proposes a new revenue
framework for PSE institutions that offers them greater long-run funding
security and predictability. Snowdon provides a useful review of past
university funding arrangements in Ontario since 1967 as context for the
Rae Review proposals. He notes that, while the title of the Rae Report
is
A Leader in Learning, the proposed funding levels are not in
reference to
benchmark leaders but to benchmark averages that Ontario should try to
catch up with. He views the report's endorsement of the "corridor
system"
of funding as a positive move towards improved funding
predictability.
Snowdon goes on to assess the funding mechanism the Rae Report
proposes against the stated goals of access for all qualified students,
quality of teaching and research, institutional autonomy within a public
system, and the mutual responsibility of the players involved
(government,
institutions, and students). With respect to access, Snowdon notes that
the Rae Report steps beyond the traditional Robarts policy of ensuring
that Ontarians are provided the opportunity to pursue PSE. Higher
education is now critical for prosperity of the province, and government
must be proactive in encouraging participation in PSE. He also remarks
that the report recognizes that access has several dimensions, including
affordability, outreach, and capacity of the system. With respect to
quality of teaching and research, the report recognizes that, in an
environment of increased resources, across-the-board salary increases
can
leave little funding available for improvements in student-faculty
ratios,
enhancements of the teaching and research facilities, and basic
infrastructure — hence the linkage of funding increases and
accountability
and multi-year revenue requirement plans by institutions. In return for
greater public investment in the PSE system, institutions will have to
demonstrate efforts to achieve government objectives of access,
affordability, and improved quality of education.
The third paper in the volume, by Robin Boadway, examines the
proposals of the Rae Report from the point of view of public finance
principles. Boadway criticizes the report for its general lack of
discussion of the underlying rationales for its various recommendations
and for its relative lack of detail on how alternative policies might be
designed to achieve the stated objectives of the report. It takes the
existing PSE system as given and asks how it can be improved. Sweeping
changes to institutions or methods of finance are not proposed; the
approach to changes in funding is basically incremental. Perhaps this is
to be expected given the time frame and resources of the review.
Boadway examines the rationales for government intervention in the
provision of postsecondary education and their implications for
government
policy. With respect to policies applied to students, he identifies
several difficult questions which need to be addressed such as what
should
be the share of PSE costs borne by students, how should the financing
and
risk costs to students be structured based on equity and efficiency
criteria (say through an income-contingent loan program or graduate tax
program), and more generally, how should PSE investments be treated by
the
income tax system? With respect to policies applied to PSE institutions,
he raises further questions: How much decentralization of
decision-making
should exist in the PSE sector and to what extent should PSE
institutions
be free to decide tuition levels and programs to offer? How many
students
ought to receive higher education, what should the level of government
funding be, and what factors should a funding formula take into account?
Finally, Boadway calls for some rationalization of the federal and
provincial roles and a clearer division of responsibilities in the
Canadian PSE sector.
The fourth paper, by Lorne Carmichael, looks at the issue of
accessibility as addressed in the Rae Report. Both Rae and Carmichael
distinguish between access and affordability. High tuition fees
certainly
create a barrier for low-income students. However, the remedy is not to
increase the tuition subsidy for everyone, but to focus attention on
those
in greatest need. Carmichael cites the report as clearly acknowledging
that higher education overwhelmingly benefits upper-income families
whose
offspring enjoy a much higher participation rate in university
education.
He identifies two aspects of accessibility — capacity and equal access.
Capacity of the system to offer positions to prospective students is
addressed by a number of recommendations to increase funding levels to
PSE
institutions, thus make them more predictable, provide greater support
for
infrastructure, and subsidize increased graduate training. Equal access
seeks to ensure that all qualified students can attend PSE institutions
regardless of their ability to pay. This is addressed by savings plans
and
loans for those who can afford to pay and by targeted bursaries and
grants
for needy students. The report offers a number of strategies for
reaching
out to potential students from poor backgrounds. The report recommends
an
immediate expansion and revision of a PSE loan program and a longer-term
development of a loan program with repayments based on income and made
through payroll deduction as already adopted in several countries. This
brings in the need for federal-provincial cooperation in implementing
such
a plan. Carmichael indeed recommends a move towards adopting a graduate
tax where PSE tuition is free to all qualified students and graduates
then
pay a tax based on the tuition cost of their program and their actual
income after graduating. Carmichael is very supportive of the Rae Report
and feels that Rae has done a great service to postsecondary education
in
Ontario.
This volume presents four reviews of the Rae Report from quite
different perspectives. The first, by Michael Skolnik, focuses on what
the
report has to say about the general structure of postsecondary
education
in Ontario. Skolnik points out that the mandate of the Rae Review was to
provide recommendations on the design of the public postsecondary
education (PSE) system and on funding models for PSE, but the report
concentrates much more on the latter and says rather little about the
former. The report's funding recommendations for universities, for
example, are based on comparisons with peer (public) institutions in the
United States that are the most expensive institutions in the American
PSE
system which also includes a wide range of other PSE providers. While
the
report indeed advocates greater institutional differentiation, it does
not
convey a vision of what a differentiated system should look like or what
kind of structural reforms are appropriate. Yet alternative funding
mechanisms, controlled deregulation of tuition fees, proposed doubling
of
the number of graduate students, and mode of delivery of distance
education in the province have potentially strong effects on the
long-run
structure of the PSE sector in Ontario. The new Council on Higher
Education proposed in the report offers the potential to provide advice
to
the government on design of the higher education system. But the
announced
intention of the government in its May 2005 budget was to have the
council
focus on issues of accountability and quality improvement in PSE rather
than on design or policy in the higher education system. The government
may be losing an opportunity to undertake a major rethinking of what PSE
structure would most benefit Ontario looking towards its future
needs.
Charles M. Beach
Director
John Deutsch Institute for the Study of Economic Policy
Queen's University
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