Alberta, We Have a Problem

WATSON SCOTT SWAIL, President & CEO, Educational Policy Institute

This week the Alberta provincial government announced that it was allowing post-secondary institutions to hike their tuition and fee charges for 2010, given that provincial subsidies will be zero funded for the next couple of years at a minimum. As expected, student and other groups are up in arms about the increases, suggesting that the Stelmach government is pulling the rug out from under students in Alberta. And, to a degree, they are. Interestingly enough, this comes during the same week where the University of California’s Board of Regents increased tuition 34 percent. It could be worse, Alberta.

The continual challenge for post-secondary education is the act of balancing check books: institutions require a certain level of revenue to operate, and are at the mercy of the provincial authorities as to (a) what subsidies they receive for operating revenue and (b) what tuition and fee charges they can levy against students and families. If there aren’t enough funds to operate institutions, then either seats (students) must be reduced, efficiencies created, or quality reduced. Not that complicated.

The demand for students in post-secondary education is a bit of a yin-yang in Alberta, as in other places, due to economic conditions. When the economy goes south (entirely appropriate saying since the US produced this round of economic woes), enrolment in higher education typically increases because people are out of jobs and retooling for the future. This typically hits colleges more than universities, but both are affected. With regard to efficiencies, business and industry sectors are implored to reduce staff and increase output; higher education has had limited pressure to do so, but that pressure will increase in time as public funding will continue to tighten. Even then, 80 percent of institutional budgets are “people-based,” and those efficiencies can be tough to reduce. To the third point, we don’t talk much about quality in post-secondary education because no one wants to admit it is an issue. Trust me: if we reduce support for higher education, quality is an issue.

Today, the Alberta government doesn’t have any money (relatively speaking), and although they have deficits, instead of choosing to reduce provincial subsidies for post-secondary education, they have zeroed the budgets for the next two years. At that time, the economy will likely be back, especially in Alberta, where oil prices are likely to be back in the $100+/barrel area. Alberta will be fat. Again.

And this is the crux. Alberta is different than the rest of Canada because of the oil industry. The economy is so closely tied with oil that it suffers from a wealth/dearth situation based on oil prices. Alberta either is flush or is broke. And right now, it is broke. This economic vacillation also has significant repercussions on the workforce. Because of the relatively strong oil-based economy, and because high school students can graduate to a $70k+ job in lovely Fort McMurray with only on-the-job training, selling college and university education in Alberta is a continual challenge.

The issue of higher education participation and funding is critical in Alberta. On Wednesday I spoke with Eva Ferguson of the Calgary Herald (read the article here and the corresponding Op-ed). “When there’s less college and university access, there’s less diversity in the workforce,” I said. “And society’s ability to change and evolve is limited” (read the article here). In the oil rich boon economy, this isn’t an issue. But when the oil runs out, it will be.

Last year, EPI conducted an evaluation in Saudi Arabia of a university preparatory program to a new American-style university. The joke in Saudi Arabia is that 70 years ago the country was only sand. If we wait another 70 years from now, they’ll be back to sand. But in truth, the Saudis are taking their oil money and investing in the future via higher education, creating incredible, high-tech universities and buying the world’s best in terms of instruction and management (Read this Chronicle article if you don’t believe me).

What will Alberta do? Will they invest heartily into post-secondary education and prepare for the future, or will they allow higher education to wither on the vine resulting in a relatively low-tech, low-knowledge society? I’m not necessarily against passing some of the costs on to students and parents, but it has to be a calculated plan to provide the necessary support for higher education while balancing the needs of the province and the responsibilities of users and taxpayers. This is a difficult, complex issue, but one that the province will always wrestle with.

Tell me this: was it really necessary a few years back for the Klein government to write checks back to taxpayers when it could have created more rainy day funds for days like these? Could they have decided to invest additional funds into education at large, including K-12 and post-secondary? They could have, but politicians rarely think longer than their tenure. The future is for other elected officials to handle. And this is where the system falls apart.

But past is prologue: what did the province choose to do half a decade ago when it was flush? Build up the knowledgebase and capacity of its youth? No, they gave everyone in Alberta a check. Not to stimulate the economy, because it was ever so stimulated, but because they “had too much money.” Then don’t now. So let the students continue to argue about how much they should be paying for higher education because that debate needs to continue. But let’s begin an honest and much needed debate to define the role of post-secondary education in Canadian society and come to terms of the level of support necessary to ensure a system of high quality with open access for all.

Let’s put the future on the table and not just think through our oil-barrel glasses.

Just a thought.

Have a good weekend. WSS>