HESA

Higher Education Strategy Associates

Banning the Term “Underfunding”

Somehow I missed this when the OECD’s Education at a Glance 2014 came out, but apparently Canada’s post-secondary system is now officially the best funded in the entire world.

I know, I know.  It’s a hard idea to accept when Presidents of every student union, faculty association, university, and college have been blaming “underfunding” for virtually every ill in post-secondary education since before Air Farce jokes started taking the bus to get to the punchline.  But the fact is, we’re tops.  Numero uno.  Take a look:

Figure 1: Percentage of GDP Spent on Higher Education Institutions, Select OECD Countries, 2011

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For what I believe is the first time ever, Canada is outstripping both the US (2.7%) and Korea (2.6%).  At 2.8% of GDP, spending on higher education is nearly twice what it is in the European Union.

Ah, you say, that’s probably because so much of our funding comes from private sources.  After all, don’t we always hear that tuition is at, or approaching, 50% of total funding in universities?  Well, no.  That stat only applies to operating expenditures (not total expenditures), and is only valid in Nova Scotia and Ontario.  Here’s what happens if we look only at public spending in all those countries:

Figure 2: Percentage of GDP Spent on Higher Education Institutions from Public Sources, Select OECD Countries, 2011

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While it’s true that Canada does have a high proportion of funds coming from private sources, public sector support to higher education still amounts to 1.6% of GDP, which is substantially above the OECD average.  In fact, our public expenditure on higher education is the same as in Norway and Sweden; among all OECD countries, only Finland and Denmark (not included in graph) are higher.

And this doesn’t even consider the fact that Statscan and CMEC don’t include expenditures like Canada Education Savings Grants and tax credits, which together are worth another 0.2% of GDP, because OECD doesn’t really have a reporting category for oddball expenditures like that.  The omission doesn’t change our total expenditure, but it does affect the public/private balance.  Instead of being 1.6% of GDP public, and 1.2% of GDP private, it’s probably more like 1.8% or 1.9% public, which again would put us at the absolute top of the world ranking.

So it’s worth asking: when people say we are “underfunded”, what do they mean?  Underfunded compared to who?  Underfunded for what?  If we have more money than anyone else, and we still feel there isn’t enough to go around, maybe we should be looking a lot more closely at *how* we spend the money rather than at *how much* we spend.

Meantime, I think there should be a public shaming campaign against use of the term “underfunding” in Canada.  It’s embarrassing, once you know the facts.

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7 Responses to Banning the Term “Underfunding”

  1. Nick Falvo says:

    Hi Alex:

    Thanks for drawing attention to this important report.

    Question: from which tables in the report are you getting these figures?

  2. David says:

    I wish sensible, fact-based discussion like this could be aired more readily without being shouted down by students who lately haven’t exactly proved themselves to be vanguards of free speech. At our University we’re expected to get shut out by tuition protesters today. Oh, the irony that I’m sure will be lost on them…

  3. Jim Sentance says:

    How about funding per capita, or comparing funding to GDP to the % of the population taking PSE. I know historically we have a relatively high level of participation.

  4. Les Robb says:

    Hi
    Wondering if it is possible to do this comparison on a per FTE basIs?
    Since governments in Canada have pushed accessibility it is appropriate to judge the underfunding issue on a per student basis in my view.
    Ameru

    • Alex Usher says:

      Hi Les.

      By popular demand, I’ll try this next week. It does not change things much (and comparisons are trickier b/c “FTE” doesn;t mean the same thing everywhere).

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