Higher Education Strategy Associates

October 20

OK, Everybody Take A Valium

Heady scenes last night.  We have a new government with a strong mandate.  And it’s not the by-now reviled Conservatives.  It can seem like a whole new world is emerging.

But as far as PSE is concerned, very little actually changed last night.  Higher education is mostly a provincial responsibility, and nothing that happened can change the fact that most provincial budgets are in a parlous state, and few governments (bar perhaps Alberta’s) seem much interested in spending on post-secondary education.

Did anything change federally?  Well, tone.  I would bet the phrase “commiting sociology” won’t be used as a term of abuse any time soon.  But as I have noted in a platform analyses here, here, and here, the Liberal platforms contains: i) no new transfer money for provinces; ii) no new money for granting councils; and, iii) no new money (or not very much anyways) for student aid – though they are promising a major and welcome re-jig of student aid, which will be to the benefit of some students from below-median income families.

That’s not very good news, but there is a base that can be built upon.  This is a government that will be more sympathetic to the concerns of the knowledge economy than the last one.  They likely can be brought round to the merits of basic science, provided that there are convincing answers for improving private sector innovation.  And to the extent that significant improvements can be made without spending a dime (do read Jim Woodgett’s A Decade of Mishandling  Science in Canada for more on this), I suspect there will be some willing ears in government.

But it’s not going to happen on its own.  The whole post-secondary community needs to speak with a single voice on this.  And it needs to speak quickly.  The basic policy framework for the new government will be set in weeks, not months.  Let’s roll up our sleeves, and get to work.

October 19

Canadian University Finances: An Update

Back in July, the Canadian Association of University Business Officers released the results of its survey of university finances for 2013-14.  The results underline the fact that institutions in Canada are facing some highly heterogeneous financial circumstances.

Let’s start with operating budgets.  Though universities are allegedly facing some kind of unprecedented austerity, total operating income rose by 4.17% in real dollars from the previous year  (inflation from September 2012 to September 2013 was a shade over 1%).  Income from government rose 0.9% in real dollars, from $11.1 billion to $11.2 billion.  But the big new source of money came from student fees, which rose 5.8% (again, after inflation) to $8.6 billion.  Remember, that’s not because tuition fees rose by 5.8%, but rather because both tuition fees and enrolment (notably, international enrolment) increased.

The surprise in 2013-14 was that although government grants and fees make up 91% of operating income, it was the remaining 9%, mostly endowment income, which actually accounted for 35% of all income growth, as shown below in Figure 1.  That’s probably not sustainable.

Figure 1: Source of Operating Income Growth














So, if operating income went up 4.17% after inflation, universities must be swimming in cash, right?  Well, no.  Because, in fact, spending went up to match income growth exactly at 4.17%.  Figure 2 shows the year-on-year increase in real spending.

Figure 2: Increases in Real Spending














Briefly: Compensation, which forms around 75% of the operating budget, is up by 4.6% after inflation (yes, after).  It’s not from hiring temps or sessionals, which gets classified as “other instructional wages” – that line item has actually shrunk slightly.  Total academic wages are up 3.6%; total non-academic wages are up 4.2%.  (Lest anyone get too excited about wage growth among non-academics, be aware that it’s primarily in student services and IT.  The smallest registered growth among all functional sectors was central administration, at 3.2%.)  But the real killer is what’s happening to benefits: up 9.2% in real terms.  Regardless of why this is happening (my guess: topping up barely solvent pension plans), the technical term for this situation is “bananas”.  But of course, it’s unfair to blame everything on the wage bill because universities aren’t excelling at restraining growth on their non-wage spending, either: that’s up 4.1%.  All of which is to suggest that the revenue theory of expenditure is alive and well in our universities; they raise all they can, and then spend all they raise.

Now of course, these trends aren’t spread equally across universities.  At some institutions, increases in operating budget came in at over 10% (UQTR, Trinity Western, and also UBC, but I think some of that is a reclassification issue).  Queen’s had an 8% real rise in income, and Toronto saw a 6% increase.  But at the other end of the table it’s pretty ugly.  UNB and PEI saw a fall of 3% in real terms, Mount Royal 4%, and NSCAD University a whopping 12%.

Similarly, outside  operating budgets, universities across the country have taken a hit.  Research income fell in nominal terms for the first time since 1995-1996; capital income fell by 8%, and now sits below $1 billion in real terms for the first time since 1998-99.

So, in short: operating costs are rising much faster than government funding, leaving institutions to fill the whole with larger student numbers and lots more international students. Research and capital funding are down in some serious ways.  But these trends are playing out in different ways in different parts of the country.  Kind of like last year only more so.

Happy Election Day, all; don’t forget to vote!

October 16

Election 2015: Last Thoughts

Voting day Monday.  So before y’all head out to the polls, here are a few last thoughts on each party’s position on post-secondary education, science, and innovation.

One: The Green platform is a vacuous embarrassment.  If you’re voting on higher ed issues, do not vote for this.

Two: It is an excellent thing in this election that all three major parties decided to focus their PSE initiatives specifically on families from below-median incomes.  The Tories are doing it through targeted measures on educational savings, the NDP and Liberals are doing it through new student grants (with the latter paying for it by taking tax credits away, thus actually raising prices for richer families).  No universal tax credits.  No schemes to lower tuition.  Just intelligent, targeted programming.  I’m immensely heartened by this.  It implies there is hope yet.

Three: Well, sort of… because pretty much all of the Science/Innovation policy on offer is pretty depressing.  Yes, lots of good stuff from Liberals and New Democrats about restoring freedom to science, creating various types of official science councils/advisors, restoring the long-form census, etc. etc., but when you get right down to it what’s on offer is this:

Liberals: hundreds of millions of dollars to incubators and accelerators.  Nothing to universities or colleges.

Conservatives: lots of tiny research promises: $24M for advanced manufacturing hubs, $45M to Brain Canada, $150M to the Canadian Partnership Against Cancer.  $4.5 Million for – I cannot believe I am writing this – Lobster Biomass Research (clearly, the Tories are in thrall to “Big Crustacean”).  Some of this might end up at universities (the Brain Canada money, for instance), but this is small bones.

NDP: The only party to actually suggest giving money to the granting councils (yay!), they budgeted a grant total of $55 million for the next four years.  Or about 25% of what inflation is likely to be (boo!), meaning the real value of council funding will continue to fall.

Greens: negative money for research because they’re going to shut down anything related to GMOs or Atomic Energy.  Because, you know, evidence-based policy-making. (Did I mention not to vote Green on higher ed issues?)

All of which is to say, scientists who want to communicate the need for more investment in basic research need to go back to the drawing board. Because on this evidence, something is going seriously wrong.

Four:  Nobody even mentioned the idea that we should touch transfer payments and get money to institutions that way. If you grew up watching politics in the 80s and 90s (as I did), this is almost unfathomable.  But it possibly represents a matured understanding of how the Federation is supposed to work.

Five: If you rank the parties on how much money they want to throw at students, access, and PSE institutions, it would look like this:

1) Green – several bazillion dollars (who’s counting?).

2) NDP – somewhere north of $1 billion.

3) Conservatives  – somewhere south of $100M.

4) Liberals – In net terms, according to their own manifesto $0 (in practice possibly higher than that).  But a more effective re-arrangement of existing dollars.

One probably shouldn’t get too depressed by this. Thinking back to the Tories: they’ve never campaigned on more money for research, but they always found a way to come up with something in every budget.  It might not have been quite what people wanted, and it might not have been as large as people would have liked, but there was never nothing.  Manifestos give you the baseline, not the entirety of a new government’s plans.  Improvisation happens.  Science can still get more than is on-offer here; it just needs to up its game.

Go vote.  And to Hull-Aylmer’s Greg Fergus, the best PSE candidate in this election: in bocca al lupo.

October 15

The Most Horrifying Book of the Year

One of the most famous studies on higher education and opportunity was published a little over fifteen years ago by economists Alan Krueger and Stacy Berg Dale.  Using something called the College and Beyond Survey, they followed over 6,000 students who had been accepted to American universities in 1976, and then looked at their outcomes almost twenty years later, in 1995.  The key finding was that holding SATs constant, school selectivity didn’t matter much.  The important thing wasn’t attending Harvard, it was having the marks to get into Harvard (for whites, at least – for black students, accessing the networks available to selective school alumni did have a positive effect on education).

As selective universities became even more selective during the early 2000s, and their average student’s socio-economic background drifted upwards, this study was comforting: the rich were just wasting their money on Ivies, and the poorer but talented who were excluded from those schools would end up doing just as well, even if they went elsewhere.  Except: I’ve never met an American parent who actually believed the study.  Sure, they’d say, but things have changed since the mid-70s.  Networks matter more, and by God the one thing you get at an Ivy League school is a network.

A book came out this past spring that explains why they’re right and Kruger and Dale are, if not wrong, then at least out of date.  It’s called Pedigree: How Elite Students Get Elite Jobs by Lauren Rivera, a professor at the Kellogg School of Business at Northwestern University.   It follows the graduate recruiting activities of a number of unnamed banking and consulting firms – the tiny fraction of companies that give 22 year-olds jobs that pay roughly six figures in the first year – across a number of Ivy League schools. And it will horrify you, and make you profoundly glad you don’t live in the United States.

The first couple of chapters are pretty mind-blowing.  The descriptions of how these major banks and consulting companies are dropping hundreds of thousands of dollars – each – on recruiting activities on these Ivy League campuses are bad enough (there must be a lot of very good parties at these places). What is truly mind-blowing is that all of these organizations, filled with “masters of the universe” types, genuinely seem to think that whatever Harvard and Princeton admissions is doing, it must be absolutely, 100% right, because that’s effectively the only filter they have.  If you’re from a selective Ivy, these purveyors of elite jobs think “they must be smart and fast learners; let’s hire them”.  From a state school?  You don’t even get an interview.  What you have accomplished in your four years of higher education is irrelevant; it’s all about where you went to school.

Not only is this mindbogglingly stupid (and, to tell the truth, odd – surely one of these companies should have arbitraged this over-focus on a tiny minority, and gone big on flagship state university hiring?), but also it is infuriating in the extreme.  Read it, or at lest the first couple of chapters, which describe how firms filter by campus (it gets less interesting after that): if your blood doesn’t boil, you have no soul.

A last note: try reading this book next to Kevin Carey’s The End of College, or Ryan Craig’s College Disrupted.  Both Carey and Craig are of the opinion that one thing that will drive disruption in higher education is that companies are going to want the “best” employees. Eventually, they say, algorithms are going to come along and find those employees wherever they are, at which point the prestige value of a degree from a selective school will disappear quickly.

But reading Pedigree it becomes clear that what employers are usually looking for are people who remind them of themselves.  People they won’t mind hanging out with on a long night in the office.  People who will fit in.  And you don’t need an algorithm for that.  You just need an old boys’ club.

October 14

Universities and National Competitiveness

Ever since von Humboldt sold the Prussian Government on the idea that research universities were a tool with which to increase national power, they’ve been publicly funded to pursue precisely those ends.  The definition of “national power”, and the role universities are asked to play in developing it, has of course varied over time and by region.  Nowadays, we talk of power in terms of “national competitiveness”, and universities are supposed to play a role in ensuring that.  But even though competitiveness has been the watchword for going on two decades now, universities still struggle to determine how to fit into that agenda.

So what should they be doing?  To start, it’s important to think about what we mean when we say “national competitiveness”.  It’s not a straightforward concept because nations do not literally compete with one another.  When most people say this, they are really asking: “is our economy growing faster than others?” Or more narrowly, “are we attracting more foreign investment than others?”  And those things depend, effectively, on what happens inside firms.  If firms are financially healthy, then they are hiring, investing, and doing all the sorts of things that make economies hum.  So the big overarching question is: what can universities do to make firms financially healthier?

(Before anyone has conniptions, I’m not saying that this is the only thing universities are for.  I’m saying that if one wants to argue for universities on the basis of increasing national competitiveness, this is the logical conclusion of that argument.)

To simplify things a bit, consider that universities have two sets of outputs: graduates and ideas.  The way graduates help firms is by being more productive.  What that means in practice varies by industry, but in most white-collar jobs it means some combination of: i) being a fast learner, ii) being a good communicator, iii) being able to deal with ambiguity, iv) being able to make decisions without bothering the boss every few minutes (note: public sector employers like this stuff too).  If you’re running a university, or a faculty, or a department, you need to ask yourself: how do our teachers and our curriculum work towards giving students those skills?

The ideas part of this is a bit trickier.  What governments tend to focus on are ideas that lead to patents and licences: notions that are excludable, and can be given or sold to business in ways that allow them to make new products and develop new lines of business.  But the problem is that firm-strengthening ideas pass between academia and firms in a variety of ways.  Silicon Valley, for instance, would never have become what it did if Stanford had focussed on patents and licenses.  Rather, it arose because Stanford embraced the sharing of equipment and ideas, and of professors and entrepreneurs working with each other.

So if you’re running a university the question really should be, “what am I doing to make sure that ideas are flowing between universities and firms faster and more freely?”  That’s not an exercise in increasing publication counts, it’s an exercise in getting people to collaborate with those outside academia.

Where things get even trickier is with the fact that, in some cases, the conduit for sending ideas back and forth between universities and firms is students and graduates themselves.  This is most obviously true in the case of co-op students (which former Waterloo President Jim Downey calls the “human bridge” between universities and firms); but it’s also true in many professions, and even in business, where ideas taught in the classroom eventually seep into everyday practice, as graduates who’ve learned new ways of doing things flood the labour force.

(One area where more of this is desperately needed is in business.  Canadian business on the whole is simply not attuned enough to international markets, which is why there is always pressure to maintain a low dollar so we can pursue the lazy strategy of selling to the Americans.  A greater focus on developing markets in Canadian business schools has to be part of any national competitiveness agenda.)

Again, I’m not arguing that this is a university’s sole purpose.  Arts, culture, and the spirit of free inquiry are all central to university identities.  But if universities want to claim a significant share of public monies (equal to 1% of GDP, last I checked, and that’s not including any research money) on the basis of making the country (or the province) more competitive, these are the kinds of agendas that need to be in play.

October 13

Statistics Canada is in the Wrong Century

If what you are looking for is agricultural statistics, Statistics Canada is a wondrous place.  See, Statscan even made a fabulous (if oddly truncated) little video about agricultural statistics.

Statscan can tell you *anything* about agriculture.  Monthly oilseed crushing statistics?  No problem (59,387 tonnes in August, in case you were wondering).  It can tell you on a weekly basis the weight of all eggs laid and processed in Canada (week of August 1st = 2.3 million kilograms); it can even break it down by “frozen” and “liquid”.  Want to know the annual value of ranch-raised pelts in Canada?  Statscan’s got you covered.

But let’s not stop here.  Wondering about barley, flaxseed, and canola deliveries for August, by province?  Check.  National stocks of sweetened concentrated whole milk, going back to 1970? Check (for comparison, GDP data only goes back to 1997).  Average farm prices for potatoes, per hundredweight, back to 1908?  Check.

There is even – and this one is my favourite – an annual Mushroom Growers’ Survey.  (Technically, it’s a census of mushroom growers, – and yes, this means Statscan expends resources to maintain a register of Canadian mushroom growers; let that sink in for a moment.)  From this survey – the instrument is here – one can learn what percentage of mushrooms grown in Canada are of the Shiitake variety, whether said Shiitake mushrooms are grown on logs, in sawdust, or pulp mill waste fibers, and then compare whether the value per employee of mushroom operations is greater or lesser for Shiitake mushrooms than for Agaricus or Oyster mushrooms.

According to Statistics Canada, this is actually worth spending money on.  This stuff matters.

Also according to Statistics Canada: the combined value of agriculture, forestry, fishing, and hunting is $25 billion.  Or about $10 billion a year less than the country spends on universities alone.  Total value of educational services is $86 billion a year.

And yet, here are a few things Statscan doesn’t know about education in Canada: the number of first-year students in Canada, the number of part-time instructors at Canadian universities, the number of part-time professors at universities, anything at all about college instructors, access rates to post-secondary education by ethnic background or family income, actual drop-out and completion rates in secondary or post-secondary education, the number of new entrants each year to post-secondary education, the rate at which students transfer between universities and colleges, or within universities and colleges, time-to-completion, rates of student loan default, scientific outputs of PSE institutions, average college tuition, absolutely anything at all about private for-profit trainers… do I need to go on?  You can all list your pet peeves here.

Even on topics they do know, they often know them badly, or slowly.  We know about egg hatchings from two months ago, but have no idea about college and university enrolment from fall 2013.  We have statistics on international students, but they do not line up cleanly with statistics from Immigration & Citizenship.  We get totals on student debt at graduation from the National Graduates Survey, but they are self-reports and are invariably published four years after the student graduates.

What does it say about Canada’s relationship to the knowledge economy, when it is official policy to survey Mushroom growers annually, but PSE graduates only every five years?  Who in their right mind thinks this is appropriate in this day and age?

Now, look, I get it: human capital statstics are more complicated than education statistics, and it takes more work, and you have to negotiate with provinces and institutions, and yadda yadda yadda.  Yes.  All true.  But it’s a matter of priorities.  If you actually thought human capital mattered, it would be measured, just as agriculture is.

The fact that this data gap exists is a governmental problem rather than one resulting from Stastcan, specifically.  The agency is hamstrung by its legislation (which mandates a substantial focus on agriculture) and its funding.  Nevertheless, the result is that we have a national statistical system that is perfectly geared to the Edwardian era, but one that is not fit for purpose when it comes to the modern knowledge economy.  Not even close.

October 09

Living the Lie in Research Universities

Take the following two thoughts/statements:

1.       “At our institution, research and teaching are inseparable, two sides of the same coin”

2.       “At our institution, if you are a good researcher, you get more money and you get teaching leave to do more research”

Both these statements can’t be true.  Which do you think is false?

Back in pre-89 Czechoslovakia, Vaclav Havel liked to tell a story about a shopkeeper who displayed a sign saying “workers of the world, unite!”.  The shopkeeper did not believe this slogan; rather, the shopkeeper displayed it because not to do so would be seen as disloyal.  Displaying the sign was a sign of submission to the regime, not a sign of support.  It was a lie in which the shopkeeper had to live in order to maintain his or her position in society.

“At our institutions, research and teaching are inseparable, two sides of the same coin”.

This is a lie.  It is a lie whose purpose, fundamentally, is to obscure actual work practices in universities and to obscure actual institutional priorities and the consequences of those priorities.

That’s not to say professors don’t care about teaching.  It’s not to say that they aren’t good at teaching (some are great, other less so).  It’s not to say that some institutions aren’t doing some truly stellar work on teaching and learning (give UBC some love here for its many initiatives in this area).  It’s not even to say that research and teaching can’t be informed by one another.  It’s just to note that universities do not even act as though the two acts are even remotely equal in importance or prestige.

We need to remember that systems – even ones that on the whole are relatively beneficial – usually require at least some lies in order to work.  And if we don’t want to be utterly controlled by those systems, it’s good once in awhile to remember Vaclav Havel, and stop living the lie.  Talk about the lie, and what it means and what it makes us do.  And think about how we might be able to do better by the undergraduates that pay everyone’s salaries if things were different.

October 08

Higher Education Data Glasnost

Many people complain that there is a lack of post-secondary data in Canada.  But this is actually not true.  There are tons of data about; it’s just that institutions won’t share or publish much of it.

Let me tell you a little story.  Once upon a time, there was a small, public-minded higher education research company that wanted to create the equivalent of Statistics Canada’s university tuition fee index for colleges.  The company had completed a project like this before, but had done so in a somewhat imprecise way because of the time and effort involved in getting enrollment data necessary to weight the program-level tuition data.  And so, politely, it began asking colleges for their enrolments by program.

Now, program-level enrolments are not a state secret.  We are talking about publicly-funded institutions here, and given the number of people who use these services, this is very much the definition of public information.  Nor are these data difficult to collect or display.  Institutions know exactly how many students are in each program, because it’s the basis on which they collect fees.

And yet, across most of the country, many institutions have simply refused to provide the data.  The reasons are a mix of the understandable and the indefensible.  Some probably don’t want to do it because it’s a disruptive task outside their workplan.  Others are cautious because they don’t quite know how the data will be used (or they disagree with how it will be used) and are afraid of internal repercussions if it turns out that the shared data ends up making their institution look bad (note: we’re using the data to publish provincial averages, not institutional ones; however, in single-institution provinces like Saskatchewan or Newfoundland and Labrador, this can’t be helped).  A few simply just don’t want to release the data because it’s theirs.

Regardless, it is unacceptable for public institutions to conceal basic operational data for reasons of convenience.  That’s not the way publicly-funded bodies are supposed to operate in a democracy.  And so, regretfully, we’ve had to resort to filing Access to Information (ATI) requests to find out how many students attend public college programs across Canada.  Sad, but true.

It then occurred to me how many of our national higher education data problems could be solved through Access to Information legislation.  Take Simona Chiose’s very good piece in the Globe and Mail last week in which she tried to piece together what Canadian universities are doing with sessional professors, and where many institutions simply refused to give her data.  If someone simply started hitting the universities with annual ATI requests on sessional lectures, and publishing the results, we’d have good data pretty quickly. Ditto for data on teaching loads.  All that excellent comparable data the U-15 collects every year?  You can’t ATI the U-15 because it’s a private entity, but it’s easy-peasy lemon squeezy to ATI all of the U-15 members for their correspondence with the Ottawa office, and get the data that way (or, conversely, ATI the U-15’s correspondence to each university, and get the collected data that way).

Oh, I could go on here.  Want better data on staff and students?  ATI the universities that have factbooks, but refuse to put them online (hello, McGill and UNB!).  Want better data on PhD graduate outcomes?  ATI every university’s commencement programs from last year’s graduation ceremonies, and presto, you’ve got a register of 3,000 or so PhDs, most of whom can be tracked on social media to create a statistical portrait of career paths (this would take a little bit of volunteer effort, but I can think of quite a few people who would provide it, so while not easy-peasy lemon squeezy, it wouldn’t be difficult-difficult lemon difficult, either).

It’s not a cure-all of course.  Even with all that ATI data, it would take time to process the data and put it into usable formats. Plus there’s an agency problem: who’s going to put all these requests together? Personally, I think student unions are the best place to do so, if not necessarily the best-equipped to subsequently handle the data.  And of course institutional data is only part of the equation.  Statistics Canada data has to improve significantly, too, in order to better look at student outcomes (a usable retention measure would be good, as would an annual PSIS-LAD-student aid database link to replace the now-terminally screwed National Graduates Survey).

To be clear, I’m not suggesting going hair-trigger on ATIs.  It’s important to always ask nicely for the data first; sometimes, institutions and governments can be very open and helpful.  But the basic issue is that data practices of post-secondary institutions in Canada have to change.  Secrecy in the name of protecting privacy is laudable; secrecy in the name of self-interested ass-covering is not.  We need some glasnost in higher education data in this country.  If it takes a wave of ATI requests to do it, so be it.   Eventually, once enough the results of these ATI requests filter into the public realm, institutions themselves will try to get ahead of the curve and become more transparent as a matter of course.

I’d like to think there was a simpler and less confrontational way of achieving data transparency, but I am starting to lose hope.

October 07

Party Platform Analysis: Science and Innovation

In the platform analyses I’ve done so far (for the Greens, the Conservatives, the NDP, and the Liberals), I’ve focused mostly on the stuff around student finance.  But in doing so, I’ve left out certain platform elements on science and innovation, specifically from the Liberals and the New Democrats.

There are some pretty broad similarities between the two parties’ programs, even though they package them somewhat differently.  Both are long on promises about process.  The Liberals will appoint a Chief Science Officer; the NDP will go one better, and appoint an Office of the Parliamentary Science Officer AND create a Scientific Advisory Council to the Prime Minister.  Both promise to “unmuzzle” scientists; both promise to bring back the long-form census (which I personally find irritating – shouldn’t we at least try to move into 21st century with an administrative register?).  Both promise to make government data “open”; additionally, the Liberals promise to ensure their policies are “evidence-based”.  The word “independence” shows up a lot: Liberals want to give it to Statscan, without actually specifying what the word means; the NDP want to restore it to the granting agencies, without specifying what the word means.  They also want to re-establish scientific capacity in government, but apparently aren’t allocating any money for it, so you know, take that with a grain of salt.

The differences, such as they are, are about where to spend the lucre.  The Liberals have set aside an extra $600 million over three years for an “Innovation Agenda”, which will “significantly expand support to incubators and accelerators, as well as the emerging national network for business innovation and cluster support”.  This, apparently, is meant to “create successful networks like the German and American partnerships between business government and university/college research”.

Genuinely, I have no idea what they are talking about.  Which German and American programs?  The Fraunhofer institute?  The Tories already did that when they converted NRC to an applied research shop.  As near as I can tell, this seems to be innovation-speak for “let’s give money to middle-men between academia and business”.  Which is not promising.  I mean, even assuming that early-stage commercialization is the real bottleneck in our innovation system (and where’s the evidence for that, evidence-based policy guys?), why is this the right way to go about fixing it?  Weren’t the Centres of Excellence for Commercialization and Research supposed to do the same thing, albeit from another angle?  Shouldn’t we – you know, wait for some evidence about what works and what doesn’t?

The Liberals also are promising another $100 million over three years to the Industrial Research Assistance Program, which would normally make me want to tear my eyes out, but apparently it’s all going into something that is meant to mimic the US Small Business Innovation and Research Program, which does tend to get high marks.  But, significantly, there is not an extra cent for educational institutions, and not an extra cent for the granting councils.

The New Democrats, on the other hand, are talking much smaller sums: $105 million over four years to “support researchers in post-secondary institutions”.  A helpful NDP staffer has clarified for me that this actually means money to the granting councils, which would make the NDP the only party to commit to more council funding.  That said, unless inflation dips below 1% (unlikely, but not impossible), that amount is not enough to cover inflation.

So, take your pick here.  On non-financial aspects of their policies, the two parties are essentially singing off the same sheet.  Financially, the Liberals have more money on the table, but none of it appears to be heading to institutions.  The NDP has a much smaller package, which will benefit researchers via the granting councils, but not by a whole lot.

Back next Friday with a final summary of the election and higher education.

October 06

Party Platform Analysis: The Liberals

Two quick things at the outset.  First, this will only look at the Liberal’s Monday announcement on student financing.  Tomorrow, I’ll look at their science/innovation policy in conjunction with that of the NDP, which apparently released a similar platform in conditions of complete secrecy last week.  Second, in the interest of full disclosure: I was asked by the Liberals to comment on a draft of their platform a few weeks ago.  I did so, as I would have for any party had they asked.  Judging by what I see in their platform, they took at least some of my comments into account.  So bear that in mind when reading this analysis.

The main plank of the Liberal announcement is that they are planning to increase grants for low income students by $750 million, rising to $900 million by the end of the mandate (which more than doubles the total amount; however,it’s not clear if this increase includes alternative compensation to Quebec… if it does not, add another $200 million).  The Canada Student Grant for Students from Low-Income Families (CSG-LI) will rise in value from $2,000/year to $3,000/year, and the Canada Student Grant for Students from Middle-Income Families (CSG-MI) will rise in value from $800 to $1,800.  The thresholds for both will be increased, meaning more students will receive the low-income grant, and more students with incomes in the $80-100K family income range (precise values not set, but this looks like about what they are going to do) will receive the middle-income grant.  In addition, the Liberals propose raising the repayment threshold (i.e. the level below which borrowers in repayment are not required to make payments on their loans) from just over $20,000 to $25,000.  It’s unclear what this would cost (take-up rate is uncertain), but a good bet would be somewhere in the neighborhood of $100 million.

So, a $1 billion promise.  Except the Liberals are promising that this will all cost the taxpayer… nothing.  And the reason for that is that the Liberals have decided they will axe the education amount and textbook tax credits (something I, and, others have been suggesting for many years – for instance here).  Now, I actually don’t think this will quite cover the entire spending bill, but it will be within $100 million, or so (basically, it will cover the grants, but not the loan threshold change).

However, what this means is that the plan creates winners and losers.  The value of those federal tax credits for full-time students is $558/year (for part-time students it is $168).  Everybody will lose that amount.  For those who currently receive the CSG-LI, and those who receive CSG-MI and remain in the CSG-MI bracket after the thresholds move, the extra $1,000/year the Liberals are offering means they will be better off by $442 (but they will also benefit by getting the entirety of their $1,000 sooner in the form of grants, rather than delayed in the form of tax relief).  For those in the CSG-MI moving into the CSG-LI category, the net benefit will be $1,642.  For those who currently do not receive grants, but will now become eligible for CSG-MI, the net benefit will be $1,242.

So there are winners.  But there are losers, too.  Families with incomes over $100,000 (or so) will simply be out that $558.  And part-time students, who are ineligible to receive CSGs, will also be out $168.  But this is what happens when you try to do big policy without spending (many) additional dollars.  And there’s always the risk that they will come under political fire for “raising taxes”, which is arguably what cutting tax credits amounts to.

So, full marks for creativity here: these policies would make the funding system somewhat more progressive (in a slightly quirky way).  And full marks for putting out a backgrounder that makes it clear that these moves will create costs for provinces (their co-operation will be needed in order to raise the loan threshold) that need to be mitigated, even though the Liberals are vague on how this will actually work.

But it should be noted that by their own claim (which, as I said above, is probably not quite true), Liberals are choosing not to invest another dime in the sector, which puts them last among political parties in new spending commitments.  As pleasing as the re-arrangement of inefficient subsidies is, wouldn’t it have been better if they had added some funds on top of it?

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