Throne Speech Pledge Could Signal Tuition Hikes

Two sentences in last week's throne speech may signal major changes ahead for the province's colleges and universities.

"Legislation will be introduced enabling our universities to remove themselves from the government reporting entity," said the speech, delivered by Lieutenant Governor Steven Point on behalf of the government. "We cannot let accounting policy stand in the way of our students' interests or hold our universities back from pursuing their unique areas of excellence in partnership with others."

What sounds like an innocuous accounting change has some observers wondering if the government is getting ready to reduce financial transparency at the public institutions or if it is changing how it views its relationship with the schools.

Asked for an explanation, Advanced Education Minister Moira Stilwell said, "The government reporting entity is the consolidated government books. In some jurisdictions, universities are in the entity and some are not. So we review every year which entities should be in and should be out.

"The post-secondary institutions have asked to be excluded and, as we said in the throne speech, we'll be passing legislation that will allow some of them to do that," she said.

Deregulation concern

The chairperson of the B.C. branch of the Canadian Federation of Students, Shamus Reid, said he has questions about the direction that are as yet unanswered. "That's something we're trying to figure out, exactly what it will mean."

The lines from the speech did catch his organization's attention, he said, adding they wonder how it may affect tuition fees. "Any time the government is talking about reducing oversight we're concerned about things like deregulation," he said.

He said he hopes the government isn't planning to allow schools to hide financial or other information. "I don't think so, but we want to make absolutely certain it's not going to limit that kind of information from the public eye."

New Democratic Party advanced education critic Dawn Black, the MLA for New Westminster, said she understood universities were looking for the change as it would give them greater latitude to manage their own affairs.

She'd heard concerns from student groups about the possibility it might become harder to get certain information from the schools, she said, noting that tuition fees have risen to the point that the province now collects more revenue from students than it does from corporate taxes.

"We have to wait and see what the legislation provides," she said.

Not intending to hide

Advanced Education Minister Stilwell said many of the details are still being worked out.

Will institutions remain covered under the Financial Information Act and other legislation that requires financial reporting? "I would assume the answer is 'yes,'" said Stilwell. "As we lay out the legislation that will be defined in the legislation."

It will still be clear how much money the government is putting into the sector, she said. But when asked if things like salaries would still be publicly reported, she said, "At this point I would say we're looking at the options."

As with other public bodies, all university and college salaries over $75,000 are now publicly reported.

And when asked if a lot of information about the schools is going to become secret, she said, "That's certainly not the intent at all."

All about accountability

Whether post-secondary institutions should be included in the government reporting entity has been a matter of discussion for some time in the province, said the CEO of the Institute of Chartered Accountants of B.C., Richard Rees.

The discussion goes back to 2001 changes to the Budget Transparency and Accountability Act that required public bodies to follow Generally Accepted Accounting Principles. Under those principles, in the private sector, a parent company has to include any subsidiary's financial information with its own. In the public sector, that means if the government controls an entity it would be included in the government's consolidated books.

"The government should be accountable for everything it controls," said Rees, explaining the principle. In the case of colleges and universities, the government provides a large part of their funding, but also regulates what they can charge for tuition fees.

Under the University Act, the government also appoints the majority of members to the board of governors at each institution.

"It gets to be a little difficult to argue that you don't control it," he said. "The reality is the government has fairly significant control over the capacity of post-secondary institutions to function."

Some university presidents had concerns that being included in the government reporting entity could infringe on their institutions' academic freedom, he said. However, he added, the government would likely want to keep some control "when you're paying all the bills and it's a bit of a political hot potato."

The issue may become hotter depending how it develops, he said. "If it ends up leading to a policy change in relation to tuition fees, that's a hugely political issue."