Students' Union, UCalgary

Your Students' Union has been taking your experiences to the experts. In May, we participated in a student consultation session with the Expert Panel on Post-Secondary Institution Funding and Alberta’s Competitiveness. Chaired by the University of Calgary's own Dr. Jack Mintz, this panel was convened by the Government of Alberta (GoA) to review how our institutions are funded and their ability to compete globally.

Your SU was one of only two independent students' associations to attend this session, allowing us to spotlight problems faced by UCalgary undergraduates. Joining us were our colleagues at the Graduate Students' Association, as well as representatives from ASEC and CAUS. Discussions ranged from the consequences of Alberta's debt-based student loan system to the realities of the post-graduation labour market.

We followed up with the Panel in June to provide more detail in the form of a written submission, clocking in at nearly 100 pages. This post provides the highlights, and you can read the full submission here.

Of the guaranteed funding that Albertan public post-secondaries receive from the GoA every year, the biggest investment is known as the base operating grant. These grants have been cut since 2019, leading to frequent tuition hikes. The University of Calgary's base grant for the 2023-24 fiscal year was 20% less than it was in 2018-19. The table to the right shows how your dollars have come to essentially bridge the gap.

Why were budget cuts made in the first place?

In 2019, the GoA tasked a team of experts to balance its books. The Blue Ribbon Panel on Alberta's Finances, aided by research from consultancy KPMG, concluded that the GoA was overspending per student compared to similar provinces. It recommended that students should pay more tuition, and that institutions should find more alternative revenue sources to reduce their reliance on provincial funds.

However, the methodology KPMG used to create advice for the Blue Ribbon Panel gets a failing grade from us. One example is the method KPMG used to conclude that the GoA spent $36,510 per student, up to $15,000 more than similar provinces, in the 2018-19 academic year. KPMG conceded to using "estimating assumptions" to make this finding, because the budgetary information it would need to calculate this figure was "limited" or—most eyebrow-raisingly—"did not exist." (In 2022, the Ministry of Advanced Education walked back KPMG's figures, stating that Alberta had spent $13,967 per student in 2018-19.)

KPMG also did not account for the fact that provinces like Quebec and Ontario receive between two and four times as many students as Alberta, meaning that Alberta's institutions may well require comparatively more provincial funding due to economies of scale. Put simply, tuition from 400 students will more comfortably cover an instructor's salary than tuition from 100 students.

Our conclusion

The GoA can have a world-class higher education system that costs more to fund but produces skilled workers who aren't impeded by debt, or it can have a system that prioritizes short-term savings at the expense of Alberta's future skills base. The unfortunate reality is that it cannot have both.

The average cost of an Albertan undergraduate education rose 32% between the academic years of 2018-19 and 2024-25. Undergraduates now pay more than the national average and take on more debt: the volume of students borrowing from Alberta Student Aid has climbed by 47% since 2019.

Research suggests that prospective students will approach this situation strategically. Tuition hikes can deter enrolment, particularly among students from low-income backgrounds, but they may still be willing to take on debt if they believe their chosen institution will lead to a strong return on investment. If they don't think that an institution is value for money, they look for affordability over prestige.

This is bad news for Alberta, as it seems that a rising share of students don't think an Albertan education is either value for money or affordable. The enrolment rate of young Albertans has declined since 2019, potentially accelerating a decades-long trend of Alberta losing more students to other provinces than it gains.

For those who do choose Alberta, they'll graduate owing more than the national average, leading 1 in 5 to work outside their field of study in order to repay. Not only does this deprive the economy of the very skills they took loans to acquire, but 66% of Albertans will cut their non-essential spending, to the detriment of local commerce. Indebted graduates are also more at risk of depression or substance abuse. While many parents want to help, they have their own obligations: Canadian households are the most indebted in the G7.

Our conclusion

Without renewed investment, Alberta will keep losing talent to other provinces as they decide to pursue an education they believe is worth the price tag. The GoA spends millions on K-12 education and more to accommodate young Albertans as they grow up; funding its post-secondaries to retain these students will save Alberta a lot more money than it currently saves by cutting the budgets of colleges and universities.

Since 2022, Alberta's post-secondaries have had some of their lost funding returned to them via Targeted Enrolment Expansion. Under this initiative, the GoA pays to create more seats in "high demand programs" to support "key economic sectors." Targeted funds can only be spent on a chosen program's expenses.

The problem with this approach is that predicting future labour market needs is not an exact science, so restricting how post-secondaries can spend their funds can limit their ability to truly meet changing trends. Targeted enrolment expansion also can't be spent on important student supports, like advisors.

UCalgary is already seeing the results of restricted funds: most of the investments it received were for STEM or health programs, while other Faculties missed out. The Faculty of Arts, having lost 25% of its budget in recent years, has cut crucial support staff and increased instructor workloads. A 2024 review of the Faculty of Kinesiology described some of its facilities as "held together by love and duct tape." Overall, the University would need nearly $1 billion to clear its outstanding maintenance needs.

Our conclusion

Restricted funding prevents post-secondaries from providing well-rounded programming. It also undermines their ability to foster innovation wherever it occurs, as they are instead incentivized to focus on narrow fields at the expense of programs deemed less economically ‘desirable.’ As we can't know where the next breakthrough will come from, Alberta's post-secondaries should be funded according to institutional need rather than predicted market gaps.

While students are the most directly affected by post-secondary budget cuts, the money the province saves may come at the future's expense, as education is one of the most reliable investments a government can make. In Canada, universities conduct 35% all of research and development nationally. Of the 875 startups that spun out of universities in 2022, the University of Calgary produced the most for the third year running.

Furthermore, a 2021 economic impact report assessed that the University of Calgary contributes $16.5 billion to Alberta annually. That's equivalent to nearly 15% of Calgary's GDP, and doesn't include the activity of UofC graduates. In general, post-secondary graduates pay the most income tax and need less social assistance, saving Canada money in the long run.

Our conclusion

An investment in our post-secondaries isn't just an investment in our students. It's a safe investment in the province's economy, and critical for its diversification.