The Agenda with Steve Paikin (Audio) - Post Secondary Blues

Episode Date: October 29, 2024

These are difficult times to be a student at one of Ontario's colleges or universities. The provincial government is contributing less, it's frozen tuition for more than six years, and the federal government has cut way back on international student visas, depriving the system of hundreds of millions of dollars it was counting on to keep the lights on. If you've got a kid in post-secondary or are a student there yourself, what are the implications of this perfect storm? David Agnew, who's been president of Seneca Polytechnic since 2009, joins Steve Paikin to discuss. See omnystudio.com/listener for privacy information.

These are difficult times to be a student at one of Ontario's colleges or universities. The provincial government is contributing less and less to the post-secondary system's bottom line. Plus, it's frozen tuition for more than six years. And of course, the federal government has cut way back on international student visas, depriving the system of hundreds of millions of dollars it was counting on to keep the lights on. If you've got a kid in post-secondary or are a student there yourself, what are the implications of this perfect storm? Let's ask. David Agnew, who's been president of Seneca Polytechnic since 2009.

And David, we thank you for coming in today. My pleasure. It's good to see you again. Let's just, for those who don't know as much as they should about your post-secondary institution, Sheldon, bring the graphic up if you will and we'll do some history here. Here's the 411 on Seneca. It was established in 1966. They have campuses in Northeast Toronto, two in Northwest Toronto, Downtown Toronto, and then north of the city in King City, Markham, and then east of the city in Peterborough.

There are 30,000 full-time students and 60,000 annual part-time students with a budget of around $600 million a year. Now, as we say, you've been the head of Seneca for 15 years. Compare what the challenges are like today as to when you started 15 years ago. Well, a couple of things. One is that I joke that the day I joined Seneca back in 2009 was the day that the provincial government stopped giving us funding increases.

So until last fall, we went for 15 years without a general increase in our operating grant. Then about six years ago ago the provincial government decided to not just freeze but to cut and then freeze tuition and so that's been going on for the last few years and promised to go for three more years. So financial issues have been a big big challenge. Now what's happened and this is pretty much public record of course the relief valve for all of us has been international students.

And so that was kind of, I mean, what has happened now is the perfect storm. For us, in many ways, it was kind of the perfect solution. Demographically, we weren't growing more students in Ontario, so the demographics were tough, the funding was tough, but we had international students. And that could help us, in fact, not just help us survive, but cross-subsidize those domestic students.

I mean, we lose money teaching domestic students. And that's a terrible thing to say. Say that again. You lose money teaching students who are made in Ontario. Absolutely. Because the funding formula and the tuition freeze have combined to make it basically uneconomical. So you were depending on those foreign students

in order to keep the lights on? 100%. I can only tell the Seneca story. There were lots of behaviors in the system, and some of them attracted a lot of attention, and some of them weren't so good. And so inevitably that led to a kind of a reaction as every action does and we're in the pickle that we're in right now because

the federal government came in frankly with a bit of a sledgehammer on international students. Did you know that was coming down the pike? We didn't know in precise terms but there had been the the messaging moved very quickly from we've got to do something to, we're going to do something and it's going to be big. So honestly, this issue, again, Steve, you know me, I'll be very blunt. It got very political very fast.

And that's, I think, what has been is the story of the last, so to say, year or so. Just so I understand that, when you say it got political, you mean the federal government perceived that it had a political problem as it related to foreigners coming here and therefore they put the brakes on? Your words are perfect. So I think they saw that there was this kind of conflating of international students, temporary foreign workers, housing costs, rising cost of living.

We better deal with the... and listen, I mean look at the numbers. The federal government had approved a whole bunch of study permits and a whole bunch of temporary foreign workers. I mean the curve really went up. I like to remind people we don't approve study permits, the federal government did, and they did so in great, great numbers. So the pendulum swung. And the pendulum swung way over. And of course, we didn't have just a cap.

We had a cut and a cap. And then just recently, more cut to that cap. In the meantime, and this is we can get into this, because this is our challenge. And this isn't our Seneca challenge. And this isn't just the post-secondary challenge, this is the Canada challenge, because the announcement that started on January 22nd with the cut and cap then was succeeded by a whole bunch of different announcements about postgraduate work permits, you know, spousals,

graduate programs, yes, noouse has to have a letter, all sorts of confusing messages to the point now where in the 150 countries where we recruit students there's quite a bit of confusion about what Canada wants in international students. We are going to pursue that, but obviously one of the things that I've been hearing

over and over is that if this situation persists colleges and universities are either going to have to close campuses or some may even close down entirely. What has been the Seneca experience in terms of whether you've had to close campuses? We've temporarily closed our Markham campus, so that's our campus up at Highway 7 and 404. It was our Seneca International Academy. We had 5,000 international students there,

taking a whole bunch of programs. Again, we're very proud of the diversity of our international student population. We have made that a, well frankly since I arrived, we've made that a mainstay of our international strategy. But we've just watched as interest in Canada dries up, our applications are way down. As others have have remarked, we are going to way over achieve on the federal cut to international student numbers collectively because there's so little interest and so much confusion out there about what Canada wants. The message out there is that we really don't want you to stay.

So what happens to the 5,000 students and presumably there is that we really don't want you to stay. So what happens to the 5,000 students and presumably the staff that we're teaching those 5,000 students, what happens to them? Well, so there are fewer than 5,000 so what we've done starting in January is we've moved those students and those programs back to a couple of other, you know, bigger campuses that are still thriving and so the students actually it's, I mean, this was as much done, I mean, obviously it's going to be done for operational efficiencies, but it's also being done for the student experience.

It's better to be at a thriving campus with lots of services and lots of other students. So we're happy about that because we think that the student experience will be great. But yeah, I mean, this is, again, I mean, I don't mind personalizing this in terms of Seneca, but this is the story that's happening in post-secondary across Ontario, across Canada, is that we are going to have fewer students. That is a challenge. You've seen this. Some institutions have already started to suspend programs.

If you suspend programs, you don't need as many teachers. If your population is dropping, you're not putting as much money into the local economy, all those kinds of impacts. There will be those who will say, and some of them may be in the provincial government, we're just right-sizing a system that was too big. It's not a bad thing, they will argue, if campuses close or if we actually lose a university or college or two along the way. What do you say to that? You know, that's an interesting perspective.

You know, I would argue that it's always a challenge to lose an institution or two. You know, politically I would suspect that the provincial government wouldn't actually be in favour of that because the ones are going to go or they're going to be in smaller communities. It's not going to be in Toronto that that happens. It's going to be in Nipissing. It's going to be in places where there's good advocates around the cabinet and caucus table and I suspect that that's going to be a very hard decision.

Look, other provinces have gone down these routes. I mean, you know, there's one college in Newfoundland, New Brunswick, Nova Scotia, these are big amalgamations. Those conversations have happened from time to time, but there's just no political appetite for it. I think, have we grown too much? Well, we are the least well-funded provincial post-secondary education system in the country.

Have been for 40 years, I have to add. Have been for a long time. We've been lucky because international students want to come to Toronto. They want to come to Ontario, but they really want to come to the GTA, so we've been able to mask that underfunding. But now that that's challenged by what the federal government has done and we don't have you know just to be very blunt we don't necessarily have two governments that are working terribly well together on this issue. I mean the

federal government can say immigration's ours and we're not post-secondary. Province can say post-secondary is our immigration but you know what they're joined at the hip. Well okay let me follow up on that angle because certainly when the Ford government first came in in 2018 they announced with a great deal of fanfare and they assumed it would be a very well-received policy idea to say we're going to cut tuition and freeze it and you know you students who want to go to post secondary this is great news for you.

Similarly, the federal government thought we've got an immigration problem we better do something about that and they have done what they have done. Do you think it's possible that both levels of government didn't really appreciate the bigger picture here because they were so focused on the sort of more narrowly focused political problem they each had. I mean, you've been around politics as long as I have. You know, the short-termism is not helpful in something like education and immigration.

Because you build your, if I can put it in marketing terms, you build your brand over years, and you can lose it overnight. And that's what's happened to Canada. And it's because we've got this short-termism, which you could also say is a very political lens. And I will say, at the risk of attracting some criticism from some quarters, that at the same time

that the government cut and froze tuition, it also took a fair amount of money out of the Ontario Student Aid Program and changed some of the grants to loans. So it wasn't entirely a clear win for students in all cases. So, yeah, but we don't we're not connecting those dots and really part of I guess part of what I come away from our current perfect storm is

can we ever get to the point where we sit down the provinces, the employers, the schools and the communities because the communities are very much affected by this. That's part of the story here is that communities felt overwhelmed in some cases by the number of international students and the number of temporary foreign workers. Could we ever come together and really say okay so let's be intentional about this rather than reactive? How does that happen? If that's what's needed, how does that happen? Well, I think it takes some political leadership and courage. Do you see that on the horizon?

I think we're in a challenging time because of the elections on both levels on the horizon. Canada has, and I should ask you whether it still has, Canada has had an image out there that we are a fairly welcoming place to people who want to come from all over the world and study here and either take that learning that they've had here and go back home and spread the good word there or stay here and, you know, make a life for themselves here. Do you think that brand is in danger because of what's going on right now? I think it's more than in danger.

I think it has been badly, badly bruised, if not broken. And this is not hyperbole. We have recruiters who are reporting from Asia that education fairs aimed at Canadian institutions are being canceled because there's lack of interest. aimed at Canadian institutions are being canceled because there's lack of interest. Just I mean the now one major market for us of course has been India for the country.

The partly because of what's happening with Canada-India relations, but partly also because of what what IRCC has announced. Very very bad press in in about press about Canada. I mean, you know, we have to, until very recently, there was actually a marketing campaign from the federal government, not from institutions, from the federal government, saying study, explore, work, stay. I mean, very explicit.

You know, come here to study. Get your three-year postgraduate work permit. Earn your points toward permanent residency. And know Bob's your uncle you'll become part of the Canadian. Somehow we're getting a different message out there and and whether it's the intended message or not that's the way and don't forget I mean other countries unlike Canada apparently has a very explicit strategy of being an international education hub like and surprising countries. Germany, Finland, South Korea wants to be an international hub.

China wants to be a receiving country, not a sending country. Malaysia, Singapore, all these places, India's just now opened up to having international campuses open up. So everybody, millions of students will be traveling and studying elsewhere. We are shutting ourselves out of that market if we don't smarten up. Never mind our brand, what about the loss of money?

Do you have a guess at how much money we're losing by not being as welcoming as we once were? We'll see where it ends up. I mean, we've seen a big, big hit across, across again these are public figures now and reported the media I mean you know upwards of 40-50 percent drop in in September enrollments. I mean some of this is you know if people here for two years they're still here for the second year so the real cliff is gonna come next year if we don't sort of get our house in order. Let's take a look at the province for a second.

I think it's fair to say that when you and I went to university a few years ago, the province of Ontario had the sort of the biggest chunk of subsidy of our tuition. What is it today? Well, last year, last fiscal year for us, the share of our revenues that came from the provincial government was 16.7%. 16.7%. Yes. Wow.

Now, of course, because we had a huge chunk of international tuition. I mean, that's the truth. But that was what was, is helping cross-subsidize our domestic programs. And that's when you saw there was an institution that suspended 29 programs. And very explicitly, they said, the problem is that not just we're losing the international students, we're losing the cross-subsidy from international students for

these programs. So even students, even these programs with mostly domestic students, were relying on that flow of money. But again, back in our day, the province had a... When the province told you to do something, you did it, and the explanation was, because he who pays the piper calls the tune. They're not paying the piper anymore.

Why do they still get to call the tune? Well, they're the government. We're not. We're also, you know, the college system, or as I would say now, the polyic and college system, we're crown agencies. Universities have separate acts. We actually are crown agencies. So that's a pretty direct line to government policy. Do you have any idea how much money Seneca has foregone because of the tuition freeze over the past six and a half years? Oh, I actually I don't know that number. It would be

millions and millions of dollars. Millions of dollars. Yeah, I mean we were we were getting, you know, sort of permission to raise tuition by about three percent a year. So, you know, in percentage terms, I know that, you know, the amount of the operating grant until we got 3% this year and 2 and 2 for, but that's after 15 years freeze, the loss in terms of cost of living on that money was about 35%. So what can't you do now that you kind of had hoped to do on the assumption that those millions were going to be in your coffer and you could spend them?

Well we postponed a major, major capital project to preserve our cash. We have looked at several other smaller capital projects that we're going to put on hold or slow down. We're slowing down some of our initiatives because we can't afford to put the resources against them. And ultimately we have to look at, frankly everyone does, and this if things don't change we're gonna have to look at new ways of doing business, new business models. We'll be looking as hard as we can for things like contract training.

Again you know we have to go back 18 years. We're not making any more you know students right now. We just we know what those demographics dictate and. And frankly it's Hunger Games trying to recruit those domestic students to our campuses. Again, we used to have the relief valve international, that's not going to happen. So we're not going to start making cars. We have to think about what we do with the intellectual property that we have, our curriculum and so on. And obviously what we can do is teach. And what we can do is look for new markets for our teaching abilities in our curriculum and so on. And obviously what we can do is teach, and what we can do is look for new markets for our teaching abilities in our curriculum. Can you have as many teachers, professors,

instructors as you used to have? If you guys haven't got the money coming in, do I assume you have to fire instructors and professors to keep up? I mean, there's a direct correlation between the number of students you have and the number of staff that you have. There's just no question about that.

So if the number of students continues to fall because we're losing international students, there's obviously going to be an impact on employment. Here's one of my get comfortable. I got a big setup here on this question. I met the new minister of colleges and universities at an event that we were both at in Cornwall, I guess it was about three or four weeks ago. minister of colleges and universities at an event that we were both at in Cornwall, I guess it was about three or four weeks ago. And he was a very pleasant guy, very charming guy.

I'm not sure he's 40 years old yet. He's a very young guy. He approached me and he said, I'd love to be on your show and tell everybody about all the great things we're doing on colleges and universities. And I said, terrific. I'll email your office and we'll make that happen. I emailed his office. I was hoping he'd come on with you here today, actually.

I got an email back from his office saying the minister is unavailable. I said, well, can we find another time where the minister might be available? And I believe the kids say, I got ghosted. That was the end of that. That was the end of the conversation. To be clear, I don't have any doubt that he wanted to come on.

I think probably what happened was somebody in the Premier's office said, this is not our thing. This is not our brand. We don't want our people out there talking about this stuff. And so, sorry, but it's not on. You're finding yourself in the same situation. And so, sorry, but it's not on. You're finding yourself in the same situation. How do we hold these decision makers to account on decisions

which you've clearly put through your lens and concluded they're ultimately hurting the system? Yeah, I mean, I guess we're in a time when we tend to be more reactive than anticipatory. So, you know, I would sort of watch this space. I think over the next few months slash year, you are going to see a number of very troubling announcements out of post-secondary institutions. And I think it'll have to be, sadly, sadly, it'll have to be that kind of mounting pressure. Troubling meaning what?

Well troubling meaning people have to suspend programs. People like us have to temporarily close campuses. People will have to move into layoffs. You know, you've probably seen the numbers from universities, they've been very public about it. They are, a number of big leading universities in Ontario are projecting very big leading deficits this year. And so you can only run on those for so long. You know, you dip into your cash reserves, some of us have been saving for either any day

and the tsunami has arrived. So, but that only lasts for so long. Again, you have to look at your fundamental cost base and you have to make adjustments and at some point you have to make the decision, can we continue to do this? And I'm not saying at all that Seneca is in that situation, but there are many smaller institutions that are going to be very challenged over the next year. We don't have to name names, but we should put numbers on the table here. There are 24 colleges, 23 universities.

How many do you think are in trouble? Well, I mean the COU, the Council of Ontario Universities, was reporting before we realized how bad the damage was, the Canadian brand, that more than half of universities are going to be in deficit this year. I suspect at least half of the colleges will be in deficit this year. The ones that aren't are because, again, those returning international students,

but they have a limited time left with us. And as soon as they leave, and if you can't replace them, then you fall off the fiscal cliff. I have one question left, and that is, how do I put this? OK, Premier Doug Ford famously went to, I think it was Humber, for I think less than a year and then dropped out. The post-secondary experience is not for everyone

and Mr. Ford, I guess at the time, decided that it wasn't for him. And he's done very well without a post-secondary education. He's a successful businessman, he's now the premier of the province, the second best job in politics in the country. Do you think that personal experience for him in the post-secondary world has led him to become

inordinately antagonistic to your sector? Well, A, I have no idea. I'm not in the premier's head. B, I don't find him antagonistic towards the sector at all. I mean, we've got some good things out of the Ford government. I mean, we were allowed to offer our own nursing degrees, as opposed to having to be in a collaboration with universities. We have now three-year degrees, which, ironically,

were going to be very, very popular in the international market to bring students here for a couple of years. which ironically were going to be very, very popular in the international market to bring students here for a couple of years. We in the college slash polytechnic sector can now do master's degrees. And we have our very first masters, we have our application coming in for a master's in artificial intelligence. So we're in some ways, we you know we've got some really good things going but financially this is something you can't escape and at some

point I mean you know the chickens are here they've they've roosted and we're gonna have to deal with the consequences very very soon. That's the conversation that we need to have. David Egna we thank you for having some of that conversation here on TVO tonight much appreciated. Thanks very much great to see you.