This was an incidental argument over a sealing order for two documents representing an exchange between the Ministry of Colleges and Universities and the University. However, it draws more attention to the astonishing insolvency of a Canadian University. (Laurentian University has protection under the Companies’ Creditors Arrangement Act .)
Over the past year, there has been some news about the impact on universities of being closed off from foreign students. In July 2020, there was news about UK universities: Coronavirus: 13 UK universities ‘could go bust without bailout’.
The BBC report at the time explained the factors creating the financial pressure:
- “fewer international student enrolments
- less income from student accommodation, conferences and catering
- losses on long-term investments
“In addition, universities which are running pension scheme deficits will see them widen during the pandemic as investments stagnate.”
The study analysis, interestingly speculated that larger universities would be better able to withstand the pressure than smaller ones.
“Universities with many international students which also have substantial pension obligations are often also higher-ranking institutions, with “large financial buffers” and the option of alleviating losses by admitting more UK-based students.”
“But this behaviour could harm less selective universities, which could see their potential students recruited by higher-ranking institutions.”
As the year progresses, we may see more insolvencies of public institutions. Even those that are not insolvent, maybe rely on greater support from provincial governments. If so, we would have an implicit further drain on government finances not, perhaps, immediately evident in budget deficits.