Laurentian University of Ontario declares insolvency, cuts hundreds of jobs and dozens of programs
The management of Laurentian University, which serves Northern Ontario as a post-secondary hub, filed for creditor protection in February and has spent the past three months forcing savage cuts on faculty and staff. establishment staff. The use of insolvency proceedings for the first time at a Canadian post-secondary institution has received the green light from the far-right Conservative government in Ontario and broad sections of the ruling elite. They see it as a precedent for a broader attack on education workers and seek to reorganize the post-secondary sector to better meet the needs of big business.
A quarter of full professors – around 110 professors – were unceremoniously fired last month, without notice during a Zoom call with the school administration. Dozens of contract positions have also been cut, mostly due to Laurentian ending the federated status of three small regional universities: Huntington University, Thorneloe University and the University of Sudbury.
The cuts are particularly devastating in a region that has no other major post-secondary institution. Additionally, Laurentian was one of the few predominantly English-speaking Ontario institutions that allowed students to study in French, an option that has now been significantly curtailed with the elimination of key programs like the French language and cultural studies.
Fifty-eight undergraduate programs and 11 graduate programs were eliminated entirely, representing about one-third of the Northern University’s course offerings. Programs that have been scrapped include undergraduate degrees in Anthropology, Environmental Sciences, Geography, Italian, Mathematics, Modern Languages, Music, Philosophy, Physics, Political Science, and Spanish. .
It also seems likely that Laurentian’s Native Studies program, one of the oldest in Canada, will cease to exist.
The savage destruction of much of the university’s academic course offerings, combined with the termination of a substantial section of full professors, was the desired and intended policy pursued by the administration. .
Like other Ontario universities, Laurentian faced increasing financial pressures due to years of government underfunding and cuts that the provincial government led by Doug Ford implemented soon after taking office. in 2018. These pressures were exacerbated by the pandemic and Laurentian’s inability as the smaller institution in the north to recruit large numbers of international students and develop lucrative business partnerships.
Having said that, Laurentian President Robert Haché, with the tacit backing of Ford and perhaps the big banks, fabricated a financial crisis and then presented his decision to seek protection under the Arrangement Act. creditors of companies (CCAA) as a fait accompli. The CCAA, aimed at private companies, allowed Haché and his fellow university directors to draft their plan for decimation of the university behind closed doors, without intervention from staff or students and in flagrant violation of all collective agreements with the faculty and staff.
After harshly sacking a quarter of the permanent workforce, management then intimidated the terrified and demoralized remaining faculty into accepting sweeping concessions in new collective agreements that were smashed within hours. With the proverbial pistol held to its head, the faculty voted for a 5% pay cut from May 1, followed by a two-year pay freeze. The laid-off professors have been told they should apply for severance pay as part of the CCAA process. In other words, they will have the chance to receive a dime in severance pay once the very profitable banks receive their pound of flesh with additional interest.
In the self-serving account presented by management, Laurentian owed $ 91 million on three different unsecured lines of credit with RBC ($ 71.1 million), TD Canada Trust ($ 18.5 million) and Bank of Montreal ($ 1.3 million). At a time when the RBC line of credit was not being used, Laurentian opened an additional line of credit of $ 14.4 million with Desjardins, according to court documents. This was refunded in full last fall upon receipt of tuition fees. For reasons that remain unclear, RBC and Desjardins canceled their lines of credit at the institution last summer. Laurentian has conducted its financial operations by managing its operating budget and its earmarked funds (those for research grants, etc.) from a single bank account, which further complicates the accounting.
Even industry experts have pointed out the questionable nature of financial transactions at Laurentian. Alex Usher, president of the consulting firm of Toronto Higher Education Strategy Associates, said, “Did the bank actually take the line of credit out?” Usher writes. “If so, why? Or did the president of Laurentian University really choose to forgo the line of credit to cause a crisis (the cautious wording of [President] Haché’s affidavit is ambiguous on this point). If there were non-CCAA alternatives that could have been taken and were not, it is probably unforgivable.
Management has long sought to significantly reduce costs at the university. Laurentian court documents for the CCAA proceeding bitterly complained that it costs on average $ 2,000 more than the provincial average to educate Laurentian students. The teachers’ association was also known for its activism.
The underhanded and ruthless actions taken by the university management have had the blessing of the provincial Conservative government. The province could have easily transferred the money to avoid bankruptcy proceedings, if only to recover it at a later date from provincial grants. Laurentian, however, is the proverbial canary of the coal mine.
Large corporations are determined to restructure post-secondary education, both to tie it more closely to the needs of its labor market and to develop new sources of profit through the corporatization and privatization of education. By allowing Laurentian to brutally restructure its operations at the expense of staff and students, the political establishment has sent the message that a wave of cost cuts and layoffs is looming across the industry.
When it comes to market apostles, the Enlightenment ideals of the value of comprehensive education and educated citizenship are hurdles to be overcome. They also want to move forward to change the way universities are funded.
The decades immediately following World War II saw a significant expansion of Canadian universities and, in the 1960s, of community colleges. This was linked to the post-war boom and the needs of industry and the expanding welfare state for a more highly skilled and technically trained workforce, as well as concerns within the political elite – as noted in the 1951 report of the Royal Commission on National Development. in the arts, letters and sciences (commonly known as the Massey Commission) – on the promotion of a Canadian identity as a bulwark of the capitalist regime.
Initially, the federal government played a leading role in providing operating grants to universities, and during the 1960s the provinces increased their per capita aid to students by over 85%. Objectively, it was based on the post-war boom.
At its end in the 1970s, major changes were made to the funding of universities. Ottawa has largely withdrew from direct funding, with the exception of research funding and Canada Student Loans, and has instead provided the provinces with transfers to help fund post-secondary education in the form of transfers in Canada. cash and tax credits.
These transfers were consolidated with health transfers to the provinces by the Liberal Chrétien government in the mid-1990s, with cuts totaling billions of dollars. The provinces then imposed sweeping cuts in their funding for post-secondary institutions and allowed tuition fees to rise 7 to 8 percent annually for most of the decade. Student aid was gutted, resulting in the usurious program of large loans with interest rates several percentage points above the prime rate. This led to a doubling of student debt. Right now, the average student owes at least $ 28,000 upon graduation that they must repay and cannot file for bankruptcy. As a proportion of university operating revenues, government funding increased from 77% in 1992 to 55% in 2012.
Tuition fees have increased accordingly, especially for international students. According to Statistics Canada, the average annual tuition fee for an international student was $ 29,712 for the year 2019-2020.
Ford’s staunch anti-worker, anti-education, and right-wing regime is the most naked and backward representative of the market-based education vision. Last November, the provincial government launched a performance-based funding initiative. In a November 26, 2020 statement, the provincial government said it had “signed historic agreements with public colleges and universities that will revolutionize post-secondary institutions.” This move will help students get the education, skills and experience they need to find good jobs by ensuring that post-secondary institutions offer programs that match the demands of the labor market.
This decision is clearly intended to take another important step in the direction of the commodification and corporatization of post-secondary education. Up to 60 percent of provincial government funding will depend on 10 performance metrics, such as graduate earnings, a loose category of “experiential learning” (ie co-op programs) and economical consequences. Institutions that do not meet the parameters will see their funding reduced.
Significantly, this draconian decision was not challenged by opposition liberals. NDP opposition spokesman Chris Glover barely said the move “would destabilize institutions and prevent them from budgeting.”
Laurentian’s struggles provide the clearest example to date of how the ruling class intends to implement its plan to drastically restructure higher education across the country for the benefit of big business. If quality post-secondary education is to be championed and developed in a way that provides free education for all, teachers, support staff and students must look to the working class. It is the only social force which has the power and the interest to reorganize socio-economic life to place human needs, science and culture before the imperative of capitalist profit.