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Sherbrooke, January 17, 2013 – Quebec universities wish to comment on transfers from operating funds to capital funds.

First, a few definitions are necessary. Capital acquisitions fall into two main categories:

• Those involving “brick and mortar” assets, primarily the construction of new buildings and major renovation projects;

• Those involving major equipment, particularly specialized equipment required for teaching and research, communications and multimedia, vehicle fleets, office furniture and equipment, library books and documents, IT equipment, computer software and hardware upgrades.

It is not true that universities make massive use of their operating funds to finance capital projects.

In fact, close to 70% of so-called capital expenditures go towards equipment and documentation and support for teaching and research.

Capital acquisitions can vary widely from one fiscal year to the next and from one university to the next, depending on how projects evolve. For a reliable picture of the situation, it is necessary to study data over several years. A compilation of capital expenditures for the years 2003-2004, 2006-2007 and 2009-2010 shows that, on average, for those three years:

69.9% of all capital fund acquisitions financed by the operating fund fall under the “major equipment” category:

• Specialized equipment related to teaching and research, communications and multimedia, vehicle fleets and office furniture and equipment (20.2%)

• Library documents (29.2%)

• IT equipment (16.8%)

• Hardware and software upgrades (3.7%)

Transfers circumscribed by government regulation

In calculating operating funds, the government understands full well that some funds will be used to pay for major equipment, among other things.

Under the government-imposed budget rules and accounting principles universities must follow, such expenditures, which may be amortized over several years, must be recorded in the capital fund.

The transfers between funds are therefore anticipated. Accounting procedures for capital acquisitions are defined and circumscribed by the Politique de capitalisation des immobilisations pour les réseaux de l’éducation, de la santé et des services sociaux.

Transparency and accountability

All transfer decisions are approved in advance by the university boards of directors (whose members include students and professors). They are faithfully and transparently recorded in the financial statements, which are subject to an external audit and submitted to the government.

Putting an end to the myth

University enrolment increased by 30.8% from 2001 to 2011. That’s close to 70,000 students. No new buildings were built to accommodate these new students, although renovations, expansions and new construction were certainly necessary.

The document “Calcul définitif des subventions de fonctionnement aux universités, année universitaire 2011-2012” (A final calculation of university operating grants for the 2011-2012 university year), published in July 2012 by the Ministry of Higher Education, Research, Science and Technology, reveals that the university system as a whole is suffering from a lack of space estimated at 11% overall, compared to standardized needs. This is according to the government’s calculations. In the case of eight universities, the space shortage is greater than 10%.

CREPUQ includes all 19 Quebec universities. The organization acts as their voice in relations with government and milieus concerned with university education and research. It also fosters coordination and collaboration between universities, is a research centre for university administrations, acts as a centre for coordination and joint service delivery, and is a resource centre and think tank for its members.

Source:
Chantal Pouliot, Director of communications
Conference of Rectors and Principals of Quebec Universities
514-288-8524, poste 244
cpouliot@crepuq.qc.ca
http://www.crepuq.qc.ca