THE MacKAY REPORT
Why was the MacKay Report necessary? The Government of Saskatchewan appoints a majority of the Board of Governors and the Board appoints all the senior administrative officers of the University. What is the problem? Who is to blame? What is the remedy? Where do we go from here?
1. What is the problem?
The MacKay Report brings the policy of fiscal restraint to the universities. It publicly acknowledges that the government has downgraded "the priority afforded to university education, compared to other major provincial programs (p. 30)," for over a decade. Now, funding will be frozen in real terms at the projected level of the 1998-99 base operating grant. This is called The Fiscal Reality:
the reality in Saskatchewan is that, barring some entirely unpredictable positive change in economic circumstances, the universities cannot expect the Government of Saskatchewan to provide operating funds for general purposes which, on a constant dollar basis, will significantly exceed those which they will receive after giving effect to the measures announced in the 1996 provincial budget (p. 26).
Fiscal Reality is treated as if it were a natural phenomenon, not a government policy; and no attempt is made to justify the reduction in spending on university education as a percentage of the government budget, even though the effects of this policy must ultimately fall upon the students and people of Saskatchewan. The problem is the change in government policy.
2. Who is to blame?
MacKay directs much of his criticism at the Collective Agreement between the Board of Governors and the Faculty Association, which he stigmatizes as obstructionist. His analysis would require faculty to forsake the negotiated procedures that protect tenure, give up their rights under the law, and bear most of the cost of adjusting to the new government policy.
We are now in the midst of negotiating a new Collective Agreement with the Board of Governors. Negotiations have not broken down. They show no sign of breaking down. They may be slow, but they have progressed. Collective bargaining is a lawful and legitimate method of resolving differences between labour and management. Yet, MacKay points his finger at our Collective Agreement and threatens that
should necessary changes at the universities be frustrated by disputes between management and labour, the government will have to carefully assess whether governance changes of the sort recommended by the Johnson Report, or other measures, should be legislated (p. 78).
He does not mention that the administration put almost 100 items on the table this last year and then came unprepared to negotiate. The administration is still so unprepared for negotiations that they cannot answer simple questions about their own proposals. Government sponsored criticism does not smooth the way to an agreement, especially when the critic is as partisan and misinformed as Mr. Harold H. MacKay, Q.C.
He reports, for example, that most of the reduction in costs has been born by the non-academic staff: "I have been provided with statistics which show that there has been a disproportionate curtailment in certain non-academic jobs on the universities during the recent period of fiscal restraint (p. 82)." This leads him to recommend that faculty should bear most of the cost in the future through lay-offs and early retirement.
In fact, most of the cost reductions have been born by members of the Faculty Association. MacKay's information no doubt came from the administration, as Vice-President Whitworth was recently quoted in the Star Phoenix (13 September 1996) saying: "Administrative staff positions have been cut 7.8 per cent compared to 6.6 per cent for faculty and 5.5 per cent for unionized staff since 1992." This gives a false impression of the size and the significance of cuts to faculty relative to administrative staff.
First, the University of Saskatchewan, Statistics, shows that F.T.E. administrative staff increased every year from 1990 through 1994, from 309.0 to 323.9. If certain non-academic jobs have declined 7.8 per cent since 1992, the percentage calculation is biased by selection.
Second, the Faculty Association witnessed a decline of 100 members between October of 1990 and October of 1995. We went from 1003 to 903. Now we have 864 members, according to our August dues list, down another 32 from August to August. Thus, faculty have declined about twice the percentage given for administrative staff.
Percentages, however, do not measure the significance of staff reductions. The number of vice-presidents, for example, was temporarily cut in half on July 1, 1996, but a 50 per cent cut in vice presidents has little or no effect on students or on academic programs. In contrast, a cut of 132 faculty positions means that some courses will no longer be offered at all, others will be offered less frequently and many classes will be larger in size. Students must inevitably receive a poorer education.
3. What is the remedy?
MacKay offers two major remedies for the problem of government cut backs: laying off tenured faculty and offering an assisted early retirement program.
a. Layoff tenured faculty.
The Johnson Report noted that our collective agreement diminished the authority of the governing bodies of the university "in respect of the limitation or discontinuation of programs (p. 77)." The University of Saskatchewan Act (1995) increased the powers of the Board of Governors to disestablish academic programs if it declared the existence of a financial exigency. Council must be consulted before an academic program is disestablished, but the Board can act on its own authority, whether Council agrees or not, after the passage of 60 days.
However, the issues outlined by the Johnson Report in respect of the collective agreements have not been fully addressed. The collective agreements may well continue to present constraints to effective university repositioning if they are used to inhibit necessary program changes or if, in application, they erect insurmountable financial barriers (p. 77).
MacKay does not address how the Collective Agreement between the Board and the Faculty Association has operated in practice. He does not mention that the old Council with a faculty majority never delayed or blocked the discontinuance of any program. Indeed, the current administration has never proposed eliminating any program. In the past, the faculty Council voted to discontinue the College of Home Economics; and the Board of Governors discontinued funding to the Department of Far Eastern Studies and the Institute of Northern Studies. Instead of focusing on the facts, Mackay criticizes the procedures for layoff and severance in our Collective Agreement (Article 30), which the Board and the Association freely and thoughtfully negotiated and ratified, but he gets them wrong.
First, he claims that "some classes of tenured faculty may not be laid off in any circumstances (p. 77)." Wrong. Under a Temporary Layoff, which would occur if the University simply ran out of money, or an Partial Redundancy, which would occur if a program is discontinued, faculty members may be laid off regardless of age, rank, seniority or tenure.
Second, he states that still other provisions
provide notice of layoff periods which make it difficult in time (potentially up to 24 months) and costly in terms of aggregate pay in lieu of notice and/or severance benefits (up to 42 months) to effect faculty layoffs, thereby potentially frustrating necessary program restructuring (p. 77).
Wrong again. The maximum possible pay for severance is 15 months salary and the maximum pay in lieu of notice is 12 months, which adds to 27 months, not 42 months. In the absence of a collective agreement, a wrongful dismissal judgement against the University for a highly qualified and specialize faculty member may be richer than our Partial Redundancy benefits. Furthermore, as MacKay reports, the principal barrier to reducing the size of the University quickly is the necessity of letting students finish the programs in which they are enroled.
The universities note the obligation they may have at law, or in any event may feel in practice, to see students presently enroled through to their degree opportunities notwithstanding the closing of a college. If that hypothesis were accepted, the full benefit of savings would be achieved only after a full cycle through to graduation of the present student cohort (4 to 5 years) (pp. 72-73).
Since that hypothesis is current practice, the disparaging comments by MacKay on the notice period in the Collective Agreement is mischievous at best. If the full cycle from admission through graduation exceeds the period of notice for faculty who are to be laid off, how can our Collective Agreement with the Board inhibit necessary program changes?
b. Early retirement.
The Faculty Association has tried to establish a generous Assisted Early Retirement Plan for over a decade, and we have exchanged proposals this year. The administration put a proposal on the table that is in the 1992-95 Collective Agreement. We sweetened it by adding the CPP-OAS supplement that was in our 1991-92 agreement and that is in the current ASPA agreement. We expect a new proposal from the Board soon. We want an early retirement plan because some of our members want to retire early. MacKay wants an early retirement plan to create a "normal" age distribution of full-time faculty, but his analysis is based on false premises.
First, data on the age distribution of faculty include 988 individuals (Appendix K), whereas the Faculty Association had an average of only 904 members for the 1995-96 academic year. The difference of 84 individuals is no doubt full professors with senior administrative duties, which Statistics Canada puts in the same table with other faculty. In 1994-95, Statistics Canada listed 86 senior administrators with professorial rank. If these senior administrators are older than the average faculty member, which seems probable, MacKay's data are skewed to the older age groups and do not properly reflect the age distribution of the Faculty Association membership.
Second, the starting age of faculty at most universities is now much older than was the case in the 1960's because of profound changes in the academic job market. New members of the Faculty Association have been 38 years old as an average in recent years; and, incidentally, the largest cohort of faculty is now age 43 to 45 with 117 members compared to 110 in age group 55 to 57. If the typical working life of a faculty member is from age 35 to 65, an average age of about 48 may be perfectly "normal." Given the nature of the academic job market, which is mainly external to Saskatchewan, it is not surprising that "of the full-time faculty, over 47% are aged 50 or over (p. 12)." The "age bulge" may be a boogie man.
Third, if the University should adopt a policy of hiring young faculty in preference to older faculty, it may be in violation of the Saskatchewan Human Rights Act and the Occupational Health and Safety Act, of which the Hon. Robert W. Mitchell is so justly proud. Indeed, MacKay may transgress when he writes that "it is probable that some in this large aging faculty cohort will, in the years ahead, become less productive as they approach retirement, thereby potentially diminishing the vitality of the institutions (p. 27)." The Board of Governors should be committed to eliminating discrimination.
4. What about pension reform?
Nothing so clearly illustrates how poorly MacKay was informed as his failure to discuss the issue of pension reform. Early retirement and pension reform are inseparably linked. If Jane Example, whose case has been so widely discussed, were to retire and take her cash at the end of this year, she would leave $142,892 on the table if the pension is not reformed. This money is due to the so-called 1% annual tax on the interest credited to individual balances that is assessed to protect the Board of Governors. No early retirement plan will compensate her for what the 1% tax has taken from her. With pension reform she may expect to take a good part of this money with her. A successful early retirement plan requires a fair and equitable reform of the academic pension.
5. What is the alternative?
The University has usually solved its financial problems by freezing vacant positions, such as President Ivany recently announced. This solution requires no debate, no negotiations and no approval of any academic body. The cash saving is immediate and large. Last year, 128 members of the Faculty Association quit, retired, died or otherwise went off the payroll, August through July. Most of these vacancies were filled, but 32 were not, as of August. With so large an annual turnover of faculty members, the financial problems of the University are always very easily solved. Faculty salaries account for about 40% of University expenditures.
President Ivany's $19 million deficit arises from a proposed cut in the government grant of $10 million dollars to the two universities spread over three years. The shortage of funds is then artificially inflated by the assumption that there are about 988 faculty who will receive their Career Development Increases plus salary scale increases of 1%, 1% and 1% a year. However, these assumptions are not based on fact. Only 864 faculty remained on the payroll at the end of August. Most of them do not receive Career Development Increases. Salaries are still under negotiations. And attrition will reduce costs further.
The University of Saskatchewan does not have a financial problem. It has an academic problem. Departments and colleges experience vacancies in a haphazard and unpredictable way. Some departments have lost five or six members, others have lost none. No mechanism exists to ensure that vacancies are filled on the basis of academic criteria such as student numbers, research programs, and degree requirements. Academic decisions should be made on academic grounds. This requires academic judgement and academic leadership.
6. Where do we go from here?
The Faculty Association and the administration have discussed the major issues raised by the MacKay Report: layoff procedures and early retirement. We have discussed other issues, too: the Crop Development research scientists, systemic discrimination, pensions, salaries as well as many minor items. Differences are being resolved, even though the uncertainty caused by the intervention of the government into the internal affairs of the University through the MacKay Report has retarded and altered the course of negotiations. We will eventually reach an agreement.
Whatever agreement the Faculty Association and the Board of Governors may reach, it will not hurt the University. The government policy of underfunding and downsizing does hurt the University. It does not serve the public interest. It has already weakened many parts of the University. It will reduce the quality of education and ultimately hit the students.