2020-21 Preliminary Budget Planning Parameters

Updated: December 2, 2019

Preliminary planning parameters for the next three years are based on our best estimation of revenues and expenses given available information. This year, we have a heightened level of uncertainty as we move forward with the planning process because there is still much we need to learn—chiefly around enrolment targets, as well as new performance-based funding criteria for post-secondary institutions and the U of A specifically. 

Keeping in mind this uncertainty, for 2020-21 we have considered a number of factors. 

Operating Revenue:

  • The U of A’s Campus Alberta grant reduction of 6.9%—applied as a one-time cut to faculties and academic support units in 2019-20—must be rolled into base budgets in 2020-21.
  • From information we have to date, we assume that the government plans an average cut to the Campus Alberta system of 5% for the next three years. 
  • Taking these two factors into consideration, we are assuming a total reduction of 11.9% to the university's institutional operating base grant for 2020-21. 
  • To help offset this reduction in the provincial grant are planned increases in tuition. We have assumed 7% increases on average to both domestic and international for the next three years—except for international students entering in 2020 with the new program-based guaranteed international tuition fees.  
    • It is important to note that these are planning assumptions. Actual tuition increases for 2020-21 will be developed through the normal annual consultation process, involving representatives from the Students’ Union, Graduate Students’ Association, and administration. Proposals developed through this process move through GFC and Board governance committees before coming to the Board for a final decision as part of the passing of the whole budget in March 2020. 
    • A meaningful portion of tuition increases will be set aside to strengthen student financial aid.
  • An estimated $15 million of investment income (intended for the investment reserves fund) will be allocated to the general operating budget in the short-term.

Operating Expense:

  • Faculties and units will continue to be responsible for any across-the-board changes to salaries, benefits, and merit (as per collective agreements with our associations). 
  • Typical inflationary pressures on supplies and other purchases should be anticipated at an annual 2% increase.

Preliminary Planning Parameters

Taking all of these factors and assumptions into consideration, the following preliminary planning parameters have been set for the next three years:

  • 2020-21: 
    • -9.1% average reduction for faculties, which may be reduced by the impact of increasing tuition
    • -9.4% average reduction for academic support units 
  • 2021-22 and 2022-23: -5% reduction per year to all Campus Alberta grant funded portions allocated to faculties and academic support units in the new budget model

Please note: With the implementation of the new budget model beginning April 1, 2020, the reductions outlined in these preliminary planning parameters will affect faculties and academic support units differentially.

The impact of the new budget model is being phased in over three years and will be fully implemented in 2022-23 fiscal year.