Ontario universities face financial crisis as deficits mount

Ontario universities are expecting another year of multi-million dollar deficits. CTV’s Jeff Pickel has more on search for a financial fix.

Some Ontario universities continue to bleed money, racking up multi-million-dollar deficits, including institutions in the Waterloo Region.

Experts say the provincial government holds many of the answers, but with an election just 16 days away, they say it’s unclear whether the issue will get much political attention.

The University of Waterloo is heading into 2025 with a massive operating deficit. Before making significant cuts, UW was staring at a $75 million shortfall. Cost-saving measures helped trim that down by $42 million, but financial struggles persist. The university has implemented a voluntary retirement program and a hiring freeze to stabilize its budget.

Last year, UW, along with Wilfrid Laurier University and the University of Guelph, each lost over $10 million.

The crisis isn’t limited to Waterloo Region, universities across Ontario are feeling the financial squeeze.

‘It’s starting to bite’

Higher education expert, Alex Usher, of Higher Education Strategy Associates says the crisis is largely the result of long-term underfunding.

“It was the underfunding that led to the dependence on international students, and it was the removal of international students that caused the immediate crisis,” Usher explained.

He also noted the federal cap on international student visas, intended to ease the housing crisis, has further strained university budgets.

“It’s not that we’re in any different a position than we were a year ago, it’s just that it’s starting to bite.”

Ontario has long ranked last in the country for public funding of post-secondary education, according to Usher, adding that “the unwillingness of Ontarians to pay for post-secondary education, either through public funding or tuition, is legendary.”

Election impact

With the Ontario election fast approaching, Usher believes this could potentially be a campaign issue, but doubts it will be.

“Countries with strong economies always have strong universities of one kind or another that support them,” he said. No strong universities? You’re kicking away a pillar of the economy.”

While big-picture issues like innovation and workforce education often struggle to capture voter attention, Usher believes a more immediate concern - access to programs - could resonate with families.

“That should be the ballot question, really in terms of education, which is which party is going to give you the ability to get your kids into the programs they want to get into?”

Usher stated that so far, no major party has proposed significant funding increases or tuition hikes to address the shortfalls.

“I don’t get the sense that any party is prepared to raise tuition and they don’t get the sense that any party is prepared to do is to invest significant sums of money into post-secondary,” he explained.

Usher says Ontario colleges are also in trouble; nearly 200 programs have been cut this year, and close to 1,000 more could disappear before the end of the month.