The Ontario Auditor General has issued a Report on Laurentian University’s declaration of bankruptcy. The Report, released on April 14, 2022, underscores the need for vigilance at York University.
The Auditor General’s investigation lays the blame for Laurentian’s financial woes on the Administration’s “poorly considered capital investments”, poor financial management, weak governance oversight, and rising senior administration costs—not academic staff salary costs.
There are parallels between the factors identified by the Auditor General as being responsible for Laurentian University's financial crisis and the concerns raised in the recent report by the YUFA Governance Committee. Our Governance Committee identified its chief concerns as: Board financial oversight, erosion of collegial governance structures, investment in expensive building projects, and burgeoning administrative costs.
The Ontario Confederation of University Faculty Associations (OCUFA) indicates in its summary of the Auditor General’s Report: "Among the Auditor General’s findings were numerous problems with the university’s governance practices, including weak oversight and excessive use of in-camera sessions by the Laurentian Board, ill-advised building projects, questionable hiring practices, and an increasingly expensive payroll for senior administrators."
Furthermore, the Auditor General found that Laurentian had no need to file for creditor protection under the Companies’ Creditors Arrangement Act (CCAA). Bankruptcy could have been avoided if the university administration had accessed the financial exigency provisions in the collective agreement with the faculty association and made “comprehensive and clear efforts to seek financial assistance from the Ministry of Colleges and Universities.”
The Canadian Association of University Teachers (CAUT) is calling for the immediate resignation of Laurentian University President Robert Haché and all senior administrators.
For years YUFA has sought greater financial transparency at the Board of Governors, more respect for collegial governance structures, and open searches for senior administrative personnel. Recently YUFA questioned the financial and academic rational for York University’s hiring of NOUS, an expensive outside consultant, criticized by the Auditor General for its role in the management of Laurentian University’s financial crisis. We also find worrisome the appointment of a number of administrators who were working at Laurentian during the years investigated by the Auditor General, including the Vice-President, Finance and Administration; the Assistant Vice-President, Facilities; and the Dean of Science.
One hundred and ten tenured faculty were terminated at Laurentian University in connection with its avoidable bankruptcy procedures. Fifty-eight undergraduate and eleven graduate programs were eliminated. In light of these findings in the Auditor General’s Report, and to protect the interests of YUFA members, YUFA has asked the administration whether they were aware of the financial accounting issues at Laurentian when these ex-Laurentian people were hired to join York’s senior administration, and what steps the Board of Governors has taken to ensure that the situation at Laurentian will not happen at York.
YUFA has called for a meeting of the Joint Financial Information Committee to review these matters and has requested more transparent information on present and anticipated costs for the Markham campus, the Vaughan Healthcare Centre Precinct, and recent building additions to the Keele campus; restructuring expenses associated with the university's use of external entities such as NOUS; the expenses and revenues of the York University Development Corporation (YUDC); and the governance and oversight structures in place with respect to YUDC’s role in land and building projects.