The decision to approve the zero percent increase was made by the management resources and compensation committee at Tuesday’s board meeting.
“It’s a prudent step, and a responsible step, given it’s a challenging economic time,” said university spokesperson John Danakas.
At this point, these salary range adjustments are limited to the executive group and the senior administrative academic group.
The executive group is comprised of the president, vice-presidents, associate vice-presidents, vice-provost, executive directors and the university secretary. The senior administrative academic group included the 24 deans of faculties and directors of schools, plus the heads of colleges and the director of libraries.
Altogether, the two groups include 41 staff.
The board will decide the salary recommendation for the other excluded groups of staff not belonging to a bargaining unit at their next meeting in April. These excluded groups contain approximately 1,000 employees.
The university is currently negotiating salary recommendations with one support staff union, the Association of Employees Supporting Educational Services (AESES-Security), and will be bargaining with two faculty unions — the University of Manitoba Faculty Association (UMFA) and the University of Manitoba Dental Clinical Staff Association (UMDCSA) at the end of March.
According to Brad Mackenzie, UMFA president, “Our position would be that it has no bearing on the nature of our contract relationships.”
An UMFA newsletter released in February 2010 states that from 2005 to 2009 the U of M’s General Fund cash and investments have increased by $72 million. It also points out that in 2009 the U of M’s operating revenues exceeded operating expenses by close to $42 million last year, which equals more that 38 per cent of UMFA salaries for 2008-09.
Vice-president of UMFA and professor of accounting and finance Cameron Morrill, who contributed to the writing of the newsletter, explained that this information can all be found in the U of M’s Annual Report for 2009.
He went on to explain that this money is effectively sitting in the bank in internally restricted funds, mostly in government bonds.
“The money is all internally restricted,” said Morrill, touching on how this money is set aside for future expenses within the U of M.
Considering the fact that the funds are internal, the U of M still has control on what they choose to finance.
Morill stated that UMFA might make the suggestion that the university reassess their use of these funds.
“In our case, we have a pretty big pension deficit. [Because of] the risks that we might have to cut back on services or cut back on programs to balance the budget, I think it’s not a bad time to use a lot of the money that they’ve banked over the past few years to make up for what might be just a temporary shortfall,” said Morill.
McKenzie explained that the university still requires more funding from the province.
“That would help in a number of ways,” said McKenzie.
He explained that it would allow the university to not be forced to make cuts to certain services and programs through initiatives such as the ROSE and OARs projects.
“It would allow them to fund some of the new programs for students. That would benefit students, but they can’t proceed with it because they don’t have enough extra funds or new funds,” said McKenzie.
“New money could prevent any tuition cost increases that would be more difficult on students. That’s why new money is needed from the province.”
Morill explained that the university has predicted large funding shortfalls many times over the past few years. For example, the shortfall predicted for 2009–10 was an estimated $28.3 million.
These numbers are generated because the Council on Post Secondary Education (COPSE) required the university to submit a base level budget regarding the upcoming year’s expenditures.
This budget assumes that the university will maintain the current year’s level of programming, services and capital expenditures and that there will be no increase in external revenues.
John Danakas, director of public affairs at U of M said, “We don’t want to argue it out in the media, so we are waiting on other communication from UMFA [ . . . ].”
He continued, “We’re going to provide comment in another forum that will explain clearly [ . . . ] the details around operating revenues and operating expenses.”
The provincial budget for 2010 will be released on March 23.