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Revenue and expenditures for public colleges, CEGEPs and polytechnics increase in 2018/2019

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Released: 2020-12-15

Similar to universities, student college fees represent an increasing share of revenues. They rose from one-quarter (24.8%) of total revenues in 2014/2015 to account for just under one-third (32.2%) of the $9.8 billion in total revenue for colleges in 2018/2019. This increasing share of revenue comes from international students, who pay up to four times more in tuition than Canadian students.

In 2018/2019, revenue for Canada's 166 public colleges, CEGEPs and polytechnics rose 7.6% from a year earlier to $9.8 billion, while expenditures rose 5.4% to $9.6 billion. This resulted in a reported budget surplus of $187 million or 1.9% of total revenues, up from a deficit of $18 million, or 0.2% of revenues in 2017/2018.

Since the data series began in 2000/2001, colleges have kept a relatively balanced budget, where budgetary deficits were at a maximum of 4.0% of revenue. However, colleges will face unprecedented financial pressures in the 2020/2021 fiscal year due to COVID-19. Fewer international college students coming to Canada because of travel restrictions, the added strain on provincial budgets during the pandemic (the largest source of college revenue) and lower revenue from other ancillary businesses, may negatively affect college revenue. Moreover, the need to develop online learning platforms to adapt to a new teaching environment will also likely increase college expenditures.

Provincial/territorial governments are largest source of funding

Funding from provincial/territorial governments ($5.3 billion) remained the largest source of college revenues in 2018/2019. Despite the amount being relatively stable from a year earlier, the share of provincial/territorial government funding towards total college revenues has been falling steadily. In 2018/2019, provincial/territorial funding accounted for 53.9% of college revenues, down from 61.6% in 2014/2015.

Student fees, the second largest source of revenues, accounted for just under one-third (32.2%) of college revenues in 2018/2019. The remaining funds came from ancillary enterprises (4.9%), the federal government (1.9%), donations (1.2%) and other miscellaneous sources (5.9%).

Student fees account for a growing share of revenue

Revenue from student fees has risen from $2.1 billion in 2014/2015 to $3.2 billion in 2018/2019, while the share of total revenues from student fees has grown from approximately one-quarter (24.8%) to approximately one-third (32.2%).

A key factor behind the rise in student fee revenue for colleges is the increased enrolment of international college students, whose fees are up to four times higher compared with Canadian students.

In 2018/2019, international college students made up 16.1% of the total college student population, and for the first time, surpassed the percentage of international university students (15.9%) as a percentage of total university students. From 2014/2015 to 2018/2019, the total number of international college students grew by 120.8%, more than three times the growth rate of international university students.

Chart 1  Chart 1: Distribution of college revenues by source, 2018/2019
Distribution of college revenues by source, 2018/2019

Salaries and benefits account for the largest share of total expenditures

Staff compensation (total salaries, wages and benefits) totalled $5.9 billion in 2018/2019 and has always accounted for the largest share of college expenditures. Nevertheless, total staff compensation as a percent of total expenditure has fallen from 64.0% in 2014/2015 to 61.6% in 2018/2019.

Of the $5.9 billion in total compensation, $5.0 billion was attributable to salaries and wages and the remaining $940.2 million was spent on employee benefits. Benefits include contributions to pensions, group life insurance, worker's compensation, as well as staff training costs paid for by the institution. Teacher's salaries made up the bulk (58.3%) of the $5.0 billion in total salaries and wages, with the remaining 41.7% of salaries paid to administrative and support staff.

Spending on sponsored research declines

Sponsored research accounts for an institution's income paid in the form of a legally enforceable contract under which the institution, or an individual within the institution, agrees to undertake a research project or activity. Sponsored research funds are provided through various sources, such as the federal and provincial/territorial governments, business enterprises and individuals. Across Canada, the total amount for sponsored research funds for colleges decreased from $80.5 million in 2017/2018 to $77.1 million in 2018/2019.

Student support edges down

To help college students reduce the cost of their education, Canada's public colleges, CEGEPs and polytechnics support students through scholarships, bursaries and other related student supports. In 2018/2019, $100.4 million was spent in student support, down slightly from $103.6 million in 2017/2018. The spending on scholarships, bursaries and other related student supports has remained a stable percentage of total expenditure over time.

Capital spending decreases as a share of total expenditures

Capital expenditures cover direct investment in properties, buildings, renovations and equipment and are meant to update aging infrastructure and improve the learning environment for students and teachers. Capital expenditures rose by 1.0% year over year to $970.1 million in 2018/2019. However, the percentage of total expenses devoted to capital spending fell from 10.6% in 2017/2018 to 10.1% in 2018/2019. Other college expenditures included operational supplies ($756.7 million) and fees and contracted services ($751.9 million), which combined accounted for 15.7% of total expenditures.

Unlike teaching salaries, utilities and contractual expenses, which are generally fixed financial obligations, capital spending can often be postponed until an institution can afford the expenditure. Given that the COVID-19 pandemic will likely place financial pressure on colleges, some institutions could decide to postpone some long-term capital spending in the 2020/2021 fiscal year to balance their budgets.

Chart 2  Chart 2: Distribution of college expenditures by type, 2018/2019
Distribution of college expenditures by type, 2018/2019

  Note to readers

In the Financial Information of Community Colleges and Vocational Schools survey, "college" refer to colleges, institutes, CEGEPs and polytechnics.

Revenue and expenditure data are collected from each college and distributed by type of fund in accordance with fund accounting.

The main funds are: general operating funds (an unrestricted fund that accounts for the institution's primary activities of instruction and operations), sponsored research, and capital.

All of the financial figures mentioned are in 2002 constant dollars (adjusted for inflation) unless otherwise mentioned.

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