THE ROLE OF GOVERNMENTS in corporatizing Canadian universities


Government focus on boosting the economy and shrinking public expenditure has transformed our universities.

A new, market-based vision for higher education has taken shape in recent years, and the direction and priorities of higher education policy in Canada have shifted alongside it. In my recent book, Academia, Inc.: How Corporatization is Transforming Canadian Universities, I connect these changes to a process of corporatization. I take no credit for the term. “Corporatization” and the “corporatized” university are now commonplace in both academic and lay circles. And, the fact that Canadian universities are being transformed has not really been questioned. But there remains considerable debate around the sources of this transformation. Who or what is responsible? Corporate leaders, university administrators, and “academic capitalists” have all been implicated. Some have suggested that students, who are sometimes accused of embracing the role of educational “consumers,” also share responsibility. I would add, though, that there is another group of important players, a group who have perhaps not received the attention they deserve: governments.

The pivotal role of underfunding and austerity
One of the driving forces behind university restructuring in Canada has been the sharp and prolonged reduction in government funding that began in the 1970s. There are important linkages between these austerity measures and processes of corporatization. The logic is simple: once underfunding has undermined the integrity and functionality of a public system, corporations and market-oriented bureaucrats are invited to come in and reinvigorate these “failing” institutions through restructuring or privatization. In some cases, this need to shift to a corporate model has been clearly articulated by political, business, and even university leaders. For example, the Task Force on Labour Market Development, headed by economist David Dodge in the early 1980s, recommended a number of concrete ways that universities could be “induced” into a restructuring mandate. These included more reliance on private funding, redirecting federal money to support sponsored research and market-based programs, and reallocating funds away from arts-based disciplines.

In the 1980s and 1990s, other actors, including the Business Council on National Issues (BCNI) and the Corporate Higher Education Forum (CHEF)—an alliance of 25 corporate CEOs and 25 university presidents—also played a leading role in achieving an elite consensus on educational issues. The BCNI launched a sustained attack to undermine public confidence in public education and repeatedly called for government cutbacks to universities, while the CHEF explicitly advocated government underfunding to make universities more responsive to private interests. As part of these campaigns, the university was portrayed as unresponsive to market demands and the home of a lot of useless learning. These campaigns placed universities alongside other supposedly outdated public programs and entitlements, such as social security. The strategy taken up by many Canadian elites is summed up in a 1995 quote from the Conservative Education Minister of Ontario, John Snobelen, who said: “If we really want to fundamentally change the issue in training and… education we’ll have to first make sure we’ve communicated brilliantly the breakdown in the process we currently experience. That’s not easy. We need to invent a crisis. That’s not just an act of courage. There’s some skill involved.”

Snobelen’s “crisis” was largely invented through fiscal austerity. Canadian federal governments have steadily reduced the monetary commitment to postsecondary education through direct cuts to transfer payments and amendments to the funding formulas that determined them. Between 1983-84 and 1994-95, the federal contribution to postsecondary education was reduced by over $13 billion. When student enrolment is taken into account, the amount of federal transfer money spent per student declined by almost 50 per cent between 1994-95 and 2004-05. Many provinces also introduced their own brands of austerity during this period, such as the Conservative governments of Mike Harris (Ontario) and Ralph Klein (Alberta) who dramatically reduced university operating grants as part of a broader effort to shrink the public sphere and redirect higher education toward prescribed economic goals.

By the time the federal Liberal’s thirteen-year reign was over in 2006, Canada’s university system was a shell of its former self. Federal and provincial government funding for university teaching and non-sponsored research fell from more than $17,900 per student in 1980-81 to $9,900 in 2006-07. Although the federal Conservatives increased funding to universities through transfer payments and research funds beginning in 2006, these increases were still billions of dollars short of what was needed to restore funding to 1990s levels. The government also failed to set any binding conditions or legislated guidelines for new investments, which meant that while some provinces increased their grants to universities, others did not and some, like British Columbia, even reduced them. At the national level, public funding made up 84 per cent of university operating revenues in 1979; by 2009 this figure was reduced to just 58 per cent.

While this mix of austerity programs over the past four decades may have reflected resource scarcity on the part of governments, it is important to understand that they were also part of a deliberate plan to link universities more closely to the needs of the market and lay the foundation for corporatization.

Willful neglect of teaching and teachers
As government support for university teaching has plummeted, there has been an increase in targeted funds for university research. We have seen the introduction of the Canadian Foundation for Innovation and the Canada Research Chairs program, and a range of selective grants supporting the private sector and university-industry ties. And as more and more money is channeled into these special targeted programs, less money is reaching the classroom. Sponsored research in Canada’s 25 largest universities accounted for around 15 per cent of university expenditures in 1988; by 2008, this figure had grown to 25 per cent. Teaching has not just fallen on the list of priorities, it has been pushed there by conscious resource allocation decisions.

An even more notable consequence of government cutbacks has been the sharp growth in the number of contract faculty working in Canadian universities. In Ontario, for example, the changes have been dramatic. According to data I received through freedom of information requests, in those departments that are now part of the Faculty of Liberal Arts and Professional Studies at York University, the number of part-time contract appointments increased from 531 to 1253 (136 per cent) between 2000-01 and 2009-10, while the number of tenure-stream faculty grew from 493 to 593 (18.3 per cent). The growth in part-time positions was especially prominent in certain departments, such as English (564 per cent); Languages, Literatures and Linguistics (180 per cent); Administrative Studies (174 per cent); and Philosophy (169 per cent). In the 16 departments I reviewed at Trent, the number of part-time positions increased from 66 to 200 (203 per cent), while the number of tenured/tenure track positions increased from 138 to 156 (13 per cent). At Carleton, in 2003-04, part-timers were responsible for teaching one out of every five undergraduate courses; eight years later, they were teaching one in three.

Some argue that the accelerated use of contract employment represents a deliberate management strategy to impose labour “flexibility” in the academy and transform the nature of academic work. I would certainly agree. But this transformation would not have been nearly as severe in the absence of imposed resource shortfalls. In fact, contract faculty hiring represents one of the primary cost-saving measures available to cash-strapped universities.

Selling out the “customers”
Successive federal administrations and most provincial governments have adopted a “customers pay” orientation to university financing. This approach has resulted in Canada having high tuition fees, especially by European and Scandinavian standards. While tuition varies considerably across provinces, the overall cost of undergraduate tuition has grown from an average of $1,706 in 1991-92 to $6,191 in 2015-16, an increase of 263 per cent. Escalating fees has also meant escalating student debt. Federal government student loan debt in Canada is approximately $15 billion. When provincial and commercial bank loans are included, the total is closer to $20 billion. A recent study by the Canadian Federation of Students shows that students requiring a Canada student loan now graduate with average debts of over $28,000 (Burley and Awad, 2015). Of course, tuition is not the only culprit. According to the OECD’s Education at a Glance 2014, student aid in the form of grants now covers a much smaller proportion of the direct costs of postsecondary education in Canada than it does in most other OECD countries.

Skyrocketing fees and regressive aid policies do not only reflect an economic strategy, or the inevitable impact of public funding cuts. On the contrary, downloading the costs of higher education to students and their families is a political choice based on particular assumptions about public education and what constitutes a just society. This is particularly evident when tax policies are taken into account. In 2011, David Macdonald and Erika Shaker of the Canadian Centre for Policy Alternatives estimated that the total cost of rolling back undergraduate tuition rates in Ontario to their 1990 level—from $6,500 to $2,500 a year—would cost approximately $1.5 billion. In contrast, the corporate tax cuts the province introduced in 2009 cost roughly $1.6 billion. At the national level, Canadian federal governments chose to forgo approximately $48 billion in revenues through tax cuts during the 2000s, with much of it going into the pockets of Canada’s largest corporations. Just 10 per cent of that money could have funded the elimination of tuition fees for all students currently enrolled in Canadian universities.

When you consider the far ranging impacts of these policies, it is clear that governments are doing universities—and Canadians—a great disservice. Research has shown that rising tuition and debt levels are blocking access to higher education for underprivileged families (Coelli, 2005, 2009; Neill, 2009). Students with high debt levels are also more likely to take on paid employment with adverse academic effects (Callender, 2008; Côté and Allahar, 2007; Motte and Schwartz, 2009), more likely to complete their studies at a slower pace (Ekos, 2006), less likely to graduate or pursue further education (Maritime Provinces Higher Education Commission, 2007; Prairie Research Associates, 2007; Williams, 2012), and less likely to consider employment or training in public service occupations (Chernomas and Black, 2004; Field 2009; Tannock 2006).

Debt dependence also permeates our broader political culture. As more and more students are forced to deal with the debt “time bombs” that await them after graduation, they are less and less likely to participate in social activism. In this way, I see debt dependence as serving a disciplining and individualizing function. It is contributing to the creation of a fragmented society where individuals are focused on individual concerns and less likely to engage in collective struggles. I have no doubt this impact is also understood by governments—and their private sector partners—who control the policy-making process.

Strengthening corporate governance
Austerity measures also affect university governance. As Canadian universities have increasingly turned to private sources of financial support, they have also devoted a greater and greater share of institutional resources to external relations (such as fundraising and the expansion of corporate-university partnerships). Growing financial concerns and secretive corporate agreements within universities have ostensibly required management that is free from faculty influence. The result has been that there are more and more career administrators who are hired from outside of the university to govern with a corporate, managerialist approach.

Governments have also inserted themselves more directly into the university governance process. In addition to championing the idea that our universities are not producing enough graduates with relevant skills and talents (the highly touted and largely illusory “skills gap”), they have also played a lead role in redefining curricular relevance by assuming greater control over academic programs. The Alberta government, for example, has introduced funding and other mechanisms—including so-called mandate letters specifying government expectations—to ensure that new university programs correspond with its interpretation of labour market needs. Performance indicators have also become a popular tool used to monitor and support corporate priorities, such as the training of “work-ready” graduates. Governments have provided tens of millions in taxpayer dollars to support contentious donor agreements, such the Munk School of Global Affairs at the University of Toronto and the Clayton H. Riddell School of Political Management at Carleton University. Another disturbing trend is the appointment of executives from management consultant firms (that specialize in the privatization of public services) to university boards. In 2013, the Government of Alberta appointed Firoz Talakshi, a KPMG executive, to the University of Calgary’s Board along with Steve Allan, who specializes in “corporate restructuring and insolvency”, while the government of British Columbia recently appointed Ernst & Young Executive Fiona Macfarlane to the Board of the University of British Columbia.

Government funding mechanisms also have an impact on campus infrastructure. Capital funding for universities accelerated during the 2000s, largely through Ontario’s SuperBuild program, funding for research infrastructure provided by the Canadian Foundation for Innovation (CFI), and the federal government’s Knowledge Infrastructure Program. All of these programs were designed to secure matching funds from the private sector, which means they have a structural preference for infrastructure projects in certain disciplines. Between 1998 and 2009, for example, the CFI disbursed over $4.2 billion to various projects, with about 90 per cent of this funding going to the physical sciences, health sciences, and engineering (accounting for 5,590 out of 6,310 funded projects). In contrast, arts, literature, humanities and social sciences received just five per cent of funds. This disparity has allowed the CFI and its corporate partners to exercise considerable influence over curriculum and research priorities.

“Innovation” = commercialization

The main impact of government “innovation” agendas, especially at the federal level, has been to commercialize university research. This was evident in the 1980s when the Mulroney Conservatives overhauled Canada’s national research policy to turn university researchers away from basic science and towards commercial application. Examples include the development of the federal Networks of Centres of Excellence (NCE) program and the changing mandate of the Science Council of Canada. In the 1990s, the Liberals branded their own innovation agenda in several major reports, including one by the Expert Panel on the Commercialization of University Research. It argued that universities should add a fourth mission—“commercialization”—to their customary missions of teaching, research, and service. From 2006 on, the Harper Conservatives went even further. They launched a new NCE program to be “proposed and led by the private sector.” Some of the new NCEs were packaged as Centres of Excellence for Commercialization and Research (CECR), which were designed to facilitate commercialization in the priority areas of management, business and finance; natural resources and energy; health and life sciences; information and communications technologies; and the environment. An example of a CECR with an alleged environmental focus is the Canada School of Energy and Environment, which supports tar sands development and advises industry and governments on creating “sound” regulations and “appropriate” legislation to deal with fossil-fuel energy expansion.

The federal Conservatives also oversaw a strategic reorientation of the federal granting councils. In 2009, it was announced that scholarships granted by the Social Sciences and Humanities Research Council (SSHRC) would focus on “business-related degrees.” The Canadian Institutes of Health Research (CIHR) also has a new commercial mandate. And the National Science and Engineering Research Council (NSERC) got a complete overhaul. As part of NSERC’s new focus on innovation, the government
redirected public funds to programs to help solve company-specific problems, which is tantamount to providing free labour for the corporate sector (since 2009, company specific research funding has grown by more than 1,000 per cent). In 2012, NSERC was even offering to organize “speed dating” events to bring interested researchers and corporations together. At the same time, NSERC’s Discovery Grants program—the main funding source for basic research in the natural sciences and engineering— has declined significantly, from two thirds of the Council’s budget in 1978 to one third in 2010. The NSERC currently has no natural scientists on its governing council, but it does include a number of corporate representatives (one of whom used to head the Fraser Institute).

Recent federal budgets have continued along the same lines. In 2012, $37 million was allocated to enhance granting council support for “industry-academic research partnership initiatives” in areas with promising commercial output. In 2013, all new money announced for the councils was targeted to support research partnerships with industry. In the 2014 budget, the government launched the Canada First Research Excellence Fund, which accelerated council support for targeted research in the interests of corporate Canada.

Corporatizing academic research has gone hand in hand with the decline of basic research funding, even though it is basic research that has yielded many of the world’s most important scientific and technological advancements (not to mention those of major commercial significance). In fact, the majority of scientific breakthroughs in virtually every field have resulted from basic research conducted in academic settings built and supported largely by public funds. The strategy of defunding basic research and throwing resources at the narrow fields of commercial application has been highly damaging from a public interest perspective.

Who do our governments represent? Not the public
The role of governments in transforming higher education in Canada has been considerable and, with few exceptions, guided by a unidirectional economic focus. They have been preoccupied with how to reshape universities to contribute to corporate profitability and national competitiveness, and how to create enough “human capital” to facilitate economic growth.

Not only does this vision offer a distorted and dehumanized view of the value and purpose of education, it sharply conflicts with the goals and values of Canadians. On virtually every measure, the public opposes a corporatization agenda. A majority of Canadians strongly disagree with a “customers pay” model of university financing, with most agreeing that tuition fees should be eliminated altogether (CAUT, 2009). They are vehemently opposed to public funding cuts (CCL, 2009; CFS 2012; Ipsos Reid, 2004). They believe that teaching—not research—is the most important factor in considering university quality (Ekos, 2003). A majority also believe that the best strategy to compensate for funding shortfalls would be to reduce central university administration costs (CAUT, 2011). And, although the opinions of university scientists have been largely ignored by our political leaders, the public believes they should be taken seriously. According to a nation-wide poll, 44 per cent of Canadians said they find the opinions of university scientists to be the most trustworthy in debates over university research funding. In sharp contrast, 10 per cent said corporations were the most trustworthy source, nine per cent said university administrators, and just nine per cent said the federal government (CAUT, 2009).

Governments are supposed to represent the will of the people on matters of public policy. In the area of higher education, they simply have not. AM

Jamie Brownlee is the author of Academia, Inc.: How Corporatization is transforming Canadian Universities, out now from Fernwood Publishing.


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