Update on the 2024-25 budget: Queen’s $60.1 million surplus poured into capital as pressures to cut continue

We have reminded the Queen’s community over the last two years that university budget projections are statements about what might happen in the future – but it is in the end-of-year audited financial statements where we can see what is actually going on with the university’s finances. In what has become an annual tradition, the news is quite a bit more rosy than Queen’s initially projected.

In the report provided to the Board of Trustees for their September meeting, the university announced a year-end operating budget surplus of $15.8 million and a total surplus of $60.1 million, driven by returns on the university’s substantial investment funds. Rather than use these funds to support the operations of the university or to prolong our runway for action while the Province considers revisiting university funding, the university instead chose to transfer $41.9 million into its capital reserves. These reserves are then to be used for projects “like the purchase of 235 Frontenac Street” or other priorities set by the senior administration (rumours abound). Further highlighting this emphasis on capital investments, last year the university spent $22.6 million more than originally budgeted on capital projects without the type of scrutiny that operations would face for a fraction of that overspending.

This positive budget situation has allowed Queen’s to increase upon what rating agency DBRS Morningstar has noted is Queen’s “consistently strong balance sheet” despite the pressures placed by provincial underfunding. Notably, the university’s total assets increased from $2.269 billion to $2.443 billion in the past year. This included an increase of its internally restricted assets from $407 million to $446 million. So while the university was cutting back on the services on which students, staff, and faculty rely, its admin-controlled war chest for future capital investments continued to grow.

In positive news, and to give credit where due, the university has increased its use of investment income from the Pooled Investment Fund for operations from $5.2 to $10 million (as we discussed previously). Further, in its reporting on the university’s finances, the administration is now solely providing the overall figure with its commentary, rather than engaging in creative accounting exercises to concoct deficit figures.

We’ll end by emphasizing our consistent argument over the past two years. The budget pressures facing Queen’s are real, and provincial policy means that revenues are not keeping pace with inflation. However, decisions about how to use the university’s considerable wealth are political, not inevitable. Let’s not forget that there is room to maneuver and to make different decisions. And let’s use every opportunity we have to remind one another and our leaders that another path is possible.