Faculty and Students Excluded from University Funding Review
November 20, 2025
CALL TO INCLUDE THE PERSPECTIVE OF ALL CRITICAL CONSTITUENCIES IN THE FUNDING REVIEW
OCUFA understands that the Ontario government has nearly completed its planned review of the Ontario university funding model. As the voice of more than 18,000 university faculty, academic librarians, and academic professionals, OCUFA is dismayed that it was not consulted as part of this review, particularly considering OCUFA’s longstanding call for a multi-stakeholder review of the university funding model.
The government’s failure to engage with and incorporate expertise from across all critical stakeholder communities in this review recalls its approach to the Blue-Ribbon Panel on Postsecondary Education Financial Sustainability, which included no representation from students enrolled in postsecondary education or professors. These are the two most important constituencies in postsecondary education, but neither have been consulted and therefore, their essential perspectives are not represented in the funding review. It is regrettable that the government has once again taken this misguided approach.
OCUFA calls on the government to embark on wider consultations, including with OCUFA and student groups, and for it to accept written submissions from all postsecondary stakeholders. There is still time for government to make the right decision and incorporate these voices.
ONTARIO UNIVERSITIES ARE FACING A FUNDING CRISIS
Ontario universities are facing an unprecedented funding crisis that threatens their sustainability because of four factors:
- chronic per capita underfunding;
- tuition cuts and freezes;
- overreliance on international students; and
- changing demographics
Chronic Underfunding as a Result of Low Per Capita Funding
A foundational cause of the chronic underfunding is that Ontario makes the lowest per capita investment in higher education in Canada. In 2022-23, the most recent year for which there is comprehensive data, Ontario provided $10,246 in total university funding per domestic full-time equivalent student, putting Ontario far behind the national average of $16,789. Ontario’s funding is entrenched in last place, so far behind that it would take a 55% increase to match Alberta, the province with the second-lowest funding per domestic FTE in 2022-23.
Low per-student funding means that Ontario’s public universities receive a much smaller portion of their total revenues from the province than is common across Canada. While the average Canadian public university received 32.4 per cent of its revenues from its provincial government in 2023-24, provincial funding accounted for just 21.1 per cent of university revenues in Ontario. This is the lowest total in Canada by far, with Nova Scotia the only other province below this national average. Because of its size, Ontario effectively brings the national average down.
Chronic Underfunding as a Result of Declining Domestic Tuition
The funding gap for Ontario’s universities is compounded by earlier policy decisions that moved it increasingly in the direction of an unequal ‘user pays’ system that contributed to the affordability crisis in higher education. Motivated by this affordability issue, in January 2019, the Ontario government cut tuition by 10 per cent and implemented a tuition freeze that remains in effect. While this did provide some relief to students, it did not address the fact that Ontario’s domestic students continued to pay one of the highest rates of tuition in the country. In the current academic year, Ontario’s domestic students pay an average tuition of $8,958. This is over $1,224 more than the Canadian average of $7,734.
Over Reliance on International Students
Given chronic underfunding due to low per capita funding and declining rates of tuition, universities have been forced to look elsewhere for funding. The province’s decision to allow unrestricted international student tuition fees gave universities a way of filling funding gaps.
In the last 10 years, the number of valid foreign study permits has risen by 280 per cent in Ontario compared to 118 per cent in the rest of the country. The government’s Blue-Ribbon Panel underscored this issue, noting that Ontario universities have become over-reliant on international tuition fees to fund their institutions. The 2025 federal budget continues to tighten the cap on foreign students. This will drive the over reliance of Ontario universities on those students into sharp relief.
Changing Demographics
The over-reliance on international students points to another concern raised by chronic underfunding. Ontario’s funding practices were born in a time of stagnant or declining domestic enrolments, but this is no longer the case. Ontario is on the cusp of a surge in domestic student enrolment, with the proportion of Ontarians aged 20-24 expected to rise by 12 per cent by 2030, meaning there will be 100,000 more Ontarians aged 20-24 than there are now. Currently, 24 per cent of this demographic actively attends university. If this rate holds, Ontario will need an additional 24,000 university seats by 2030 to meet the demand just from this age range, which is not the only demographic that attends university. Ontario universities will not be able to absorb this growth in demand.
New, Unfunded Responsibilities
Ontario universities are constantly being asked to do more with less. They face an almost relentless wave of new responsibilities that are mandated by government, both provincial and federal. While many of these responsibilities are important to the mission and well-being of the university community, they frequently come with significant new costs that are not offset by any new funding. Universities are expected to find the money to cover these new costs within their existing budgets that are already strained by chronic underfunding, leaving them shifting critical resources from one high priority budget line to another.
THE ONTARIO GOVERNMENT MUST MAKE CHANGES TO THE FUNDING FORMULA
To address the current funding crisis within Ontario universities, the Ontario government must make critical updates to the funding formula and immediately increase per student funding.
Funding Model Fundamentals
OCUFA holds that an appropriate funding model capable of supporting a strong and stable public university sector must do the following:
•Support and adequately fund the enrolment growth of academically qualified Ontario students;
•Recognize that all university programs equip learners with transferrable job skills;
•Embrace transparency by producing a funding model that can be understood and appreciated by any Ontario taxpayer; and
•Strengthen and sustain the ability of Northern universities to contribute to their regional communities and economies.
Ontario Must Undertake Key Updates to the Funding Formula
Recognize that all disciplines contribute to the Ontario economy
The Ontario government has increasingly relied on targeted “envelope” funding to support its favoured programs, most obviously those in STEM. The evidence is clear that all Ontario university programs prepare future workers for success by equipping them with highly transferrable job skills. While colleges are exceptional at preparing learners for highly specific occupations, universities equip learners with skills relevant to a wide array of occupations, occupations which tend to be more lucrative than those pursued by college graduates. They also provide them the flexible skills that allow them to be resilient in today’s rapidly changing labour market and to drive the innovation that grows Ontario’s current and future economy.
In Ontario, the evidence is clear that university graduates across all disciplines are thriving. Three years after graduation, Ontario humanities graduates have the same median earnings as STEM graduates and the same employment rate. Their strong strategic thinking abilities and emotional and social intelligence skills are clearly highly valued by employers. These skills are also among the least susceptible to being displaced by AI. Collectively, the employment outcomes of university graduates is strong across all fields. In a survey of 2020 graduates, the Council of Ontario Universities found an employment rate of 95.1% two years after graduation; no program area had an employment rate below 90%.
Streamline the funding formula
The current funding model is needlessly complex, requiring a 44-page technical manual full of advanced arithmetic to explain it. The result is that the average Ontario government official or university administrator, let alone the average Ontario taxpayer, cannot explain how universities are funded. This is at odds with the government’s professed commitment to democracy and transparency. Ontarians should not need a PhD to understand how their public universities are funded.
Ensure that all regions of the province are part of Ontario’s economy of the future
The university funding model will also need to equip Northern universities to continue supporting their regional communities and economies. Ontario’s universities have unique mandates, with many having mandates oriented toward enhancing postsecondary access and participation, including among Francophone and Indigenous communities. With a smaller population base, Northern universities lack the opportunities to pursue economies of scale to the same extent as
other postsecondary institutions and require additional financial support to reflect their higher cost base. The urgency to support Ontario’s Northern universities has never been higher. With the Ontario Government’s intension to enhance economic activity in the Ring of Fire, graduates from Laurentian University’s Mining Engineering and Nipissing University’s Environmental Science programs, among others, will be central to growing Ontario’s economy.
Ontario Must Immediately Increase Per Student Funding
An increase in per-student funding across all institutions is needed to avoid a crisis in Ontario universities. Government funding is a more stable source of revenue than international tuition. If Ontario universities were funded at the same rate as the Canadian average, they would be able to weather a sudden catastrophic drop of 50 per cent in their international undergraduate enrolment.
The Blue-Ribbon Panel’s call for enhanced funding for Ontario’s universities, entailing an immediate 10 per cent increase (in real terms, only a 6 per cent when accounting for inflation) followed by annual 2 per cent increases, would still leave Ontario dead last in funding.
At the very least, Ontario should strive to match the Canadian average of per student funding, recognizing that such a transformation may not be possible overnight. OCUFA urges the government to immediately embark on a path of increasing per student funding by of 11.75 per cent per year, which would bring per capita funding in Ontario to the provincial average within four years and raise funding from $11.7k to $18.0k per student.
Conclusion
Universities are the backbone of the Ontario economy, equipping the next generation of Ontarians with the skills they need to thrive. Achieving the best possible funding model is an existential imperative, and one in which all postsecondary stakeholders deserve a voice.