Tag: caps

  • Defense Department Caps Universities’ Indirect Cost Rates

    Defense Department Caps Universities’ Indirect Cost Rates

    The Department of Defense is planning to cap indirect cost reimbursement rates for higher education institutions at 15 percent, according to a May 14 memo signed by Secretary of Defense Pete Hegseth. 

    “The Department of Defense (DoD) is the steward of the most critical budget in the Federal Government—the budget that defends our Nation, equips our warfighters, and secures our future. That stewardship demands discipline. It demands accountability. And it demands that we say no to waste,” wrote Hegseth.

    The memo directs the DOD to develop the new policy within 21 days, marking the fourth federal agency—including the National Institutes of Health, the Department of Energy and the National Science Foundation—that has enacted a plan to cap indirect cost rates at 15 percent. For decades, universities have negotiated with the federal government to calculate bespoke indirect cost reimbursement rates to pay for research costs that support multiple grant-funded projects, such as facilities maintenance, specialized equipment and administrative personnel. (The paragraph has been updated.)

    Universities and their trade associations have already sued the NIH, DOE and NSF over these plans, arguing that capping indirect costs would hurt research production and compromise global competitiveness, all while violating multiple aspects of the Administrative Procedure Act, including bypassing congressional authority required to alter indirect cost rates. So far, federal judges have blocked indirect cost caps from taking effect at the NIH and DOE. The NSF agreed to pause the cap until June 13 in order to proceed to summary judgment, which is a way to resolve the case quickly without a full trial.

    Matt Owens, president of COGR, which represents research institutions, condemned the DOD’s newly announced plan. 

    “DOD research performed by universities is a force multiplier and has helped to make the U.S. military the most effective in the world. From GPS, stealth technology, advanced body armor, to precision guided missiles and night vision technology, university-based DOD research makes our military stronger,” Owens said in a statement. “A cut to DOD indirect cost reimbursements is a cut to national security. Less funding for research means less security for our nation.”

    Hegseth’s memo claimed that capping the Defense Department’s indirect cost rate for universities would “save up to $900 [million] per year on a go-forward basis,” while also claiming that the department’s “objective is not only to save money, but to repurpose those funds—toward applied innovation, operational capability, and strategic deterrence.” The NIH has also made similarly incompatible assertions. It touted on social media its indirect rate cap plan’s potential to save taxpayers more than $4 billion, while a lawyer for the NIH told a federal judge that the cut was simply a reallocation of funds. 

    The Defense Department’s plans “will not stop at new grants,” Hegseth wrote, adding that “meaningful savings can also be achieved by revisiting the terms of existing awards to institutions of higher education.” The memo directed the under secretary of defense for research and engineering to do the following within 30 days:

    • Initiate a departmentwide effort to renegotiate indirect cost rates on existing financial assistance awards to institutions of higher education. “Wherever cooperative, bilateral modification is possible, it shall be pursued.”
    • “Where bilateral agreement is not achieved, identify and recommend lawful paths to terminate and reissue the award under revised terms.”
    • “Complete renegotiations or terminations for all contracts by 180 days from the date of this memorandum.”

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  • Over 5k HE job cuts in Canada since study permit caps

    Over 5k HE job cuts in Canada since study permit caps

    • Over 5,000 higher education jobs in Canada have been cut since the government clamped down on study permit numbers – with Ontario, British Columbia and Quebec the hardest hit.
    • The thousands of job cuts tracked by a higher education expert are just those that have been made public, with the possibility that there have been many more.
    • Institutions are also having to consolidate the programs they offer, as billions of dollars worth of budget cuts make their mark.

    More than 5,000 jobs have been lost in the post-secondary education sector in Canada since the federal government first imposed a study permit cap in January 2024, according to research from higher education consultant Ken Steele. Further restrictions – capping study permits at a scant 473,000 – were introduced in September.

    But the cuts collated by Steele are just the ones that have been made public. A number of institutions are not disclosing their drops in employment in teaching and administration.

    With Liberal Mark Carney triumphing in last month’s election, his new government must address worries about jobs disappearing, such as in the auto manufacturing sector, due to US President Donald Trump’s punishing tariffs.

    Slashing jobs in education – due to the government’s own actions – is a huge mistake, Steele said.

    “The unilateral imposition of extreme, abrupt, student visa caps have thrown Canadian higher education into crisis, decimated our reputation abroad and precipitously destroyed one of our major ‘export’ industries,” he told The PIE News.

    For the past year, Steele has been tracking reported job losses at universities and colleges across the country. As expected, programs that relied heavily on international students were forced to make the biggest cuts.

    According to Steele’s data, Mohawk College in Hamilton, Ontario, has eliminated almost 450 positions. The University of Windsor, also in Ontario, has reduced employment by 157 spots.

    The total of 5,267 cuts across the country almost certainly underreports the actual job losses. “Many institutions are keeping quiet about their cuts, including the Ontario private colleges that were partnering with public colleges,” he noted.

    It’s not just jobs that are being slashed. Post-secondary institutions have been forced to eliminate programs and reduce spending.

    Fanshawe College in London, Ontario, appears to lead the way in getting rid of programs. It has suspended 50 fields of study, including advanced live digital media, construction project management and retirement residence management. In all of Canada, Ontario colleges are the top eight for suspending programs, accounting for two-thirds of the 453 cuts.

    The financial hit is significant. “So far, I have tracked CAD$2.2 billion in budget hits at post-secondary schools across the country,” Steele said. This includes last year’s cuts as well as planned reductions for next year.

    If Canada reopened its doors tomorrow, it would likely take until at least 2030 to recover the international enrolment momentum we had just two years ago
    Ken Steele, education consultant

    Ontario was most reliant on international revenues and has been hardest hit by the study permit cap. Steele’s figures suggest that 70% of the cuts have struck that province, with British Columbia and Quebec also suffering. The remaining seven provinces faced more modest losses.

    In Vancouver last month, dozens of staff and faculty at several post-secondary institutions staged a protest of the study permit cap. Taryn Thompson, vice-president of the Vancouver Community College Faculty Association, said there have been 60 layoffs at her school alone, with more expected in the coming months.

    The big question is: Will the new federal government ease the cap? The issue of post-secondary funding was hardly raised at all during the election campaign, overshadowed by concerns about Trump’s threats to annex Canada.

    There’s also the concern about restoring Canada’s reputation following the study permit debacle.

    “If Canada reopened its doors tomorrow, it would likely take until at least 2030 to recover the international enrolment momentum we had just two years ago,” warned Steele.

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  • Coalition announces harsher international student caps – Campus Review

    Coalition announces harsher international student caps – Campus Review

    The Coalition has said it would cap international students at 240,000 and triple the visa application fee to $5,000 for those applying to Group of Eight universities to free up room in the rental market.

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  • Study permit caps not to blame for Ontario college funding crisis

    Study permit caps not to blame for Ontario college funding crisis

    Educators in Ontario are setting the record straight about the cause of the province’s college funding crisis – the blame for which, they say, falls squarely on the Ontario provincial government.  

    “We currently see a wave of Ontario college program closures/suspensions sweeping across all of Ontario’s 24 colleges… This is just the tip of the iceberg and there will be many more to follow,” school educator and former college administrator David Deveau wrote in a letter to government officials.  

    “This letter aims to correct the media’s false assertion that these program suspensions are a direct result of the federal government’s restrictions on international student visa approvals and identify the actual reason for this alarming trend across the Ontario college system,” he continued.  

    The letter, which has been widely shared by sector stakeholders, lays the blame for Ontario’s college crisis on decades of underfunding from the provincial government, exacerbated by a 10% tuition fee reduction and freeze in 2019.  

    “Ontario’s higher education sector is in crisis due to chronic underfunding, tuition freezes, and a reliance on international student tuition as a financial lifeline,” said Chris Busch, senior international officer at the University of Windsor.  

    In 2001/02, Ontario’s colleges received 52.5% of their revenue from public funding, the second lowest of any province, according to Canada’s statistics agency.  

    By 2019/20, this figure had dropped to 32%, by far the lowest proportion across Canada’s provinces and territories, which, on average, provided 69% of college funding that year.   

    “Colleges and universities have had to attract talent from abroad, increasingly enrolling international student to help fill the funding gap,” said Vinitha Gengatharan, assistant VP of global engagement at York University.  

    This is particularly evident at the college level, where institutions have seen international student enrolment of 30-60%, compared to universities where it ranges from 10-20%, added Gengatharan.

    Educators across Ontario’s college and university sector have spoken out in support of Deveau’s letter, calling for a long-term commitment to stable and adequate funding from the provincial government.  

    In recent weeks, Ontario’s 24 public colleges have made the headlines for sweeping budget cuts, course closures and staff layoffs.  

    Stakeholders have raised additional concerns about increased class sizes and deferred maintenance and tech upgrades eroding the quality of education and the student experience for all learners, including Ontarians, Busch maintained.  

    This week, Algonquin College announced the closure of its campus in Perth, Ontario, alongside the cancellation of 10 programs and the suspension of 31, citing “unprecedented financial challenges”.  

    It follows Sheridan and St. Lawrence colleges announcing course suspensions with associated layoffs, and Mohawk College cutting 20% of admin jobs.  

    The ability of Ontario’s universities to fulfil their mission – providing high-quality education, driving research, and fuelling the economy with talent – is at significant risk under current conditions
    Chris Busch, University of Windsor

    “What is currently happening within our colleges is a downward spiral that will hurt Ontarians, the labour market, and our economies in the end,” wrote Deveau, adding that it was especially important to be strong in the face of externally imposed tariffs from the Trump administration.  

    In the letter, Deveau said the tuition freeze – which continues to this day – is akin to a “chokehold suffocating the life out of the college system” that is eliminating vital programs, restricting career choices of Ontarians and “jeopardising the province’s economic future”. 

    He raised attention to the “domino effect” of program closures impacting students’ career prospects, faculty layoffs and damaging local economies.  

    “The ability of Ontario’s universities to fulfil their mission – providing high-quality education, driving research, and fuelling the economy with talent – is at significant risk under current conditions,” said Busch.  

    In March 2023, the Ontario government itself published a Blue-Ribbon Report recognising the need to increase direct provincial support for colleges and universities, “providing for both more money per student and more students” and raising tuition fees.

    Last year, the Ontario government injected $1.3 billion into colleges and universities over three years to stabilise the sector’s finances, though critics are demanding systemic funding changes rather than “stop-gap” and “gimmicky” proposals, said Deveau.  

    Nationwide, Canada’s colleges were dealt another blow when the IRCC announced its new PGWP eligibility criteria, which stakeholders warned risked “decimating” Canada’s college sector.

    It is feared that more Ontario colleges will face cuts before the province’s 2025 budget, expected in April.  

    The PIE News reached out to the Ontario government but is yet to hear back.

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  • Ministerial Direction 107 to be revamped after caps defeated

    Ministerial Direction 107 to be revamped after caps defeated

    Education Minister Jason Clare has been under pressure from the sector to replace the direction. Picture: NCA NewsWire/Martin Ollman



    By: NCA Newswire

    in International Education, Top Stories


    December 9, 2024

    The Albanese government is preparing to replace a controversial ministerial direction that has been criticised for favouring sandstone universities over regional and outer-suburban institutions, as providers warn Labor’s “confused and mismanaged” policy approach is damaging the sector and the economy.

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