KPMG misses point of university education

Photo by Ovahlordx

The province’s KPMG report on post-secondary education fails to recognize what universities are supposed to achieve.

The Winnipeg Free Press reported on Oct. 4 that the accounting firm KPMG had produced a massive financial report advising the provincial government to freeze public- sector funding for post-secondary education and raise tuition and private-sector revenue, while using its control over money to cut funding for programs that can’t prove “value for money.”

Knowing its controversial suggestions will be unpopular, KPMG warned the Progressive Conservatives that “a robust change management and communications strategy will be needed” to defend what Manitobans will correctly perceive as changes that will harm post-secondary education in this province.

Why would the Pallister government pay KPMG hundreds of thousands of dollars for a report on the funding of post-secondary education? KPMG is not an expert on the subject. Given KPMG’s history, it would seem the government was looking for a rationalized, predictable outcome that would suit its economic priorities. KPMG is a for-profit firm whose responsibility is to serve its clients, not the public interest. They profit by giving their customers what they pay for.

In the past, this has resulted in some very questionable activities. The New York Times reported (Jan. 13, 2004), in the U.S., KPMG collected US$124 million in fees for creating tax shelters that cost the government at least US$1.4 billion in lost revenue.

The CBC reported (April 10, 2016) that critics want public hearings into Canada Revenue amnesty for KPMG offshore tax dodgers. The Toronto Star reported (July 22, 2011) that critics of KPMG’s city service review saw it as “smoke and mirrors, too shallow and underfunded to unearth best ways to save.”

The KPMG report tells us a lot about the Pallister government’s provincial approach to post-secondary education, and little else. A real study of the sector would include meaningful advice from the students, administrators, faculty, librarians and staff that actually are the university, as well as data from reputable independent sources.

This sort of information is already available, but it suggests that should the Progressive Conservatives implement the recommendations of their well-funded review, it would be to the detriment of post-secondary education. The Investing in Canada’s Future panel (2017), chaired by former University of Toronto president David Naylor, found that in an effort to replace government funding, universities have turned increasingly to other forms of revenue.

This money, in part, has come from increases to tuition fees and larger undergraduate class sizes. However, this has had adverse effects on the student experience at university, creating, in Naylor’s opinion, “an environment that undermines excellence in both research and education.”

Research indicates that as tuition fees rise significantly, the average annual family income of those attending the university rises significantly as well. Cutting programs and courses reduces choice and lengthens the time for graduation, affecting both the quality and the affordability of the post-secondary education system for students.

The crude calculus of short-sighted “value for money” undermines the role of a post- secondary education system in society. A century ago, John Dewey argued that the true value of education is personal growth, preparing people to be fully participating democratic citizens. The university must be more than “a factory that turns out a certain product needed by industry”; it must remain a conscience and critic of society, often a role played by the humanities and social sciences.

A Pallister-KPMG university would make funding cuts that compromise the equality of access and educational experience of Manitoba students.

It would also jeopardize the province’s competitiveness. According to the World Economic Forum’s “competitiveness report,” investment in research and development by the Canadian business sector fares poorly in comparison to that of other wealthy countries. In 2016-17, the forum reported that “Canada’s largest disparities with Organization for Economic Co-operation and Development countries are in business sophistication and innovation.”

Limited private-sector R&D in Canada makes the government role especially important. Despite the claims about the inherent innovation of the private sector, it is the public sector that is often responsible for the largest gains in R&D. Much of this funding has been channelled through research departments in universities.

The Naylor panel’s first priority recommendation was for university research to be investigator-led, not chosen by government or the private sector. And it is to be funded by increases in government spending.

Maybe the most troubling aspect of the Pallister-KPMG idea of a university is its clear intention to micromanage post-secondary education, focusing on immediately measurable productivity that undermines academics’ ability to do basic research. In order to serve its function of innovation, criticism and co-operation, a university requires a stable and independent environment.

External interference, whether by government or the private sector, limits academic freedom and the ability to pursue research and teaching without fear of being censored, disciplined or penalized financially. Without academic freedom, there is no higher education.

Robert Chernomas and Ian Hudson teach economics at the University of Manitoba and are authors of two recent books, Economics in the Twenty-First Century: A Critical Perspective and The Profit Doctrine: Economists of the Neoliberal Era.

This article originally appeared in the Winnipeg Free Press.

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