TORONTO/SUDBURY, April 13, 2022 – The Auditor General of Ontario’s preliminary report on Laurentian University confirms assertions faculty have been making for more than a year—that the university’s financial crisis resulted from secretive and deficient governance practices and the Ford government’s failure to step in and support the institution when its financial needs became clear. The Auditor General found that the use of the Companies’ Creditors Arrangement Act (CCAA) was inappropriate and unneeded and that, instead, the university should have worked collegially with the Laurentian University Faculty Association to address the institution’s financial challenges.
“The Auditor General’s report makes clear that day-after-day, month-after-month, Laurentian University’s senior administration embraced a flawed and secretive approach to institutional governance and financial planning that lacked the transparency and accountability vital to a healthy university,” said Sue Wurtele, President of the Ontario Confederation of University Faculty Associations (OCUFA). “Once they realized the consequences of their mistakes, instead of coming clean and working with the faculty association to find a path forward, the senior administration doubled down on secrecy and spent months planning how they would dismantle the university through the CCAA process.”
Among the Auditor General’s findings were numerous problems with the university’s governance practices, including weak oversight and excessive use of in-camera sessions by the Laurentian Board, ill-advised building projects, questionable hiring practices, and an increasingly expensive payroll for senior administrators. When these poor governance practices led to a financial crisis, the senior administration’s abhorrent solution was to spend tens of millions of dollars on lawyers in efforts to cut university programs, faculty, and staff. When the Auditor General was asked to investigate what had occurred, the toxic commitment to secrecy continued, with senior administrators creating a “culture of fear” amongst university workers and implementing “unprecedented restrictions” on access to university documents and staff.
“This is a clear validation of what we have been saying for years,” said Fabrice Colin, President of the Laurentian University Faculty Association (LUFA). “Time and again, the faculty association urged the university administration to be more accountable, come clean about the university’s finances, and work with us to strengthen this important public institution of higher education and its tricultural mandate. Time and again, we were ignored.”
The Auditor General found the destructive CCAA process was unnecessary and could have been avoided, and that the Ford government and Ministry of Colleges and Universities were aware of the university’s financial challenges before the CCAA process was triggered but failed to proactively intervene when the crisis became clear. The report also notes that the federal CCAA legislation is an inappropriate remedy for addressing financial challenges at public institutions as it undermines the fundamental principles of transparency, accountability, and the precedence of public interest. This report’s findings on the CCAA should be swiftly acted on by the federal Liberal government, which has committed to reforming insolvency legislation so that it can never be used again on another public institution.
“The Ford government had both the opportunity and duty to step forward and provide Laurentian University with the funding needed to prevent cuts and chart a new path forward,” said Wurtele. “Instead, Ford and numerous Ministers of Colleges and Universities sat on their hands, ignored their responsibilities, and watched the university collapse.”
“It’s time to begin a new chapter at Laurentian,” said Colin. “New leadership should be hired ready to embrace collegial, transparent, and accountable governance and the provincial government should step up to provide Laurentian University with the funding it needs to restore the programs, faculty, and staff that were cut as a result of the crisis and the Ford government’s inaction.”
The Auditor General’s report is available at: https://auditor.on.ca/en/content/specialreports/specialreports/Laurentian-U_Preliminary_Perspective_en.pdf