International student fees: short-term profits vs long-term sustainability

International student fees: short-term profits vs long-term sustainability

Canada’s higher education system is unique in that education falls within provincial jurisdiction rather than federal. This means that rates vary among provinces and institutions, which in many cases results in instances of extreme polarisation between domestic and international tuition fees. At the same time, Canadian higher education institutions are facing challenges to meet their financial bottom line due to provincial budget cuts. In response, an increasing number of universities are relying on international tuition revenue to make up for budget cuts. But how can we know if the rates of international tuition that Canadian academic institutions are setting are a quick fix to offset cuts to funding or if they will have a long-term impact on their sustainable growth, and what can this tell us about how higher education systems elsewhere might tackle the question of tuition fees?

Financial quick fix

Since the end of a five-year tuition freeze in 2008 at the University of Regina, a medium-size university located in the prairie province of Saskatchewan, tuition has increased year after year, jumping 36% from 2008 to 2018. Through increases in student tuition, the University of Regina has been able to balance their budget. “It is absolutely correct to say the tuition revenue from what we call ‘visa students’, students from out of country, is essential to the operation of the [University of Regina],” stated Dr. Thomas Chase, Provost and Vice-President (Academic).

But the University of Regina is not the only institution in the province of Saskatchewan that is relying on tuition revenue. The University of Saskatchewan increased tuition in 2018 by 4.8% for arts and science students – more than double last year’s increase of 2.3 percent. Dr. Tony Vanelli, Provost and Vice-President (Academic) mentioned that “tuition revenues are projected to reach $137.3 million in 2018-19 – representing 25% of the [University of Saskatchewan’s] operating budget.”

The other side of the story

If we look deeper into international student tuition fees, Canadian universities have different approaches when it comes to setting graduate tuition. For example, focusing only on PhD tuition and fees for 3 credit hours, for the 2018–2019 academic year the University of Regina charged $2295 for domestic and $3455 for international students per semester, whereas University of Saskatchewan charged $1379 for domestic and $2178 for international students per semester. But other Canadian provinces are taking a different approach when it comes to tuition fees for international PhD students.

In 2018, the province of Ontario increased funding to help recruit and support international PhD students. This increase in funding resulted in many research-intensive universities reducing their international PhD fees to the same level as those for domestic students, including University of Ottawa and University of Toronto. The lowering of PhD tuition for international students is attracting students with strong academic backgrounds from around the world – and because 50% of international students who enrol as PhD students at Ontario universities become permanent residents and Canadian citizens, they are also contributing to the province’s economic growth.

Brock University is another academic institution in Ontario that is making great strides to support international PhD students. Through fellowships and financial support, Brock University is able to support international PhD students and cover all their tuition fees. “The initiative will make the university more accessible to a wider variety of students from different countries”, said Dr. Jamie Mandigo, Vice-Provost of Enrolment Management and International at Brock University.

What about long-term sustainable growth?

With some Canadian institutions increasing international student tuition, and others lowering it to the level of domestic fees, how will these institutions be affected in the long term? The answer could be sustainable growth.

If we focus on the University of Regina and the University of Saskatchewan, both are ranked within the bottom of their university categories. According to Maclean’s University Rankings 2019, University of Regina was ranked 14/15 among comprehensive schools (institutions that offer undergraduate, graduate and professional degrees), and University of Saskatchewan 14/15 among medical/doctoral schools (institutions that have a strong research focus and offer a wide range of graduate degrees).

Should the University of Regina and the University of Saskatchewan continue to increase international tuition fees comparable to the fees charged by higher-ranked universities, international students with high academic standing would likely apply to such leading universities, while students in the lower percentile will apply to Regina and Saskatchewan instead. International students with weaker academic backgrounds will need additional academic support, resulting in higher institutional costs due to this additional input of resources; they will take longer to graduate, and in some cases might not be able to finish their degree, negatively affecting the overall academic quality, student satisfaction and ranking of these universities. Therefore, while international students might be supporting Saskatchewan universities financially, such institutions will not be able to achieve sustainable growth in the long term due to the focus on short-term financial gain.

In the cases of the University of Ottawa and University of Toronto, both have a good academic reputation and high rankings (University of Toronto 1/15 and University of Ottawa 9/15 among medical/doctoral schools). As both universities are charging PhD international students domestic tuition fees, it works as a competitive advantage to recruit students with strong academic backgrounds that will contribute to their institutional research endeavours, thus improving the overall academic quality and research output of these universities. This should result in either maintaining or improving their rankings.

As for Brock University, this institution is ranked 13/15 among comprehensive schools. However, contrary to the University of Regina (also a comprehensive school), Brock University is able to cover all tuition fees for international PhD students through fellowships and additional funding. This can result in the recruitment of highly academic students with financial constraints that will be able to contribute to Brock University’s research output and its overall ranking.

Moving forward: to raise or not to raise?

As Canadian academic institutions are not the only ones charging tuition differential fees, universities and colleges around the world must make a comprehensive analysis of the long-term implications – academic, economic and social – of increasing international tuition and fees. For example, Brock University is looking at their changes in international PhD tuition as their commitment to global growth: “We are seeing a lot more interest from developing countries, from northern Africa … from Latin American countries […] When they finish their degrees, these students will be able to benefit their home countries […] That's an important role we as a university can play. We have a social obligation to disseminate knowledge worldwide and education can be that catalyst of revitalization in all parts of the world,” expressed Dr. Mandigo, Vice-Provost of Enrolment Management and International at Brock University.

Should the main purpose of international student recruitment be to support institutional academic and research advancement, to relieve institutional financial constraints, or to be a way to positively transform the world? This a decision that university executive teams and boards of governors are taking – and let us hope that they are doing so wisely.

Money matters

International students as sources of revenue may be a taboo topic, but it’s relevant in Europe too. The EAIE Barometer: Money matters explores how financial concerns like these tie into the everyday work of internationalisation.

Arturo Segura
University of Ottawa, CanadaArturo is Director of the Centre for Research Opportunities at the University of Ottawa, Canada.