By Hussain Abdul Hussain ---
The silence of the administration on
student inquiries about the possibility of an increase in tuition next
year is ridiculous. Two probable scenarios stand behind this silence.
It could be either that the administration is hiding budget numbers, or
that it prepares the University's annual budget overnight.
If the administration is concealing numbers until after
it presents them to the Board of Trustees, then the administration's transparency
is at stake. If the numbers, which are usually forwarded to the trustees
in mid-March, were not ready by the first of March (the date of the recent
student strike), then AUB certainly has a bunch of amateurs occupying the
fifth floor of College Hall and running the University's financial affairs.
Personally, I do not know much about budgeting.
Yet, what I gathered from official statements can be put as follows.
The University budget is divided in two: the capital budget and the operating
budget.
On the one hand, the capital budget comes from gifts and
stands in the form of endowments invested mostly in the US stock market.
A certain formula, which takes all economic factors into consideration
(inflation, variation in stock market growth, etc.), allows AUB to use
a percentage of this capital budget revenue for maintaining and expanding
the AUB campus and its facilities.
The University has its projections for this budget and
can foretell its expected revenue for at least the coming five years.
For example, in the coming future, with the slowing American economy and
with the expected relative recession in the US stock market, AUB is not
expected to gain revenue equal to that of the previous five years from
its capital budget.
The operating budget, on the other hand, comes mainly
from investors' (student) revenues and from the revenues of hospital services.
This budget, presented annually at the Issam Fares Hall, pays for University
expenditures, which include salaries and purchases. This budget becomes
suddenly visible in April and takes the issue of balancing the books of
the coming fiscal year into consideration.
The operating budget always seems to have been prepared
in an overnight. In an overnight the University announces an increase
in tuition fees. The administration seems to have no expectations
for this budget, no formulas, nothing (or as we said, has them but hides
them). When students inquire about the reasons behind the annual
increase in tuition the administration gives one of two answers: l) the
inflation rate in the Lebanese economy, which affects the University's
purchases (In the case of deflation or decrease in purchasing expenses
no decrease in tuition fees is expected.) and 2) additional expenses.
In the case of inflation, students were saying, we can
swallow an equivalent increase in tuition; otherwise, the administration
should cut the rhetoric. The students were absolutely right.
At least they were pushing the administration to keep up with its "no inflation,
no increase" slogan.
What bothers students most is the second answer, that
the increase is necessary to meet additional expenses. In this case,
the administration underestimates the ability of both students and faculty
to comprehend budgeting principles. When students ask the administration
to cut down its additional expenses, the administration shows them a list
of these expenses, something that looks like a shopping list, and asks
them to scratch out whatever they think to be unnecessary.
Heavens! That is funny! A budget that is prepared
in an overnight with a shopping list next to it. Doesn't the administration
have any expectations about the operating budget for the coming five years?
Don't they have any graphs or projections that might justify the administration's
views based on given economic factors in the region?
Financial administrators must have set formulas for the
operating budget in which they take into consideration the Lebanese inflation
rates, the shrinking student market, the expected alumni contribution,
the expected expansion of the academic infrastructure, and the expected
losses of the hospital. Then they can draw some projections to say
to students: look, over the coming five years, we will increase tuition
by x, y, and z and you will have problems a, b, and c solved and the academic
infrastructure completed.
Then the administration can say: listen, at this point
we think we are operating at high standards. There will be no further
increase in tuition unless we cannot meet the pressure of inflation in
a given year.
The students might swallow justified increases in tuition
provided they were assured that no other variable could help achieving
what's in the best interest of the University's growth. Yet, they
are not expected to remain calm while they find themselves to be the only
negotiable digit in the operating budget's balance sheet.
The student demonstration on February 28 against tuition
increase was right. The students might have included some false arguments,
which the administration tried to exploit to show the immaturity of the
students' action. Yet, it seems that the immature party was the one
who was beating around the bush while never answering the main concerns
about tuition increase.
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