Transcript: Evaluating Performance-based Funding | Oct 03, 2019

Steve sits in the studio. He's slim, clean-shaven, in his fifties, with short curly brown hair. He's wearing a blue suit, white shirt, and striped lilac tie.

A caption on screen reads "Evaluating performance-based funding. @spaikin, @theagenda."

Steve says IN THE LAST PROVINCIAL
BUDGET, THE ONTARIO GOVERNMENT
ANNOUNCED ITS INTENTION TO MOVE
TO A PERFORMANCE-BASED FUNDING
MODEL FOR COLLEGES AND
UNIVERSITIES.
HERE TO HELP US UNDERSTAND JUST
WHAT THAT MEANS AND THE IMPACT
IT COULD HAVE ON THE EDUCATION
STUDENTS RECEIVE AT OUR
POST-SECONDARY INSTITUTIONS, WE
WELCOME:
GYLLIAN PHILLIPS, SHE IS
ASSOCIATE PROFESSOR OF ENGLISH
AT NIPISSING UNIVERSITY AND PAST
PRESIDENT OF OCUFA: THAT'S THE
ONTARIO CONFEDERATION OF
UNIVERSITY FACULTY ASSOCIATIONS...

Gyllian is in her late forties, with long curly blond hair. She's wearing glasses and a pink shirt.

Steve continues AND ALEX USHER IS HERE, HE'S
PRESIDENT OF HIGHER EDUCATION
STRATEGY ASSOCIATES.

Alex is in his mid-fifties, clean-shaven, with short gray hair. He's wearing a dark blue suit, a blue shirt, and a navy-blue tie.

Steve continues WE ARE PLEASED TO WELCOME TWO
FAMILIAR FACES WHO UNDERSTAND
THIS COMPLICATED TOPIC BUT IT'S
AN IMPORTANT TOPIC, WHICH IS WHY
WE'RE DOING IT.
I WANT TO TAKE A SECOND OFF THE
TOP AS WELL TO SAY THAT WE
ACTUALLY HAD THE HIGHLY UNUSUAL
SET OF CIRCUMSTANCES WHERE THE
MINISTER OF TRAINING, COLLEGES,
AND UNIVERSITIES WAS PREPARED TO
COME ON THIS PROGRAM WITH THE
TWO OF YOU AND HAVE A DISCUSSION
ABOUT IT.
ROSS ROMANO FROM SAULT STE.
MARIE.
SADLY SOME KIND OF FAMILY...
WHAT WAS THE EXPRESSION?
A FAMILY... PERSONAL EMERGENCY
CAME UP AT THE LAST MOMENT AND
WE HOPE HE'S OKAY AND
EVERYTHING'S OKAY, BUT SADLY, HE
IS NOT ABLE TO BE WITH US RIGHT
HERE.
OKAY.
LET'S DIVE IN.
ALEX, PERFORMANCE-BASED FUNDING.
WHAT DOES THAT MEAN?

The caption changes to "Alex Usher. Higher Education Strategy Associates."
Then, it changes again to "Opening up the books."

Alex says WELL, USUALLY
WHAT HAPPENS, THE GOVERNMENT
GIVES MONEY TO INSTITUTIONS, IS
IT GIVES THE MONEY BASED ON THE
NUMBER OF STUDENTS THEY HAVE.
AND THAT'S MEDIATED BY THE KINDS
OF STUDENTS THEY HAVE.
YOU GET MORE FOR AN ENGINEERING
STUDENT THAN AN ARTS STUDENT,
THAT KIND OF THING.
PERFORMANCE-BASED FUNDING IS A
WAY OF SAYING, ACTUALLY, WE'RE
NOT AS CONCERNED WITH THE NUMBER
OF STUDENTS THAT YOU HAVE.
WHAT WE CARE ABOUT IS THE
RESULTS THAT THE INSTITUTION IS
ABLE TO OBTAIN.
SO, FOR INSTANCE, YOU PAY FOR
GRADUATES; YOU DON'T PAY FOR
STUDENTS.
THAT WOULD BE PROBABLY THE
SIMPLEST WAY OF DESCRIBING IT.
PERFORMANCE-BASED FUNDING HAS
BEEN USED ALL OVER THE WORLD.
IT'S IN USE IN I THINK ABOUT 43
U.S. STATES.
IT'S IN USE IN MOST OF EUROPE,
PLACES LIKE NORWAY AND GERMANY
AND FRANCE.
THIS IS A PRETTY STANDARD WAY OF
DOING BUSINESS, AT LEAST FOR
PART OF THE BUDGET.
USUALLY IT'S ABOUT STUDENT
COMPLETION.
SOMETIMES IT'S ABOUT RESEARCH
OUTPUTS.
AND IN ONE OR TWO PLACES, IT'S
ALSO ABOUT STUDENT EMPLOYMENT
RATES POST-GRADUATION.

Steve says IF OTHER PLACES HAVE
BEEN DOING THIS FOR A LONG TIME,
HOW COME WE NEVER HAVE?

Alex says WE HAVE IN VERY SMALL AMOUNTS.
SO ONTARIO HAS HAD I THINK ABOUT
1.5 percent OF UNIVERSITY BUDGETS HAVE
BEEN BASED ON COMPLETION RATES
FOR ALMOST 20 YEARS NOW, I
THINK.
SO IT'S NOT TOTALLY UNKNOWN.
BUT IT'S NEVER BEEN A MAJOR
PORTION OF THE FUNDING HERE.

Steve says 1.4 percent FOR
UNIVERSITIES, 1.2 percent FOR COLLEGES.
VERY SMALL.

Alex says YEAH.
AND I THINK... SO ONE OF THE
RAPS AGAINST IT IS IF YOU DON'T
DESIGN A PERFORMANCE-BASED
FUNDING SYSTEM WELL, IT CAN MAKE
FUNDING VERY UNEVEN FOR
INSTITUTIONS.
YOU DO WELL ONE YEAR; YOU DON'T
DO WELL ANOTHER YEAR.
CERTAINLY IN THE 1990s, THERE
WERE A COUPLE OF STATES IN THE
UNITED STATES, I THINK SOUTH
CAROLINA WAS ONE OF THEM, WHERE
THINGS DID GO VERY BADLY AND
MONEY DID FLUCTUATE A LOT.
THAT'S NOT SO MUCH AN ARGUMENT
AGAINST PERFORMANCE-BASED
FUNDING BUT IT'S AN ARGUMENT
AGAINST BAD PERFORMANCE-BASED
FUNDING INDICATORS AND A WAY OF
TURNING THOSE NUMBERS INTO
DOLLARS.

Steve says GYLLIAN, IF THE
PROVINCE PLANS TO TAKE THIS NEW
AND DIFFERENT APPROACH, WHAT
WOULD BE THE VIEW OF PROFESSORS
ACROSS THE PROVINCE TO THIS?

The caption changes to "Gyllian Phillips. Ontario Confederation of University Faculty Associations."

Gyllian says FACULTY
ACROSS ONTARIO ARE OPPOSED TO
THIS.
IT'S A RECKLESS MEASURE WHICH IS
GOING TO INTRODUCE INEQUITIES
BETWEEN UNIVERSITIES WITHIN THE
SYSTEM ITSELF BUT ALSO INEQUITY
FOR STUDENTS WHO MAY WANT TO
ATTEND UNIVERSITY.
AND THERE IS NO CLEAR EVIDENCE
PRODUCED BY THIS GOVERNMENT THAT
THIS KIND OF MOVE... THIS
DRAMATIC MOVE IS NECESSARY, OR
THERE'S NO EVIDENCE INDEED THAT
IT WILL IMPROVE THE QUALITY OF
EDUCATION.
SO ALTHOUGH MY COLLEAGUE HERE
SAYS, YOU KNOW, DO IT, DO IT
WELL, THERE IS NOT A LOT OF
RESEARCH TO DEMONSTRATE A TRULY
GOOD SYSTEM OF PERFORMANCE-BASED
FUNDING.

The caption changes to "Gyllian Phillips. Nipissing University."

Gyllian continues AND WHAT WE SEE HERE IS A
RECKLESS SET OF ARBITRARY
TARGETS WHICH ACTUALLY DON'T
MEASURE THE QUALITY OF EDUCATION
AT ONTARIO UNIVERSITIES AT ALL.

Steve says DO YOU SHARE THOSE CONCERNS?

The caption changes to "Alex Usher, @AlexUsherHESA."

Alex says I THINK...
THERE'S TWO TYPES OF RESEARCH ON
PERFORMANCE-BASED FUNDING, AND
ONE OF THEM ARE VERY
QUANTITATIVE METHODS.
THEY PUT IN A PERFORMANCE-BASED
SYSTEM IN X YEAR.
DID IT CHANGE THE GRADUATION
RATE?
THOSE ARE DIFFICULT THINGS TO
DO.
THERE'S A WHOLE BUNCH OF WAYS
THAT THE DEPENDENT VARIABLE GETS
CONSTRUCTED THAT IT'S ACTUALLY
VERY DIFFICULT TO FIGURE OUT
BECAUSE USUALLY FOR THERE TO BE
A CHANGE YOU'D EXPECT THERE TO
BE A BIG CHANGE IN FUNDING.
IF THEY'RE DESIGNED WELL, YOU
DON'T HAVE BIG CHANGES IN
FUNDING IN YEAR ONE AND YEAR
ZERO.
THOSE STUDIES DON'T PICK THINGS
UP.
THE MORE QUALITATIVE STUDIES,
AND TENNESSEE IS A STATE THAT
WENT TO 100 PERCENT
PERFORMANCE-BASED FUNDING,
THERE'S BEEN SOME REALLY GOOD
WORK ON TENNESSEE, AND THAT'S A
PLACE WHERE YOU CAN CERTAINLY
SEE THE WORK THAT INSTITUTIONS
HAVE PUT INTO IMPROVE STUDENT
OUTCOMES, RIGHT?
CAN WE GET MORE GRADUATES.
CAN WE MAKE SURE THERE ARE MORE
MINORITY GRADUATES WHO ARE
COMING THROUGH THE SYSTEM.
AND I THINK WHAT YOU SEE IS IT
DOES CHANGE INSTITUTIONAL
BEHAVIOUR.
YOU CAN QUESTION THEN WHETHER OR
NOT CHANGING INSTITUTIONAL
BEHAVIOUR ACTUALLY CHANGES
INSTITUTIONAL OUTCOMES, BUT
THAT'S A QUESTION OF
INSTITUTIONAL EFFECTIVENESS,
RIGHT?
I THINK THERE IS ACTUALLY A FAIR
BIT OF EVIDENCE TO SUGGEST THAT
IT DOES CHANGE INSTITUTIONAL
BEHAVIOUR, WHICH IS WHAT YOU
WANT TO DO.

Steve says LET'S PUT UP A CHART
HERE.
SHELDON, I'M GOING TO ASK YOU TO
PUT THIS UP AND I'LL DESCRIBE IT
FOR THOSE LISTENING ON PODCAST.
THEY HAVE DECIDED APPARENTLY,
THE PROVINCE OF ONTARIO, THAT
THERE ARE GOING TO BE TEN BASIC
METRICS THAT THEY WILL JUDGE
POSTSECONDARY INSTITUTIONS BY IN
ORDER TO DETERMINE HOW THIS IS
ALL GOING TO WORK OUT.
HERE THEY COME...

A slate appears on screen, with the title "The 10 metrics."

Steve reads data from the slate and says
GRADUATE EMPLOYMENT EARNINGS,
EXPERIENTIAL LEARNING, SKILLS
AND COMPETENCIES, GRADUATE
EMPLOYMENT RATES, INSTITUTIONAL
STRENGTH AND-OR FOCUS,
GRADUATION RATES... ALEX, YOU
MENTIONED THAT EARLIER...
RESEARCH FUNDING AND CAPACITY
FOR UNIVERSITIES AND
APPRENTICESHIP-RELATED TARGET
FOR COLLEGES.
FUNDING FROM PRIVATE SECTOR
SOURCES WHICH WOULD GO TO
UNIVERSITIES, COMMUNITY AND
LOCAL IMPACT, AND AN
INSTITUTION-SPECIFIC TARGET
RELATED TO ECONOMIC IMPACT.
SO THESE ARE THE METRICS BY
WHICH, IN THE FUTURE,
POSTSECONDARY INSTITUTIONS ARE
GOING TO BE JUDGED TO DECIDE HOW
MUCH FUNDING THEY'RE GOING TO
GET.
WHAT'S WRONG WITH ANY OF THAT?

Gyllian says WHERE DO I START?

Steve says AT THE BEGINNING.

Gyllian says ALL RIGHT.
ONE OF THE POINTS THAT I MADE
EARLIER IS THAT NONE OF THESE
METRICS ACTUALLY JUDGE OR
EVALUATE THE QUALITY OF
EDUCATION FROM ANY OF OUR
INSTITUTIONS, AND IN FACT, A LOT
OF THEM ARE...

Steve says CAN I JUST JUMP IN THERE?

Gyllian says YEAH.

Steve says IF YOU GRADUATE WITH
SKILLS AND COMPETENCIES, HAVE
YOU NOT HAD A QUALITY EDUCATION.

The caption changes to "Gyllian Phillips, @OCUFA."
Then, it changes again to "Graded by metrics."

Gyllian says THAT'S AN INTERESTING ONE.
I KNOW YOU HAVE THINGS TO SAY
ABOUT THIS AS WELL.
THAT'S ACTUALLY THE LEAST
DEFINED... ONE OF THE LEAST
DEFINED OF THE CATEGORIES, AND I
KNOW ALEX HAS REFERRED TO IT AS
ONE OF THE MORE INTRIGUING
ASPECTS OF IT.
SO THAT'S A TRICKY ONE.
WE HAVE NO IDEA WHAT IS THE
INTENT TO MEASURE WITH THAT OR
HOW THEY INTEND TO MEASURE IT.
BUT I THINK REGARDLESS, I WOULD
ARGUE THAT OUR SKILLS AND
COMPETENCIES OF OUR GRADUATES
ARE CLEARLY EVALUATED AND
DETERMINED AT THE UNIVERSITY AND
INSTITUTIONAL LEVEL.
STUDENTS ARE EVALUATED IN EVERY
SINGLE PROGRAM VERY THOROUGHLY
AS THEY COME THROUGH, AND EVERY
SINGLE PROGRAM IS EVALUATED FOR
THE KINDS OF SKILLS AND
COMPETENCIES THAT STUDENTS ARE
INTENDED TO ACHIEVE AT THE END
OF THOSE.
AND SO I FEEL LIKE THERE IS
ALREADY A LOT OF OVERSIGHT AND A
LOT OF CHECKS AND BALANCES
THROUGHOUT THE SYSTEM, SO WE
KNOW OUR UNIVERSITY GRADUATES
ARE REALLY WELL-EDUCATED.
THEY'RE WELL PREPARED FOR LIFE
AND FOR THE WORK FORCE.
AND I THINK ONE OF THE THINGS
ABOUT THIS... HAVING THESE KINDS
OF METRICS OUT THERE IS THEY
CREATE A PERCEPTION THAT THERE'S
A PROBLEM.
THERE ISN'T A PROBLEM.
THIS IS A SOLUTION IN SEARCH OF
A PROBLEM.

The caption changes to "Connect with us: Twitter: @theagenda; Facebook, agendaconnect@tvo.org, Instagram."

Steve says LET ME TRY THIS, THOUGH.
ALEX, FROM WHAT I UNDERSTAND
RIGHT NOW, THERE ARE, FOR
COLLEGES, 38 DIFFERENT METRICS
WHICH THEY ARE JUDGED AGAINST,
AND FOR UNIVERSITIES, 28.
38 AND 28.
THEY'RE CUTTING IT DOWN TO TEN.
IN SOME RESPECTS, IS THIS AN
EFFORT TO SORT OF LASER-LIKE
FOCUS ON WHAT THE PROVINCE OF
ONTARIO WANTS ITS UNIVERSITIES
TO BE GOOD AT AND WHAT IT WANTS
STUDENTS TO BE ABLE TO DO ONCE
THEY GRADUATE?

Alex says THAT'S ONE SPIN
ON IT, AND I THINK... IF THAT IS
THE SPIN THAT SOMEONE TRIES TO
PUT ON THIS, I THINK WHAT
WORRIES ME ABOUT THE CURRENT SET
OF PROPOSALS IS THAT AMONG THE
THINGS THAT GOT TOSSED FROM
THOSE EXTRA INDICATORS ARE ALL
THE INDICATORS AROUND ACCESS.

Steve says SUCH AS WHAT?

Gyllian says INDEED.

Alex says WELL, THE
NUMBER OF INDIGENOUS STUDENTS
YOU BRING IN, THE NUMBER OF
STUDENTS WITH DISABILITIES.
THOSE ARE THINGS THAT
INSTITUTIONS NEEDED TO REPORT
ON.
I MEAN, THEY WERE PRETTY SOFT
TARGETS.
I MEAN, THEY HAD TARGETS BUT IT
DIDN'T REALLY MATTER IF YOU HIT
THEM OR NOT.

Steve says IT DIDN'T MAKE THE
CUT OF THE TOP TEN.

Alex says IT DIDN'T MAKE THE CUT OF THE
TOP TEN.
I ACTUALLY THINK THAT DOES
MATTER.
IF YOU LOOK AT THE GRADUATION
RATE, WHICH IN MANY WAYS SHOULD
BE THE SIMPLEST INDICATOR ON
THERE AND THE EASIEST TO GET
SOME AGREEMENT AROUND, IT SEEMS
TO ME IF YOU PUT A GRADUATION
RATE INDICATOR IN THERE AND YOU
DON'T PUT AN INDICATOR IN FOR
ACCESS, YOU ACTUALLY DO CREATE
SOME INCENTIVES FOR INSTITUTIONS
TO START CREAMING OFF STUDENTS.
WE'RE NOT GOING AFTER THOSE
STUDENTS BECAUSE WE CAN GET
BETTER INDICATOR RESULTS IF WE
DON'T TAKE THOSE MORE DIFFICULT
STUDENTS.
AND I DO THINK THAT'S A PROBLEM.

Gyllian says CAN I
JUMP IN ON THOSE GRADUATION
RATES?
THAT'S A GOOD ONE AS AN EXAMPLE.
SO I AGREE WITH THAT.
I THINK THERE'S SOME REAL ISSUES
AROUND ACCESS AND EQUITY.
AND FROM ANOTHER DIRECTION TOO.
IF YOU'RE TYING FUNDING TO
GRADUATION RATES, AND AGAIN, WE
DON'T KNOW EXACTLY HOW THEY'RE
GOING TO DETERMINE THAT OR
DEFINE THEM, BUT GRADUATION RATE
USUALLY MEANS TO TIME TO
COMPLETION OF DEGREE.
NOW, I'M IN A NORTHERN
INSTITUTION, A SMALL
INSTITUTION.
IT SERVES OFTEN FIRST-GENERATION
STUDENTS, STUDENTS FROM LOWER
INCOME BRACKETS, A LOT OF
STUDENTS ON OSAP.
SO WHEN YOU LOOK AT THE OSAP
GRANTS COUPLED WITH THE FACT
THAT MY STUDENTS ARE GOING TO
BE... I HAVE STUDENTS WHO WORK
30 AND 40 HOURS A WEEK AT A PAID
JOB AND GO TO SCHOOL FULL TIME.
THAT'S LIKE AN 80-HOUR WORKWEEK.

Steve says THEY HAVE A PAID JOB
TO HELP PAY THEIR TUITION...

Gyllian says THAT'S CORRECT.
SO THEIR DEBT LOAD IS NOT HUGE.
THE LIKELIHOOD THAT THOSE
STUDENTS ARE GOING TO COMPLETE
AN HONOURS BACHELOR DEGREE IN
FOUR YEARS IS LOWER, RIGHT?

Steve says THEY'LL TAKE MORE TIME...

Gyllian says THEY WILL TAKE LONGER.
THEY WILL DROP OUT FOR A COUPLE
OF YEARS AND THEY'LL COME BACK.
THERE IS CLEAR EVIDENCE TO SHOW
THAT STUDENTS ON LOANS RATHER
THAN GRANTS DO NOT HAVE THE SAME
LEVEL OF PERSISTENCE.

Steve says SO THIS SYSTEM WOULD
PUNISH THAT KIND OF STUDENT IN
YOUR INSTITUTION.

Gyllian says EXACTLY.
AND THAT'S WHERE I WAS GOING.
AS WE FAIL TO MEET OUR TARGETS
ON GRADUATION RATES, WHAT
HAPPENS?
THE MONEY COMES OUT OF OUR
BUDGET.
IT GOES TO ANOTHER UNIVERSITY
THAT'S MUCH BETTER AT MEETING
THOSE RATES.
AND WHY IS THAT?
BECAUSE MAYBE THEIR STUDENTS ARE
MORE PRIVILEGED.
BECAUSE I THINK THERE'S SOME
SERIOUS CONSEQUENCES, AND I ALSO
WANT TO THINK ABOUT WHAT THAT
MONEY OUT OF THE BUDGET DOES.
IT PUNISHES THE STUDENTS.
THAT MONEY COMES OUT OF THE
CLASSROOM, RIGHT?
OUR CLASS SIZES GET BIGGER.
NUMBER OF FULL-TIME PROFESSORS
GOES DOWN, OR PROFESSORS AT ALL
IN FRONT OF THE CLASSROOM GOES
DOWN, AND THOSE STUDENTS HAVE
LESS HELP, LESS SUPPORT.

Steve says ALEX, CAN I GET YOUR
TAKE ON WHETHER YOU SEE THAT
ROLLING OUT THAT WAY BECAUSE IF
GYLLIAN IS RIGHT AND IN IF THE
STANDARDS ARE FAILED TO BE MET
AND THEREFORE... IS THAT THE
PLAN, THAT MONEY WOULD BE TAKEN
AWAY FROM THESE INSTITUTIONS AND
GIVEN TO OTHER UNIVERSITIES OR COLLEGES?

Alex says I WISHED THAT'S
HOW IT WAS GOING TO WORK.
I THINK IT'S GOING TO BE MUCH
WORSE THAN THAT.

Steve says WHAT DO YOU MEAN?

Alex says SO IN MOST PERFORMANCE-BASED
FUNDING SYSTEMS, WHAT HAPPENS
IS, HERE'S AN ENVELOPE.
AND AS THIS GOVERNMENT HAS SAID,
THEY WANT IT TO BE 60 percent, WHICH
WOULD BE ABOUT 3 BILLION dollars
BETWEEN ALL THE COLLEGES AND
UNIVERSITIES.
AND YOU WOULD COMPETE FOR IT,
RIGHT?
YOU WOULD SAY IF YOUR RATES ARE,
YOU KNOW, A CERTAIN LEVEL, YOU
WOULD GET A CERTAIN NUMBER OF
POINTS AND YOUR SHARE OF THE
POINTS IS YOUR SHARE OF THE
3 BILLION.
THERE ARE THINGS THAT GYLLIAN
TALKED ABOUT.
FOR INSTANCE, IN FRANCE.
THEY HAVE A COMPLETION MEASURE.
BUT IF YOU HAVE LESS... YOU
KNOW, IT'S RATED ON A CURVE.
SO WE HAVE TWO INSTITUTIONS AND
WE HAVE THE SAME GRADUATION RATE
BUT STUDENTS AT OUR INSTITUTION
ARE LESS PRIVILEGED, SHE GETS
MORE MONEY, RIGHT?
SO YOU CAN MAKE THOSE KINDS OF
THINGS WORK.
THE REAL ISSUE I THINK IN
ONTARIO IS THAT THEY'RE NOT
USING AN ENVELOPE SYSTEM.
IT'S NOT SAYING THERE'S
3 BILLION dollars HERE, THE
INSTITUTIONS CAN HAVE IT.
WHAT THEY'RE DOING IS WHAT I
CALL A CONTRACT SYSTEM.
WHAT THAT MEANS IS THEY'RE
SAYING EACH INSTITUTION, WE'RE
CUTTING YOUR BUDGET BY
60 PERCENT AND YOU CAN WIN THAT
MONEY BACK.

Steve says SO THEY'RE VERY MUCH
COMPETING AGAINST EACH OTHER
RIGHT NOW... THEY WILL BE.

Gyllian says YES.

Alex says THE LINE IS
THEY WILL BE COMPETING AGAINST
THEMSELVES, BECAUSE THE LEVEL
THAT YOU HAVE TO REACH AS AN
INSTITUTION WILL BE BASED ON
YOUR OWN NUMBERS.
SO, YOU KNOW, THE TARGET FOR
GRADUATION RATE, IF NIPISSING
HAS GOT A LOWER LEVEL THAN
U OF T, THEN NIPISSING IS GOING
TO BE REQUIRED TO HIT A LOWER
NUMBER IN ORDER TO GET
100 PERCENT OF ITS MONEY BACK.
BUT HERE'S THE TRICK.
THE TRICK IS, IF YOU DON'T HIT
THE TARGET, WHAT HAPPENS TO THE MONEY?

Steve says GOOD QUESTION.
WHAT'S THE ANSWER?

Alex says IT GOES BACK TO
TREASURY.
SO IT DOES NOT GO TO ANOTHER
INSTITUTION.
IT GOES BACK TO TREASURY.
THEN WHAT YOU'RE INTO IS A VERY
WEIRD SITUATION WHERE YOU
WANT... YOU HAVE TO CREATE TEN
DIFFERENT TARGETS FOR ALL 40-ODD
INSTITUTIONS, SO 400 TARGETS.
AND YOU HAVE TO HIT 100 PERCENT
ON THAT TARGET OR YOU LOSE
MONEY.
YOU CAN'T OVERPRODUCE IN ONE
TARGET AND UNDERPRODUCE IN
ANOTHER.
SO WHAT THAT MEANS IS, IF
EVERYBODY HITS THEIR TARGET,
EVERYBODY KEEPS THEIR BUDGET.
SO IF YOU HAVE A REALLY LOW
TARGET... THIS IS WHAT I CALL
POINTLESS PERFORMANCE-BASED
FUNDING, RIGHT?
IF YOU MAKE THE TARGETS REALLY
LOW, EVERYBODY DOES WHAT THEY'RE
DOING NOW, NOTHING CHANGES.
BUT YOU CAN ALSO HAVE PAINFUL
PERFORMANCE-BASED FUNDING.
THAT IS IF THE TARGETS ARE SET
REALLY HIGH.
AND WHAT THAT WOULD MEAN IS THAT
PEOPLE WOULD MISS THE TARGETS,
THE MONEY WOULD GO BACK TO
TREASURY, IT WOULD NOT GO TO
ANOTHER INSTITUTION, AND
POSTSECONDARY AS A WHOLE WOULD
BE POORER.
THAT'S WHY I HAVE ALWAYS WORRIED
THE WAY THIS WAS DESIGNED IS IN
FACT A SELF-CUT TO POSTSECONDARY
EDUCATION.
I HOPE IT'S NOT.
BUT THE PROBLEM IS, IF IT'S NOT,
IT'S GOING TO BE POINTLESS AS A
MEASURE.
IT'S EITHER POINTLESS OR
PAINFUL, THE WAY THEY'VE DESIGNED IT.

Steve says JUST TO BE CLEAR,
THIS IS NOT GOING TO HAPPEN
OVERNIGHT, WHICH IS WHY THERE'S
CONSIDERABLE DISCUSSION RIGHT NOW.
SHELDON, CAN I GET YOU RIGHT
NOW, AT THE BOTTOM OF PAGE 2,
THANK YOU, TO BRING THE GRAPHIC UP.
AGAIN FOR THOSE LISTENING ON
PODCAST, I'M GOING TO DESCRIBE IT.

A slate appears on screen, with the title "Outcome-based funding. Ontario's 5-year post-secondary plan."

A line chart shows that the percentage of overall funding is planned to increase from an average 1.3 percent in 2019 to 60 percent in 2025.

Steve reads data from the slate and says
AS WE SUGGESTED EARLIER, THE
PROPORTION OF FUNDING TIED TO
PERFORMANCE AT THE MOMENT IS IT
ONLY 1.4 percent FOR UNIVERSITIES AND
1.2 percent FOR COLLEGES.
BUT THAT IS GOING TO AMP UP
STARTING NEXT YEAR IF THE
GOVERNMENT OF ONTARIO IN FACT
GOES FORWARD WITH THIS, AS THEY
HAVE DESCRIBED IT.
IT WOULD GO TO 25 percent AND THEN
THERE WILL BE A 10 percent BUMP EVERY
SCHOOL YEAR UNTIL THE YEAR
2023-24, AND IT'LL BE A 5 percent BUMP
UP TO 60 percent EVENTUALLY BY 2024-25.
WE GET THIS?
SO BY THE YEAR 2025, 60 percent OF THE
BUDGET WILL BE DETERMINED BY
THESE METRICS THAT WE JUST
DESCRIBED AND THE 3 BILLION dollars THAT ALEX ESTIMATES IS UP FOR
GRABS HERE.
DO YOU THINK THAT'S ENOUGH TIME
TO MAKE ALL OF THIS HAPPEN?

Gyllian laughs and says I THINK IT'S A VERY
AMBITIOUS TIME LINE.
IN FACT WE DON'T KNOW HOW IT'S
GOING TO BE IMPLEMENTED.
EVEN NOW, WHEN THE PROCESS IS
SUPPOSED TO BE STARTING FOR NEXT
YEAR, IT'S NOT CLEAR HOW THE
TARGETS ARE GOING TO BE SET,
IT'S NOT CLEAR HOW THAT DATA IS
GOING TO BE MEASURED, IT'S NOT
CLEAR THE TIME LINES BY WHICH
ALL OF THOSE THINGS ARE GOING TO
BE ACHIEVED.
SO IT'S PRETTY AMBITIOUS.

Steve says AMBITIOUS ISN'T BAD.

Gyllian says WELL, IT IS... IT IS IF WHAT
WE'RE TALKING ABOUT IS STEPPING
UP A RATE OF POTENTIAL CUTS, AS
ALEX IS TALKING ABOUT, UP TO 60 percent
IN FOUR YEARS.
SO DOING THAT WITHOUT EVEN
REALLY KNOWING HOW YOU'RE GOING
TO DO IT OR HOW THE INSTITUTIONS
ARE GOING TO DO IT, I THINK IT'S
CHAOS IN THE SYSTEM, HONESTLY.

Steve says YOU MENTIONED
TENNESSEE EARLIER.
HOW LONG DID THEY TAKE TO GET TO
WHERE THEY ARE RIGHT NOW, AND IS
IT WORKING BETTER?

The caption changes to "Looking from abroad."

Alex says THAT'S A GOOD QUESTION.
SO THEY'VE HAD SOME FORM OF
PERFORMANCE-BASED FUNDING FOR
QUITE A WHILE.
THEY'VE MOVED TO 100 PERCENT I
BELIEVE IN 2010.
ONE DIFFERENCE, RIGHT... SO
OBVIOUSLY IT WAS AN ENVELOPE
SYSTEM THERE, AND SO, YOU KNOW,
THEY DESIGNED IT IN SUCH A WAY
THAT THE NUMBERS MOVED VERY
SLOWLY.
IN THE FIRST YEAR IT WASN'T, YOU
KNOW, MILLIONS OF DOLLARS COULD
GO MISSING IN AN INSTITUTION.
I THINK IT WAS VERY CAREFULLY
DESIGNED.
IF ANYONE WANTS TO GO, TYPE IN
TENNESSEE PERFORMANCE-BASED
FUNDING INTO GOOGLE AND YOU CAN
SEE ALL THE DOCUMENTS, ALL THE
SPREADSHEETS.
IT'S QUITE FASCINATING THE
AMOUNT OF WORK THEY PUT INTO IT
AND HOW TRANSPARENT THEY'VE
BEEN, WHICH IS NOT SOMETHING
WE'VE SEEN HERE IN ONTARIO.
AND THEY ALLOWED IT TO MOVE
GRADUALLY.
ONE OF THE SECRETS THEY HAD,
THOUGH, WAS, IT WAS VERY
DIFFICULT TO LOSE IN THEIR
SYSTEM, BECAUSE ALTHOUGH THEY
MOVED TO, IN THEORY, 100 PERCENT
PERFORMANCE-BASED FUNDING, IN
FACT EVERYBODY WAS STARTING OFF
EXACTLY WHERE THEY ENDED IN THE
OLD SYSTEM AND THEY ALLOWED IT
TO DRIFT SLOWLY AND THEY'VE BEEN
PUMPING MONEY IN CONTINUOUSLY
FOR 10 YEARS.
SO THE AMOUNT OF MONEY AVAILABLE
TO COMPETE FOR... THE PIE IS
GROWING AT THE SAME TIME...

The caption changes to "Watch us anytime: tvo.org, Twitter: @theagenda, Facebook Live, YouTube."

Steve says SHOULD WE BE DOING THAT HERE?

Alex says IT'S ALWAYS EASIER TO PUT IN
PERFORMANCE-BASED FUNDING WHEN
THE PIE IS GROWING.
PUTTING IT IN WHEN THE PIE IS
SHRINKING REALLY DOES MAKE IT
DIFFICULT.

Steve says IS PART OF WHAT...
LET ME TAKE A STEP BACK HERE FOR
A SECOND.
ONE OF THE GREAT THINGS I GUESS
ABOUT THE POST SECONDARY SYSTEM
IN ONTARIO IS AS LONG AS YOU'RE
A QUALIFIED STUDENT, THERE'S A
PLACE FOR YOU IN THERE, RIGHT?
AS LONG AS YOU GET THE MARKS,
YOU CAN... THEY'VE GOT A PLACE
FOR YOU SOMEWHERE AT ONE OF
THE... WHATEVER IT IS NOW... 40
INSTITUTIONS, COLLEGES OR
UNIVERSITIES, WHATEVER.
THE DOWNSIDE, WE HAVE BEEN TOLD
IS, BY PUTTING EVERYBODY ON SUCH
AN EQUAL PLAYING FIELD, IT MAKES
IT DIFFICULT, MORE DIFFICULT, TO
CREATE INSTITUTIONS THAT ARE
REALLY WORLD CLASS AND SUPERB
AND CAN COMPETE WITH THE
HARVARDS AND STANFORDS AND SO ON
AND SO FORTH BECAUSE WE'RE MORE
WORRIED ABOUT EQUITY AND THAN
EXCELLENCE.
IT SEEMS THIS IS DESIGNED TO TRY
TO GET MORE EXCELLENCE.
DO YOU SEE THAT?

The caption changes to "Post-secondary policy."

Gyllian says NO, I DON'T.
I THINK ONE OF THE... ONE OF THE
WAYS OF GAINING EXCELLENCE...
AND, AGAIN, THIS IS BORNE OUT BY
RESEARCH IN BOTH TEACHING AND
RESEARCH... IS BY ADEQUATELY
RESOURCING BOTH ACTIVITIES.
AND WHAT THIS AIMS TO DO IS CUT
RESOURCES FROM THOSE ACTIVITIES.
AND SO I THINK...

Steve says WELL, ONLY FOR THOSE
WHO AREN'T MEETING THE TOP 10 LIST.

Gyllian says YEAH, BUT AGAIN, I THINK... I
THINK... AGAIN, WE NEED TO BACK
UP AND ASK THE QUESTION: WHAT IS
THE PROBLEM HERE?
IS THE PROBLEM THAT WE DON'T
HAVE ENOUGH HIGH ELITE PRIVATE
UNIVERSITIES IN OUR SYSTEM?

Steve says NOT PRIVATE BUT WE
MAY NOT HAVE...

Gyllian says WELL, THAT'S THE HARVARDS AND
THE STANFORDS, RIGHT?

Steve says WE MIGHT NOT HAVE
ENOUGH ELITE UNIVERSITIES... IF
YOU WANT TO COMPETE ON THE WORLD
STAGE TO BE ONE OF THE BEST
UNIVERSITIES, ONE OF THE TOP TEN
IN THE WORLD, THEY WOULD ARGUE,
THEY'VE GOT TO DO MORE OF THIS.

Gyllian says I WOULD
ARGUE WE DO HAVE THESE
INSTITUTIONS AND WE'VE BEEN
REALLY... OVER THE YEARS, WE'VE
HAD A KIND OF AGREED PHILOSOPHY
THAT WE'RE GOING TO BE
RESPONSIBLE ABOUT BALANCING THAT
NEED FOR HIGH-END RESEARCH...
WE'VE GOT THE HIGH-END TECH,
WATERLOO, AND WE'VE GOT U OF T,
WITH THE KIND OF UNIVERSITIES
THAT ALLOW FOR EQUITABLE AND
REGIONAL ACCESS LIKE NIPISSING
AND WINDSOR AND THOSE KIND OF
INSTITUTIONS.
SO I WOULD ARGUE THE HEALTH OF A
PROVINCE, THE HEALTH OF A
NATION, DEPENDS ON A KIND OF
BALANCE BETWEEN THAT KIND OF
ATTAINMENT AND ALSO A LEVEL OF
SPREADING IT AROUND SO THAT YOU
HAVE A DEPTH OF LEARNING IN YOUR
CITIZENRY.

Steve says I THINK EVERYBODY
AGREES THAT YOU'VE GOT TO FIND
THE SWEET SPOT ON, YOU KNOW,
GREAT ACCESS, GREAT EQUITY, AND
ALL OF THAT, WITH ALSO
CONDITIONS THAT CREATE
EXCELLENCE.
WHERE DO YOU... WHERE DOES THAT
SWEET SPOT MOVE IF THIS NEW
SYSTEM COMES IN, IN YOUR VIEW?

Alex says I DON'T THINK
YOU CAN MAKE A FEASIBLE ARGUMENT
THAT IT'S GOING TO CREATE MORE
WORLD-BEATING UNIVERSITIES IF IT
DOESN'T INVOLVE MORE MONEY,
RIGHT?
ONTARIO'S LEVEL OF PUBLIC
FUNDING OF UNIVERSITIES IS NOT
VERY GOOD.

Steve says IT GOES DOWN ALL THE TIME.

Alex says IT GOES DOWN ALL THE TIME.
ACTUALLY IT'S PRETTY CLOSE TO
AMERICA... WE DID THIS A WHILE
AGO AT MY OFFICE.
WE SAID LET'S LOOK AT THE
PRIVATE AND PUBLIC SPENDING IN
ONTARIO.
IT ACTUALLY LOOKS LIKE THE
UNITED STATES.
THE REST OF CANADA LOOKS A
LITTLE MORE LIKE EUROPE.
IT'S ABOUT ONE-THIRD PUBLIC
FUNDING AND TWO-THIRD PRIVATE
FUNDING, VARIOUS TYPES OF FEES...

Steve says IT WAS THE EXACT
OPPOSITE WHEN YOU AND I WENT TO
UNIVERSITY.

Alex says PRETTY MUCH, YEAH.
I DON'T THINK THAT WILL DO IT.
I UNDERSTAND THERE'S A DESIRE TO
RAISE STANDARDS AND IT MIGHT DO
THAT IN SOME WAYS IN SOME
PLACES.
BUT, LOOK, U OF T IS ONE OF THE
TOP 10 PUBLIC UNIVERSITIES IN
THE WORLD, AND OTTAWA AND
McMASTER BOTH REGULARLY MAKE
THE TOP 200 AND TO THE EXTENT
YOU CARE ABOUT WORLD RANKINGS,
THOSE TWO WILL ALWAYS MAKE THE
TOP 200.
WATERLOO HAS ENORMOUS STRENGTHS
IN INNOVATION.
THERE'S LOTS OF GOOD
UNIVERSITIES OUT THERE.
AND WE HAVE... IT'S A DIFFICULT
PROVINCE TO SERVE BECAUSE IT'S
SO BIG.
WE'RE ABOUT THE SIZE OF THE
NETHERLANDS IN TERMS OF
POPULATION, BUT WE'RE NOT, YOU
KNOW, IN THE NETHERLANDS, YOU
CAN GET ANYWHERE IN AN HOUR.

Steve says RIGHT.

Alex says I HAVE TROUBLE GETTING TO
WORK IN AN HOUR IN THE GTA.

Steve says THAT IS TRUE.

Alex says SO IT'S A MUCH MORE DIFFICULT
KIND OF PROVINCE TO SERVE, AND
SO I THINK IT'S A TOUGH BALANCE
TO HIT. I DON'T THINK WE'VE
DONE TOO BADLY.
I THINK WHAT WE'VE DONE REALLY
WELL AT AND WHAT WE ALWAYS WORRY
ABOUT IN THESE TYPES OF
SITUATIONS, WE'VE DONE A GREAT
JOB OF CREATING POLYTECHNIC
INSTITUTIONS THAT I THINK ARE
REALLY INNOVATIVE, REALLY
WORLD-LEADING. PLACES LIKE
HUMBER, PLACES LIKE SENECA.

Steve says ONTARIO TECH?

Alex says THAT'S MORE OF A UNIVERSITY STILL.
I'M THINKING MORE THE SORT OF
ALGONQUIN AND HUMBER AND SENECA
AND SHERIDAN AND CENTENNIAL.
ALL THOSE PLACES.
THERE'S REALLY NOTHING LIKE THEM
IN NORTH AMERICA.
AND THEY HAVE THIS FANTASTIC WAY
OF DEALING WITH BOTH ACCESS AND
QUALITY, NOT HARVARD KIND OF
QUALITY, BUT I THINK IN A MUCH
MORE KIND OF APPLIED WAY THAT
HELPS LOCAL BUSINESSES, THAT
HELPS INDUSTRY ADAPT TO GLOBAL
COMPETITION. THAT'S THE STUFF
WE SHOULD BE WORKING ON.

Steve says THEN AGAIN, THEY
DON'T HAVE 30 BILLION dollar
ENDOWMENTS, DO THEY?

Alex says NO.

The caption changes to "Producer: Patricia Kozicka, @TrishKozicka."

Steve says AND THEY'RE STILL MANAGING.
OKAY.
THE MINISTER COULDN'T BE WITH
US, WHICH WE'RE SAD ABOUT, BUT
YOU'VE BOTH GIVEN HIM LOTS OF
GOOD ADVICE WHICH WE'RE HAPPY
ABOUT. ALEX USHER AND GYLLIAN
PHILLIPS, WE THANK YOU FOR
COMING IN TO TVO TONIGHT.

The caption changes to "Subscribe to The Agenda Podcast: tvo.org/theagenda."

Alex says THANK YOU.

Gyllian says THANK YOU SO MUCH.

Watch: Evaluating Performance-based Funding