PRASE proposes new budget model for York

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The PRASE executive sponsors Patrick Monahan, vice-president academic & provost, and Gary Brewer, vice-president finance & administration, are pleased to share with the York community the PRASE Working Group on Budget Models (WGBM) Stage 1 report, which proposes a new budget model for York.

Over the next six weeks, the WGBM will hold a series of community information sessions to share the proposed budget model and get feedback and input from the York community before proceeding with developing and testing the elements of the recommended budget model for the University.

“Recognizing York’s dramatic growth, current financial situation, size and composition, it was clear that the University had to move to a more transparent, decentralized and accountable budget model for more effective resource allocation and management – the status quo was simply no longer an option,” said Patrick Monahan, vice-president academic & provost. “I would like to sincerely thank the members of the PRASE – WGBM for their commitment, hard work and thoughtful, pragmatic recommendations.”

Gary Brewer, vice-president finance & administration, added that “while there is still a lot more work to be done, we are confident we are on the right track.”

Last fall, the PRASE – WGBM developed principles to guide its work in proposing a new budget model. Through dialogue with community members, it learned that a successful new budget model for York had to:

  • Advance institutional goals and priorities
  • Be transparent
  • Provide a predictable and sustainable basis for planning
  • Provide improved responsibility and accountability
  • Have clear and straightforward allocation methodologies

After evaluating all potential models against these principles, WGBM recommended to the executive sponsors and the president that York University adopt a Shared Accountability & Resource Planning (SHARP) budget model.

“There is no one-size fits-all approach to budgeting. The proposed York SHARP budget system is a modified version of an activity-based budget approach, which includes some key elements of other budget models to capitalize on each model’s inherent strengths,” said Trudy Pound Curtis, WGBM co-chair. “The final SHARP budget system will minimize any drawbacks, strengthen York’s existing Integrated Resource Planning framework and mitigate risks associated with devolving responsibility of resource management through a clear accountability structure that articulates roles and responsibilities at the institutional, divisional and Faculty levels,” added Rhonda Lenton, WGBM co-chair.

Key features of the SHARP budget system include:

  • Resource allocation to Faculties reflecting revenues they generate with university-wide costs charged back in a transparent and repeatable manner
  • A formalized budget committee
  • Rigorous shared accountability for resource management closest to the activity and/or decision point (e.g. enrolment targets set at institutional level; Faculties responsible for achieving local enrolment targets and for costs incurred locally)
  • A central University fund to provide the necessary resources for the transition to a new model and to support strategic initiatives in line with the University’s key priorities
  • A formal contingency fund would also be established to manage institutional risks and unforeseen costs

“Should the final SHARP budget system be accepted by the University, many complex financial, human resource and systems implications still need to be resolved,” said Brewer. “Going forward, the PRASE team will now develop and test elements of the model, recommend the necessary transition period and develop the implementation strategies for Faculties and business units to successfully move to the SHARP budget system.”

Once the consultation process is completed, a draft report containing recommendations will be finalized and presented to the University Budget Committee for approval in early June. After the Stage 1 recommendations are approved, the PRASE – WGBM will move forward quickly to develop a project plan for Stage 2, and then begin work on developing the conceptual design for SHARP.

If you are interested in attending the SHARP Community information sessions, they will be held on May 23, from noon to 1pm, in the Senate Chamber and on May 24, from 1:30 to 2:30pm, at 001 Accolade East. You will have the opportunity to see the preliminary budget model proposal presented by the WGBM, and the chance to ask questions and provide your feedback.

A copy of the WGBM Stage 1 report can be accessed here or through the PRASE website.