The federal government's budget includes $1.7-billion in funding to attract top international researchers to universities.Liam Richards/The Canadian Press
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Much lower caps on international students announced in Tuesday’s federal budget threaten to exacerbate financial strain in the postsecondary system, but the country’s big research universities say they’ll benefit from the major funding set aside for talent attraction and infrastructure.
Universities welcomed the allocation of $1.7-billion in funding to attract top international researchers. The plan includes $1-billion over 13 years for recruitment, $400-million over seven years for labs and other infrastructure, and a little more than $250-million to attract PhD students, postdoctoral fellows and assistant professors.
The government also said Wednesday it will be exempting graduate students at public institutions from the cap on international student permits, an important victory that universities had sought since the cap was extended to grad students last year.
“We’re pretty happy given the fiscal circumstances,” said Robert Asselin, CEO of the U15 group of major research universities. “The talent piece is important and substantive. Talent is essential to build what we need for our sovereign capabilities and the future of this country.”
At the same time, however, the government announced a major reduction in the number of international study permits it will issue, which could have significant financial implications for some schools. International students pay much higher tuition and have become a major revenue source for postsecondary institutions as transfers from provinces have stagnated.
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Pari Johnston, president of Colleges and Institutes Canada, said the cut in international students, from about 306,000 a year under the most recent plan, to 155,000 next year, will hurt some schools financially.
“It’s going to have financial implications for institutions that are underfunded at a time when their communities really need them and the country needs them,” Ms. Johnston said.
She added that this makes more than a dozen policy changes on international students since January, 2024, when the first cap was announced by former immigration minister Marc Miller. The uncertainty has damaged the country’s brand as a welcoming destination to such an extent that schools were unlikely to reach this year’s cap in any case, she said.
“We’ve had a lot of change to absorb, often with not a lot of notice, often with not a lot of rationale,” Ms. Johnston said. “We need to continue to attract really good students to Canada because they’ve been going away. They don’t see a welcoming environment.”
Colleges Ontario, which represents the province’s 24 publicly funded colleges, said in a news release that the budget “fails to acknowledge the crucial contributions of college-educated international students as skilled workers and entrepreneurs.”
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More than 8,000 jobs have been lost at Ontario colleges in the past two years after cuts to international study permits. Colleges Ontario said the most recent reductions to study permits could mean the loss of another $2.5-billion in revenue. The sector has already made $1.8-billion in cuts and suspended or closed more than 600 programs since January, 2024.
The federal government said in the budget it is implementing a balanced and sustainable approach to migration to attract and retain the world’s best talent.
On research funding, universities secured a major reprieve as the government reduced spending-cut targets for the national granting councils to 2 per cent. Under the government’s expenditure review, departments were told to find reductions of up to 15 per cent.
Paul Mazerolle, president of the University of New Brunswick, said there is a lot for universities to like in the budget.
“This is a budget that takes seriously the role of universities in productivity and boosting the work force of the future,” Dr. Mazerolle said. “I think there’s real opportunity here.”
He said his school may lose a few million in revenue as a result of the reduction in international study permits, but there are several areas included in the budget where it could gain.
The funding made available to recruit scholars at all levels, from professors to PhD students to postdoctoral fellows, could bring significant benefits, Dr. Mazerolle said, as could some of the new initiatives around infrastructure and defence funding that will apply to universities.
Universities and colleges are eligible to access some of the the $17.2-billion provinces and territories are allocated for infrastructure funding announced in the budget.