Education Minister Line Beauchamp is fining Concordia $2 million for approving millions of dollars in severance packages handed out to former senior employees over the past several years.
In a letter dated March 8 sent by the minister to Peter Kruyt, chair of Concordia’s Board of Governors, Beauchamp writes of past communications with Kruyt in January and February when she expressed her concern over the number of people leaving senior positions at Concordia, and ultimately over the university’s “management of public funds.”
She also criticized Concordia for rehiring and remunerating former Concordia President Judith Woodsworth, who left the university with a severance package worth $703, 500 in December 2010. Woodsworth, who returned in January, is currently a translation professor with tenure in the French department.
The letter, obtained by several media outlets including TVA, who posted it to their website, indicates that Beauchamp had urged Concordia in January to use “moderation” when making budgetary decisions, and that the university’s approval of severance packages worth millions of dollars had “given citizens cause for concern over the proper use of public funds by universities.” As a result, Beauchamp wrote that she was imposing a fine of $2 million on Concordia.
In a press release issued this afternoon, Beauchamp said that Concordia had shown “a lack of control,” and that the university must now face the consequences for its actions. By sending the letter to Concordia, Beauchamp said she was signalling to all Quebec universities that “healthy management is synonymous with transparency and efficiency. I insist that our universities be administered efficiently and rigourously.”
In a statement posted on the university’s website late on Friday, Concordia President Frederick Lowy said that the university “understands and shares [the minister’s] concerns,” adding that, “we take note of the minister’s decision and will act in accordance with our responsibilities.” Beauchamp’s decision means that Concordia will receive $2 million less in provincial funding for 2012-2013.
Lucie Lequin, president of the Concordia University Faculty Association, said the union’s executive was disappointed with the minister’s actions, saying that “it’s unfair to make the entire Concordia community pay for the actions of a few people.”
“Maybe this will mean less services for students, or make it more difficult for employees to negotiate better salaries,” she said. “For us, the minister’s letter is nothing more than a political and public relations move. In the face of student unrest and people citing Concordia as an example of mismanagement of funds, the minister felt she had to act. […] But the warning is after the fact.”
Lequin questioned the timing of the letter, pointing out that no severance package has been issued since Woodsworth’s departure in 2010-2011.
Concordia Student Union President Lex Gill echoed Lequin’s sentiment, indicating that the government must have been aware of the severance payments long before this year, yet for some reason chose not to act until now.
“[The minister’s letter] is a validation that the students have been right all along, that there is an issue of mismanagement of public funds,” she said. “But by acknowledging that there’s a serious issue at Concordia, the ministry is only trying to save face. What the minister is doing is just a reaction, it’s not a solution.”
At the Concordia University Part-Time Faculty Association, chair of communications and cinema professor Dave Douglas said that, if anything, Concordia has been making progress on governance and transparency since the BoG and Senate adopted most of the recommendations from the Shapiro Report, which came about in spring 2011 after the BoG ousted Woodsworth.
“When you think about it, $2 million is not a large amount when it comes to the government’s overall budget,” he said. “The loss of that $2 million will be dearly felt at Concordia, but I don’t know if it will really improve the government’s revenue. That money could have perhaps been used instead for financial aid for students.”
He said that maybe if the university administration could prove to Beauchamp that it is working at resolving outstanding issues regarding public funds, the $2 million fine could be “held in abeyance pending a successful outcome [at Concordia].”
Graduate Students’ Association President Robert Sonin called Beauchamp’s decision “absurd,” saying that “it highlights how out of touch the ministry is, how poorly administered our higher education system is, and how completely unaccountable the people who make poor decisions are.”
Ministry of Education spokesperson Esther Chouinard said she could not confirm if Beauchamp had decided to send the letter now because of Concordia’s recent decision to hire external auditors to review severance packages worth $3.1 million that were given to six senior employees who left Concordia between 2009 and 2010. The hiring of the auditors will come at a cost of $25,000, and was approved by the Board of Governors last Friday after being proposed by Lowy. Chouinard said it would appear that the ministry was not informed of that decision.
Gill said she supports the hiring of auditors, but that the university and the ministry need to go even further and conduct an “inquiry” into the issuing of severance packages and the management of public funds as a whole.
Lequin said Beauchamp should be “congratulating Concordia for hiring the external auditors,” adding that “I agree with the minister that we have to move forward, but you can’t punish retroactively.”
The six severance packages that will be looked at by the external auditing committee:
$703, 500 to former president Judith Woodsworth
$605,000 to former internal audit director Ted Nowak
$639,000 to former internal assistant audit director Saad Zubair
$700,000 to former vice-president of advancement and alumni affairs Kathy Assayag
$332,000 to former chief financial officer Larry English
$129,000 to former security director Jean Brisebois
Woodsworth’s predecessor as president, Claude Lajeunesse, was given a $1.3 million severance package when he left halfway through his term in 2007, but this payment will not be among those analyzed by the auditors.