Message from the President – Financial Challenges and Mitigation Measures

Posted on Tuesday, February 11th, 2025

Dear colleagues,

Our College community is built on the dedication and hard work of our employees; the steps we are taking now are not a reflection of that commitment, but rather a response to the changing environment in which we operate.

As discussed in my previous messages and at our January 16 Town Hall, Algonquin College, along with the entire post-secondary education sector, is facing unprecedented financial challenges. This is due in part to a prolonged and ongoing provincial government tuition freeze, chronic underfunding, and recent federal government immigration policy changes that negatively impact international enrolments.

The College needs to take immediate and substantial action to address this perilous fiscal situation. Without intervention, Algonquin College will incur a budget deficit, on a cash flow basis, of at least $60 million in 2025-2026, rising to $93 million by 2026-2027.

To ensure the long-term financial sustainability of the College, we are implementing mitigation measures immediately and taking decisive steps to reduce expenses, optimize resources, and explore new revenue opportunities. Note that while the measures announced this week will make an important contribution to closing the financial gap, it will not completely eliminate the projected deficit. Therefore, a Phase 2 is in progress to explore additional measures. This includes an Efficiency and Accountability Initiative undertaken with the Ministry of Colleges and Universities to identify further mitigations that will help restore the College’s long-term fiscal health.

Program suspensions

Algonquin College is recommending the suspension of 37 academic programs, effective Fall 2025 to the Board of Governors at its February 24, 2025, meeting. This includes 31 program suspensions and six campus-specific program offering suspensions, representing 16% of the College’s programs of study. If approved by the Board, no new students will be admitted to these programs starting Fall 2025. Current and Spring 2025 students will be able to complete their studies, provided they meet all the necessary academic requirements. Employees and learners impacted by these changes will receive additional messaging from their respective Vice President.

Targeted Retirement Departure Initiative

To mitigate the potential impact on our employees, the College introduced the Targeted Retirement Departure Initiative (TRDI). This initiative offers a one-time lump-sum financial incentive to eligible employees who meet specific criteria. Specifically, individuals must be at least 50 years of age, eligible for an unreduced pension, and their departure will result in ongoing savings and reduction of a position.

Voluntary Exit Registry

To further mitigate job impacts, we will be launching a voluntary exit registry where employees can self-identify as willing to depart the College and receive a modest financial incentive. The College will review requests against operational requirements. Departures must result in ongoing savings and reduction of a position. More information will be communicated soon by Human Resources.

Additional mitigation measures

Alongside the above departure initiatives, we are actively exploring other opportunities to minimize layoffs and support fiscal sustainability. These include:

  • Expense reductions.
  • Continued review of the strategic relevance and financial viability of our academic programs.
  • Service
  • Position vacancy review.
  • Non-renewal of contracts that do not contribute to the College’s financial sustainability or strategic direction.
  • Other departmental efficiency measures.

Additionally, the College has resolved to streamline our Corporate Training and Business Development activities. These areas will undergo changes aimed at concentrating on core functions and advancing our strategic priorities.

While layoffs are unavoidable, we are committed to mitigating their impact through staged resource adjustments. Workforce impacts related to program changes may not occur immediately due to the need to teach out current cohorts.

Tomorrow, Vice Presidents will provide further details on specific cost containment initiatives within their respective divisions. Where there are people impacts, there are specific processes that will be used. For unionized employees, we will adhere to the respective collective agreements. For administrative employees, employment contracts, terms and conditions, and the Employment Standards Act will determine severance and termination entitlements. We are committed to treating everyone with dignity and respect throughout this process. Please visit the updates section of the HR Portal for more information.

Perth Campus

As I referenced in my January 9 message, a recommendation will be tabled at the February 24, 2025 Board of Governors meeting to transfer the three current programs of study to the Ottawa Campus and cease operations of the Perth Campus by the end of August 2026. As I have stated before, this is a difficult decision that is not taken lightly and is a direct result of the financial challenges we are facing. Every effort will be made to mitigate impacts on employees and learners during this transition.

Commitment to a sustainable future

The changes we are instituting are intended to position the College for a strong recovery and long-term financial health, with an array of programs that are strategic and in-demand by employers, while maintaining our reputation for providing high-quality education.

I know this situation is causing great anxiety to many and you no doubt have many questions. If you are looking for additional support and resources, please do not hesitate to explore our Employee and Family Assistance Plan. In addition, frequently asked questions have been prepared to provide further background on the financial realities Algonquin College is facing as well as additional information pertaining to program suspensions.

Thank you for your continued dedication and support as we navigate these challenges together.

Sincerely,

Claude Brulé
President and CEO


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