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Posted on Oct 1, 2018

Building a Better Mousetrap

Building a Better Mousetrap

No matter how much time and effort schools spend on careful course programming, staffing and other planning decisions, it can all seem to disappear into thin air when the government implements changes that schools have no control over.  As Ronald Reagan once said, “If you invent a better mousetrap, the government comes along with a better mouse.”  This past year, independent schools have been forced to deal with several government decisions that have seemingly come out of the blue to impact school budgets:No matter how much time and effort schools spend on careful course programming, staffing and other planning decisions, it can all seem to disappear into thin air when the government implements changes that schools have no control over.  As Ronald Reagan once said, “If you invent a better mousetrap, the government comes along with a better mouse.”

This past year, independent schools have been forced to deal with several government decisions that have seemingly come out of the blue to impact school budgets:

Canada Summer Jobs Grants

Many charities were caught unaware when the federal government decided to require them to agree with certain charter values in order to receive grant funding for employing students this past summer.  Some schools have relied on this funding to help run summer camps, perform extra maintenance work, or supplement office staff.  Undoubtedly some of this work had to be reduced or cancelled if grant applications were rejected and alternate funding could not be found.

Employee Health Tax

While some changes to the provincial Medical Services Plan were anticipated, it was still surprising that the government decided to push the entire cost of the program onto employers, and even more frustrating that the old MSP premiums would continue for the first year of the new tax.  Some relief has been since been provided for charities, but the piecemeal announcement of the detailed tax regulations has made it difficult to pin down the expected financial impact.  When a $30,000 change to a school budget means the difference between hiring an aide or not, lack of government clarity has a real impact on students and teachers.(The latest details on the EHT can be found at www2.gov.bc.ca/gov/content/taxes/employer-health-tax.)

Education Funding

Schools benefited from additional Classroom Enhancement Funding last year, but preliminary grant numbers for 2018/19 released in March were somewhat disappointing, meaning schools were once again forced to trim costs from their budgets.  It came as a happy surprise when the government issued “revised” preliminary grant figures in early July showing higher block grants, but the constant up and down makes it difficult to plan programs and hire staff.  Schools appreciate the extra grant funding, but if it comes too late to make well-though out programming and staffing decisions, it may be utilized in a less efficient or less impactful way.

While dealing with an outside bureaucracy can pose a challenge for accurate budgeting, there are a few things schools can do to help manage the uncertainty caused by changes in government policy:

• Budget conservatively to provide a buffer for unexpected changes

• Manage tuition fees and develop other sources of revenue to reduce undue reliance on government grants

• Update budgets to include the impact of recent government changes so that decisions can be made based on the most up-to-date information

• Build flexibility into some areas of the school budget for programs or activities which can be easily reduced or enhanced based on government decisions

• Watch for information from the government, FISA and SCSBC to keep apprised of the latest news

Developing methods to deal with budget uncertainty is crucial for independent schools, particularly as we see more polarizing views in the public discourse which can lead to abrupt changes in government policy.  No matter how well schools plan programs and staffing, and how much time is spent fine-tuning budgets to use funds in the most effective and stewardly manner, outside forces will sometimes throw a wrench in the mix.  Schools must stay informed, be flexible and ready to adapt – and always prepared to build a better mousetrap.

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