The confrontation between McGill University and the government of Quebec over the $29,500 in tuition fees McGill is charging for its MBA program is not going to end well. Both sides are rejecting compromise. McGill says that in the real world $29,500 is a rock-bottom price for an MBA. The government, meanwhile, has clambered onto the high road of "principle," arguing that McGill cannot be allowed to act unilaterally, and price cannot be allowed to limit students' accessibility to programs.
Education Minister Line Beauchamp last week told media that the government would penalize McGill financially if it insists on continuing to charge $29,500. It has threatened in the past to claw back from McGill's general funding $28,000 per MBA student, leaving the school with only the $1,500 in tuition the Education Department rules allow.
On the simple level of disobeying funding rules, McGill is in the wrong. But on every other level, it is right. What Quebec is proposing to give McGill for its MBA program is so far short of the mark, it's painful. Last year, Peter Todd, dean of McGill's Desautels Faculty of Management, explained that McGill's program costs about $22,000 per student a year to operate, leaving the school with a perstudent shortfall of $10,000 after tuition and other subsidies. Top Ontario business schools spend even more - in the range of $30,000 to $35,000 per student a year.
If McGill is forced to offer its MBA program at current tuition rates, it means that money has to be siphoned from other programs to make up the shortfall. MBA graduates tend to earn high salaries almost as a matter of course. They don't need to be subsidized by liberal-arts students, nor should they be.
The elephant in the room is Quebec's refusal to increase university tuition fees in any meaningful way. Whoever is in power, provincial governments have all run scared from the threat of student protests, with the result that Quebec's fees are less than half the Canadian average of just over $5,000 a year. In December, the heads of Quebec universities asked for a fee increase spread over four years to bring the yearly tuition up to $3,680. The province has allowed a $100-a-year increase from the 2007-08 to the 2012-13 academic years and Premier Jean Charest recently promised to review the freeze.
The traditional argument for Quebec's low fees is that they lead to higher enrolment. But they don't. In fact, Quebec trails the other provinces at next to last in university enrolment figures.
For a province trying to position itself as a key player in a global knowledge economy, it is proving oddly dim about the need for a highly educated workforce. It's in the wrong. It's time it increased fees - and backed off from McGill.