Conestoga College laid off hundreds of employees after a rapid drop in revenue brought on by a decline in the number of international students.Nick Iwanyshyn/The Canadian Press
The Ontario government says it has found evidence of serious financial mismanagement at Conestoga College and appointed an administrator to take control of the postsecondary school after dismissing its board of governors.
The government said it discovered “numerous egregious financial decisions” while conducting what it called an extensive audit.
It cited the board’s approval of a large salary increase for Conestoga’s former president to more than $636,000, a jump of 55 per cent in a relatively short time. It also described a termination payment for that president that was 83 times his monthly salary, which exceeds the 24 months permitted under the law governing broader public sector compensation. Although the government didn’t specify the former president’s monthly salary, a payment of that size on a salary above $600,000 a year would be in the $4-million range.
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Nolan Quinn, Minister of Colleges, Universities, Research Excellence and Security, said the province’s goal is to bring sound financial management to the institution. He said the province will look into the possibility of recovering some of the funds.
“We’re looking into all options to see if we can bring that money back where it should be with the students,” Mr. Quinn said.
Former Conestoga president John Tibbits retired earlier this year after more than three decades in the role. The college, which is based in the Kitchener-Waterloo area and has several branch campuses in the region, grew quickly during the international student boom and ran surpluses of more than $100-million a year at its peak.
The school’s Waterloo campus was named after Mr. Tibbits in 2018. Attempts to reach Mr. Tibbits Thursday were unsuccessful.
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Conestoga has laid off hundreds of employees in response to a rapid drop in revenue brought on by a decline in the number of international students.
Starting in 2024, the federal government made a series of policy changes designed to reduce the number of international students it admits to Canada, a response primarily to pressure in the housing market. Conestoga, which had more international study permits than any other institution, has been dealing with a sharp drop in revenue as a result.
The government said it has appointed Linda Franklin, a former president of the lobbying group Colleges Ontario, to act as administrator to “restore financial prudence and appropriate governance to the college.”
Under her watch, the college will continue normal operations, the government said, and students and staff will not be affected.
The government’s announcement also detailed a trip to Italy by three senior leaders at Conestoga that was uncovered by the audit, as well as “other similar trips.” The government said the school paid for business class airfare and what it describes as luxury accommodations. It also states that hospitality expenses were repeatedly approved without proper oversight, pointing to a $1,300 staff meal for which more than half the pretax total was spent on alcohol.
Mr. Quinn told reporters on Thursday there were governance issues at the college and that the board was “rubber-stamping decisions on behalf of the president.”
“We believe right now that Conestoga is an outlier,” Mr. Quinn added. “But if there’s any other institutions that are not putting money directly towards the students, we will not hesitate to act.”
The Opposition NDP accused the government of trying to dodge responsibility.
“Doug Ford created a system where colleges were forced to rely on international tuition revenue because public funding was nowhere near enough,” said Catherine Fife, NDP MPP for Waterloo. “Now communities, workers and students are dealing with the fallout while the government tries to act like this is all someone else’s fault. What did they think was going to happen?”
With a report from Jeff Gray at Queen’s Park.