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SMA's and Ontario's New Funding Model for Universities

SMA's and Ontario's New Funding Model for Universities

Author: Joyce Bott

This tutorial will look at Strategic Mandate Agreements and how they will play a factor in Ontario's new funding formula for universities.

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1.0 What is an SMA?

An SMA is a strategic mandate agreement made between Ontario's Ministry of Training, Colleges and Universities (MTCU), and an Ontario university or college. In the summer of 2014, SMA agreements were established with 45 publicly assisted colleges and universities across Ontario. This first SMA agreement cycle covers years 2014 to 2017. The next agreement cycle will begin in 2018.

The purpose of the system-wide SMA's is to improve Ontario's postsecondary education system by helping institutions build on their individual strengths, limiting expansion in academic areas where programs already exist. By reducing redundancies in academic programming, this will ensure students will have access to innovative and affordable colleges and universities. As stated by the MTCU minister, Reza Moridi (2014):

"By working with institutions to build on the strengths they define for themselves, we can continue to move towards a system where institutions work together as complementary parts of the province's postsecondary education system and avoid unnecessary duplication."

1.1 Why are SMA's so Important?

At a recent President's Town Hall Meeting for Brock University, President Lightstone (November 2015) explained that going forward, anything an institution asks for from the Ontario government, will only be considered if it's in line with the goals stated in the institution's SMA agreement with the MTCU. For example, if Brock university wants to open up more graduate spaces to students, the ministry will look at Brock's SMA agreement first. Since part of Brock's SMA goals involve promoting transdisciplinary research and partnerships with the local community, the more evidence Brock can provide to show these new graduate spaces are connected to the stated SMA goals, the better the chance of getting their request approved.

More examples of where SMA's will be used:

  • Program approval process
  • Quotas on professional programs (e.g. teacher certification, medical residencies, engineering enrolment, etc)
  • Capital expansion approval process
  • Inter-institutional credit transfers
  • Online learning programs

The system-wide objective of the SMA agreements are to ensure institutions provide academic programming connected to the economy through experiential learning and applied research. This will put students in the best position to find skilled work or grow businesses that will benefit Ontario's economy.

2.0 What Government Framework are SMA's based on?

SMA's between MTCU and Ontario colleges and universities were developed as a result of the Ontario government's Differentiation Framework which was established in November 2013. The Differentiation Framework was created in anticipation of the following challenges currently facing Ontario (Lightstone, 2015):

  • Every region of Ontario is experiencing a ~10% decline in the 18 to 20-year-old age group (the last children of the baby-boomers are graduating)
  • Numbers will not return to present levels for the next 10 years
  • As long as funding (tuition and government grants) is enrolment driven, every Ontario university will increasingly "fish" in the Greater Toronto Area (GTA) pond

To address some of these issues, the framework highlights the following government priorities:

  1. Social and Economic Development
    • Job creation
    • Enhanced productivity
    • Contribution to the vitality of communities
    • Improved labour market outcomes
    • Higher employment rates
  2. High-Quality Educational Experience
    • Improved student outcomes
    • High-quality teaching providing knowledge and skills for students to succeed
    • Better coordination of program offerings at the system level (avoid unnecessary duplication)
  3. Post-Secondary Education Financial Sustainability and Accountability
    • Short term financial sustainability for PSE institutions
    • Long term financial sustainability for PSE institutions
    • Affordable PSE education options for students
  4. Access for All Qualified Learners
    • Increased accessibility on the ability to learn rather than the ability to pay
    • Increased retention for underrepresented groups (French Language, Aboriginal, students with disabilities, first generation students, etc.)
  5. World-Class Research and Innovation
    • Growth in Ontario's knowledge
  6. Collaboration and Pathways for Students
    • Innovative collaboration among institutions to provide enhanced learning opportunities for students
    • Increased support student mobility between institutions

In order to implement the ministry's Differentiation Framework, two things need to happen:

  1. Colleges and universities need to articulate their unique mandates, strengths and aspirations through SMA agreements with MTCU.
  2. Funding levers must be tied to the SMA agreements to ensure PSE institutions follow through with their objectives.

3.0 How will SMA's be tied to MTCU's Funding Model?

Before answering this, a basic understanding of the current funding model needs to be established.

3.1 The Current Funding Model

In order to tie SMA's to the PSE funding model, a general understanding of the funding formula needs to be established. Factors that make up the current funding formula include the following:

  • Student Enrolment by program/major (certain programs not eligible)
  • BIU's (funding weights assigned to each program based on program cost)
  • Special Grant incentives (not tied to enrolment)

The current funding formula does not really factor in the performance outcomes of institutions (there is a tiny element tied to alumni employment rates). The formula is mostly enrolment driven. So the model must be revised to factor in performance outcomes based on goals set in the SMA agreements negotiated with each institution.

3.2. The Revised Funding Model

MTCU has recognised the need to revise the funding model into one that is more outcome driven. Consultation with various stakeholders occurred over the summer and ended in September 2015. The ministry is now in the process of reviewing the recommendations to determine a new and improved funding formula. Factors that will make up the new funding formula will include:

  • Student Enrolment by program/major
  • BIU's assigned to programs/majors
  • Performance outcomes based on SMA goals (funding contingent on meeting desired outcomes outlined in the SMA agreement)
  • Special Grant or "Ontario Priority" incentives not tied to enrolment

4.0 Comparing SMA's - Key Area's of Differentiation

4.1 Brock University

Brock University's areas of strength include: undergraduate teaching excellence with foci on work-integrated, service, and small-group learning; regional partnerships; and continued excellence in research and associated graduate programs, with a special focus on transdisciplinary research hubs highlighting areas of strength that contribute to the social, economic, and cultural development of the Niagara Region.

4.2. McMaster University

McMaster is a research-focused student-centred university with a unique pedagogical approach embedded in a research-intensive setting. McMaster’s research strengths are diverse and include: health sciences, the broad determinants of health, engineering, life sciences, digital information and media, business and economics, history, society and culture, policy, ethics, and sustainability. McMaster’s signature pedagogies include problem-based learning and inquiry, and its distinctively collaborative culture has fostered strong interdisciplinary programs and partnerships.

4.3 University of Guelph

The University of Guelph is a research-focused, learner-centred university with strategic areas of focus in food, health, environment, and community. Guelph is committed to the highest standards of teaching and learning in the education and well-being of the whole person. Agriculture and veterinary medicine are recognized as areas of special responsibility at Guelph.

4.4 Wilfred Laurier University

Laurier is a comprehensive university that excels in liberal arts and science education, with an emphasis on teaching quality, student outcomes, and community partnerships. Laurier-specific areas of research strength include: environment; governance and policy; health and well-being; culture and society; economics, markets, and management.

4.5 University of Waterloo

is a research-intensive university centred on cultivating innovation through experiential learning, entrepreneurial education, and high-impact research across all disciplines, with a focus on mathematics, computer science, quantum science/nanotechnology, “X” and Business, environment/biological systems, engineering and architecture, health and well-being, psychology, governance, and accounting and finance.

4.6 Ryerson University

Ryerson meets societal need and labour market demand through an emphasis on professional accreditation, experiential learning, and connections to industry and community. Examples include:

  • Ryerson’s Digital Media Zone (DMZ), an incubator environment where students develop business plans, create commercial or non-profit products and services; develop start-up ventures; collaborate with industry and community partners; and work with technologies such as advanced digital manufacturing.
  • Every undergraduate program at Ryerson has an Advisory Council comprised of industry/discipline experts to ensure that programs reflect the most current practices in the field and that students graduate with career-relevant skills.

5.0 Sample Metrics for SMA Report-back to Ministry (Brock University)

SMA Goal Required Metric





NOTE: These are just a sample of metrics currently being used at Brock to help inform SMA report-backs to the ministry. It is anticipated that new institution-specific metrics will be negotiated for the SMA report-back, which will be tied directly to the new funding allocation model which may be announced in the next year.

Class Handout


Appendix A: Ontario's Differentiation Framework


Appendix B: Brock's Strategic Mandate Agreement


Peer Evaluation