Proposed budget model

Our goal in developing a new hybrid budget model is to strengthen long-term connections between budget and enrolment, reflective of our primary operating revenue sources, budget model principles and mandate to educate students.

While there are many aspects of the model still being developed, considered and formed, we are committed to ensuring that the new model is underpinned by our principles, values and accountabilities.

Principles & values

During the budget model review process, we heard consistently from both our internal and external consultations that any changes to our model should be selected, developed and implemented based on our values and principles, and connected to our academic and research missions.

In addition to aligning with our institutional principles and core mission, the future budget model and process will:

Reflect UVic’s mandate as a publicly funded research university that offers a comprehensive range of programming to meet student interest while positioning itself to respond to societal, government and community priorities.
Be sensitive to differential abilities and scope across units to generate revenue, pursue incentives or take on risks.
Be data-driven and evidence-based, with transparent metrics for allocations and accountabilities.
Foster transparency in university budgeting and resource allocation, including how institutional priorities shape funding decisions.
Provide clear links and accountability mechanisms between revenues, costs and allocations.
Incentivize and reward collaboration, innovation and entrepreneurialism.
Incentivize and reward service efficiency and excellence across the university. Discourage duplication of new, siloed services where possible.
Be resilient in periods of both expansion and contraction, with respect to enrolment and external funding.
Foster commitment amongst all budget leaders to the financial capacity of their units and the financial health of the institution as a whole.

Revenue

Through the future principles-based budget model, UVic will strengthen the link between budget and enrolment, reflecting the university’s primary revenue sources and core academic mission. Since approximately 90% of UVic’s operations are funded through the provincial operating grant and student tuition—both directly tied to enrolment—the model connects funding more closely to where and how students are taught and supported.

Base budgets

Base budgets for faculties and units will be tied to the provincial grant and domestic tuition, providing stability and predictability while acknowledging that units have different capacities to generate new revenues. Over time, these core funds will be used to cover ongoing operational costs.

Incentive-based budgets

Additional incentive-based budgets will come from revenue-generating activities such as international enrolment, professional graduate programs, micro-credits and funded academic program expansions. This structure encourages innovation, entrepreneurialism, and the development of new programs, enabling faculties to invest in their strategic goals and priorities.

Revenues will be distributed to faculties and support units based on defined performance indicators and principles, with a portion directed to institutional priorities through a Strategic Initiatives Fund. This transparent approach ensures that resources are allocated in alignment with UVic’s academic and strategic objectives.

A guiding principle of the budget model design is recognition that faculties have differential abilities to increase enrolments and revenues and that cost structure vary among units.

Revenue flow

The model would recognize revenue sources, distribution drivers and distribution areas as outlined in the image below. Revenue would be distributed to faculties and, over time, non-academic units based on key performance indicators (distribution drivers). A percentage of revenue would also be allocated to institutional priorities through a strategic fund (or funds).

Figure: Proposed distribution areas and drivers of revenue in the new budget model. The graphic is intended to illustrate the concepts and does not reflect the actual or proposed scale.

Allocations

Budget allocations would be based on performance measures and strategic principles while acknowledging that faculties are the revenue generating engines of the university and recognizing units’ differential abilities to generate revenues.

Academic units

For faculties with degree-seeking students, enrolment (managed and taught loads defined by FTE and EETs) would be the primary measure for budget allocation.

Enrolment generates revenue for the university in the form of the provincial operating grant and student tuition. The managed load is designed to weight resources in support of student recruitment, retention and success, and timely graduation. The taught load, as its name suggests, is designed to weight resources in support of teaching.

Under the future principles-based budget model, funding will be guided by performance measures such as enrolment, teaching activity, and research intensity.

Enrolment will be measured through both managed and taught load, and will be the primary factor in determining allocations, as it drives both the university’s provincial operating grant and tuition revenue. Funding per student will vary by program to reflect differences in teaching methods, infrastructure needs, and overall program costs. For example, programs with intensive lab, studio and clinical components will receive higher per-student allocations to reflect their greater resource requirements. We will also prioritize Indigenous programming.

International and professional graduate programs, which are not funded through the provincial operating grant, will continue to rely on tuition revenues set to cover the full cost of education. Faculties will retain most of these incentive-based revenues to support strategic initiatives, program development and student recruitment and success.

Support and service units

Budgets for support and service units will initially continue to be incremental. Each unit leader will establish performance measures that will be reviewed annually to ensure service excellence and alignment with the university’s academic mission.

Over time, revenues will be divided among three categories: retained within faculties, distributed to support units, and reserved for strategic initiatives. Within faculties, allocations will reflect both managed and taught load to balance support for student recruitment, retention and success with the resources required to deliver high-quality programming.

This transparent and balanced approach ensures that funding reflects the unique opportunities and challenges of each faculty while supporting the breadth of programs and services that define UVic’s academic mission.

Annual process

In the principles-based model, revenue allocations would be determined based on the metrics outlined above so there will be no need for a central annual budgeting process with unit leaders.

Instead, to support the needs of this model and continue providing a forum for focused discussion and strategic alignment across the university, there will be an annual budget retreat for leaders where strategic priorities and goals will be discussed and identified.

VPAC and VPFO will monitor the revenue flow throughout the year to identify anomalies or areas of concern and connect with leaders as appropriate, as they do in the current model.

Strategic fund(s)

Over time, we intend to build a strategic fund (or funds) that provides allocations to faculties and service units to support key strategic priorities. Priorities would be identified through the annual budget retreat and allocated to units following approvals.

More information

For additional information on the proposed hybrid model being developed, download the Budget Design Committee's report and recommendations.

We also welcome you to visit our FAQs and resources, which includes a glossary of terms.