Generous severance payments net Concordia University $2-million fine

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The Quebec government will fine Concordia University $2-million next school year, a sharp signal that it has had enough of generous severance pay the school handed to departing senior administrators.

Numerous high-level employees left or were forced out in 2009 and 2010, taking lucrative packages totalling millions of dollars with them, and shedding light on long-standing governance problems that stung Concordia's image.

Education Minister Line Beauchamp said the fine emphasizes efficient financial governance, but student and faculty leaders counter that it is nothing more than a public relations move in a time of turmoil, when tens of thousands of students have walked out of classes to protest planned tuition fee hikes.

"Today, I'm sending a signal to all our university leaders. Transparency and efficiency are synonymous with healthy management," Ms. Beauchamp said in a public statement.

Concordia learned of its misfortune in a letter from Ms. Beauchamp to Peter Kruyt, chair of the university's board, dated March 8 and obtained by The Globe and Mail. Ms. Beauchamp reminds Mr. Kruyt that she warned him that she was concerned about the university's high turnover in senior staff, and the generosity of their severance, on Jan. 20, 2011.

"I made it clear to you that the financial implications of those excessive severances were fuelling citizens' concerns over the responsible use of public funds by universities," she wrote. "I urged you to act with rigour and show great moderation in your budget decisions."

No other senior-level administrators have left since then, and no further severance has been paid. But last month ex-president Judith Woodsworth, who was abruptly ousted from the university's top job in late 2010, returned as a professor. Ms. Beauchamp's letter cites this as another questionable decision, even though it was understood that as a tenured faculty member, Dr. Woodsworth had a right to return.

Dr. Woodsworth collected some $703,000 in severance when she was compelled to resign, while five other employees ousted during her presidency received between $129,000 and $700,000, bringing the total to $3.1-million over 16 months.

"I am obliged to point out the inappropriate nature of some of your management choices, which have had budgetary impacts," Ms. Beauchamp wrote to Mr. Kruyt, noting she felt "forced" to impose the penalty "despite the autonomy in management granted to universities."

Concordia's interim president, Frederick Lowy, said in a statement that "we take note of the Minister's decision and will act in accordance with our responsibilities." But he also stressed that he shares Ms. Beauchamp's concerns about the payouts, and that the university's board of governors had already unanimously approved an external review of $2.4-million in severance doled out under Dr. Woodsworth's watch.

The fine is still "the wrong move," said Lucie Lequin, president of the Concordia University Faculty Association. She thinks it was designed to quell the fury of students – including Concordia's – who have joined the growing general strike and are arguing the province's universities are not underfunded, but simply mismanaged.

"The Minister took advantage of the situation at Concordia to use us as a scapegoat," Dr. Lequin said. "But will the students be happy if they have less services?"

The $2.4-million Concordia is reviewing would be enough to send more than 1,000 students to school for free for a year, said Lex Gill, president of the Concordia Student Union. She worries that taking another $2-million away will only sap precious resources at a time when the government is demanding students pay more for their education.

"In the end, you're punishing the university community and you're not dealing with the systemic issues," Ms. Gill said. "It seems to me the government is trying to play defence. ... They're trying to save face in front of a public that is losing more and more respect for them by the day."