The Covid crisis is giving Canada’s universities one of their hardest lessons yet in the danger of over-reliance on foreign students, with repercussions hitting campuses regardless of their direct international exposure.

The harm appears most direct at places such as Concordia and McGill universities, which are reportedly facing budget deficits as coronavirus restrictions deter or prevent international students from attending.

One of the worst-hit institutions, Cape Breton University, is reducing staffing and cutting pay after losing half its student body. Before the coronavirus pandemic, Cape Breton had about 4,700 students, mostly from abroad. This year’s estimated revenue loss of C$17 million (£10 million) is more than twice the budgetary reserves that those foreign students had helped the university to accumulate.

Yet all manner of Canadian institutions appear to be suffering, as a growing reliance on international student dollars has become what analysts fear is a nationwide addiction that has permanently transformed provincial budget support.

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A generation ago, governments provided more than 80 per cent of the funding of Canadian universities. But the share is now down below 50 per cent as politicians largely expect campuses to find their own revenues.

In just the past decade, by the research and consulting firm Higher Education Strategy Associates, international student tuition fees alone have covered the entire increase in the operating budgets of Canada’s colleges and universities.

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“We’ve gone to a very privatised system,” said David Robinson, executive director of the Canadian Association of University Teachers.

The trouble can be seen at places such as Dalhousie University, where nearly a quarter of the student population comes from abroad. One of the first universities to try renegotiating teaching contracts during the pandemic, Dalhousie has found the combination of budget pressures and heavier workloads during Covid restrictions to be combustive.

Faculty have been exhausted by the move to online instruction and now see themselves as ever more vulnerable to worldwide developments beyond their control, said David Westwood, a professor of kinesiology who serves as president of the Dalhousie Faculty Association.

Talks involving the 1,000-member union are at a stalemate, with faculty anxiety reflecting “the erosion of the public higher education system and the lack of resilience in the face of global events”, Professor Westwood said.

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It’s a similar story at Saint Mary’s University, which gets about a quarter of its students from abroad. Canadian students are worried for themselves, seeing provincial funding models growing unstable, said Bryn de Chastelain, an undergraduate and president of the Saint Mary’s University Students’ Association. But they also question whether their international classmates have been enrolled and brought into the country “with a focus on just obtaining their money”, he said.

The promise and the pursuit of foreign tuition dollars has pervaded higher education nationwide, according to Alex Usher and his analysis at Higher Education Strategy Associates. After the 2008 financial crisis, he said, Canadian governments simply stopped increasing their spending on post-secondary education, leaving institutions to find new funding sources.

“The pandemic has exposed that long-simmering problem within our system,” Mr Robinson said. “The over-reliance on private tuition and fees has been fully exposed now.”

Denise Amyot, president of Colleges and Institutes Canada, which represents 135 post-secondary institutions, acknowledged that the Covid-related loss of international students was a significant problem at the moment. But the overall benefits exceed any short-term troubles, both for the students and their institutions, Ms Amyot said.

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paul.basken@timeshighereducation.com