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Research funding

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Operating funds vs. research grants | The indirect costs of research

Operating funds vs. research grants

Sometimes we're asked why we don't just cut funding from research and redirect it toward teaching. The short answer is that we're not allowed to do this.

  • Research grants are awarded to help professors conduct specific research projects. Universities hold that money in trust, but we’re not allowed to spend it on building renovations, for example. 
  • Operating funds pay for things like student services, electricity, payroll, libraries, the majority of professors’ salaries, cleaning, groundskeeping, information technology and all the other services that keep universities running.

That said, slashing research today might direct a few more dollars to undergraduate education in the short term, but it's a surefire way to dampen Quebec's economy, hurt our competitiveness and drive high-skilled jobs elsewhere. If Quebec wants to compete in a modernizing world economy, we need to prioritize innovation at our universities.

The indirect costs of research

Research costs money—not just to do the research itself, but also to keep the lights on in the lab, the staff on the payroll, the buildings maintained, finances tracked, etc. These and many more expenses are called the "indirect costs" of research.

In Quebec, the government pays the full costs of research on its grants, covering both the cost of the research project and the indirect costs. However, on federal grants (the bulk of our research funding), McGill gets an extra 18% of research grants to pay these indirect costs. Great, except those expenses actually cost an extra 60%, approximately. The more federal research grants we get, the more "extra" expenses that aren't covered—and must be paid for out of operating or by going into deficit. 

This means that McGill research projects are forced to compete for funding with things like teaching and student support. According to budget documents tabled by the Quebec government in March 2011, “Federal underfunding of the indirect costs of research conducted by [Quebec] universities represent(ed) a shortfall of approximately $90 million for 2007-2008 alone”. The Quebec government can’t be expected to shoulder this burden. It’s crucial that the federal government finance the real costs of research, and allow more of Quebec universities’ overall operating budgets to go to other areas.