#ableg I'm hardly an expert, but have worked in risk management for a big chunk of my career. The purpose of reserve funds (i.e. of schools) is to mitigate risk. Set aside money so that you don't go into debt. If you are a school, you might not be allowed to go into debt. 1/8

Operational Risk: common business risk of unexpected costs. e.g. needing building repairs / surprise extra students / extra temporary staffing needs. 2/8

Market Risk: expected interest / bond yield / exchange rates go down and your investments aren't worth as much as expected. e.g. if a government transfers your pension into a volatile investment strategy and it doesn't pay off (see UCP in early 2020) 3/8

Counterparty Risk: creditor can't / won't pay obligations. Should be uncommon with schools. But... e.g. if the government delays budget until after school year starts & then introduces massive _retroactive_ cuts to education after schools make obligations (see UCP, Oct 2019) 4/8

Systematic Risk: truly unexpected, affects everyone. eg. 9/11, 2008 financial crash, COVID-19, murder hornets, end of encryption. Prep ltd by imagination & willingness to keep $$$ aside. (see also criticism of school boards for carrying too much in their reserve funds) 5/8

So AB's UCP government expects schools to use reserve funds to handle a systematic risk event (which it isn't designed for), after having depleted those reserves via a counterparty risk event (which shouldn't happen). 6/8

Either UCP think that COVID-19 isn't serious & shouldn't qualify as a systematic risk event (plenty of evidence they think that), or costs required aren't significant (e.g. teachers can "tidy up"), or it's not their responsibility & boards should be blamed for failures, ... 7/8

... or they assume that it will be _other_ people's kids and families that will be unlucky and they'll be fine because of their choices.
This is fiscally ignorant & fiscally irresponsible at best, and ghoulish at worst. #ableg #abed 8/8