Make post-secondary education affordable for all

Students and their families are bearing an ever-larger burden of the costs of higher education. Years of tuition growth to offset stagnant public funding has resulted in a significant amount, an average of $28,000, of student debt carried by 1 out of 2 graduates.

Coupled with growing inequality and stagnant wages, fewer Canadians have affordable access to education and training. A college or university education allows for increased opportunities for young people, including to do better financially and break out of the poverty cycle. But as they grapple with the rising costs of living and high youth unemployment, post-secondary education is moving out of reach. The escalating cost of tuition is disproportionately affecting students from low-income families, racialized, Black, and Indigenous students, and students living with disabilities.

While one out of two Canadians has attended a post-secondary institution, nearly all Canadians (93%) said they would have pursued post-secondary education if they had not needed to pay tuition. There is broad appreciation for the value of a university or college education, but affordability remains a barrier.

  • “Since the last recession in 2008, provincial government spending in the sector has decreased by one per cent in real terms. Meanwhile, student enrolment has grown by more than 20 per cent over the same time and income from tuition by nearly 70 per cent. Relying on student fees to solve the funding crisis simply isn’t sustainable.”[1] – Brenda Austin-Smith, CAUT President
  • “Students from coast to coast to coast reject imposed austerity measures to offset government debt by defunding education. We call on our elected officials to honour commitments to provide a high-quality, affordable, and accessible education to all learners” – Canadian Federation of Students (CFS)[2]
    • Newfoundland and Labrador: eliminated tuition freeze and doubled tuition for Canadian students (with current students paying a 4% increase in tuition per year until 2026)
    • Manitoba: scrapped tuition freeze allowing for fees to increase every year, resulting in students facing another 3.75% increase in tuition at the University of Manitoba
    • New Brunswick: access to PSE was diminished when the free tuition and tuition relief for middle class programs were cancelled.
  • Provincial governments have experimented in tuition rebate programs that target students most in need. In Ontario, some 40% of full-time post-secondary students benefitted from the free tuition program when it was in place. The Ontario Student Grant program transformed $500 million of loans into grants in 2017-18 to ensure that students from low-income families would have no student debt upon graduation and at least 50% of students from middle-income families would have their college or university tuition covered.
  • Almost 8 in 10 Canadians agree that students must borrow too much to pay for their education and that cost should never prevent anyone from pursuing an education.[3]
  • 54% of university graduates owed debt at graduation, and 45% owed more than $25,000.[4]
  • Over the last decade, universities have increasingly relied on tuition fees as a revenue source. At the national level, the proportion of revenue from tuition fees grew from 24.7% in 2013-14 to 29.4% in 2018-2019.[5]

Solutions

  • Include affordability measures as part of a national strategy for post-secondary education that will reduce tuition costs, while maintaining operating funding for institutions.

Public funding has not kept pace with enrolment and as funding diminishes, universities and colleges increase tuition and other fees for students to make up for the funding gap. The escalating costs of tuition are putting post-secondary education out of reach for some and contributing to unsustainable levels of debt for others and the average undergraduate tuition fees are on the rise. Meanwhile, a growing share of federal support has been provided through the tax system and the Canada Education Savings Program (CESP). This approach primarily benefits those who are less likely to require financial assistance, like families and individuals who are in higher income tax brackets: to receive assistance through tax measures, students or families need to pay tuition and other expenses out of pocket, and in turn, they receive a reduction in their taxes the following year—or sometimes years later. This lag between when the tuition expense is incurred and the support is received discourages and disadvantages prospective students who cannot pull together the funding upfront. Instead, federal funding measures should ensure post-secondary education is affordable to students without compromising institutional funding.

  • Make permanent the doubling of the student grant, a pandemic measure set to expire in July 2023.
  • Move to a 50:50 funding model for grants and loans.

The balance of federal support is too heavily weighted towards loans: for every $1 in grants that the federal government disburses, they loan $2 in funds which must be repaid.  A more equitable disbursement, particularly with a focus on low-income and middle-income families, would be for the government to move towards a 50:50 grants and loans model. This measure would be a welcome step in the path towards public, tuition-free, universal post-secondary education, consistent with our approach to primary and secondary education, and basic health care services.

  • Permanently eliminate interest on federal student loan debt.

The federal government provides support to students in the form of student loans, but charges students high interest on their loans. Interest rates on variable Canada Student Loans are prime plus 2.0%, well above the going rate on many mortgage loans. By the time indebted graduates pay off their loans – with interest – they will have paid significantly more for their education than their peers who were able to pay their tuition upfront. The economic downturn from the pandemic will be felt for many years to come, and as a first step towards reducing generational economic inequities, the federal government should permanently eliminate interest on federal student loan debt.

  • Invest in Indigenous education.

Eliminate the gap in post-secondary attainment between Indigenous students and non-Indigenous students by increasing funding for Indigenous post-secondary education programs by a minimum of $650 million annually. The top-up to the Post- secondary Student Support Program that helps fund First Nations and Inuit education was capped at an annual 2 per cent growth in 2016, even as inflation and population growth exceeded these benchmarks. As a result, the program is falling short in addressing the backlog of Indigenous students for this program.

CAUT believes full access to post-secondary education benefits both individual Canadians and society in general. All barriers to access and participation in post-secondary education, including financial barriers, must be removed. Learn more: CAUT Policy on Student Fees and Student Aid.

[1] “Universities and Colleges Headed for a Crisis,” November 23, 2020 (first published in the Toronto Star). https://www.caut.ca/latest/2020/11/universities-and-colleges-heading-crisis

[2] https://cfs-fcee.ca/standing-in-solidarity-with-students-of-newfoundland-and-labrador/ July 9, 2021

[3]2019 national survey https://www.caut.ca/latest/2019/09/canadians-want-accessible-affordable-and-high-quality-post-secondary-sector

[4] 2015 (most recent) https://www150.statcan.gc.ca/t1/tbl1/en/tv.action?pid=3710003601

[5] StatsCan, August 2021 “Projected Financial Impact of the COVID-19 Pandemic on Canadian Universities for 2020-21"