Federal Budget

From Academica:

Mixed reaction to PSE funding outlined in federal budget: While the Conservative government is being praised for earmarking $2 billion for post-secondary infrastructure in its latest budget, some organizations are disappointed that only 30% of that funding is going towards colleges. Other groups say the budget fails to address necessary investment in provincial transfers for core operating funding, academic research, and student financial aid. In comparison to the US stimulus package, in which billions of dollars are geared towards higher education, Canada's budget falls short, and may lead to a national brain drain. Budget 2009 | Globe and Mail | CBC | ACCC News Release | CSA News Release | CFS News Release | CAUT News Release | CREPUQ News Release | EPI News Release | AUCC News Release | OUSA News Release

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Note 7: Financial Support

This post is the last in a week-long series.

The financial support system for students has demonstrably changed over recent years, but has it improved access to post-secondary education?

If the objective is to improve access by helping students struggling to meet the costs of a higher education, it is clear that government spending is not as effective as it could be. Recent increases in need-based aid are welcome. In the face of rising costs, however, this aid has not so much improved the financial situation of students as simply kept it from deteriorating further.

Increases in need-based aid have not been on the same scale as other funding. In fact, need-based aid comprises only 66% of the total student financial support. A decade ago, it was over 80%. As a result, need-based aid is barely keeping up with the escalating costs of attendance.


And this 66% represents only the value to students. Since this includes loans, which cost less than their value to issue, government spending is even lower. Although the value of need-based support is 66%, the actual cost to the government of need-based aid is only 40% of the total financial support.

While overall need-based aid may lack growth, targeted aid to under-represented groups has actually seen a decrease. Despite a growing population of Aboriginal youth in Western Canada, federal funding has dropped 8.5% from ten years ago.


Where, then, is all the funding going? Largely to tax credits and savings grants, with the intention of distributing funds to everyone, regardless of financial need and without necessarily improving access. This can have adverse effects.

Not only do tax measures not target those in financial need, they actually tend to disproportionately benefit affluent families and students. After all, many of these tax supports cannot be fully used unless the student (or a family member) owes income taxes.

Furthermore, tax measures do not cover costs when they are due, leaving many students with immediate unmet need. If they are fortunate enough to qualify for loans to cover these costs, student debt loads increase. As such, grants are needed both to provide greater access and to prevent debt escalation.

The research used for this and other Millennium studies was indeed comprehensive, but not without limitations. We still lack information, from institutional data to socio-economic profiles. Even with Millennium, we had nothing to match the research and surveying used in the United States, programs that help inform decision-making and define policy.

Despite a surge in the interest surrounding this research, there is no mandate to renew or continue research on access to post-secondary education. We cannot help but wonder where this will leave the issue of access in general.
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Note 5: Assessing Aid

This post is part of a week-long series.

One of the values on which the Canada Millennium Scholarship Foundation based their program was "to deliver aid to under-represented students who appear to be under-served by the existing financial aid system." Surprisingly, these under-represented students are those from low-income families.

The assumption that grants are already targeted to low-income students through existing financial aid architecture appears to be incorrect.

Part of this seems to lie in the cost-conscious nature of low-income students, and part in students' dependency statuses.

The need-based system tends to favour those who are considered independent, despite research indicating that many still receive funding from their parents. Moreover, low-income students tend to enrol in less expensive programs, live at home, and work during school, all to reduce their costs. Hence, they miss out. In fact:

Almost 60% of the $1.07 billion spent on grants in 2001 was provided to individuals from the top two income quartiles.

Which is why the Millennium access bursaries were created. By complementing the needs-based system, the access bursaries were meant to fill the gaps in student aid.

Now, as we look to 2009-2010 when the Canada Student Grant Program will replace Millennium, we are faced with a consolidation of federal grant programs. What this entails is not yet clear, but there is certainly a concern that not all students' needs will be met, especially the under-represented. And with no funding in place to continue research, we are already missing the studies and pilot projects meant to identify those very needs. Continue reading...

Note 1: Affordability in Canada vs. in the US

This post is part of a week-long series.

Many Canadians assume that their education is more affordable than that in the US. Whether they've heard of the astoundingly high prices for institutions like Yale or Harvard, seen the high tuition fees for certain state universities, or just extrapolated from their assumption that our social policy is more egalitarian than in the US -- they might find this comparative research surprising, something both Millennium, who commissioned the study, and EPI, who published it, are quick to point out.

They are also quick to note the limitations of the international comparisons. Loan remission and tax rebate programs, for instance, both have limited data available on one or both sides of the border. Nonetheless, the research remains invaluable, raising the question of whether there is enough aid in Canada. Indeed, both reports bluntly state:

The amount of aid available to Canadian students is not what it needs to be.

How do they arrive at this? In looking for a "comprehensive approach to the notion of affordability", Millennium and EPI look beyond the cost of tuition by adding room and board, and then by subtracting available aid in order to attain what they call out-of-pocket expenses. Their findings are summarized in the chart below.

If we are moving towards a high-cost system -- and the trend in tuition and housing certainly seem to suggest this -- we need to ask two questions. First of all, is this policy shift the best way to ensure greater access, or are there better alternatives? And second, if we are going to follow this policy shift, when are we going to introduce the second half of the equation, namely high-aid? The longer we linger, the more qualified students miss out on an education they deserve.


To read the full study, visit the Millennium Scholarships website.
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Millennium Research

From the Millennium Research Program website:

The Millennium Research Program was launched in 2001 to assist the Foundation in carrying out its mandate to improve access to post-secondary education and provide students with the educational opportunities they need to prepare themselves for the future. The Research Program advances the study of barriers to post-secondary education and the impact of policies and programs designed to alleviate them. It ensures that policy-making and public discussion about opportunities in higher education in Canada can be informed by rigorous analysis and empirical evidence.

Last year, the Government of Canada decided not to renew the Canada Millennium Scholarship Foundation after its initial mandate is complete. It will be sorely missed.

Over the next week, I will feature one of the program's Research Notes per day, outlining the findings and what they might mean to us. So stay tuned to learn more, and don't hesitate to comment in order to facilitate further discussion on these crucial matters. Continue reading...

Claiborne Pell Dies at 90

Yesterday, former Senator Claiborne Pell died at the age 90. Pell is best known for his sponsorship of the 1973 bill which created what are known today as the Pell Grants.

Originally called the Basic Educational Opportunity Grant program, the federal grants provide non-repayable assistance to low-income families across the United States. Today, Pell Grants continue to help millions of students per year despite having seen little or no growth alongside the escalating costs of access.

In 2005-06, the maximum Pell grant covered one-third of the yearly cost of higher education at a public four-year institution; twenty years ago, it covered 60% of a student's cost of attendance. Continue reading...

Rising Tuition is a Myth?

It was quite the relief to see yesterday that "the real cost of university is falling". Here I thought that university prices were going up, and that accessibility was an ongoing issue -- if not an increasing one. But apparently "one province is even paying its students" when tax rebates are considered, according to an EPI study. So where did I go wrong?


Was it the increasing housing costs? Maybe textbook prices? How about childcare? Wait, have I touched on tax rebates before? Let's see:

"A report released yesterday by the Canada Millennium Scholarships Foundation asserted that student aid may not be going to those who need it most. The report indicates a fundamental shift from needs-based grants to tax credits and rebates, a move that tends to favour the more affluent and leave the truly needy further behind."

And on that note, the EPI study reports that Alberta relies more heavily on tax credits than any other province. Continue reading...

Study(ing) Aid

With the economic downturn, many university leaders have begun questioning stewardship priorities, often with a resulting shift to student aid. Take Bobbi Mark, vice president for institutional advancement at Barnard College, who recently empathized,

"We can delay in building that new building, but we can't say to the entire sophomore class: Why don't you take a year off?"

That year off may be forced on more students than higher education officials expected, according to a number of recent studies.


From the annual conference of the Association for the Study of Higher Education came three reports which examined the effect of two major need-based scholarships. These reports concluded that generous grants not only increase access, but also increase retention, especially among low-income recipients.

Unfortunately, that level of aid is all too often absent, a study by the National Association for College Admission Counseling determines. This report details that although many institutions claim to be need-blind, their aid only covers a small portion of costs -- resulting in a "gapping" effect that can leave many students behind. One of the reasons: colleges and universities are spending less on need-based aid than in the past.

Which brings us to a recent study from the Institute for Higher Education Policy. This study finds that the increasing costs of university and the dwindling availability of aid are preventing access to qualified students. More than 80 percent of non-college goers -- who had earned at least a 2.5 high school GPA, taken a college-preparatory curriculum, and taken some levels of advanced mathematics -- reported that the availability of financial aid was either “extremely” or “very” important in their decision not to enroll.

And some institutions are responding. Not only is Barnard College going to "delay building that new building", but they are also going to concentrate their efforts on increasing aid. This initiative of shifting donor contributions to student aid has been adopted by numerous universities, with some community colleges even waiving tuition for their local unemployed.

Let's hope it's enough to prevent students from taking the year off -- if they can afford it in the first place. Continue reading...

A Step Behind

A report released yesterday by the Canada Millennium Scholarships Foundation asserted that student aid may not be going to those who need it most. The report indicates a fundamental shift from needs-based grants to tax credits and rebates, a move that tends to favour the more affluent and leave the truly needy further behind.


That aid does not go to the most needy students should come as no surprise to anyone who has followed the discussion on student aid south of the border. Calls for reform of the student-aid system have been made by various groups and individuals, including Margaret Spellings, the U.S. Secretary of Education, and the Rethinking Student Aid study group. Both outline the importance of reducing the enrolment gap between more affluent and less privileged students.

Both also outline the importance of grants. Increases in aid in the U.S. have often seen subsequent increases in grants, making the accessibility issue primarily one of background (ie. who receives the grants). And this is why Millennium Scholarship's results may come as a surprise: our accessibility issue remains very generally a financial one.

Which puts us a step behind. And when we're behind a country where a "sharp rise in inequality was largely due to an educational slowdown", it's not a pleasant thought.

Originally posted October 23. Continue reading...