Ontario announces tuition cut, eliminates free tuition for low-income students

Ontario eliminates grace period for student loans Colleges and universities will be expected to absorb the loss of revenue due to the tuition cuts.

TORONTO -- Ontario has eliminated free tuition for low-income students as it attempts to trim a multibillion-dollar deficit, a move that -- despite an accompanying tuition fee cut -- is being slammed as harmful to those it's purported to help.

The Ontario Student Assistance Plan grants had become unsustainable and it was time to refocus the program to provide help to students in the most financial need, said Training, Colleges and Universities Minister Merrilee Fullerton.

"The previous government believed in handing out OSAP funding to some of Ontario's highest income earners rather than focus student grants to those individuals who needed it the most," she said Thursday.

The previous Liberal government increased the number of grants and made it possible for low-income students to attend college or university free of cost. But the auditor general found last month that costs for that program jumped by 25 per cent and warned it could grow to $2 billion annually by 2020-21.

The Tories are in the midst of trying to trim a deficit they peg at $14.5 billion -- though the financial accountability officer says it's closer to $12 billion.

Under the Liberal OSAP program, families earning up to $175,000 could qualify for some funding and that threshold is now reduced to $140,000. Low-income students could qualify for grants large enough to cover the full cost of tuition under the previous plan, but now a portion of the funding they receive will be a loan.

Most of the grants will go to students whose families have an income of less than $50,000.

At the same time, tuition fees are being cut by 10 per cent, the government announced. It framed the moves as ones that will help the students in greatest need, but students and critics said that isn't the case.

"The recent changes that we saw in September 2017 related to OSAP actually ensured that one in four students could access enough grants to cover all of their tuition fees," said Nour Alideeb, chairperson of the Canadian Federation of Students Ontario.

"By restoring the OSAP program back to the 2016-17 model it actually makes students take out more loans, meaning that when they graduate they have to pay it back with interest."

Liberal Mitzie Hunter, who is the former minister in charge of post-secondary education, echoed the students.

"Needy students will see next to no benefits because under the previous program they were already being provided for," Hunter said. "Wealthy students, who never qualified for OSAP in the first place, are being given a 10 per cent tuition cut even though they can afford it the most."

The current tuition fee framework, which has capped increases for most programs at three per cent, expires at the end of this academic year. Under a new framework, tuition would decrease by 10 per cent for the 2019-2020 year, then be frozen for the following year.

Colleges and universities will be expected to absorb the loss in revenue, Fullerton said.

"They will make choices in terms of what they need to do," she said. "They will be able to determine what they need to do to change, to adapt and innovate."

A 10-per-cent tuition cut would take about $360 million away from universities and $80 million from colleges.

Core operating grants from the government to post-secondary institutions are contingent on their compliance with the tuition cut, but Fullerton said those grants -- another important source of funding for post-secondary institutions -- would not be reduced.

The Council of Ontario Universities said that when adjusted for inflation, operating grants per student have decreased by more than 10 per cent over the past 16 years, leading universities to fund a larger proportion of their operating costs through tuition fees.

This announcement will "negatively affect their ability to provide the best possible learning experience for students, partner with their communities and help deliver economic and social benefits to the people of Ontario," the council said.

NDP critic Chris Glover called the tuition fee cut alongside OSAP changes a "sugar-coated poison pill."

"The universities are already cash strapped and they're going to have to find ways to make up for the loss of revenue and it's going to come out of the students," he said. "It's going to come out of the quality of education that they receive, through their class sizes and through the number of professors that are on the campus to help them."

Fullerton also announced that universities and colleges will have to give students the option of what additional fees they pay, such as those that fund campus organizations, student newspapers and clubs.

Alideeb said the move seems targeted toward certain campus organizations.

"What's really scary is that I feel like this is a direct attack on the groups that actually try to hold the government accountable when it comes to student issues," she said.

Some fees will remain mandatory, Fullerton said, including walksafe programs, health and counselling, athletics and recreation and academic support.