End of Ontario fee freeze ‘undermined by grant changes’

Any benefits universities might receive from the Ontario government’s long-awaited unfreezing of tuition fees have been wiped out by a restructuring of the province’s grant system, it has been warned.

Premier Doug Ford’s provincial government has announced a series of policy changes to higher education, including billions of dollars of new funding and allowing institutions to increase tuition by up to 2 per cent per year for three years.

This marks the end of a fee freeze which had been in place since 2019. Since then, institutions’ only major source of new funding has been international student fees.

Elizabeth Buckner, associate professor of higher education at the Ontario Institute for Studies in Education (OISE) at the University of Toronto, said the province has been chronically underfunded compared with others in Canada for decades.

After operating on “shoestring budgets”, she said the decision to unfreeze fees had “depoliticised” the issue and will pave the way for continued increases for years to come.

After the initial three-year period, universities will then be able to raise fees up to 2 per cent or the three-year average rate of inflation, whichever is less, in the years following.

“There has been a huge cut to budgets, and most colleges and universities in the province are operating at a deficit, and they’ve already had to do lots of lay-offs,” said Buckner.

“These fundamental realities are not really changing, so I think the idea is that the domestic student population is going to also have to see some increases in tuition as part of the conversation about how to stabilise the sector.”

Glen Jones, professor of higher education, also at Toronto, said the freeze led to the college sector enrolling an extremely large, almost unsustainable, number of international students – and had experienced “dramatic” falls when the federal crackdown decided to introduce a cap on enrolments.

“There has been a collective sigh of relief within both the college and university sectors that the new arrangements may bring some stability to a system that has been subject to weekly announcements concerning programme and staffing cuts,” he added.

“There is no doubt that every institution will increase all fees by the 2 per cent limit. After a seven-year tuition freeze most observers view this as a modest, almost token, increase in fees.”

The provincial government has said this rate of increase will be among the lowest of any province.

With Ontario recognised as having the lowest per-student income, Jones said this modest increase in tuition costs will not have much impact on decisions in other provinces.

However, what good news there was for institutions was quickly eclipsed by major changes to the Ontario Student Assistance Program (OSAP) with the vast majority of student financial assistance now switching from non-repayable grants to student loans.

“Students with financial challenges will see a huge increase in costs with most financial support now provided through loans that will undoubtedly lead to increasing student debt,” said Jones.

Students in need were previously allowed to use grants for up to 85 per cent of their fees, but that has now been reversed. Students are now eligible to receive a maximum of 25 per cent of their OSAP funding as grants and a minimum of 75 per cent of their funding as loans.

Daniel Corral, an assistant professor of higher education in the Ontario Institute for Studies in Education (OISE), said the restructuring posed a serious risk to students’ opportunities, particularly for low- and middle-income students.

“When aid shifts from predominantly grants to loans, students face higher net prices because they are now expected to repay some of the support they previously received as a grant. To compensate, students will likely need to increase their working hours, which can have negative effects on academic performance and completion.”

Corral said this change will very likely negate the benefits of lifting the tuition freeze, which was meant to generate revenue that improves the student experience.

“If the OSAP restructuring makes higher education less affordable, the benefits will never reach the low- and middle-income students those investments were meant to serve.”

patrick.jack@timeshighereducation.com