New OSAP regulations unveiled in September aim to reduce application delays and to encourage graduates to enter the not-for-profit sector, but critics charge the McGuinty government should be more concerned with the rising costs of tuition and student debt.
OSAP Express is a new system that allows students to receive funds by direct deposit and requires them to sign a loan agreement only once. Government savings are estimated at $150,000 a year.
The Ministry of Training, Colleges and Education (MCTU) also announced last week that students whose first post-graduation job is in the not-for-profit sector would be given a grace period of a year before their loan repayments come due. All other students will continue to have a six month grace period before loan repayments begin.
“The three main priorities [the government] has for post-secondary education are to ensure the high quality, accessibility, and affordability of Ontario institutions,” Alvin Tedjo, Director of Communications for the MTCU, said in an interview last week.
Tedjo said the extended grace period was meant to encourage recent graduates to pursue their interests in the not-for-profit sector by easing some of the financial difficulties they might face.
Though the McGuinty government has made a considerable effort to increase the availability of post-secondary education, little has been done to cut down on the ballooning costs many students face, or even to address student concerns about these costs.
Ontario currently has the highest average tuition rate among provinces, estimated at $7,513 a year including compulsory fees, and tuition rates in the province have gone up five per cent a year for the last three years, far above the 2.1 per cent inflation rate. A 30 per cent tuition rebate for students of middle and modest income, announced in January, will help alleviate some, but not all, of the burden.
With rising tuition rates comes worries about rising student debt.
OSAP recipients graduate with roughly $21,000 in government loans, Tedjo said, divided between the provincial and federal loans. High interest rates reinforce difficulties in making repayments: the usual loan repayment period is 9.5 years for OSAP recipients.
A Bank of Montreal study released in September found that more students (27 per cent) are concerned with paying for school than with finding a job after graduation (22 per cent) or achieving academic success (20 per cent).
Rising Canadian student debt has also raised concerns about the state of the Canada’s future economy.
“We need today’s students to become tomorrow’s big earners,” Rob Carrick wrote in a Globe and Mail article on student debt. “Someone has to pay the taxes that fund social programs for the aging baby boom generation.”
“You can’t be a fully functioning player in the economy if a big piece of every paycheque goes toward student debts,” wrote Carrick.
Student unions across Ontario have protested the McGuinty government’s approach to post-secondary education, demanding that more attention be paid to student debt.
“Students in Ontario pay the highest fees in the country, are taking on record levels of debt, and sit in the largest classes in Canada, but the government is refusing to tackle student debt,” said Sarah Jayne King, chairperson of CFS-O, in a media statement earlier this month. “Record high tuition fees continue to put college and university out of reach for many willing and qualified Ontarians.”
A recent think tank study on the costs of higher education singled out Ontario’s post-secondary system as one of the least affordable for low-income students. Though the tuition rebate should defray costs temporarily, unless stronger action is taken Ontario faces a growing crisis in post-secondary education.
