The provincial government announced large-scale changes to university and college tuition frameworks and the Ontario Student Assistance Program (OSAP) on January 17.
Notably, the non-needs-based component of the Ontario Student Grant for OSAP recipients will be removed. While students receiving OSAP previously had a six-month grace period before charging interest, under the new plan, interest will be charged immediately after students end their full-time studies. However, the six-month period will remain.
The provincial government’s justification for these decisions was to combat an “unsustainable” system, to “reduce complexity for students,” and to prioritize lower-income students.
Here is a breakdown of OSAP — why it was created, how it has evolved, and what led up to the Progressive Conservative government’s changes.
What is OSAP?
OSAP was established under the Canadian Student Loans Program. The federal government partnered with Ontario and New Brunswick in 1999 to “harmonize” financial aid for students in those provinces.
Currently, the program is administered by Ontario’s Ministry of Training, Colleges and Universities to assist students in paying for tuition, school supplies, required student fees, living expenses, and childcare for students with children.
Students who are Canadian citizens, permanent residents, or “protected persons” residing in Ontario can apply for OSAP.
Before 2016, one third of student aid was through non-repayable grants and two-thirds of aid was in repayable loans.
Changes under Premier Kathleen Wynne
Under the former Liberal government, OSAP received a significant redesign. Beginning in September 2017, students whose parents earn $50,000 or less were eligible for free tuition. Students who were out of high school for four years or more were eligible for free tuition if they earned $30,000 or less.
‘Free tuition’ meant that students received funding that was equal to or more than the actual tuition for a university undergraduate arts and science program, a college diploma program, or the average tuition for a high-cost university or college program such as engineering or computer science.
Kathleen Wynne’s Liberals also merged multiple OSAP grants — the 30% Off Ontario Tuition grant, the Ontario Access Grant, the Ontario Child Care Bursary, the Ontario Student Opportunity Grant, and the Ontario Distance Grants — into one single grant “to help with education costs when they are incurred.” However, some grants did remain separate, including the Indigenous Student Bursary and Bursary for Students with Disabilities.
Under this OSAP framework, students received “base” funding depending on their family income and “needs-base” funding calculated by a student’s financial need.
In the 2018 Provincial Budget, Wynne’s government once again expanded OSAP to offer more grants and loans for married and middle-income students.
Wynne’s OSAP changes were estimated to cost taxpayers $650 million more than the former system.
Auditor General report
Last December, Ontario’s Auditor General Bonnie Lysyk released her annual report examining a number of provincial programs, including OSAP.
In her report, Lysyk concluded that, while 24 per cent more university students and 27 per cent more college students were receiving OSAP, enrolment rose by merely one per cent for universities and two per cent for colleges.
“We concluded that a large portion of new OSAP recipients were already attending college or university — and paying for it by themselves or with loans — even before they qualified for the new aid,” Lysyk said when the report came out.
However, because the program was only one year old, Lysyk said people should be cautious before making “long-term” assumptions. “But it certainly bears watching,” Lysyk added.
The report stated that OSAP would cost nearly $2 billion per year by 2020–2021 — 50 per cent more expensive than originally planned.