Ontario's Budget and Tuition Fees | What's Left

Ontario's 2016 budget was announced on Thursday. In contrast to the newly applied progressive veneer of the current Liberal brand, the budget was actually an austerity budget. The funding for infrastructure all comes from other parts of the public purse, increases to regressive flat taxes, and delayed spending on much needed social programs. Reallocating public service funds to infrastructure investments will not give the province the advertised economic boost because every infrastructure job and investment will be offset by job losses and cutbacks to other public services.

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There was a brighter spot in the budget and the mainstream media, looking for positive stories, latched onto it: a grants program to fund current tuition fees for students from low-income families. The low-income cut-off in Ontario is about $37,000 to $44,000 for a family of three to four (two wage earners and children).

As semi-regulated tuition fees have surged in recent years, many studies have shown low-income people are being squeezed out of the university and college system. So, the government finally listened to the Canadian Federation of Students and followed the lead of the federal government by overhauling its primary system of financial assistance for post-secondary education. Instead of having to spend years paying off large loans, students from low-income families will now be provided with upfront grants to pay for their education.

The Canadian Federation of Students-Ontario was right to celebrate the more progressive redistribution of grant and loan financing. Needs-based, upfront grants are a good thing and the CFS has been the leading voice on this ask for as long as it has been around. This announcement shows that strong analysis, democratic mobilization, and persistent principled advocacy can push government to change its approach.

However, this more progressive reallocation of student financial assistance is only a small step towards the ultimate goal of universally accessible, high-quality post-secondary education. And, for many students and families, this step, while moving in the right direction, is still not enough.

While this victory should be celebrated, here are some facts that should drive activists to double-down and take this opportunity to push further.

There is almost no new money in the budget for university and colleges (only $100M in 2017-2018 and none for the current year). Infrastructure funding is vaguely defined in the budget, so there is uncertainty whether any has been earmarked for maintenance of post-secondary institutions. In fact, if anything, it looks like there may be an actual decrease in funding for 2017.

This “new” grants system is basically a redistribution of current grant money to lower income families. While this is more progressive (and honest) than the “30% Off” nonsense the Liberals introduced a few years ago, it is not new money.

How does the new system work? Money from the current regressive financing model that supported students from middle class families is redistributed to families that earn under $40,000/year. Note that these grants end up being larger because the group that qualifies to receive them ends up being a smaller group than under the old system. This is mainly because to receive the largest amount from the new grant requires the combined income of all members of the student’s family to be less than $40,000/year (not $50,000/year as claimed by Liberal propaganda). Currently, only 10% of students in university and college meet this criteria.

So, a student who comes from a middle-income family earning between $40,000 and $80,000 a year, will receive diminishing support as their parent’s income increases. But, even a family earning just over minimum wage may not qualify for the full tuition fee grant. A two-parent household with both parents working full-time at minimum wage jobs would bring in around $44,000 per year.

Even the Liberal government explanation of the new funding model shows low-income students are still expected to pay $3,000 of their own money – in addition to loans to cover education-related expenses. While base tuition fees might be covered, increasing and often unregulated ancillary fees (for campus services and developments unrelated to tuition) will continue to keep university out-of-reach for many low-income students.

Current tuition fee regulation is set to expire in 2017. If the government is allowed to deregulate tuition fees they will sky-rocket and the impact of this low-income grant will be dramatically reduced. This is where students and community activists should take our next stand and make a difference: convince the government to maintain the cap on tuition fees and ensure the grant is actually able to have an impact for more than just one year.

Without a tuition fee freeze or reduction, there will be an increase in the commodification of university and college education and an increase in the “student as consumer” mentality. This undermines the public university system and quality of education and research. More of the university budget will depend on private fees – putting pressure on universities to target money-making programs and marketize their programs. The result will be cuts to programs like Women’s Studies (recently dropped by the University of Guelph) – that are important areas of study, but are ones that bring in less money to universities than business and technology programs.

Since the budget does not increase funding to university or college institutions, austerity on campuses will continue and probably increase. This means reduced quality of jobs and lower quality learning environments.

Beyond education, there are cuts to all other public services and an increase in a flat tax on gas (remember, cap and trade is the right-wing libertarian solution to carbon pricing and hurts working people more than other carbon pricing schemes). These new regressive taxes will increase costs for low-income families. On the other hand, large corporations have been given a year cap-free to “adjust”.

On top of the increased costs, the price on carbon is only set to top-out at $17 a tonne – well below the $35 a tonne that has been demonstrated to actually impact consumer behaviour. There is also no support for the impacts this will have on low-income families. So, the cap and trade system is mostly just a flat tax, not an environmental program.

As a comparison, the amount of money put into supporting public assisted housing and post-secondary education is about the same as that which is being used to subsidize the province’s horse-racing tracks. That is a hint about how out of whack the Liberal’s priorities are. The $1.2 billion dollars (at least) the Toronto Community Housing needs next year to maintain its current stock of housing has not been covered. So much for supporting low-income families.

Overall, this is an austerity, privatization budget where regressive taxes and cuts to public services pay for private infrastructure projects and a couple of programmes that will generate good PR.