Question Period Note: POST-SECONDARY EDUCATION AFFORDABILITY

A Globe and Mail article on September 11, 2023, entitled “How students and graduates can tackle the enormous pressure student loans are creating,” reported that according to a poll by Embark Student Corp, 75 percent of students say it is very difficult to afford post-secondary education (PSE), and 79 percent say debt during school can be debilitating.

Canadians are facing increasing affordability pressures. Post-secondary education is a key driver of inclusive economic growth, and the Government is committed to ensuring that it remains accessible and affordable for all Canadians.

To help students afford post-secondary education, the Government has increased non-repayable Canada Student Grants by 40 percent over pre-pandemic amounts for the current school year. Canada Student Loan debt has remained stable for over a decade due to significant increases in grants.

The Government has also made Canada Student Loans permanently interest-free and has increased the weekly loan limit from $210 to $300 for this year.

Finally, the Government has enhanced the Repayment Assistance Plan. As of August 1, 2023, no borrower has to repay a Canada Student Loan until they are earning at least $42,720 per year, with higher thresholds for those with higher family sizes.

If Pressed (Subject)

Grants are non-repayable, so they provide students with additional funding to attend school without increasing debt.

Loans are a cost-effective way of providing students with more up-front support to pay for things like tuition and housing while in school.

Permanently eliminating interest accrual on loans means that the cost of repaying a student loan is lower, and not subject to changes in interest rates.

As announced in Budget 2023, the Government is also consulting with students on a long-term plan for student financial assistance.

The Canada Student Financial Assistance Program provides need-based grants and interest-free loans to help students access post-secondary education and offers the Repayment Assistance Plan to borrowers with financial difficulty.

In response to the COVID-19 pandemic, Canada Student Grants (CSGs) were temporarily doubled over pre-pandemic amounts from the 2020-21 through 2022-23 school years.

To address ongoing affordability challenges, CSGs are increased by 40% over their pre-pandemic amounts for 2023-24. Post-secondary students can benefit from the following grants:

Canada Student Grant for Full-Time Students: up to $4,200 for a typical academic year (versus up to $3,000 in 2019-2020);

Canada Student Grant for Part-Time Students: up to $2,520 annually (versus up to $1,800 in 2019-2020);

Canada Student Grant for Students with Disabilities: $2,800 annually (versus $2,000 in 2019-2020);

Canada Student Grant for Full-Time Students with Dependants: up to $2,240 per dependant per typical academic year (versus $1,600 in 2019-2020); and

Canada Student Grant for Part-Time Students with Dependants (CSGPTDEP): maximum of $2,688 annually (versus $1,920 in 2019-2020).

Canada Student Loans (CSLs) were also increased from $210 per week to $300 for 2023-24. This means full-time students can receive a maximum of $10,200 for a typical 34-week academic year (previously $7,140). Prior to 2023-24, the weekly loan limit had remained at the same level ($210) since 2005-06, except when it was temporarily increased to $350 for 2020-21 as part of COVID-19 relief measures.

On April 1, 2023, the Government of Canada permanently eliminated interest accrual on CSLs and Canada Apprentice Loans. This built on temporary waivers on interest during the COVID-19 pandemic.

On November 1, 2022, the Government increased the zero-payment income threshold for the Repayment Assistance Plan so that single borrowers are not required to begin repaying their CSLs until they are earning at least $40,000 per year. This amount is adjusted upward based on family size. To ensure this support keeps pace with the cost of living, the zero-payment income threshold is indexed to inflation. As of August 1, 2023, the zero-payment income threshold for a single borrower is now $42,720 per year.

For 2023-24, the Government has also waived the requirement for mature students 22 years or older to undergo credit screening to obtain grants and loans. This will help up to 1,000 prospective students in accessing funding for post-secondary education.

“Canada’s learners have faced significant financial barriers over the past year. We should not be in a place where students’ finances are pushed closer to the brink with each grocery trip. Students are struggling to afford the essentials, and this report makes that evidently clear.”

Sadie McAlear, Canadian Alliance of Student Associations (CASA) Chair, August 16, 2023, Living In The Red - Canadian Alliance of Student Associations (casa-acae.com)

“Budget 2023’s one-time investment of $813.6 million into supporting student financial assistance needs to extend beyond one year to ensure long-term predictability of the CSFA program for students.”

CASA, August 4, 2023, CASA 2024 Pre-Budget Submission.

“With two-thirds of jobs requiring some form of post-secondary education, accessible and affordable education has never been more in demand or necessary…With many announcements that will directly address the mental health crisis, transportation accessibility, and college research opportunities, Budget 2023 saw many items that the Federation pushed for in our pre-budget submission, but the radical investments that students have long-called still have yet to be addressed.”

Canadian Federation of Students (CFS), March 28, 2023, Budget 2023: Students See Action on Affordability and Employment.

“In 2021 the Federal government recognized the need to continue some measures of support, and specifically kept the doubling of Federal grants until July 2023, and the suspension of interest accrual until March 2023. These measures have helped students ensure that they are able to continue to access an affordable education without having to worry about their debt load.”

Canadian Association of Student Financial Aid Administrators (CASFAA), 2022-2023 CASFAA Policy Positions, page 3.