Hittin' the Books: The Downward Spiral of Post-Secondary Education Funding in Ontario
Budget Dilemma: Ontario Leaves Higher Educational Institutions in a State of Suspension
Ricardo Tranjan, a senior researcher on housing and social policy at the Canadian Centre for Policy Alternatives, sheds some light on the alarming state of post-secondary education funding in Ontario. In an informal and engaging tone, let's dive into the fiscal fiasco that's gripping the province's academic institutions.
The recent budget tabled by the Ontario government makes some essential moves to protect the economy from Trump tariffs but fails to tackle the pervasive underfunding in core areas. alarmingly, post-secondary education is left in the cold, and the neglect is especially troubling considering the critical role it plays in the economy.
In 2024, the federal government imposed caps on international students, whose high tuition fees had kept many universities and colleges afloat for years. This financial squeeze resulted in a hefty revenue shortfall for these institutions. As the economic uncertainty looms over Ontario and Canada, one would anticipate a head-on approach to address this long-standing issue. However, the government prefers to slash funding instead.
Recalling the '80s when a summer job was enough to fund a full academic year, Tranjan's colleague laments the stark contrast between then and now. In the past three decades, government funding for universities has dwindled while tuition fees have skyrocketed.
Oddly, average tuition fees for domestic students in Ontario have tripled between the '90s and 2019, once inflation is factored in. With few options to extract more dough from domestic students, universities began relying heavily on international students as a significant revenue source.
In 2019 alone, Ontario cut tuition fees by 10% and froze them. The move cost universities $360 million and colleges $80 million, as the government disappointingly skipped compensating for the budget shortfall. The government also abandoned a program offering free tuition to low-income families.
The Financial Accountability Office of Ontario published a report in those tumultuous years, revealing a 8.4% per-student funding decline, adjusted for inflation, under the PC government's reign. Ironically, international student enrolment surged by an astounding 15% in those two years.
Colleges treaded similar ground. In the 2020-21 academic year, tuition from international students accounted for an average of 31% of colleges' revenue in Ontario.
But the music stopped in 2024, with the imposition of a cap on international student enrolment. This financial blow sent several institutions spiraling into crisis mode. Ottawa's Algonquin College was one of the hardest hit, with the drastic measure of cancelling 37 academic programs set for next September.
In the face of such economic turbulence, this government could have taken the opportunity to remedy the situation. Unfortunately, the recent budget falls short of the mark.
The budget allocates targeted funding for certain initiatives such as $750 million over five years for new science, technology, engineering, and mathematics courses. Furthermore, $40 million supports communities and businesses affected by Trump tariffs, $20 million assists laid-off workers through action centers, and $900 million beefs up the Skills Development Fund over three years.
While these resources will aid specific workers and communities impacted directly by tariffs, they only scratch the surface. The budget neglects to address the fundamental underfunding of post-secondary education. Instead, funding plummets from $14.2 billion in the previous year to $13 billion in 2025 and 2026, then $12.8 billion in 2027-28, the last year of the budget outlook.
According to analysis by the Canadian Centre for Policy Alternatives, post-secondary education spending as a percentage of GDP will decrease from 1.41% in 2019 to 0.97% in 2028.
In essence, students who graduated from elementary and secondary schools amidst the COVID-19 pandemic now grapple with colleges and universities that are both expensive and underfunded. With limited training opportunities due to restricted funding and institutions shedding programs, workers impacted by the economic downturn may not find suitable avenues for professional development.
In closing, the Ontario government is stalling post-secondary institutions during a period when they should be an essential resource for the growth of the workforce and the economy at large.
- Ricardo Tranjan, a senior researcher on housing and social policy at the Canadian Centre for Policy Alternatives, discusses the detrimental impact of the Ontario government's funding policies on post-secondary education.
- The recent budget presented by the Ontario government addresses some economic concerns but ignore the constant underfunding in post-secondary education.
- The neglect of post-secondary education funding is disconcerting given its significant role in the economy and in providing opportunities for self-development and policy-and-legislation-driven career paths.
- In 2024, federal government's caps on international student enrollment exacerbated the financial predicament of universities and colleges in Ontario, causing a substantial revenue shortfall.
- The government's decision to slash funding while neglecting the consequence of underfunded educational institutions is particularly noteworthy given the stark contrast between the cost of education in the 1980s and today.
- In an attempt to address the financial strain, the government introduced a 10% tuition reduction and froze tuition fees in 2019, but failed to compensate universities and colleges for the budget shortfall, resulting in losses of $360 million and $80 million, respectively.
- Despite the tumultuous economic situation, the government's most recent budget does little to remedy the underfunding of post-secondary education, continuing to allocate less funding over the next few years and failing to prioritize the growth and development of Ontario's educational institutions.
