Do increases in tuition fees reduce access to post-secondary education in Canada?

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Introduction

Quality education is one of the public goods that every nation endeavors to deliver to its citizens by enacting relevant education policies. While in many nations including Canada, basic education is delivered by the state at much subsidized costs, financing post-secondary education causes people to dig deep into their pockets both in the developing and developed world.

From an economist perspective, increasing the prices of public goods has the impact of reducing the demand for the public good. In this sense, increasing the fees for post-secondary education would mean a reduction in the accessibility levels. This paper seeks to provide a response as to whether this economic view applies for the case of Canadian post-secondary education.

Impacts of increasing tuition fees on accessibility to post-secondary education in Canada

Affordability limits accessibility levels

Hiking of fees for post-secondary education makes it only affordable by the wealthy people. This claim means that the less fortunate people would not have equal accessibility levels with the more fortunate members of the society (Kirby 268).

Indeed, over the last 15 years, the tuition fee paid by Canadians has grown to thresholds that make fees account for the largest expense that is encountered by university and other higher education institutions students. This hiking has been attributed to cutting down public funding on post-secondary education by the federal government (Coelli 1072) and provincial governments (Easton and Rockerbie 194).

Over the last two decades in Canada, a sharp cut from 84 percent to 57 percent on post secondary funding from the public kitty has been experienced. Over the same period, tuition fees grew on an upwards trend right from 14 percent of operating funding to over 34 percent (Coelli 1081).

This growth produces multiple impacts on the affordability of post-secondary education when compounded with a reduction in public spending on post secondary education. The overall effect of the reduction of funding of post-secondary education by the federal and provincial governments is that post-secondary education has shifted from a public-focused model to a more privatized fee model.

Consequently, a rapid increment of fees without necessarily being accompanied by increased economic wellbeing of the Canadians makes the accessibility to post-secondary education fragmented and segregated based on peoples economic status. Hence, increasing tuition fees makes post-secondary education less affordable for middle and low-income households in Canada.

Relationship between debt level and post secondary education completion rates

Although a reduction of public funding on post-secondary education has the impact of making low and middle-income families have limited accessibility to education as argued above, some critics argue that such families can still gain access to the education through debts.

Their point is that the costs of education can be transferred into some future time meaning that increasing tuition fees would have minimal or even no impacts on the accessibility levels if the students would have accessibility to government and or other sources of educational loans (Finnie 156).

While the above argument remains valid, research on the impacts of high tuition fees on post-secondary accessibility proves otherwise. For instance, Statistics Canada reports that low income families students are less than a half as likely to participate in university than those from high incomes families (17).

In further support of this finding, Statistics Canada and Human Resources and Skills Development Canada conducted yet another research referred to as youth transition survey on which it found out that amongst the reasons cited by secondary school graduates for not participating in post secondary education was related to financial reasons (156).

British Columbia researcher by the name Lori McElroy echoed similar results in his study that found out students with little or no debt were more than twice as likely to finish their degree as students with high levels of debt (McElroy 5). Based on these findings, debt levels are negatively correlated with post-secondary completion rates.

Therefore, even though many people may consider funding the otherwise expensive post-secondary education with the readily accessible credit, risks associated with the credit may make people shun away from indulging in credit commitments in their pursuit of post-secondary education.

The above argument is not only supported by the discussed scholarly results within Canada. Elsewhere in the world, for instance in the US, similar results are obtained. For example, the University of California researchers based in Lose Angeles found, for every $1,000 increase in tuition fees, enrolment rates dropped by 15 percent (Kane 11).

Kanes study further demonstrated, decrease in enrolment was composed almost exclusively from minority and low-income students (Kane 12). Putting these results in the Canadian context, Canadian Association of University Teachers conducted an analysis of long-term effects of increasing tuition fees as a proportion of after tax income in Canada (205).

The research found out that increasing tuition fees produced the most pronounced impacts on the poor people in Canada. This case implies that accessibility of credit for funding post-secondary education whose fees has been on the rise for the last two decades does not reduce the impacts that high tuition fees has on accessibility levels to post-secondary education.

Bursaries and loans have mild impacts on absorption of negative impacts on high tuition fees

Before the implementation of the education policy, every government will have evaluated the short-term and long-terms impact of the policy. In the US and Canada among other nations, the government is aware that the rising of tuition fees would obviously have negative implications.

For instance, according to Finnie, the Charest government planned to reinvest 35 percent on the total amount of money generated through hiked post secondary education on bursaries and loans through the financial aid program (159).

The reinvestments are meant to ensure that those students who already have accessibility to bursaries would get more funding through bursaries and loans coupled with attracting more loan and bursary recipients.

Since post-secondary bursaries allocation in Canada is done based on proof of the need of financial aid, application of this idea would mean leveraging the impact of the rise in tuition fees on the middle and low-income families to bring them at par with students from wealthy families.

Putting in place such a strategy would mean exploration of exclusion policies based on financial endowment of the Canadians. Bearing in mind 40% of parents, independently of their revenue, do not help their children financially during their studies (Finnie 161), the impacts of such an exclusion policy are expected to be spectacular before the public eyes.

The argument here is that financial aid in response of the impacts of the financial hike on the accessibility of post-secondary education among middle and low-income households would not aid in the absorption of the resulting negative impacts of the fees hike.

If the financial aid program is to absorb a significant amount of negative impacts of post-secondary education fee hikes, it needs to apply to all students irrespective of their financial status.

Being a post-graduate does not necessarily mean having the power to finance education that is more expensive

The notions behind increasing fees for postgraduates rest on the platforms of the argument that people with an advanced degree have the ability to earn more during their work lifespan in relation to the low-skilled people. For this reason, justification is made for escalating international students, PhD, and masters degree students fees (McElroy 13).

In this context, McElroy argues that universities in Canada have over exaggerated the earning of advanced degree holders in pursuit of higher fees (13). This exaggeration makes post-secondary education institutions charge fees beyond the market expectation and capability. Therefore, few graduates would seek access to post-graduate education.

Basing the reason for increasing fees for postgraduate education on the assumption that post-graduates earn more in the labor market is flawed since it ignores that they also pay more incomes taxes, which in one way or another land in the basket for paying the costs of post-secondary education.

The underlying argument is that, irrespective of the targeted population seeking post-secondary education in Canada by high fees, the accessibility to post-secondary education is influenced either directly or indirectly. The condition is shoddier for intercontinental and higher-grade students.

As Kirby confirms, While undergraduates, unlike the graduates, are not enrolled all year round, they do not pay fees during the months of summer (273). Compared to alumnae, those still in college and or universities do not only have to disburse lower tuition charges but also disburse less charges for during a usual winter and fall school program.

In 2010, international students had their tuition fees increased by 5.2 percent in Canada. Such an increase is prohibitive to accessing post-secondary education in Canada by the international students. Therefore, the more the tuition fess is hiked for graduate and international students, the more the chances of losing accessibility to Canadian post-secondary education.

From the Veroniques argument, tuition hikes in the 1990s in the rest of Canada had decreased the participation in post-secondary education for youths from families earning less than $75 000 per year (Para. 4), increase in tuition fees for undergraduates would mean a pronounced negative impact on post-secondary education accessibility levels.

Conclusion

Therefore, based on the expositions made in the paper, it suffices to point out that, in the effort to build a skilled human resource capital base in Canada, post-secondary education is inevitable. Knowledgeable people have low felony rates, improved public activities, and reduced expenditures on health matters.

In the modern Canada, a university degree is becoming almost a primary requirement for full participation of the citizens in the economy. Based on these benefits of post-secondary education, it would be almost imperative to presume that post-secondary education needs to be made easily accessible in Canada for all people irrespective of their social economic backgrounds.

Unfortunately, as argued in the paper, this is not the case. Over the last two decades, there have been rising tuition fees for post-secondary education institutions in Canada. The paper held that, for all levels of education (postgraduate, graduate, and even undergraduate), increasing tuition fees has had the impact of reducing accessibility to the respective post-secondary education level.

Works Cited

Canadian Association of University Teachers. The Economics of Access: The Fiscal Reality of PSE Costs for Low-Income Families. CAUT Education Review 8.2(2006): 205-217. Print.

Coelli, Michael. Tuition fees and equality of university enrollment. Canadian Journal of Economics 42.3(2009): 1072-1099. Print.

Easton, Stephen, and Duane Rockerbie. Optimal government subsidies to universities in the face of tuition and enrollment constraints. Education Economics 16.2(2008): 191-201. Print.

Finnie, Ross. Student loans, student financial aid and post-secondary education in Canada. Journal of Higher education Policy & Management 24.2(2002): 155-170. Print.

Kane, Thomas. The Price of Admission: Rethinking How Americans Pay for College. California: University of California Press, 2003. Print.

Kirby, Dale. Strategies for widening access in a quasi-market higher education environment: recent developments in Canada. Higher Education 62.3(2011): 267-278. Print.

McElroy, Lori. Student Aid and University Persistence: Does Debt Matter? Montreal: Canada Millennium Scholarship Foundation, 2005. Print.

Statistics Canada and Human Resources and Skills Development Canada. At a Crossroads: First Results for the 18 to 20-Year-old Cohort of the Youth in Transition Survey. Higher Education 12.1(2002):156-169. Print.

Statistics Canada. Participation in postsecondary education and family income. The Daily (2001): 17-18. Print.

Veronique, Lisa. Give up university education? Together lets stop the hike, 2012. Web.

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