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We’ve Got Issues - Tuition “Debt Sentence”?
February 20th, 2007 by JPWe’ve all heard a lot about the tuition fees issue recently, with the February 7th Rally and the Freeze Tuition Fees Campout. There are a lot of students who wish for lower tuition fees, and they’re pretty vocal about it. We don’t often hear arguments for the other side, at least not from students. So, when a friend offered to write up a piece arguing that tuition fees are NOT too high, I was pretty interested to hear what he had to say. I realize that the whole tuition fee issue is a contentious one and there’s a lot to consider. However, below is one student’s take on it.
There is only one fact that everyone can agree on when it comes to university: no one wants to pay tuition. In fact, there are entire student groups devoted to reducing tuition, freezing tuition or even doing away with it altogether. Recently, one of these groups, the Canadian Federation of Students held a “National Day of Action!” to call for a reduction of tuition fees across Canada. They claim “Education shouldn’t be a debt sentence” and “access… shouldn’t be determined by the size of your wallet”. Bold claims from a bold group.
Unfortunately, the louder the calls for reducing tuition become, the less we hear about the actual facts on tuition, debt and government support. We have all heard the horror stories about students with so much debt they spend years paying it off, or students with so little money all they can afford is Kraft Dinner. But a quick search on statistics Canada shows that only 14% of graduates have debt over $25,000 (termed large debt), in fact a full 47% of graduates have no student debt at all when they graduate.
Furthermore, the 2001 census showed that the average income for university graduates was $61,156 per year, compared to $34,631 pear year for those with only a high school diploma or less. Clearly, the annual worth of a university degree is greater than the one time debt students incur.
The Canadian Federation of Students and other student activist groups regularly call for more government support for students. They claim that current levels of support are insufficient and need to increase if post secondary education is to be accessible.
Once again, their bark is louder than the fact�s bite. Statistics Canada shows that total University expenditure in 2006 (that covers pay for professors, research, rent etc�) was $31.85Billion. Tuition fees contributed $6.65Billion, while the Government gave $17.3Billion to universities in the form of cash transfers. The remaining money came from donations, interest and sale of assets.
The government is already paying $2.60 for every $1.00 paid in tuition. For the average Canadian undergraduate student, tuition for the 2006/2007 year was $4,347, and this wasn�t even half the actual cost of providing post secondary education.
So far the statistics have shown two very important facts, the average student does not have a “debt sentence” and the government is actually footing most of the bill for post secondary education anyway.
Recently, some of the more vocal activist groups have claimed that “Canadians have a right to post secondary education”. The answer to this is an unequivocal NO. There is no right to a university degree. A university degree is a privilege you have to earn. In fact the Canadian Charter of Rights and Freedoms outlines that “Citizens of Canada … have the right to have their children receive primary and secondary school instruction”. There is no mention of post secondary education.
To conclude, I would like to provide facts on some other myths surrounding post secondary education. First, there is a social stigma that a university education is necessary for a successful life. Statistics Canada reports that as of 2001 only 21% of adult males and 18% of adult females had a post secondary education. The remaining 80% of the population does not live in squalor, poverty or general decrepitude. In fact, according to the UN the population of Canada enjoys the 6th highest standard of living in the world.
Second, a post secondary degree is in fact accessible. Statcan reported that in 2001 “In all, the number of Canadians aged 25 and over with university, college or trade credentials grew by 2.7 million, a 39% increase and more than 2.5 times the population growth for that same age group.” The numbers don’t lie: those people that want a post secondary degree are getting them, and in record numbers too.
The statistics I have quoted are all available to the public at www.statcan.ca. There is no conspiracy to keep them from the public, and in all they show that except in rare situations, student debt is manageable and tuition is already heavily subsidised.
Ultimately, attending university places considerable responsibility on Canadian students. For many it is the first time they have to be financially and academically accountable. It is understandable that many students want out of these responsibilities. But, the simple fact of the matter is that if you want a university education, and the benefits that come along with it, you can get it in Canada without bankrupting yourself.
by Justin Alizadeh, Engineering Science 0T6+PEY
February 20th, 2007 at 2:45 am
Despite all the stats you quote, I think it’s worth noting that the per-student government funding for post-secondary education has steadily decreased over the past years in Ontario. And as a result, the percentage funding that comes from tuition has increased.
While it may be true that it is still possible to get a university education without bankrupting yourself, I don’t see this as a particularly encouraging trend.
February 20th, 2007 at 9:19 am
If you want to get through school without debt, apply to a co-op program.
February 20th, 2007 at 10:32 am
I think it is also important to note that the rise of tuition far exceeds national or provincial inflation. The fact is students will be graduating with more and more REAL debt.
February 20th, 2007 at 11:49 am
I have to agree with Justin here. I will graduating with between $25,000-$30,000 in debt (putting me in the large debt category)… This after going home and working for two summers, working for a Prof for two summers, and having a PEY job for 8 months… The simple fact is I knew what I was getting myself into when I came to university and also understood that I would have a lot of debt coming out. I also realized as Justin mentions that I was in for a bigger “pay day” down the road by getting degree, and more importantly, I would have the chance to work in a field I was interested in.
The simple fact is, getting a post-secondary degree is an investment in your future (not a right) and like any investment you need to pay for it.
February 21st, 2007 at 1:49 pm
The issue is where should we be going forward as a society. It’s great that some people are so confident they will get a job after school. The phenomenon of “debt aversion” shows many people fear having large debts they cannot repay. People from single parent households and new immigrant households have the highest rates of debt aversion, and are less certain than other groups that they might be able to repay their debt. Fear of not being able to repay, or ’sticker shock’ keeps many people out of school.
Moreover, while many university graduates earn more, fully 1/4 of university graduates earn less than the average high school graduates. Employment is not entirely predictable. Two students with BAs in psychology and B averages might end up in very different places. One might be working in marketing at Starbucks and one might be a Barista. Someone with a Social Work degree might end up running a non-profit and earning $75,000 a year or they might end up as a frontline worker earning $25,000 a year.
It’s hard to tell before hand and outcomes like the latter are what keep many people from taking out student loans - they fear the results.
This is why it makes more sense to fund education through the income tax system rather than the up-front fees system. People who derive economic benefits from their education will pay the price. People who do not, will not. Also, it recognizes that all of society benefits from an educated population and should fund it.
February 21st, 2007 at 8:06 pm
“Furthermore, the 2001 census showed that the average income for university graduates was $61,156 per year, compared to $34,631 pear year for those with only a high school diploma or less. Clearly, the annual worth of a university degree is greater than the one time debt students incur.”
NO! Clearly, people that have went to university report more income than people that only finished high school or dropped out of high/grade school. That fact, and that fact only is what is clear.
Could you think of other reasons why a person who was able to complete university may make more money than someone who only finished HS or less? Here’s one: Lots of successful people work in trades and don’t declare all of their income. Or the university graduates group would include only those that finished high school, and the comparison group includes those that dropped out anywhere from K-12, a big confounding variable. Or maybe they’re just smarter and it has nothing to do with their education at all.
Though I would hope, generally, a university grad will make more than a non-grad, but the figures cited are terribly unclear of that and its magnitude.
“The government is already paying $2.60 for every $1.00 paid in tuition. For the average Canadian undergraduate student, tuition for the 2006/2007 year was $4,347, and this wasn�t even half the actual cost of providing post secondary education.”
You’re really confusing the cash transfers made to universities with the cost of education. The money the government provides to universities is for far more than just education. Professors aren’t just paid to teach their 1 or 2 courses a year (I sure hope anyway).
Funny how you somewhat mentioned this difference in the prior paragraph, but didn’t bother to think about it when looking at student’s component of tuition vs. government’s component of tuition.
If you really want to make the comparison here, you need to figure out by what amount the amount spent on education exceeds the amount gained from tuition in a university. I’m sure the ratio wouldn’t be anywhere near the 2.6:1 figure you found. Possibly even less than 1:1.
I’d go so far as suggesting that there is a very large public benefit gained by the entire population from the non-education products of a university, but feel free to disagree with me here.
Shouldn’t the government be paying for this public benefit in the first place, instead of a small-set of students?
My concluding statement(s)/thought(s):
If university grads are making greater incomes, aren’t they already paying substantially more in taxes than the non-grads?
By forcing them to cough up money when they’re making the least, are we minimizing their ability to start-up risky but innovative businesses when they are at their intellectual peaks?
Are we forcing them to take the larger-paying job(s) (eg: waitering/waitressing/bartending), instead of ones that would be more beneficial to them in their long-term career goals given their new education (eg: working with a non-profit/NGO)?
Are we forcing students to work through the school-year when they’d rather be concentrating on their studies (debatable for some students, realistic for others)?
Are we limiting student’s abilities to pursue higher level education because their undergrad debt is too great (forcing smart minds into the workforce when it isn’t best)? If you’re entering into a graduate program, interest on $25k isn’t a very nice thing to have on a limited income, which 14% of students, as you say, graduate with more than (and how knows how much more than). At least interest rates are historically low right now.
My solution would be loan-accounts where you’re additionally taxed on your income until the education component of your tuition is paid off. This whole lower/raise tuition is pretty much garbage.
March 17th, 2007 at 7:58 am
Justin, i am a girl from Cernavoda,Romania,and if you are that Justin,who lived and worked here,in Cernavoda,please write back to me.pleaaaseeeeeeee. i am trying to find you for a long time:( .my email adress is
March 18th, 2007 at 5:18 am
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