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Rock bottom tuition therefore achieves few public benefits
July 9, 2012
By Ben Eisen
and Jonathan Wensveen
The Frontier Centre for Public Policy
WINNIPEG, MB, Jul 9, 2012/ Troy Media/ – Recently, The Vancouver Province published a commentary by Iglika Ivanova from the Canadian Centre for Policy Alternatives offering ‘five reasons’ all provinces should adopt lower tuition fees, similar to those in Quebec.
However, the best available evidence on the relationship between tuition fees and access to higher education, contradicts Ivanova’s main arguments. Quebec’s model of nearly free tuition does little to promote higher university participation rates or enhance access for low-income families.
Ivanova argues that using subsidies to ensure rock-bottom tuition fees is ‘a great investment for our public dollars’ that will produce long-term fiscal benefits. In short, this argument holds that low tuition causes more young people to pursue a university education, causing them to become more productive as adults, ultimately leading to higher tax revenues.
A fundamental problem with Ivanova’s argument is that there is very little evidence that cut-rate tuition causes significantly more young people to go to university. A simple comparison between Ontario and Quebec illustrates the point. In the past academic year, the average tuition for Quebec’s undergraduates was $2,400. Average tuition in Ontario was $6,640, among the highest in the country. Ontario, however, has significantly higher university participation rates and attainment rates for young adults than does Quebec. The university attainment rate in Quebec for 25 to 34 year olds currently stands at 32 per cent, compared to 37 per cent in ‘high’ tuition Ontario.
Clearly, rock-bottom tuition fees are not necessary to ensure high university participation rates. Tuition subsidies in Ontario and other ‘high’ tuition provinces, combined with the availability of grants and student loans are sufficient to ensure that most qualified young adults pursue higher education. The additional tuition subsidies in Quebec do little if anything to further boost participation, and therefore do not produce the long-term fiscal benefits described by Ivanova.
Ivanova further argues that cheap tuition is necessary to ensure access to university for low-income families. She writes that, currently, university education is ‘only accessible to some Canadians.’ Again, the evidence explicitly contradicts Ivanova’s opinion.
In reality, high tuition Ontario does a better job of attracting students from low-income families than Quebec. Further, a paper we published just last year for the Frontier Centre for Public Policy shows that, across Canada, there is no correlation between cheaper tuition and higher rates of university participation for low-income students. In other words, youth from low-income families in low-tuition provinces are generally no more likely to attend university than similar young people in higher tuition provinces.
Existing tuition subsidies and loan programs in ‘high’ tuition provinces are generally sufficient to ensure access for low-income families. Ross Finnie of the University of Ottawa has done extensive research on the relationship between tuition and university access. Speaking about the situation in Ontario, Finnie concludes the current policy structure ‘by and large ensures accessibility for those who would otherwise face financial barriers.’ Ontario’s tuition rates are clearly compatible with a highly accessible university system.
Ivanova attempts to refute this point by noting that students from low-income backgrounds are underrepresented in Canadian universities. This fact, she claims, proves ‘student loans don’t make up for high tuition fees.’ Ivanova’s reasoning fails to consider that the participation gap between high- and low-income families does not tend to be any smaller in low-tuition provinces compared to high-tuition provinces.
This reality undermines Ivanova’s suggestion that the participation gap between high- and low-income families is caused by high tuition fees, since it persists in provinces that have taken Ivanova’s advice and embraced cheap tuition. Other factors aside from tuition are primarily responsible for this gap. For example, children from affluent families have, on average, better high school grades than students from low-income families. This enables more of them to choose to go to university. Lowering tuition, even all the way to zero, wouldn’t change that reality and therefore wouldn’t close the gap.
Shrinking the university participation gap between high- and low-income families is a worthwhile objective. However, the evidence suggests that investing in high quality, targeted early childhood education programs and efforts to improve high school education in low-income communities are smarter strategies than using scarce public dollars to drive tuition rates closer and closer to zero.
The Quebec model of nearly free tuition does little to promote access to higher education and human capital formation compared to the shared-cost approaches found in most other provinces. Rock bottom tuition therefore achieves few public benefits, while absorbing public resources that would be better spent on other priorities.
Ben Eisen and Jonathan Wensveen are public policy analysts at the Frontier Centre for Public Policy and co-authors of Tuition Fees and University Participation for Youth from Low-Income Families: An Interprovincial Analysis (http://www.fcpp.org/).
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