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The Crisis in Post-Secondary Education

On February 2, a national day of student action was held to protest the growing costs of post-secondary education and escalating levels of student debt. In Manitoba, over 1,000 students participated in a demonstration and rally in downtown Winnipeg.

While education has never been recognized as a right by the Canadian state, as part of the anti-social offensive that began in Canada under the Mulroney government, funding for post-secondary education has steadily decreased, making it less accessible.

In Manitoba, which already has the lowest national rate of students continuing with post-secondary education after high school, enrolment levels are either remaining static or declining. This comes at a time when studies conducted by the federal department of Human Resources Development conclude that 60 percent of all new jobs created in Canada require a minimum of four years of post-secondary education and training.

A paper released recently by the Manitoba wing of the Canadian Centre for Policy Alternatives highlights the crisis in post-secondary education. The paper, entitled No Dollars for Scholars, points out that sharp funding cuts to post-secondary education began in the early 1990s. From 1990-1995, government support (provincial and federal combined) fell by about $800 per student. Since 1995, when the federal Liberals replaced the Established Programs Funding and Canada Assistance Plan with the Canada Health and Social Transfer, federal funding to the provinces for social programs has decreased by 40 percent - or some $7.6 billion dollars.

Faced with decreased funding, individual universities turned to tuition fees to recoup some of the lost revenue. The result? In less than a decade, tuition fees across the country have increased on average by 90 percent. In Manitoba, for example, full-time Arts tuition at the University of Manitoba rose from around $1400 in 1990-91 to about $2800 in 1997-98, an
increase of 100 percent. During the same period, the cost of living rose by 13 percent.

Increasing Debt Burden

Faced with increasing tuition costs, more students have turned to student loans to complete their studies. While full-time enrolment in universities and community colleges increased by 12.5 percent between 1984-85 and 1994-95, the number of full-time students with loans increased by 61.9 percent. The average student debt load is also increasing. Within a four-year period, 1991-92 to 1994-95, the number of full time students with less than $5000 in Canada Student Loan debt had declined from a majority of 58 percent to a minority of 44 percent. Figures from Statistics Canada released in 1997 pegged the average student loan debt (including federal and provincial loan programs) at $25,000.

It has become increasingly difficult for students to repay their loans after completing their studies. As of 1995, the federal government no longer guarantees student loans to the banks. Instead, they paid the banks a five percent risk premium and withdrew from the role. In 1998, after intense lobbying from the banks, the federal government changed the bankruptcy laws
to prevent students from defaulting on their student loans for ten years after graduation. This month, the federal government also announced it would pay the banks another $100 million risk premium.