Canadian Commentary

Walking the Education Talk

April 2001

This article originally appeared in Pundit Magazine in March 2001

Over the past two weeks, there has been a sudden upsurge of concern over the state of Canada's education system.

In a recent speech, Charles Baillie, CEO of TD Bank, described education as a fundamental factor in a growth strategy for Canada, and bemoaned the fact that the number of students in post-secondary education has fallen as a percentage of the population over the last decade.

Meanwhile, in separate appearances, two federal cabinet ministers, Jane Stewart (whose ministry exercises what little role the federal governmenet plays in education) and Paul Martin (who controls the purse strings that enable that role) described education as a priority issue for the nation.

There is a feeling in these statements that education is a national issue, one that affects the future of the country as a whole, and that there should therefore be some kind of national initiative or strategy to ensure that Canadians have the education to face the challenges of the new century.

The problem with these admirable sentiments, of course, is that in Canada education is firmly under the control of the provincial governments. The scope for any kind of national strategy on education is extremely limited.

The one area in which the federal government has exercised some role in the past is post-secondary education. Yet even here the federal role has been reduced over the past decade.

At one time, the federal government included cash for colleges and universities in its transfers to the provinces. In the mid 1990s, however, this cash transfer was subsumed into tax points as part of an arrangement begun in the Trudeau era.

In the early years of the current Liberal government, Lloyd Axworthy (then Minister for Human Resources Development Canada) attempted to convert the remaining cash transfers into a permanent student loan fund, but the idea died amidst protests by students fearing tuition increases.

Of course, tuitions increased anyway. Over the past 15 years, tuition fees in most provinces have doubled, during a period of very low inflation. At the same time, provincial funding for colleges and universities in most provinces has been cut, so that students now pay more for a lower quality education. It is no wonder that the growth in the number of students in post-secondary education has been stunted.

The situation is particularly serious because post-secondary education is ever more necessary in order to participate in the modern global economy. Recent headlines have raised alarms about a looming shortage of skilled workers in Canada - yet we have been simultaneously discouraging students from gaining the necessary skills by doubling the cost of going to college or university.

The issue is, certainly, a national one. Canada cannot hope to stay ahead of the economic curve internationally if its workforce does not have the necessary skills. Yet there seems to be little that the federal government can do. Now that cash transfers have disappeared, it no longer has any hold over provincial post-secondary education policies; nor is there an equivalent of the Canada Health Act to set basic national standards.

Most of what federal funding there is for universities goes to research, which benefits faculty and graduate students. While a worthy cause, research funding does not directly benefit the majority of undergraduate students, nor does it make access to post-secondary education more widely available.

The federal government also funds a national student loan program for students. Yet student loans are no more than a band-aid over the problem of accessibility. Students may be enabled to fund their education, but the horrific debt load they face upon graduation is just as much of a discouragement. Federal student loans merely patch up the problem without providing any kind of national leadership or strategy for education.

If the federal government is serious about creating a nation education strategy, it has to make affordable tuition a national policy. Such a strategy would have an immediate impact in making post-secondary education more accessible and attractive to young Canadians.

How could such a strategy be framed and sold? The provinces are obviously reliant on tuition fees to make up for the cuts they have implemented over the last decade. In order to create a national strategy, the federal government would have compensate the provinces financially in exchange for keeping tuition fees at a certain level.

Since education is a provincial responsibility under the constitution, any such arrangement would have to leave the provinces with as much flexibility and control as they could desire. Otherwise, the provinces simply would not come to the table.

These objectives could be accomplished by setting as a national standard that tuition fees should never be more than 25% of the cost of a post-secondary program. Setting maximum tuition fees as a percentage ensures that the costs of expensive and lucrative professional programs would still be higher than the cost of general undergraduate programs. Meanwhile, the provinces would still be free to fund their universities and colleges to a greater or lesser extent, with tuition fees that were higher or lower in proportion.

A complementary aspect of such a national strategy would be portability - ensuring that out-of-province students paid the same tuition and local students, or, at the least, paid no more than the 25% maximum tuition.

In order to compensate for the lost revenue, the federal government would tranfer the equivalent funds to the provincial governments. Working out a formula for these transfers would take some negotiation, but it would probably be based on a certain amount per student studying in the province, adjusted for the kind of program they are following.

Would the provinces accept yet another federal shared-cost program? The one proposed here would have very limited conditions. The provinces and institutions could still set their own education policies and could budget widely divergent sums for post-secondary education. Provincial governments would derive considerable politcal credit for cutting post-secondary fees, while retaining control of all significant policy and budgetary decisions and preserving their bottom line by receiving a considerable cash transfer from the federal government.

The biggest obstacle would be the newly-energized separatist government of Quebec. But Quebec's tuition fees are already among the lowest in Canada, well below the 25% maximum tuition. So the policy would, in effect, simply result in Quebec receiving a considerable sum of money without having to change its policies in any way. Such an offer would be hard to resist even for a separatist government.

The cost of such a federal strategy would be significant, and the approaching economic downturn is likely to put a dent in the government's usable surplus. By the time negotiations to develop the program are over, however, the economy will likely be recovering - and there is still a huge surplus embedded in the current budgetary forecasts. While the program might have to be phased in, it could certainly be afforded in the long term.

With an affordable tuition program, Canada would get a genuinely national post-secondary education strategy with minimal federal interference in provincial management of education. It would provide immediate, practical benefits to Canadian students, and would open up post-secondary education once again to a broader range of Canadians. It would become possible once again to work one's way through university without accumulating a crippling debt load.

If the federal and provincial governments are serious about education - and for Canada's sake, they need to be - the federal government will put its money where its mouth is, and the provinces will bring their co-operation to the table.

April 2001

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