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Canadians paying more for education, OECD finds

In purely financial terms, the benefits of a postsecondary education to individuals and Canadian society at large far outweigh the costs, a new report suggests.

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However, as Canada spends more and more on higher education, an increasing percentage of the cost is borne by students and their families, says the annual Education at a Glance report by the Organization for Economic Co-operation and Development.

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The news closely follows the revelation that Canada's federal student loan program is close to hitting its $15-billion ceiling years ahead of schedule, yet another indication both of the rising price tag of a postsecondary education and increasing enrolment levels.

While the OECD report paints a flattering picture of a country making large investments in postsecondary education, some argue the revelations indicate Ottawa must implement new guidelines to cap the price of tuition and guarantee access to higher learning.

The OECD estimates that the average Canadian man with a college or university education makes more than three times what he put into getting such an education, both in terms of direct costs and lost wages. For the average woman, the gain is more than double the cost. The value to society was similarly pegged at roughly double the government's investment.

Out of 32 developed countries, Canada had the second-highest rate of education spending in proportion to its GDP at more than 2.5%, trailing only the United States. A high proportion of that spending, 43.4 per cent in 2007, came from private sources, primarily tuition fees.

"In Canada, the fees are quite high, but the returns are higher as well," said Bo Hansson, an education analyst for the OECD, adding that in countries with lower tuition fees, the average person still pays for education later in life through taxes.

There is no problem with higher fees, so long as the government provides a robust system of student loans to guarantee access to education, he said.

Economist Hugh MacKenzie, however, said the concept of funding education through student loans freezes out those who are averse to debt, including students from low-income families.

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"The implicit assumption behind the student loan funding model is that the student or their family is willing to take on debt in order to graduate," said Mr. MacKenzie, an economist and research associate with the Canadian Centre for Policy Alternatives. "The lower your income, the less likely you are to take on debt to finance your education."

Others argue that the only way to ensure access is to bring tuition fees down and guarantee stable funding directly to postsecondary institutions.

"There's less and less of the public interest at heart in our public institutions," said David Molenhuis, national chairperson of the Canadian Federation of Students. "We've come to this point because there's no federal legislation, there's no standard of access."

Over the past four years, the federal government has injected money into the system, both by making it easier to take out student loans and by offering $350-million worth of grants to students. The Canadian Alliance of Student Associations, however, estimates that Ottawa transferred $3-billion less to the provinces for grants to institutions than it did in the 1990s.

The Education at a Glance report is a wide-ranging study of data issued by the OECD, a 32-country organization that conducts research and advises on government policy.

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About the Author
Washington correspondent

Adrian Morrow covers U.S. politics from Washington, D.C. Previously he was The Globe's Ontario politics reporter. He's covered news, crime and sports for The Globe since 2010. He won the National Newspaper Award for politics reporting in 2016. More

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