The Noise about Rising Tuition

In February, the Faculty of Law presented a long-term strategy to enhance the quality of legal education at U of T. This program involved an increase in tuition by $2,000 a year over the next five years. News of the proposed tuition increases set off alarm bells on campuses across the nation. Unfortunately, the clamour concentrated on superficial facts and drowned out any discussion about both the quality of education and the law school’s plans, at the same time, to increase student support dramatically and thereby improve accessibility.

Students and their families have every right to be concerned about the rising costs of a university education, which are due in large part to shrinking provincial grants. Their fear that access to university will become restricted to the most privileged segments of society is understandable. After all, our two major sources of income are the province and tuition, with provincial operating grants making up by far the largest portion of our revenue. Since provincial funding in real dollars declined significantly over the past decade, inevitably tuition fees had to go up. The alternative would be a long-term decline in the quality of education, and we cannot allow that to happen.

Tuition Fees

Every dollar added to the cost of an undergraduate education is deeply felt, but in reality, in most programs, tuition-fee increases in recent years have been relatively modest. Tuition in 2002-03 will rise by no more than five per cent for more than 90 per cent of our students, and more than half will see an increase of less than two per cent. For example, first-year Arts and Science students will pay $4,107, an increase of only $78 over last year, which is in keeping with recent annual increases. Regulated tuition-fee increases are limited to a rate well below the rate of inflation in academic costs, and most other fee increases, after factoring in financial aid, are just keeping up with the inflation rate.

Accessibility

Despite increases in tuition fees, access to U of T by lower-income students is holding steady or improving. Indeed, a study led by Professor Ian Orchard, the new principal-designate of the University of Toronto at Mississauga, demonstrates that in both our undergraduate student population and within our professional faculties, nearly 20 per cent come from backgrounds where parental income is less than $30,000. This percentage has increased over the past three years.

The survey also indicates little change in the proportion of students who identify themselves as belonging to minority groups. The figure remained static at 44 per cent in the professional programs and has been around 50 per cent at the undergraduate level for several years.

Student Financial Support

Access is an important touchstone at U of T. The university is committed to providing financial-aid packages that open doors to the disadvantaged and reduce their debt burden upon graduation.

One advantage that University of Toronto students have over others is that once they have arrived here, the U of T Advanced Planning for Students (UTAPS) program guarantees that economic hardship will never prevent them from completing their programs. The university’s commitment to that guarantee has been dramatic. Whereas in 1990-91 U of T provided need-based undergraduate financial support of about $1.2 million, 10 years later we distributed nearly $19 million in such aid.

As for graduate students, in 2001 U of T became the first Canadian university to offer a guaranteed level of financial support for doctoral students. Graduate funding packages, starting at a minimum of $12,000 plus tuition and fees, are available for five years, meaning that students are able to complete their programs more quickly and without significant financial hardship.

The Link Between Tuition Fees and Financial Support

Tuition-fee increases cannot always be avoided, but when they do happen the university tries to ensure that those who can afford them least are the least affected. Thirty cents of every dollar resulting from tuition increases is devoted to financial support for the neediest students. When combined with endowed funds and graduate-student aid, this 30-per cent reinvestment will help U of T enhance its spending on student support by $8.1 million in 2002-03, bringing the total amount available to more than $90 million.

Student Debt

While some students carry alarming debt loads, fortunately they are in the vast minority. Generally, there is a great deal of misinformation among the public about student debt. Of students graduating from first-entry programs at U of T in 2000-01, more than half had no Ontario Student Assistance Program (OSAP) debt at all, and a further quarter had an OSAP debt of less than $15,000. Still, undergraduate student debt must be reduced for the approximately five per cent of our graduating class who leave the university with the maximum OSAP debt of $28,000. Such high debt is unacceptable in my view, and we must work with the province and our students to reduce this burden by reforming the OSAP system, including fairer methods for assessing the financial need of students from middle-class families.

People often ask me why our administration is pushing so hard on the student-aid front. In response, I ask them to consider what constitutes a great university. A great university has a world-class faculty offering exemplary undergraduate and graduate programs. Outstanding students come to this great university in order to reap the attendant benefits. The goal of financial aid should be to ensure that all qualified students have access to that great university. On all three campuses, we are rapidly moving toward this ideal, and I find that very gratifying.

However, there are some mistaken impressions that bear correcting:

Fallacy #1: With fees in professional faculties, such as law, increasing dramatically, it will not be long before undergraduate fees go out of sight, too.

It is important to remember that the Faculty of Law represents less than one per cent of all students at U of T. In general we expect that policies for professional faculties will be different from those for undergraduate programs. The Faculty of Law’s model, whereby tuition will cover the bulk of educational costs as well as funds to guarantee accessibility, may be appropriate for certain professional faculties, but the university will not follow this path for our undergraduate programs. I should emphasize that I strongly support the law faculty’s highly principled and consultative approach to grappling with a difficult set of challenges.

Fallacy #2: Increasing fees mean that going to university is becoming an impossible dream for low-income and minority students.

Access has been maintained and indeed enhanced at U of T, as a result of our student financial-support program. The province of Ontario overall has an admirably high participation rate in post-secondary education.

Fallacy #3: Students are being forced to pay an unreasonable portion of the cost of their education.

Province of Ontario guidelines suggest that undergraduates in Arts and Science programs should pay about 35 per cent of the overall cost of their programs. In fact, at the University of Toronto, students currently pay less than 25 per cent of the total costs. By contrast, in the 1960s students paid close to the current 35-per cent guideline. Our fundamental problem is that our overall funding is too small, and it is not keeping up with inflation.

Fallacy #4: Since U of T has such a huge endowment, it should not be increasing tuition fees.

In spite of our success in building our endowment to unprecedented levels, the endowment income still accounts for only about six per cent of our total budget revenue, with about half of this going to student aid. This means that the endowment contributes about three per cent of our operating costs. Thus, although our endowment is of fundamental importance, it is not a substitute for the provincial operating grant or tuition.

Fallacy #5: Because of increasing tuition costs, all students are graduating with huge debt.

Of students graduating from first-entry programs in 2001, 56 per cent had no Ontario Student Assistance Program (OSAP) debt at all. The average OSAP debt of our first-entry students on graduation is less than $7,000.

Fallacy #6: Tuition fees represent the lion’s share of the total cost for a student attending university.

Tuition fees have long been the flashpoint in debates about the financial barriers that limit access to post-secondary education. However, tuition fees constitute only a fraction of the total cost of attendance. In fact, tuition fees are eclipsed by the total cost of books, accommodation, living expenses and foregone earnings. Our real challenge is to construct a student-aid program that recognizes the total cost of attending a post-secondary institution.