A panel of experts is calling on the Ontario government to lift the domestic tuition freeze it has maintained for the past four years and allow universities and colleges to charge higher fees to address growing financial pressures.
The government commissioned a blue-ribbon panel in March to examine the system’s financial sustainability in part as a response to Laurentian University’s insolvency in 2021. The panel, led by former university administrator Alan Harrison, concluded the sector’s sustainability is at serious risk.
The Doug Ford government cut domestic tuition fees by 10 per cent in 2019, saying it would make education more affordable, and has kept them frozen at that level since, which has resulted in a significant loss of income for universities and colleges.
In a report released Wednesday the panel called for a new multiyear tuition framework for colleges and universities. It recommends a five per cent increase in tuition in 2024-25, followed by raises of two per cent a year thereafter, or at the rate of inflation. Professional programs in universities and college programs considered “high demand” would be allowed to increase tuition an additional three per cent next year.
The average price of tuition for undergraduate students in Ontario this academic year is $8,190, according to Statistics Canada.
The panel also recommended a one-time increase of 10 per cent to the per-student operating grant that goes to each school. The grant would rise in subsequent years at the rate of inflation, or at a minimum of two per cent a year.
It also said the sector’s dependence on international students “needs to be recognized explicitly as a financial risk and incorporated into analyses of institutions’ sustainability.”
Ontario Minister of Colleges and Universities Jill Dunlop said the government is carefully reviewing the panel’s recommendations and would be working with schools to find efficiencies in their operations.
“Before agreeing to any tuition increases, however, we need to ensure that colleges and universities are taking the necessary steps to ensure that they are operating as efficiently as possible,” Ms. Dunlop said.
The Council of Ontario Universities (COU) said in the weeks before the report was published that the sector is under strain, with deficits recorded at eight of 23 universities. Queen’s University projects a deficit of more than $60-million this year, while the University of Waterloo expects a deficit of $15-million.
Steve Orsini, president of COU, said the sector is at a critical juncture. He called on the government to act immediately on the panel’s recommendations.
“This will go a long way to addressing the financial strength of the sector,” he said.
The report found that Ontario colleges’ per-student funding is 44 per cent of per-student funding in the rest of Canada, while Ontario university students are funded at 57 per cent.
Vivian Chiem, president of the Ontario Undergraduate Student Alliance, said students would welcome a boost to institutional operating grants, but said higher tuition must be matched by an increase in the grants available through the Ontario Student Assistance Program.
The report noted that many colleges and universities would no longer be able to survive financially without the revenue generated from international students, who pay fees several times higher than those paid by domestic students.
“They are financially sustainable only because of international students,” the report said.
Rapidly increasing numbers of international students, however, have added strain to an already overheated rental housing market, exacerbating a housing crisis in the province.
The panel’s report calls on the government to consider allowing colleges to raise fee levels for a longer period of time than universities, saying they are at a competitive disadvantage when compared with the rest of Canada.
It also calls for a review, within the next 18 months, of the 7,500-student cap at colleges that have a private-sector partner delivering education to international students. In addition, the report recommends a comprehensive review of institutional plans for future international enrolment.
Colleges Ontario president Marketa Evans said in a statement that improved investments in the college system would help produce a stronger work force.
The report also recommends increased financial literacy training for board members, a greater emphasis on institutional financial health reviews and specific attention to the “material risk” connected to international enrolments.
Northern institutions, which face higher costs and typically have lower enrolment, should have their enrolment targets lowered in recognition of their particular circumstances, the panel said.
In a separate view from the chair, not endorsed by the entire panel, Dr. Harrison said that the University of Toronto should be allowed to set its own tuition fees. As the province’s pre-eminent university, Dr. Harrison said, the U of T has higher costs to maintain its level of excellence and is also able to offer greater financial aid to students in need.
Editor’s note: A previous version of this article incorrectly reported that the president of the Ontario Undergraduate Student Alliance said higher tuition must be matched by an increase in both loans and grants available through the Ontario Student Assistance Program. Vivien Chiem said higher tuition must be matched by an increase in grants available through OSAP. This version has been updated.