Canada’s Liberal Budget Provides More Financial Aids to Students, Making Post-Secondary Education More Attainable
Canada's liberal government has unveiled their 2016-17 federal budget on Tuesday, led by Finance Minister Bill Morneau. The first budget could be a good news for students as the government is seeking post-secondary education affordability.
According to The Gazette, the Liberal is determined to make post-secondary education more affordable with the new budget and policies. One of the Liberals' biggest strategy is to increase grant amounts by 50 percent. Under the new budget, students from low-income families are eligible for $3,000 in federal grant money per year, compared to previously $2,000 per year. Students from middle-income families can receive up to $1,200 per year compared to previously $800.
The increased grant amounts will be available starting from the 2016-17 academic year. The grants will cost $1.53 billion over the first five years and then $329 million per year from then on. The new program will benefit nearly 247,000 students from low-income families and 100,000 students from middle-income families, according to the Liberals.
The new financial aid program for students imposed by the Liberals will also see changes in student loan payments to make it easier for students. The Globe and Mail noted that the changes include allowing low-income graduates to delay their student loan payments until they make more than $25,000 a year. Currently, university graduates are expected to start paying back by the time they make more than $20,210 annually.
In addition, the budget also proposes a new way of determining students financial aid. The new way will implement a flat-rate student contribution model, whereas students will contribute an annual flat amount toward their education fees regardless of their working status while in university. The budget did not specify the flat rate, or if it will vary depending on students' financial situation.
Even though the changes are proposed in the 2016-17 fiscal budget year, it's likely that the full impact of the changes will take years to implement. The government will likely eliminate tax credits to fund the new program so post-secondary students can receive more grants. Eliminating tax credits, however, could put graduate and professional students at a disadvantage.
Besides the students financial aid, Bill Morneau's first budget also highlights some other changes, including the Canada Child Benefit. According to CBC, new monthly tax-free payments, and other tax measures will be up to $6,400 a year per child under 6, and $5,400 for those aged 6 to 18, according to household income.
Canada's Liberal government first budget will help post-secondary students to get more grants, as well as loosening the standards to students loan payment. The new budget and policies proposed are targeted to make university education more affordable and attainable.