Low Tuition Fees No Panacea for Low-income Families: Low tuition fees does not necessarily promote higher university participation for youth from low-income families

Ben Eisen, Commentary, Education, Uncategorized

Student organizations and other like-minded groups frequently argue that low tuition levels are necessary to promote high rates of university participation and to ensure access for young adults from low-income families. However, evidence from across Canada shows there is no correlation between rock-bottom tuition fees and high university participation rates for economically disadvantaged youths.  

Tuition levels vary considerably across Canada. In Manitoba, Newfoundland and Quebec, university tuitions are very low. The average tuition for undergraduates in these provinces was less than $3, 600 in 2010. In other provinces, including New Brunswick, Nova Scotia and Ontario average tuition fees are much higher, ranging from $5, 500 to $6, 300. This variation allows us to empirically examine claims that cut-rate tuition boosts participation for young adults from low-income families.

The evidence shows that university participation rates for economically disadvantaged youth are no higher in provinces where tuition is cheap than in provinces where it is more expensive. For example, Ontario and Nova Scotia have the highest and third highest average university tuition levels in Canada. However, the most recent data from Statistics Canada shows these provinces have the highest university participation rates in Canada for high school graduates from low-income families. In 2007, Nova Scotia’s university participation rate for high school graduates from families in the bottom quarter of the family-income distribution was the highest in the country at 42.7 percent; Ontario’s was 42.5 percent, well above the national average. By comparison, the university participation rates for high school graduates from families in the bottom quarter of the income distribution in low-tuition Manitoba and Newfoundland were 36.7 and 30.1 percent.

When all the provinces are examined, we see that low-tuition provinces do not generally have higher university participation rates for economically disadvantaged youths. Nor is there greater equality in participation rates across the income distribution in low-tuition provinces. In all provinces, young adults from high-income families participate in university at higher rates than those from low-income families. However, that gap is smaller in several high-tuition provinces including Ontario, Alberta, British Columbia and Saskatchewan than it is in Quebec, Manitoba and Newfoundland where tuition is much cheaper.

This evidence does not demonstrate that tuition fees in high tuition provinces could be dramatically increased further without having a negative impact on low-income participation. Very high tuition fees would, at some point, restrict access for low-income families. These facts do, however, suggest that whether a province chooses to set tuition fees at the rock-bottom levels of Manitoba and Newfoundland or the somewhat higher levels of Saskatchewan and Ontario has little effect on low-income participation rates. If there is any effect at all, it is swamped by other, more important factors. Tuition is heavily subsidized all across Canada, which means the price of a university education is a bargain in high- and low-tuition provinces alike.  It is therefore unsurprising that the tuition gap between Canadian jurisdictions does not seem to be a decisive factor in shaping university participation decisions.

There is a broad social consensus in Canada that financial obstacles should not prevent young adults from low-income families from pursuing a university education. The question is whether maintaining rock-bottom tuition levels, at considerable cost to taxpayers, is an effective strategy for achieving this objective. The evidence from across Canada suggests it is not.