Ontario budget 2016: New grant will cover average tuition for low-income students

The Ontario Liberal government wants to ensure that college and university students from families that make less than $50,000 will have no provincial debt under a new grant unveiled in its 2016 budget.

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Under the Ontario Student Grant, 90 per cent of college students from low-income families would get more than $2,768 for their education, which the government says is the average college tuition.

Seventy per cent of university students would receive grants in excess of the average university tuition of $6,160, according to the province.

The new system would also make tuition more affordable for students from middle-income families, the Liberals say. More than 50 per cent of students from families grossing $83,000 or less will be eligible for non-repayable grants totaling more than the average college or university tuition under the new system.

The province plans to eliminate all of the grants offered by the Ontario Student AssistanceProgram (OSAP) and funnel that money into the OSG to pay for it. Students, however, will still need to contribute the $3,000 required by OSAP and will no longer be able to claim tuition and education costs on their taxes.

The actual size of the grant for a particular student will depend on multiple factors, like whether they are living at home or away and the size of their family.

The government expects to dish out $1.3 billion in grants in 2017, the first year students will be eligible for the money. No student will get less money than they would under the current Ontario Tuition Grant program, the province says.

The government offered few other details about the program.

'Sweeping improvements'

Ontario Liberal Finance Minister Charles Sousa said the new grant will help students and their families make sense of a system that is currently "very complex and convoluted."

"We want this to be oversubscribed. We want to have more students who would not otherwise look to postsecondary," Sousa said.

The Ontario Undergraduate Student Alliance (OUSA) welcomed the changes.

"These are sweeping improvements that will dramatically improve financial aid for our students," saidSpencer Nestico-Semianiw, president of the OUSA, in a statement.

The group has long argued that reforms to the province's student loan system were desperately needed, especially ditching the tuition and education tax credits for upfront money.

"Tax credits did not provide assistance when students needed it, and they diverted aid money to those who did not need the help," said Nestico-Semianiw.

In addition to the new grant, the province plans to increase financial aid for mature and married students and reduce the amount parents and spouses are expected to contribute. It will also cap the maximum yearly OSAP debt level at $10,000 for high-income students.

Patrick Brown, leader of the Ontario Progressive Conservatives, said that "while the government boasts they are helping people," it is really just cancelling one program to pay for another.