Canada Student Grants Program
The 2008 federal budget marked a critical victory for the Federation's "Grants NOT Loans" campaign. In 2009, the Millennium Scholarship Foundation will wind down and be replaced with a national system of student grants.

Although occasionally portrayed as a national program, the Foundation could be better described as a third-party that transferred sums to provincial governments that, in some cases, were used on financial aid.

The distinction between that model and a government-run program that (1) reports to Parliament, (2) is subject to federal transparency standards, and (3) can be reviewed and improved with input from students and the public, can not be exaggerated.

Slated to begin at $350 million and increase to over $430 million by 2012, the Canada Student Grant Program will be means-tested and reach approximately 245,000 students. Grant disbursements will be $250 per month (or $2,000 for an eight-month academic year) for low-income students and $100 per month (or $800) for middle- income students.

As recommended by the Federation, the Department of Human Resources and Skills Development will administer the CSGP.

Millennium Scholarship Foundation Background
Announced in the 1998 education budget, the Millennium Scholarship Foundation was a belated acknowledgement by the federal government of the student debt crisis in Canada. In the face of average debt levels of $25,000 the Millennium Scholarship Foundation was to be the centrepiece of the federal government’s student debt reduction strategy. At the time of its introduction, Finance Minister Paul Martin declared in the House of Commons that the Foundation would help those in greatest need and reduce average student debt by $12,000. However, three years after its implementation the Foundation has proved to be largely a public relations exercise that has led to no appreciable decrease in student debt.

Record
The Foundation’s mandate and terms of reference are contained in the 1998 Budget legislation. The Act spells out the governance of the Foundation as well as the framework through which scholarships are disbursed. In theory, the Foundation’s job is to disburse $250 million annually in student financial assistance. However, the federal government chose to disperse the funds through existing provincial student assistance programs. Without any advanced consensus from the provinces about implementation, the hasty and ill-conceived structure of the Foundation made some provinces resentful participants.

Provincial Misuse
The record of re-investment on the part of provincial governments has been spotty at best. The provinces signed agreements to re-invest the savings in augmentations to their existing student financial assistance programs; however the agreements were non-binding.

The Nova Scotia government simply ignored the agreement, consciously re-directing funds intended for students into other government revenues. In Ontario, where approximately 40% of the Foundation funds are transferred, the provincial government has directed less than 15% back into student financial assistance. Despite the misuse of Foundation funds by these governments, the Foundation has done virtually nothing to rectify the situation, and has neither criticised them publicly nor signalled a willingness to withhold further payments. Instead, the Foundation has opted to actively deny that the misuse of the endowment has diminished its impact on student debt.

Public Relations Smokescreen
From the very beginning, the Foundation’s purpose as a public relations vehicle for the federal government has been obvious. In its first year of implementation the Foundation sent students letters telling them they had won scholarships. In fact, students had won nothing; in many cases, the scholarships replaced loan remission; recipients were simply getting a portion of their student financial assistance from another source. To further the federal government’s own partisan goals, the Foundation included sample news releases with the letters and encouraged students to celebrate their winnings by sharing the news with the local community.

The Political Research Agenda: The PR Smokescreen Continues
Despite (or perhaps because of) the fact that it has been unable to address the issue of student debt, the Millennium Scholarship Foundation has recently embarked on a campaign to downplay the crisis of student debt. Recently, the Foundation has taken on the role of a partisan think tank in debates about post-secondary education policy. In appearances before government committees, federal bureaucrats, and university and college presidents, Foundation officials have argued that higher student debt and higher tuition fees will not affect accessibility. In other words, a supposedly arms-length, publicly-funded foundation has taken on the role of apologist for the federal government’s record on post-secondary education.

The Foundation’s efforts to downplay the student debt crisis rely on a misreading of the data. For example, using research involving interviews with 60 people who did not go to college or university, the Foundation wilfully ignores the fact that direct financial barriers were the most commonly reported reason for non-attendance: over 23% of participants in their survey list direct financial barriers as the reason for not going on to college or university. Instead of recognising the significance of this result, the Foundation chose to draw attention to the remainder of the non-attendees’ responses as proof of other accessibility problems.

This move by the Foundation is even more confounding when the data is more closely examined. Many of the non-financial barriers cited by non-attendees are actually likely to be indirectly related to insufficient personal resources. In this light, the number of people who chose not to attend college or university because of financial barriers is much higher. As this study relied on data collected in 1991 and 1995, its results also fail to take into account the effects of the enormous increases in tuition fees across Canada since the mid nineties.

In a 2001 poll conducted on behalf of the Canadian Federation of Students, 46% of lower income Canadians cite lack of money as the reason for not attending college or university. The Foundation rarely acknowledges the fact that the vast majority of those who don’t attain a post-secondary education are from lower income homes. Indeed, the dividing line in almost all studies on access to college and university is the financial status of the individual in question.

A Credible Reading of Existing Data
Foundation officials have publicly claimed that higher tuition fees have little or no effect on accessibility, and that money is not the primary factor in determining who goes on to higher education. However, most credible evidence points to the contrary. For example, Statistics Canada recently reported that wealthy Canadians are twice as likely to attend university as low income Canadians.

This conclusion is further supported by the 2000 Statistics Canada Youth in Transition Survey. The Survey found that financial obstacles were a barrier for over 70% of the 18 to 20 year old high school graduates who cited barriers to their participation in higher education. This Statistics Canada survey is yet another example of research that the Foundation has reported upon without drawing attention to the significant deterring effects that the high cost of post-secondary education has on students from low-income backgrounds.

Conclusion
The Millennium Scholarship Foundation’s primary role has been to perpetuate the appearance that the federal government has been active in reducing student debt. This effort has been bolstered by the Foundation’s research project.

Despite overwelming evidence to the contrary, the Foundation’s research project has essentially made the following three points:

1. The federal government should not invest any more money in student financial assistance,

2. Non-financial barriers are more important in determining access to college and university than an individual’s financial resources, and

3. $25,000 (or higher) average debt is perfectly acceptable because it doesn’t matter how much debt a student has, what matters is their ability to pay it back.

These are alarming positions for the Foundation to adopt, given that its alleged mandate is to alleviate student debt and promote access to post-secondary education. Not only has the Millennium Scholarship Foundation been a failure in the implementation of its own program, it has now begun an aggressive campaign to justify higher student debt and higher tuition fees. In the end it would seem, despite Paul Martin’s promise that the Millennium Scholarship Foundation would reduce student debt, the Foundation has made it its business to campaign for increased student debt.