Middle-Income Crunch

Students considered too well-off face obstacles in financing their education. Why won't OSAP pony up?

Tuesday, April 7th, 2009

A lone chair

Danielle Thompson has been saving up for university since she was 10 years old.

With two older brothers already through the postsecondary system, Thompson knew she had to contribute to her education. She worked continually, baby-sitting, delivering newspapers in her youth and holding down a part-time job throughout high school.

Now in her second year of a biology and psychology double major at the University of Toronto at Mississauga, Thompson still works 16 to 20 hours per week at a Harvey’s/Swiss Chalet outlet and devotes time to her position as residence staff. When her personal savings run out next year, she’ll have to take out a bank loan. Thompson currently pays for tuition, residence and books entirely on her own.

What was her calculation for an OSAP loan? Zero.

Many Ontario students face similar financial challenges in university. Be it the burden of external loans, the stress of balancing work and school, an inability to obtain OSAP or merely the simple fear of not finding the cash, students encounter a myriad of potential roadblocks.

Thompson and thousands of other students are faced with the middle-income dilemma when applying for government loans: their parents’ income seems high enough to pay for university, but the money is not really there.

Last year’s Canadian Millennium Scholarship Foundation’s Price of Knowledge explained the problem: “In some instances, students from middle-income families are being viewed as being too well off to have access to student financial aid, even though they have far less income than students in the higher income bracket.”

Julian Benedict, co-founder of the Coalition for Student Loan Fairness, deals with many students’ financial concerns. He said his organization gets more complaints about OSAP than any other provincial loan body.

The Ministry of Training Colleges and Universities calculates an OSAP loan amount by subtracting your family’s financial contribution from your educational expenses.

The family contribution is calculated by subtracting the provincial standard of living (according to family size) from your family’s net income, which gives you discretionary income and that is divided by the number of children.

“Middle-class families often don’t qualify ... [but] a lot of students don’t have the money, and parents don’t have the money, and they really need it,” Benedict said.

One of the most worrying trends the CSLF encounters is students taking on multiple loans to get through the term " piling credit cards and lines of credit onto student loans.

Over 90 per cent of students rely on more than one source of funding for school, Statistics Canada numbers reveal. Sixteen per cent of middle-income students with family incomes between $75,000 and $100,000 take out private loans.

“The increased psychological stress of having all this debt is affecting peoples’ academic performance,” Benedict said.

Stress also comes from balancing school with a job, according to Thompson.

“If I did get OSAP, I could work less and have more time for my school work,” Thompson said.

Brent Pickard, a fourth-year science student at Western, knew he would not qualify for OSAP and works 25 hours a week at the Western On-Campus Pharmacy in the University Community Centre to help pay for tuition and living expenses.

“It’d be tough to do a full-time job and keep up with your studies, but it’s definitely doable if you can manage it,” Pickard said.

He noted Western has many job opportunities on campus for students.

According to Glen Tigert, associate registrar at Western, Western has a variety of Student Financial Services programs, such as OSAP application assistance, bursary opportunities, financial aid profiling, needs-based awards, a work-study program and admissions scholarships.

Tigert said Western began its financial access guarantee, a stipulation that any student accepted to Western would be able to attend, several years before the provincial government followed suit.

“In Ontario, based on what I know, for any student who has the academic ability to attend university, there are sufficient financial supports in place for that student to attend,” Tigert said.

But is the province really pulling its weight " especially where OSAP is concerned?

Students like Thompson say no, and Benedict offered some potential improvements to the loan program.

“A larger portion of OSAP loans should be a grant,” he said. “A second thing is the eligibility requirements need to be relaxed.”

Kathleen Davis, the USC provincial affairs commissioner, has been working with the Ontario University Students’ Alliance to shed light on students’ financial struggles.

“University education is a huge amount of money,” Davis said. “As much as there is a financial aid system like OSAP in place, as well as entrance scholarships, they’re not sufficient to welcome all students who are qualified.”

Davis agreed many middle-class students are declined OSAP assistance.

She also noted a problem of “sticker shock,” where youth, especially those who don’t grow up in communities where students normally head to university, may see the price tag of postsecondary education and be scared away.

“One of the factors in lower enrolment levels is people are simply deciding they don’t want to go into debt $30,000 or $40,000 for undergrad,” Benedict said.

OUSA recently launched an awareness initiative called the Blue Chair Campaign, the brainchild of OUSA president and USC VP-university affairs David Simmonds.

“Too often in our province, young bright minds do not attend university due to financial, cultural, geographical or informational barriers,” Simmonds said in an OUSA press release.

Empty blue chairs across Ontario campuses are meant to symbolize the empty seats in university classrooms due to challenges facing students. The campaign aims to reduce these barriers as part of OUSA’s larger government-lobbying agenda.

However, organizations and institutions like OUSA, the CSLF and Western can only do so much in reducing financial barriers for students.

Benedict summed things up: “Our government should be encouraging people to go to school"not making it more difficult.”

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