From My Perspective – Post-Secondary Tuition (Part Two)

October 23, 2002

Post secondary tuition rates are increasing rapidly and out of proportion to cost of living and wage increases, putting a post secondary degree out of the reach of the majority of Canadians. Last week I took a brief look at some of the ways tuition has changed within only a few decades in Alberta. This week I will take a further look at what is happening within Alberta’s post secondary environment, and how it will affect each and every one of us whether we are Albertans or not.

As mentioned in my previous article, the Council of Alberta University Students (CAUS) will be bringing many of these issues to the fore in the weeks to come, and once again I urge all of you to remain informed and be ready to speak up on behalf of all Albertans and Canadians.

We all benefit from becoming educated and from having educated people in our midst. Higher education has been linked to improved social benefits, reduced rates of mental health problems, better physical health, less substance abuse, less family violence, and a whole host of other socio-economic factors that contribute to a healthier society overall. I know I’m preaching to the converted – none of us need a lecture on the benefits of education – that is why we are at Athabasca University.

Most of us have a pretty good grasp of how difficult it is to fund our education. There are a lucky few among us who have our tuition paid by our employer, or by the government, or some other public agency. Some of us also have the luxury of going to school just for fun, taking courses for personal improvement. Most of us, however are struggling to get an education by any means possible. We work and put aside a few dollars to fund each course, we borrow money, use our credit cards, or find some other way to come up with the necessary cash. A small number of AU students, like myself, rely on student loans. For many on-campus students, student loans are the only option they have.

In last week’s article I spoke of the limitations of the student loan program for students whose parents are unable or unwilling to contribute to their education, and the fact is that many students do not qualify for student loans in Alberta. Even for those who do, the student loan itself is not the ideal solution, since it does have to be paid back, beginning six months after full time studies end. If graduates do not find work immediately, this can create serious hardship. I have heard countless stories of graduates who are struggling to repay student loans for years after leaving school, without even touching the principal amount owed. As an example, the Alberta Government gives a repayment amount on a $25,000 loan as $303.32 a month over 10 years (for a total with interest of $36,398), or $506.91 a month over 5 years (total of $30,415).(7) A $25,000 loan represents the average student loan debt for an undergraduate degree. A Master’s or PhD can mean double that amount or more. How many of you are having a hard time with a $10,000 credit card debt, let alone a $25,000-$50,000 student loan debt?

According to the same government website, wages for new graduates in most programs are nowhere near the $30,000 range in the first few years. This means that students not only struggle financially for the 4-10 years they attend university, they face many more years of debt before they finally can get on with their lives and become productive Canadian taxpayers. All too often students are unable to find work immediately in their chosen field, and the student loan becomes a crushing burden with no way out, since student loans are exempt from any bankruptcy proceedings for ten years. Many of you know what it is like to try and make a monthly car payment of $300-$400, or a mortgage of anywhere from $500-$1000 a month. Graduating students may eventually have sufficient income to pay such minimal expenses, but many years of student loan repayment come first.

It is not only full time students who are struggling. There are very few government resources for part-time students in Alberta. If you are low income, a single parent with dependents, disabled, or aboriginal, there are a variety of programs that provide some funding assistance. But for most students who are taking single courses towards their ultimate goal of a degree, they are on their own when it comes to finances. We struggle to complete our courses on time while working and taking care of other responsibilities, and while Athabasca University gives us the option of extending our course deadlines when we become overwhelmed, these extension fees can represent a huge addition to our overall tuition cost. At $118 for each two-month extension period…the end result is that a single course cost for the average Alberta AU student who gets the maximum of three extensions is $850.00!

Extension fees can almost double the total tuition we pay at Athabasca University. Yet they are one way Athabasca University tries to cope with current government funding and tuition policies that penalize AU because they do not address the unique nature of our university. The government of Alberta funds universities based on a formula that allots a percentage to each university according to FLE’s (full time learning equivalents), and bases funding allotments on 30% of the infrastructure operating costs. How do these policies harm Athabasca University?

Funding based on 30% of infrastructure operating costs, in simple terms, means that a university that has huge operating expenditures (such as the University of Calgary or the University of Alberta) receives a far greater government contribution than does the University of Lethbridge (who have low operating costs) or Athabasca University (who have minimal infrastructure costs). Under this formula, universities with high operating expenditures are also able to raise tuition by a greater percentage – since the 30% rate also represents a total tuition cap, and universities can raise tuition up to a maximum of 30% of their operating costs. The higher the operating costs – the more tuition can go up.

In principle, this means that a university that uses their funds inefficiently and incurs higher operating expenses becomes eligible for even more tax dollars, while a university that runs a fiscally responsible operation is penalized. Even worse, a university without a physical infrastructure, like Athabasca University, receives a fraction of the funds the other Alberta universities do…yet our technological infrastructure represents a huge expenditure that the government does not recognize! The effect of the 30% total operating cost on the tuition cap also means that AU and University of Lethbridge have been forced by government policy to keep tuition increases lower than U of C and U of A. Even though a zero tuition increase is the ideal, the reality is that without any changes in government funding, universities will continue to rely on higher tuition rates to survive. A policy that allows two Alberta universities to raise tuition because they have huge expenditures, while preventing two universities with low expenditures from doing the same since they cannot exceed 30% of their total operating cost, is grossly unfair.

In addition, Athabasca University has relatively few FLE’s (full time learning equivalents), since most of our students are part time. While a campus-based university will get “x” dollars for one student, AU needs several student registrations to get the same “x” allotment. Yet the costs of processing and supporting each student are the same, whether they are taking a single course or a full course load. AU serves an important role in providing a part time option for students on campus, allowing them to take extra courses per semester and allowing them to take supplemental courses their campus-based university does not provide. Yet AU does not receive the equivalent funding that campus-based universities do.

These funding policies mean that while the other three universities in Alberta receive about 30% of their revenue from tuition – Athabasca University must rely on student tuition for almost 70% of their operating revenue!!!

The result of these government policies is that Athabasca University has been placed in a difficult financial position that will ultimately hurt our university. Presently the government of Alberta is conducting a review of the Universities’ Act, and Athabasca University is seeking to become included under its mandate (currently we exist legally by an Order in Council and are not under the Act itself). Discussions are underway with Alberta Learning to try and address the unique situation of Athabasca University. Recognition of our technological infrastructure as being equivalent to a bricks and mortar one is just one of the issues being addressed, as well as the removal of the 30% funding formula and the Fulltime Learning Equivalent measure. I encourage all Alberta students to contact your MLA and ask them to actively consider the proposals our Athabasca University is making to the Alberta government. I would also encourage students across Canada who attend Athabasca University to take an interest in this topic, since the policies that will be developed here in Alberta will have a direct effect on the tuition Athabasca University will be charging students outside of Alberta and abroad.

Athabasca University is struggling financially for survival. But so are the campus-based universities. And two Alberta universities are looking at some tuition and administrative policies that should concern all of us even if we never plan on becoming students at these universities.

In the final part of this article, I will take a look at what is going on in these campus-based universities and why we should be worried.

REFERENCES

(1) Council of Alberta University Students (CAUS):
http://www.su.ucalgary.ca/caus/alpha/
http://www.caus.net/alpha/pdf/news/Tuition%20Media%20Package.pdf

(2) University of Alberta Students’ Union
http://www.su.ualberta.ca/
http://www.su.ualberta.ca/mainpage_content/articles/survey

(3) University of Alberta Tuition:
http://www.registrar.ualberta.ca/ro.cfm?id=246

(4) Students’ Union, University of Calgary:
http://www.su.ucalgary.ca/suweb/html/media/tuitionfacts.html

(5) Canadian Alliance of Student Associations (CASA):
http://www.casa.ca/index.asp

(6) Statistics Canada, University Tuition Fees:
http://www.statcan.ca/Daily/English/020821/d020821b.htm

(7) Student Finance Board, Alberta Government:
http://www.alis.gov.ab.ca/studentsfinance/detpar.asp

(8) Athabasca University
http://www.athabascau.ca

Debbie is a native Edmontonian, and a single parent with four daughters. She has worked as a professional musician for most of her life, and has enjoyed a rich variety of life experiences – with many more to come! Debbie is working towards an eventual doctorate in psychology, and currently serves as the president of the Athabasca University Students’ Union.

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