Thank you. My apologies for being late.
I'm representing the Canadian Association of Student Financial Aid Administrators, or CASFAA, and I want to thank you for the opportunity to present here today.
We administer a large spectrum of student financial aid programs at all levels, including government-sponsored aid programs such as the Canada student loans, provincial assistance programs, institutional scholarships, bursaries, and work-study programs.
We are the front-line people who deal with students on an everyday basis. Because of that role, we are uniquely positioned to witness not only the success of the Canada student loans program but the gaps that seriously compromise the academic potential of a great number of students.
This particular consultation will focus on borrowing and debt. Government student loan and borrowing is a necessity for a large part of post-secondary participants. However, access to financial aid administrators and planning rarely happens before grade 12, or, in the case of mature students, until they are at their institution of choice. Most financial aid administrators, or FAOs, as we are known, will tell you that this process is way too late, and detrimental in some cases to the most disadvantaged of society. FAOs are crucial to the development and enhancement of financial literacy at all levels and years of post-secondary education, undergraduate and graduate, for Canadian domestic and international students, including first year, first entry, mature, single parent, aboriginal, etc. We see the gaps in financial literacy that hinder academic and career pursuits.
We recommend that a national strategy that includes key points of intervention at elementary, junior, high school, and post-secondary build on the success already established by such programs such as Planning 10 program in B.C. high schools and the Future to Discover program in my home province, New Brunswick, to begin financial literacy early.
For those of you who are not aware, Planning 10 is a course required by the B.C. Ministry of Education for all grade 10 students. It starts to prepare students for life after high school. It covers education and career paths, health, personal finance, and graduation.
The Future to Discover is a joint project of the governments of New Brunswick, Manitoba, and the Canadian Millennium Scholarship Foundation. It has two components. Explore Your Horizons helps students understand the range of occupational and post-secondary choices and make meaningful decisions about their future. They are also given learning accounts that support participation of students who face financial obstacles. They have an incentive of $8,000, which is deposited into a trust account that can be accessed upon successful completion of high school and enrollment at an accredited post-secondary education institution. This second component, however, is only delivered in New Brunswick and is available to students from families with incomes below the provincial median.
Recommendation two. The government has spent increasingly on student assistance through fiscal measures introduced to the tax system such as scholarship and bursary exemptions, credit, tuition fees, and allowance for each month of full-time enrollment as well as contributions to registered education savings plans, or RESPs. These tax credits are distributed almost entirely without regard to financial need, disproportionately benefiting families with higher incomes. They do little to assist high-needs students and underrepresented groups—students with disabilities, aboriginal students, adult learners—to enter our post-secondary education system.
CASFAA believes that means-tested student financial assistance that is accessible through a simplified program delivering funds at the time expenses are incurred is the most effective use of taxpayer dollars.
Recommendation three. There is growing empirical evidence from the Canadian Millennium Scholarship Foundation and Higher Education Strategy Associates, formerly known as EPI, and private researchers that qualified students will abandon post-secondary education if their student debt load is too high. Canadian-based research also states that it is not the amount of debt incurred, but it is also the affordability of education. If the gap between resources and cost of education is too vast, students will discard their educational pursuits.
Do I have one minute, or am I done?