Students in Ontario are the first in Canada to run the risk of losing their driving privileges if they drop out of school before the age of 18 under new legislation passed Tuesday in the provincial legislature.

The new law, which has the power to strip the driver's licence of any student who ends up in truancy court, sends a strong message to teens— even though recent amendments have made the legislation less punitive than it used to be, said Premier Dalton McGuinty.

"It's simply saying to our young people that it's no longer acceptable in a knowledge-based economy for you to drop out at the age of 16 and hang around the shopping mall," McGuinty said.

The changes require teens to stay in school two years longer than was previously required, but gives them different ways to earn their diploma through apprenticeships and co-op placements. Those credits have to be granted by a high school principal.

"There are many young people for whom the study of Romeo and Juliet is cruel and unusual punishment," McGuinty said. "But on the other hand, they've got tremendous talents that go largely unrecognized."

The bill was contentious when it was first introduced a year ago. The Liberals initially wanted to compel every high school student to prove they were in school before they were granted a licence to drive a car.

The government backed off after conceding the law would be difficult to enforce. Now, only the small percentage of students who end up in truancy court risk losing their licences.

"It's still there, it's just a matter of last resort," McGuinty said.

The amendments satisfied some critics who said the government is better off using incentives rather than punishment to keep kids in school longer. But many said the law alone won't keep kids from dropping out of school.

Rhonda Kimberley-Young, president of the Ontario Secondary School Teachers' Federation, said the province must review its curriculum and make sure it meets the needs and interests of students.

The curriculum for applied courses is too difficult and may frustrate students, she added.

"It's much better for the students and much more cost-effective to try to be very preventative," she said.

Annie Kidder, executive director of the parent-based lobby group People for Education, said the province should be focusing on keeping kids engaged in the classroom and giving them reasons to stay in school rather than ratcheting up the law.

"Making it a law that you have to stay in school isn't going to be the thing that makes the difference," she said.

The government's goal is to cut Ontario's dropout rate from 30 per cent to 15 per cent by 2010. Under the new law, students, parents and employers who hire students during school hours also could be fined up to $1,000.

New Brunswick is the only other province that requires students to stay in school until 18, but students there don't risk losing their driving privileges if they drop out.