Free tuition policy change leaves unanswered questions

There are still questions remaining over the Gallant government's new plan to offer free tuition to low-income students.

Gallant government gives different versions of how $25M program will be paid for

Premier Brian Gallant announced free tuition for low and middle-income students on April 14. (Harry Forestell/Twitter)

Days after Premier Brian Gallant announced sweeping changes to tuition funding rules in the province, questions remain about how the program is being paid for, when changes will take place and whether existing tuition tax deductions being cancelled to help fund it will really go to low-income students.

Last week, the Gallant government unveiled a surprise overhaul of tuition grants, bursaries and tax credits for university and community college students that will concentrate and redistribute aid to serve those from families with incomes below $60,000.

"We are doing this so university and college tuition can be free for low income and many middle class New Brunswick families," said Gallant. 

"As New Brunswickers, this is what we do: we help those who need it most."

The government estimated the cost of the new plan to be $25 million in the first year, but has given differing versions of where that money is coming from, raising questions about whether government may be keeping some of the money freed up by all of the changes for itself.

Funding unclear

During last week's announcement, Gallant told reporters the new "free tuition" program would be funded using money government cut last year from a popular tuition rebate program that had been in place for new graduates.

That program — which was introduced by the Bernard Lord government in 2006 and beefed up by the Shawn Graham government — offered to retroactively refund 50 per cent of the tuition paid by new graduates who stayed and worked in New Brunswick to lower their debt loads.

The TAB program was introduced in April by former Post-Secondary Education Minister Francine Landry. (CBC)
The program paid up to $4,000 per person per year to a maximum lifetime amount of $20,000.

Costs were approaching $25 million per year with more than 10,000 graduates claiming rebates when the Gallant government cancelled the program last year.

Last Thursday, Gallant said it was that money funding the new free tuition program.

"We had to make a tough decision with the tuition tax rebate cut but we're investing all of that money and more into this program," Gallant told reporters.

Gallant did not explain what "and more" meant, but background information distributed the same day said that a second government program — a provincial tuition and education tax credit worth $10.5 million — was being cancelled also to help pay for the new program.

$10M gap

Opposition Leader Bruce Fitch says that means there are $35 million in budget cuts to fund a $25 million program.

Opposition Leader Bruce Fitch questions why it appears government has cut $35 million in tuition tax rebates to pay for a $25 million program to given free tuition to students whose family income is less than $60,000 annually. (CBC)
"When you look at the numbers that were taken away versus what they said they would be spending there seems to be a gap," said Fitch.

The Gallant government has not responded to requests for more information about how last week's tuition announcement is being funded — whether Gallant made an error in claiming that "all" of the $25 million from last year's cancelled tuition rebate program has been devoted to it, or if it wasn't an error, why $10.5 million in tuition and education tax deductions need to be cancelled to fund the program as well.

Tuition has been tax deductible in New Brunswick in some form since 1960 and all that has been said so far is that killing the tax break was required to make the new plan work.

"Discontinuing New Brunswick's tuition and education tax credits will allow government to focus this money up front, making tuition more affordable and removing a barrier to post-secondary for lower-income New Brunswickers," wrote government spokesman Shawn Berry in an email on Friday.

No opportunity for questions

Part of the problem in getting information, according to Fitch, is that the new program was not announced in a forum where questions could be asked about it.

Making those announcements outside the Legislature does show some contempt for the process.- Bruce Fitch, Opposition leader

Despite its size, it was not mentioned in the February budget speech or again in March when Post-Secondary Education Minister Francine Landry appeared in front of a legislature committee studying her proposed funding for the year.

"If it's done during the budget speech we get a chance to debate it and if it's done in estimates we get the opportunity to ask a significant number of questions," said Fitch.

"Making those announcements outside the Legislature does show some contempt for the process."

The government has also not yet said when all of the changes take effect. 

Ontario announced it is cancelling tuition and education deductions as of September 2017 and the federal government is keeping tuition deductions but cancelling education deductions on Jan. 1,  2017.

However, New Brunswick students preparing to enrol in summer courses have not yet been told if those will continue to be tax deductible.

About the Author

Robert Jones

Reporter

Robert Jones has been a reporter and producer with CBC New Brunswick since 1990. His investigative reports on petroleum pricing in New Brunswick won several regional and national awards and led to the adoption of price regulation in 2006.

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