Recent changes to the Ontario Student Assistance Program (OSAP) have drawn significant public attention. With reductions to non-repayable grants, an increased reliance on loans, and the anticipated return of tuition increases, students in Ontario are being asked to shoulder a growing share of the cost of post-secondary education. While these changes may appear exceptional, they are not. Instead, they reflect a broader transformation in how post-secondary education is funded across Canada, where the costs have steadily shifted from the public to the individual.
Rising Tuition and Uneven Costs Across Canada
Tuition fees in Canada have increased significantly over the past several decades, but the provincial differences are striking. Prior to the 2018 tuition freeze, Ontario was the most expensive province in Canada for post secondary tuition. Since then, it has fallen to fourth place. Quebec and Newfoundland maintain substantially lower tuition levels, and other provinces fall somewhere in between.
The data show a noticeable dip in tuition around 2018, corresponding to the province’s tuition freeze. Around 2022, tuition levels quickly resumed their upward trajectory, and by 2024, they were higher than pre-freeze. The brief interruption points to the fact that tuition levels are highly responsive to policy decisions; they can be restrained, but only when governments choose to intervene.
The cost of post-secondary education is not in question. What varies is how that cost is distributed. In many countries, it is treated as a public responsibility rather than a private burden. See, for example, Austria, Denmark, Finland, Germany, Greece, Norway, Slovenia, and Sweden, where tuition for European students is free. In France, tuition for bachelor level European students is 178 EUR (approx $300 CAD) per year, and for international students, it is still an affordable 2,895 EUR (approx $4,700) per year, costs that are only comparable with Quebec and Newfoundland’s in-province fees.
The Shift From Public Funding to Private Burden
Over the past two decades, Canadian universities have become increasingly reliant on student fees as a source of revenue: from 2000-2010, around 50 per cent of university revenues came from the government, while only around 20 per cent came from student fees. In 2023, the last surveyed year, around 40 per cent came from the government and 30 per cent came from students. While government funding remains significant, its share of total university revenue has decreased relative to tuition income.
This shift reflects a process of cost transfer. As governments reduce their relative contribution to university funding, institutions compensate by increasing tuition and expanding enrollment, especially for international students. The financial burden of higher education is thus redistributed from the public to individual students and their families.
A more detailed breakdown of university revenues reinforces this point. While universities continue to receive funding from both federal and provincial governments (the latter represented here as “non-federal funding,” which consistently makes up the largest share of revenue) this support has gradually declined as a proportion of total income, falling from over 40 per cent in the early 2010s to roughly one third by 2023.
Over the same period, tuition and other student fees have become an increasingly central and stable source of revenue, rising from around 22 per cent in 2010 to approximately 30 per cent in 2023. Other sources, such as donations, grants, and investments, remain comparatively small and often fluctuate year to year, making them insufficient to offset this shift.
The result is a system that by definition incentivizes higher tuition. While provincial funding has increased modestly in absolute terms, its share of total university revenue has declined, with institutions becoming increasingly reliant on student fees, especially from international students, whose significantly higher and largely unregulated tuition has become a critical revenue source. In this context, student debt becomes a necessary mechanism for sustaining the system. Students are expected to borrow to bridge the gap between rising costs and constrained public support.
OSAP and the Structure of Student Debt
Ontario’s model is distinctive in combining relatively high tuition with a student aid system that is increasingly, and now majority, loan-based. This combination has significant implications for student debt. However, the relationship between tuition levels and debt outcomes is not always straightforward.
Interestingly, Ontario does not rank as the highest province in terms of student debt. As of 2020, the last surveyed year, Prince Edward Island reports the highest average debt at graduation ($43,500), while Nova Scotia ranks higher in the share of graduates with large debt (67 per cent of graduates). Ontario, by contrast, actually falls closer to the lower end of the distribution, with 50 per cent of graduates with debt over $25,000 and an average $30,800 in debt. Despite this, Ontario is still above the national average.
These findings complicate the idea that tuition alone determines debt outcomes and instead point to the structure of student aid as the key factor. Provinces with similar, or even lower, tuition levels can produce higher debt burdens when aid is more heavily loan-based. Manitoba, for example, has the third lowest tuition in the country, yet ranks above Ontario in average debt at graduation. There, students are eligible for a maximum of roughly $4,200 (about 20 per cent) in non-repayable grants through the Canada Student Grant program, compared to approximately $17,000 (around 80 per cent) in loans through a joint federal-provincial system. By contrast, Ontario’s relatively lower debt levels have historically been shaped by a higher share of non-repayable grants under OSAP, which helped offset the province’s high tuition.
But at the same time, Ontario’s position should not be interpreted as evidence that its system is working well. It reflects a model that, until recently, partially offset high tuition through grant-based support. The recent restructuring of OSAP threatens to undo this balance. With the new changes, Ontario risks becoming similar to the higher debt provinces, where students are more likely to graduate with significant financial burdens. In this sense, the province is not solving the problem of student debt, but is rather moving closer to the models that produce it.
What are students saying?
This year, I received $22,341 in total aid from OSAP, including $12,591 in grants (56.3 per cent) and $9,750 in loans (43.6 per cent). Under the program’s new structure, that balance would shift dramatically: my grants would likely fall to around $5,500, while my loans would rise to approximately $16,500. That is an increase of nearly $7,000 in borrowing each year, amounting to an additional $28,000 in debt over the course of a four-year degree. By graduation, I would be carrying roughly $66,000 in loans at just 21 years old.
Sophie Funston, a Grade 12 student at Perth and District Collegiate Institute, has emerged as one of the key organizers behind the recent wave of student walkouts across the province in response to the OSAP cuts. According to Funston, more than 130 high schools have participated in the protests, with students “calling for a complete reversal of the recent changes.”
Funston described a growing sense of anxiety among students about the cost of post-secondary education. “High school students are very stressed and concerned about how they’re going to pay for university or college,” she said in an interview. “Students in Grades 11 and 12 are feeling it the most. University is right around the corner, and a lot of them don’t know if they’ll be able to afford to go.”
Tayssir Benchoubane, a first-year law student at McGill University, described how recent changes to OSAP are already reshaping his academic plans. Out of province law students at McGill pay around $26,000 a year before financial aid. Now, the new changes to financial aid made him reconsider how long he can afford to stay in school. Originally intending to take four years to build experience at law firms, he is now “more intent on finishing in three years instead, just so that [he] does not have to pay for an extra semester or two.”
He described the pressure this creates as a “vicious cycle,” where “financial stability has an impact on mental health, mental health has an impact on academic performance, and academic performance has an impact on financial stability.” Calling the changes “short-sighted,” Benchoubane warned they will affect the job outcomes of his generation.
Undoing the damage
Reversing this trend does not require ignoring very obvious fiscal constraints, but it does require confronting them honestly. Restoring the previous grant-to-loan balance in OSAP is a necessary first step. As this article has shown, it was this grant-heavy structure, rather than lower tuition, that helped keep Ontario from matching the higher debt levels seen in other provinces.
Alongside this, the province should introduce a provincial student loan forgiveness program on the Ontario portion of loans, modeled on the federal Canada Student Loan Forgiveness Program. Graduates working in in-demand fields such as healthcare, education, and the skilled trades would receive partial or full forgiveness after a set period of service, aligning student aid with labour market needs.
But restoring OSAP alone will not make post-secondary education truly affordable. That requires a broader commitment to public investment, and in turn, that means raising the province’s revenue.
As Ricardo Tranjan has shown, Ontario currently spends significantly less per student than the rest of the country. Closing this gap would cost approximately $3.6 billion annually. While substantial, this figure is well within reach for a province of Ontario’s size and wealth. Increasing the corporate tax rate from its current 11.5 per cent back to the 2010 rate of 14 per cent would generate roughly $5 billion in additional revenue, more than enough to close the funding gap.
Tranjan has also calculated that modest increases to high-income tax brackets, such as a 0.5 per cent increase on incomes above $108,000 and a one per cent increase above $150,000, could generate nearly $2 billion, enough to significantly reduce tuition costs.
Ultimately, the issue at hand is not whether Ontario can afford to reduce student debt, but whether it is willing to pay for it.
