University funding: the Board of Trade asks for an increase of tuition fees of $1000 a year over three years

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Added on 8 March 2011 in Press releases

Press release

University funding: the Board of Trade of Metropolitan Montreal asks for an increase of tuition fees of $1000 a year over three years

Montréal, March 8, 2011 - As the final preparations for the budget are under way, the Board of Trade of Metropolitan Montreal would like to reiterate the importance of investing ourselves with effective, well-funded universities in order to ensure our success. This namely involves increasing tuition fees by $1000 a year over three years.

Here is our justification:

Why is the Board of Trade of Metropolitan Montreal weighing in on the debate on
university funding?
Our universities are the engines of a knowledge economy and an incubator for skilled labour. They are crucial to industrial research and development strategies. They shape the future of Quebec.

Do our universities lack funding?
Yes. Our universities have been suffering from chronic underfunding for many years. This has an undeniable impact on their current and future performance. The shortfall is enormous: around $620 million.

Can the government make up for this shortfall?
No, it already funds 68% of universities’ operating costs, compared with 53% in the rest of Canada. With health and education accounting for 70% of the government’s budget, it is unrealistic to ask the government for a greater contribution.

Why not raise taxes to fund universities?
A competitive tax environment is essential to a competitive economy. Beyond a certain threshold, tax increases have a negative impact on prosperity. Our tax burden is already among the heaviest in North America.

How much of a tuition increase is needed?
We are proposing a $1000 increase in tuition fees over three years, from 2012 to 2015, while maintaining the current level of public funding. This would allow our universities to catch up to the Canadian level of funding before the gap widens even further. This increase should be adjusted according to field of study, and accompanied by a substantial new contribution to the loans and bursaries system, in the order of 25% of additional revenue.

Why not settle for a lesser increase?
The proposed increase is merely intended to put us on a par with the Canadian average. A lesser increase would leave our universities in a precarious situation. Half measures are dangerous because they make it seem like the problem is solved when it isn’t.

Doesn’t raising tuition fees risk lowering university attendance?
No. Contrary to the widely held belief, there is no correlation between university attendance and tuition fees. Even though tuition fees are substantially lower in Quebec than in the rest of Canada, our rate of university attendance is lower. The true obstacle to university attendance is the high dropout rate among high school students.

So how can we guarantee access to university for students from lower income backgrounds?
Tuition fees can be increased without compromising access. The most appropriate way to do so is through an improved, targeted, and intelligent loans and bursaries program.

Wouldn’t it be more effective to keep tuition fees low for everyone?
Quebec has gotten itself into this situation of underfunding by wanting to offer “discount” education to all. The most effective tool for social unity and mobility is a well-funded loans and bursaries program.

What are the advantages of adjusting tuition fees based on field of study?
This is primarily a matter of efficiency and equity. The most expensive programs are by definition those that need more funding. Medical students currently pay for 14% of their education, compared with 40% for social sciences students. Medical students will earn on average $2 million more.  Basically, students should make a more proportional contribution to the cost of their education. Quebec is the only province that does not adjust tuition fees.

How do we ensure that students get what they pay for?
This is not about writing universities a blank cheque. They have to take advantage of this budgetary breathing room to become more effective. In return for the additional effort required of students, better tracking of university performance indicators, based on measurable, progressive data, will be essential.

What about efforts by businesses?
Businesses offer graduate students quality jobs and competitive salaries. An additional tax on investments or on payroll would be counter-productive. It would reduce the competitiveness of our economy and result in lower salaries. That said, the government should put in place new tax incentives to increase donations and partnerships; everyone wins if philanthropy becomes more ingrained in Quebec.

Tuition fees: debt or investment?
A person with a bachelor’s degree will earn $600,000 more than someone with a high school diploma during his or her working life. For students, university is a very profitable investment with a return that more than justifies wanting to preserve its quality through proper funding.

“Mr. Charest, Mr. Bachand, and Ms. Beauchamp, it’s time to act! We are asking you to have the courage to make the right decision. The stakes are high, the choice is clear. Quebec cannot lose ground,” said Michel Leblanc, President and CEO of the Board of Trade of Metropolitan Montreal.

Read all of our material on the topic at www.btmm.qc.ca/tuition_fees

The Board of Trade of Metropolitan Montreal is made up of some 7,000 members. Its mission is to represent the interests of the business community of Greater Montréal and to provide individuals, merchants, and local businesses of all sizes with a variety of specialized services to help them achieve their full potential in terms of innovation, productivity and competitiveness. The Board of Trade is Quebec's leading private economic development organization.

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Source:
Sylvie Paquette
Coordinator, Media Relations
Board of Trade of Metropolitan Montreal
Phone: 514 871-4000, extension 4015
sylvie.paquette@ccmm.qc.ca