Alberta cancels education grant after a decade

WATCH ABOVE: The PC government cancelled a grant program for children who opened a RESP. Kendra Slugoski explains.

EDMONTON — It was supposed to be a way for parents to kick-start saving for their child’s college or university education. But, as of April 1, the Alberta Centennial Education Savings Plan has been cancelled.

The provincial grant program was created in 2005.

Any child born between Jan. 1, 2005 and March 31, 2015 was eligible for $500 as long as that child was signed up for a Registered Education Savings Plan. But, if your child was born one day later, on April 1, 2015, you’re out of luck.

“We understand there’s fiscal pressures within the province. We understand the financial realities that Alberta is dealing with right now,” said Peter Lewis with C.S.T. Consultants Inc.

“But we felt … you could find ways to restructure this program if it wasn’t meeting the specific public policy objectives of the government.”

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Lewis lobbied for the creation of the education grant. Now he’s worried without it, parents might defer crucial contributions.

“Every day you delay savings is another day you don’t have the ability to have compound growth in your RESP,” he explained.

The $500 grant was an incentive to start that post-secondary education saving early. Over the span of 11 years, the province would top up that investment with another $300 ($100 payments when the child turned eight, 11 and 14).

WATCH: Alberta group calls for additional post-secondary funding 

Since the program started, nearly 400,000 grants were paid out, totalling about $132 million in contributions to more than 280,000 students.

Despite those numbers, the province said the program was not effective.

“What we found is, five years after the program was introduced, the participation in RESPs was actually reduced by two per cent,” said Don Scott, minister of Innovation and Advanced Education.

“So what we’re doing is we’re targeting the money in better ways.”

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If your child was born between Jan. 1, 2005 and March 31, 2015, you have until the end of July to register for the savings plan.

READ MORE: Are you saving enough for your child’s post-secondary education? 

In 2014, the average cost of tuition at a Canadian university was nearly $6,000 a year.