September 30, 2015 1:45 pm
Updated: June 12, 2017 2:06 pm

How true is it? Abolish tuition fees, forgive most student debt and axe student loan interest

Green Party Leader Elizabeth May talks with media in Ottawa on Monday, June 8, 2015.


Free university tuition is more common in Europe, but Green Party Leader Elizabeth May wants to make it a reality in Canada.

Along with eliminating tuition, May’s party also wants to forgive student loan debt over $10,000 and cancel interest on students.

The promise is to do all of that by 2020.

You can watch Elizabeth May reiterate that promise during her Twitter campaign during the Globe Debates.

How True Is It?

Investing in the future

The Green Party claims helping students will pay off. In particular, it says Canada will see better prosperity, productivity and economic competitiveness.

Paying for underemployment?

Numerous studies show most university graduates between 24 and 35 are currently underemployed.

According to a Statistics Canada article, in 2011, 18% of university graduates were working in jobs that only required high school, while 40% were in careers that required a two-year college diploma.

If that level of underemployment exists when students are required to invest in their own education, what happens when tuition is free?

Writing on behalf of the Center for College Affordability and Productivity, Christopher Denhart suggests free tuition will only increase the problem.

LISTEN: Charmaine de Silva discuss her investigation on The Jon McComb Show:

Benefits to degrees

While underemployment may be a concern, there are some other – less obvious – benefits to holding a degree.

One report from the Canadian Federation of Students suggests that over an entire career, the average British Columbian with a university education contributes $80,000 to $140,000 more to the tax base and uses between $15,000 and $18,000 less in government aid, compared to someone with only high school education.

Expensive promise

The issue of benefits aside, there is the question of whether government really can eliminate tuition fees and forgive so much student debt by 2020.

The Greens Party claims their plan will cost $6-billion next year, climbing to $8.9-billion by 2020.

A detailed list of expenses is outlined in its budget document, which can be found here.

Numbers in table below are in millions:

Funding plan

The Green Party has outlined a plan to pay for these big promises, and others it has made along the campaign trail.

One of the big funding sources?

Hiking corporate taxes to 19%, which is the level it was in 2009. The party hopes to gain $7.4-billion because of the move next year, increasing slightly to about $8-billion by 2020.

Those revenue projections are even higher than the ones predicted by the NDP’s budget plan.

As he did with Tom Mulcair’s pledge, economist Jack Mintz suggests the goal may be incredibly lofty.

Jack Mintz

University of Calgary

Mintz says a 19% federal corporate tax rate may lead to as many as 300,000 lost jobs. Further, he says actual revenue derived from the hike will not come anywhere close to the Green Party’s projections.

Mintz says his own work and the work of other economists suggests there is a “revenue maximizing” rate, and he believes Canada is already there.

“And, if you start going any higher, we’ll lose revenue, potentially, instead of getting any revenue at all.”

The Green Party also wants to bring in another $3-billion by closing tax haven loopholes, but Mintz says that hasn’t worked in the US, UK or Japan. He is doubtful it will work in Canada.

Advocates question feasibility

Even groups pushing for abolishing tuition fees are questioning the Green Party’s promise.

Jenelle Davies with the Canadian Federation of Students BC says even though they like the pledge, she’s not sure whether it is feasible to do so by 2020.

“I’d be really concerned. We’ve done this before, even in the province of B.C. when we’ve reduced tuition fees or we’ve had a freeze put on tuition fees. But the funding was just not kept up to pace and we saw institutions crumbling, essentially due to lack of funds.”

Davies says in a crunch, institutions have raised fees other than tuition, and will continue to do so.

She adds, forgiving federal student loans also won’t help those who owe money to the province or private banks.

© 2015 Global News, a division of Corus Entertainment Inc.

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