The budget and students

In a post about a week ago on the various reactions to the government’s 2006 budget “Focusing on Priorities”, I featured the following three quotations from educational stakeholders:

“The Harper Government’s first federal budget will do very little to provide relief for students and their families who are struggling with escalating fees for post-secondary education. Although the budget contains minor tax changes for students, it will not fundamentally improve access to post-secondary education according to the Canadian Federation of Students.” — Canadian Federation of Students

“We’re shocked that the Harper government has cut half a billion dollars out of the post-secondary education funding committed by the previous government … This budget means that Canada’s three granting councils will have to reduce their support for research and graduate fellowships at a time when Canada’s research capability is more important than ever” — Greg Allain, President of the Canadian Association of University Teachers

“We are pleased with the budget’s support for university research, as well as the government’s recognition of the important role that research plays for Canadians … These increases in research funding underline the government’s commitment to promote a more competitive, more productive Canadian economy.” — The Association of Universities and Colleges of Canada

As a student at Queen’s, I am well-aware of the usual knee-jerk reactions by the hard-left leaning Canadian Federation of Students to Harris-Eves-McGuinty and now Harper policy announcements for education.

I was however surprised when a fellow grad student and friend of mine (who isn’t at all politically minded) told me (paraphrasing from memory):

Friend: “Steve, I didn’t vote Conservative, but I think I’m very happy with Harper right now.”

Me: “Um, ok… why?”

Friend: “Is it true that the Conservatives just dropped all tax on student scholarships and bursaries? That’s like 100% of my income!”

I told her that I’d look into it because I hadn’t heard of that certain budget provision. But, if true, it would also make my life easier as well.

A week had passed and yesterday a lab colleague (and Liberal) told me that he too was happy with the budget for the very same reason, so I went and looked it up.

“Budget 2006 proposes the following measures:”

“Making all scholarship, fellowship and bursary income received by post-secondary students exempt from income tax by eliminating the current $3,000 exemption limit.”

Having just finished my taxes, I knew that this was a particular annoyance (I had to track down an additional copy of the special T4A form which outlined total scholarship amount to be taxed). This comes as good news. I can now declare almost my full income as tax exempt since I’m a student.

Most graduate students will experience the same tax relief (if not up to 100% of their income in my friend’s case).

Further, undergraduate students receiving scholarships and bursaries will also see this income as tax exempt. Also, it will provide tax relief on this supplementary income if students work part time.

In addition, the goverment will also:

*Expand eligibility for student loans to more students from middle-income families.

The CFS states that “[the] budget will do very little to provide relief for students and their families”. According to the government, when calculating loan eligibility, the amount that the government figures that parents could contribute is lessened making a greater number of students eligible for loans increasing accessibility to post-secondary education.

*A new $500 tax credit to help about 1.9 million post-secondary students with their textbook costs. For a typical full-time student, the tax credit will represent a yearly benefit of about $80.

I don’t know about the ‘typical student’ but when I was an undergrad my books often were between $400-$500 per year.

So, that brings up the question: What has the Canadian Federation of Students so upset? (I know that Brother Layton couldn’t convice PM Harper to make our tuitions disappear, but these credits and ideas will certainly help a lot of students)

I also provide the quotations from the Canadian Association of University Teachers and The Association of Universities and Colleges of Canada to show an interesting dichotomy. The teachers express “shock” and explain: “This budget means that Canada’s three granting councils will have to reduce their support for research and graduate fellowships at a time when Canada’s research capability is more important than ever” while a representative from Universities and Colleges says: “We are pleased with the budget’s support for university research, as well as the government’s recognition of the important role that research plays for Canadians … These increases in research funding underline the government’s commitment to promote a more competitive, more productive Canadian economy.”

Both quotations are about research in post-secondary institutions. However the quotation from the teachers shows a budgetary reaction not by a stakeholder in education but as a stakeholder in a unionized workforce that only happens to be involved in educating. (similarly, watch for unions to claim that their defence of unionized childcare is for the interests of the children)

The direct quotation from the Universities and Colleges is perhaps more representative what the new cash means regarding research at Canadian post-secondary institutions.

The Conservative budget actually increases the amount from the previous Liberal budget by $100 million per year:

*$40 million per year for the Indirect Costs of Research program.

*$20 million per year for the Leaders Opportunity Fund of the Canada
Foundation for Innovation.

*$17 million per year for the Canadian Institutes of Health Research.

*$17 million per year for the Natural Sciences and Engineering Research
Council of Canada.

*$6 million per year for the Social Sciences and Humanities Research
Council of Canada.

Of course, these figures are representative of the extra money provided in addition to the money already invested in research by the government. The government already invests $1.6 Billion into the three granting councils, $260 million into the Indirect Costs of Research program and the government has historically invested $3.65 Billion to date in the Canada Foundation for Innovation in support of research infrastructure.