As the country’s economy weakens, students need to prepare for the financial consequences of a recession 

The Canadian economy has undeniably been facing a rough patch for the past year. With the cost of living rising and wages lagging far behind, inflationary pressures left many Canadians squeezing their wallets dry.  

However, experts predict things are about to become much worse for Canadians as the economy nears a recession.  

A recession is defined as a period of economic decline. Marked by a decrease in a country’s gross domestic product, a recession brings severe job cuts as businesses reduce production, sales suffer, and consumer spending falls. 

So, why should you care? 

While the weakened state of the economy affects everyone, students, and especially socioeconomically disadvantaged students, are more disproportionately burdened by the consequences of a recession.  

Students already grapple with a range of education-related costs, on top of their basic necessities, but the volatile economic state could lead to even further financial constraints and unexpected expenses.  

As universities also begin to feel the effects of a recession, educational budget choices become difficult, often resulting in cuts to financial aid programs to support students.  

The lack of financial aid, joined with the hiking interest rates on existing student loans, makes students more vulnerable to accumulating debt during a recession. Of greater concern, however, is the fact that some may end up digging themselves an even bigger hole, as they’re forced to borrow more money as a means of short-term relief.  

Beyond these financial constraints, graduating students and those who are employed or searching for employment will need to navigate an unstable job market. The rise in layoffs may hit some working students, but graduating students and those searching for work will face a range of challenges securing a job as employment opportunities become scarce. The inability to secure a job during a recession only magnifies the financial hardships endured by students who rely on employment to support their day-to-day needs and pay off their student loan debt. 

Though the recession will widen economic disparities, stretching students thinner than ever, preparing now can help mitigate the way you experience the economic downturn.  

As with inflation, reducing spending on unnecessary purchases is a fundamental starting point to saving up for the heightened financial pressures brought by a recession. However, paying bills and credit card balances on time is also vital to ensuring you aren’t slammed with late fees and high interest charges during an already stressful period.  

Since the recession will hit individuals with less skills and work experience harder, graduating students will need to think more about the implications of entering the job market during this time.  

Not only will they face worse job prospects, but research also suggests that students who leave school for work face a range of long-term consequences.  

For instance, those graduating in a recession are dealt lower wages and lose out on initial earnings compared to students who graduate prior to a recession. Research also suggests that these students are less likely to hold managerial or skilled positions by their thirties. These issues in employment, however, translate to more concerning impacts such as lower socioeconomic status and poorer health outcomes.  

While the prospect of graduating in a recession is daunting, preparing yourself for the unstable job market through career counselling and making yourself more hireable are important steps in increasing your chances of employment. The basic advice for advancing your competitive edge in the job market has always been to diversify your skillset through further training or taking on job and volunteer opportunities that contribute to professional development – and that advice is still valuable.  

The bottom line is recessionary pressures will affect you no matter what – but doing your research on how best to prepare and taking preventative actions can help to reduce anxiety and mitigate some of the effects of a recession.  

Photo by Kyle West

On Jan 17, the provincial government announced plans to change the Ontario Student Assistance Program and cut tuition by 10 per cent.

The OSAP changes include requiring students to take out a loan when receiving an Ontario Student Grant, lowering the threshold to receive financial assistance, and eliminating the six-month interest-free period after graduation.

On Jan. 31, more than 75 student associations across Canada released an open letter demanding the government reverse the changes to OSAP.

Since the announcement, multiple protests have been held across the province, including in Hamilton.

Students at McMaster are also being affected by the changes, with more than 17,000 full-time students having applied for OSAP.

Many students are concerned about the shift in financial assistance towards loans instead of non-repayable grants.

First-year social sciences student Bryce Lawrence does not get money from her parents for tuition and says she would not be able to go to school without receiving grants and loans through OSAP.

This past year, Lawrence qualified to receive a higher proportion of grants compared to loans. Going forward, she will receive more money in loans and less in grants.

“The 10 per cent tuition decrease is nothing compared to the amount that we are not going to be getting anymore and it is going to be harder for a lot of students,” Lawrence said.

During the school year, Lawrence works three days a week, with the money going directly to basic expenses like groceries, gas and her phone bill.

“I worked hard in high school to get here and I need that money to get myself through it so that in the future I can get myself a good career that will help support a family,” Lawrence said.

Looking forward to next year, Lawrence says the money she gets from OSAP probably will not be enough to cover additional costs on top of tuition.

“It’s just frustrating,” She added. “It is going be weird not having the amount of money I need. Literally nothing is free in school. It is so expensive, and once the money goes into my tuition, I will not have enough to pay for my textbooks and stuff.”

Second-year political science student Zack Anderson said the elimination of the six-month interest-free period is especially harmful.

“It is already stressful enough once I do graduate to try and find a stable income, but I always kind of knew that that six-month cushion was going to be there for me and now that rug’s been pulled out from under me,” he said.

Anderson has relied heavily on OSAP. However, even with OSAP, Anderson still struggles to cover school and living costs beyond just tuition.

This year, he was forced to take a reduced course load and work three jobs to pay for tuition and living costs.

Over the summer, Anderson was working 70-hour weeks to save up for school.

“I have had to take out loans off the bank, I have maxed out credit cards before, done all these kinds of things to try to survive and you take it day by day, week by week,” Anderson said.

While there have yet to be any announcements since Jan. 17, the Ford government’s plans are expected to be in place for the 2019-2020 academic year.

 

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Photo by Kyle West

By: Daanish Kachalia

 

Warren Buffet is the third richest person in the world, yet he never spends more than $3.17 on breakfast, drives a $35,000 car and lives in a house priced lower than the average Toronto home.

With debt at an all-time high within millennials, many students need to manage their money more effectively. According to a Northwestern Mutual 2018 Planning and Progress study, millennials hold an average debt of $36,000. According to the same study, paying debt off is not listed as a top priority for millennials. When it comes to managing your money as a student, saving it is essential.

One may question, why can’t debts be paid off later? The simple answer to that is to secure an earlier financially-stable future. The most obvious factor to consider is interest rates, as they can add up to hundreds of thousands of dollars over time and can be detrimental to a debt-free future.

There would undoubtedly be times when you cannot refrain from spending, like eating out with friends, partying or buying school supplies, but there are ways where your savings can be optimized by some simple tips that you can apply starting today. These tips, which are by no means exhaustive, are created by a student, with students in mind!

 

Buy in bulk

If you are living away from home, buying groceries or personal hygiene items can be quite expensive. It is important to note items that are on sale and to buy them in large quantities, especially if it is a necessity. For example, if toilet paper is on sale for $1.50 off, buying the supply for the rest of the school year will result in an immediate return on your money.

 

Place your money in the right place

Making your money sit in a chequing account is possibly the worst action one can take as it is essentially not growing.  Instead, your Registered Education Savings Plans, grants and savings should be placed in a high-interest savings account.  By doing this, your money will accumulate over time via interest and you will make riskless return that you would not make otherwise.

 

Be a smart partier

Partying is one of those activities where you don’t mind spending money after a stressful week. Although there are certain costs you cannot avoid, there are also many where you can immediately save. Taking the bus being one of them. Why take an Uber or taxi when you can get around the city for free or significantly less? Of course, it would not be as comfortable or efficient, but as students just trying to get by, this method is substantial for a healthy bank account.

 

Pack your own food

This tip may be the most obvious of the bunch, yet many students somehow spend hundreds of dollars throughout the school year on food which is very much an avoidable expense. The best solution would be to meal prep. If you know that you will have a busy schedule in the coming weeks, you should prepare your food ahead of time so you have it available when needed.

 

Track your expenses

Sometimes, many of us unconsciously spend without even realizing it. Knowing where your money goes and taking corrective action can potentially result in a surplus of money by the end of the school year. Today, almost every retail bank offers free analytics on your spending through online and mobile apps. These analytics offer insights such as the months you spend the most on, categories you spend on and spending behaviours. With tracking your expenses, you can possibly realize your unnecessary costs and take the corrective action to reduce spending.

 

There is no doubt that saving your money effectively can result in less debts and a more financially stable future. When it comes to managing your money as a student, saving it is the key ingredient. Warren Buffet should serve a role model for us all, as he has a net worth of $84 billion USD yet lives a more conservative lifestyle than most of us do as students.

 

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By: Matthew Presz

For many students, it has been a smooth transition from residence in first year to a home off-campus for the remaining years of university. Rents would typically be around $500 per month for a room in a house of approximately four to eight students, or $1,000 to $1,200 per month if students opted for more privacy in a condo apartment.

There are also many who chose the commuter life in anticipation of having to payback those dreaded student loans or simply wanting to live at home. Regardless of housing decision throughout the degree, most of McMaster’s graduates will leave with greater knowledge, more skill, a better network and a hefty sum of student debt.

What lies ahead for our dear graduates? Social media has been littered with articles about rising home prices in Hamilton, especially in light of the New West Harbour Go Station and impending revitalization of Barton Street. Canada’s banking regulators have also imposed a stress test, as of Jan. 1, 2018, which slashes affordability, and seems to have the greatest impact on first-time homebuyers.

However, when it comes to affordability, there are ways to get creative when deciding how and when to jump into the home ownership circle. Rather than running straight to the bank for a pre-approval, a mortgage broker could offer an alternative lending solution that is not subject to the new stress-testing imposed by the Office of the Superintendent of Financial Institutions.

Don’t rush into any decisions when dealing with funds of a large scale and definitely do not be discouraged. There is light at the end of the tunnel for all McMaster graduates who surround themselves with proper due diligence.

Or how about help from parents? This does not mean gifted money, as only a few families could afford this, but it could be in the form of access to a Line of Credit, which would still be the burden of the recent grad. However, it would make a down payment feasible, limit mortgage default insurance costs and essentially create an extension of the upcoming mortgage.

Financing aside, let us discuss some of the options when deciding where to live. You may have rented a room near McMaster for the past couple of years, but you won’t want to be buying there as a personal residence, unless you are offsetting the mortgage through rental income of the other bedrooms. The average price of a home within one kilometre of the university over the past six months has been $594,461. Let’s compare that with an average selling price of $305,191 in north Hamilton and $424,714 on the Hamilton Mountain. The stated prices have only comprised of freehold properties, no condo or maintenance fees included, so that a more fair comparison can be seen.

A common theme that I have seen for alumni who wish to work and live in Hamilton upon graduation has been to secure a steady job and rent for one to two years while paying off student debt and saving for a down payment. This is followed by the purchase of a home whereby prospective rent could subsidize the mortgage.

Take, for example, a bungalow on Hamilton Mountain that costs $425,000 and has a separate entrance into the basement equipped with a mini kitchen, bathroom and two bedrooms. While the mortgage, utilities, home insurance and property taxes would likely run approximately $2,500 per month, that homeowner would also be able to charge upwards of $1,200 per month rent for the basement, leaving them with monthly home expenses of $1,300 per month.

Compare that cost of a freehold bungalow with the purchase of a one bedroom condo apartment in Hamilton, which is selling for an average price of $300,000 along with monthly condo fees of $300; total monthly costs at approximately $1,750. Often times, smarter investments do not have to cost more, and will end up costing less than rent in many cases.

The key to making a sound real estate investment is knowing all of the options at play, which can be used in conjunction with proper planning and budgeting. There is no such thing as equilibrium when it comes to the real estate market. The prices are driven by sentiment, which in turn leads to favourable conditions for those who have prepared accordingly.

Don’t rush into any decisions when dealing with funds of a large scale and definitely do not be discouraged. There is light at the end of the tunnel for all McMaster graduates who surround themselves with proper due diligence.

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By Hess Sahlollbey

I still remember being in first year, looking at the banking machine and finding that I only had $22 to my name. In that moment I swore to myself that I’d never find myself in that position again.

One of the hardest things to pull off in university is gaining work experience while trying to maintain a high grade point average. Many students, including myself, are put in a position at school where we’re forced to choose between our studies and finding a job.

While joining volunteering societies and committees may be a fulfilling way to invest your time, the harsh truth is that most won’t pay the bills and may not provide you with in-demand skills when you start looking for work.

While working off-campus may allow you to start gaining work experience, it can often be hard to commit to working three or more shifts a week for an employer week after week.

And while faculties are starting to integrate entrepreneurial classes into their curriculum, the most recent being the Integrated Business and Humanities program McMaster introduced this year, there are some things you must learn first-hand and not from a textbook.

To circumvent commitment to a work schedule and to maintain absolute flexibility in their school schedules, many students are turning to freelancing and finding alternative opportunities to earn money during their free time.

One of the opportunities that worked for me was to participate in studies being conducted on campus. While it may sound intimidating, many are as simple as riding an exercise bike or navigating a pen on digital display.

The vast majority are non-invasive, pay cash and might even allow me get a quick workout in.

The students conducting these studies are always looking for participants and are flexible when it comes to working around your class schedule.

Some of the studies are so fascinating and engaging that the money becomes a bonus.Most of my friends do them to earn some extra beer money, but with some clever planning, I’ve seen people make close to a grand in a semester.

Since then, I’ve spent some time looking for a variety of odd jobs to earn extra money during my spare time.

I’ve been paid to provide personal training for people in their offices during lunch breaks, bartending a baptism, answering a Kijiji ad to move furniture, taking photos for a wrestling match and teaching an art class for a children’s March Break camp.

My current paid project is to translate a full-length film, which allows me to add a new skill and experience to my résumé.

I found that with websites and apps like Fiverr now available, the barriers of entry for finding freelance work have been nearly eliminated. If you search the website, you’re bound to find an odd job that you can qualify for.

On campus, my main side-hustle has been with the Centre for Simulation-Based Learning. A friend recommended that I apply through their website’s online application, and now I am a standardized patient, trained to replicate  physical and emotional medical scenarios that a real-life patient would have in a hospital or medical clinic.

The centre is located in the McMaster hospital, and the nature of the job allows me to pick or turn down shifts, allowing me to make extra money whenever I have the time.

I found that with websites and apps like Fiverr now available, the barriers of entry for finding freelance work have been nearly eliminated.

A bonus has been that I can network and make connections with people from all walks of life that I normally wouldn’t meet if I focused exclusively on my studies.

While you won’t be able to attain financial freedom while completing your degree, taking a couple hours out every week to hustle and freelance is an engaging way to develop entrepreneurial skills and gain experience in many fields while lessening the financial burdens that university life carries.

By: Alannah Pelini

The end of the semester brings the stress of final assignments, last-minute midterms and the looming dark cloud of exams. For those graduating this year, you are realizing that graduation is within arm’s reach and that you should probably book those grad photos. Some already had their photos done and have received them in the mail. Others may still be waiting for their session.

For those waiting, allow me to shed some light on what is to come after your session. Two weeks after having your pictures taken, you will receive prints with all your poses in the mail. These prints are covered in watermarks for copyright protection. You will also receive an access code for their online store where you can order your photos. There are a number of packages to choose from ranging in price from $63 to $419. You will soon notice that if you are looking for a few photos, each with a different pose, the website offers no reasonable options. We as student deserve better options for our post-secondary milestone.

Being a 21st-century student, you look for a CD or jump drive, some type of digital copy of your prints in order to print what you want for yourself. The site offers none of these options. To receive a CD with all your prints, you must buy one of four packages ranging in price from $279 to $419.

To save you some time, I already called the company and asked about the CD, only to be informed that the CD was offered by itself in previous years, but this year the company decided it would only be offered as a bonus. No comments were made on the reasoning behind this switch. They do not offer any digital download options.

After creating a bit of a fuss, the supervisor offered to sell me just the CD for $279 plus taxes and shipping. If that price sounds familiar, it is because that is the cheapest package price that includes the CD as a bonus. When I was on the phone I didn’t realize that was the same price as the package, but last time I checked CDs do not cost that much to make.

After four years at Mac, we have spent thousands of dollars on tuition, over-priced food, textbooks that sometimes are never even used, ridiculous parking fees and we still don’t know how much we will be charged to walk across the stage at graduation. Given the celebratory occasion, one would expect better options.

You may not care about the cost of grad photos right now, but wouldn’t you rather have this dealt with now rather than later, when you graduate?

A Facebook page entitled “Grad photos for the 21st century student” has been created in the hopes of learning what other schools are offering in comparison to Mac. It was also created to find others who want to see this change. In addition, some schools in Ontario already offer more advanced options, such as Humber College and University of Guelph-Humber who both offer USB options to their students.

Two major options are being discussed. We could petition the school to better support their students by contracting a company with options that students are looking for. Or, and this is more complicated, we could find somewhere else to take our grad photos.

Spotted at Mac, the anonymous Facebook page, receives countless posts of student photographers looking for people to sit for them. Graduating students brought their own USB and a small donation for the photographers’ time. Students with a developed portfolio who are capable of handling the job could be hired as part-time photographers as opposed to a third-party photography company.

Although these options may be difficult to implement, students should be able to purchase their graduation mementos on their own terms. Considering the high cost of getting the degree in the first place, students should at least save some money here.

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The latest research from organizations such as Ministry of Advanced Education and Skills Development, Council of Ontario Universities and the Canadian Federation of Students paint a grim picture for international student attending a postsecondary institution in Ontario. Despite the growing international student population, their tuition has risen at a remarkable rate — meant to make up for reductions in government grants.

At McMaster, this gap is just as obvious. A domestic, full-time student enrolling in a program such as life sciences will pay $7228.79 in tuition fees whereas an international student in the same program will pay $25,923.88. International students also do not have access to needs-based scholarships McMaster offers, though they do have access to an international student bursary.

Likewise, due to stipulations in their student visas, international students are limited to working 20 hours a week off-campus during the school year and can only take on internships and co-op placements if they are explicitly a part of their degree.

It is unfair to expect international students to foot the bill of our education when McMaster is a public university. These funds should be coming from the provincial government. Targeting a group that is expected to pay such a high fee and actively recruiting them over domestic students is unethical to all parties involved as it drains resources from one group while taking opportunity from another. High tuition costs also ensure we limit international students to only those of means, which can alienate students who may want to attend McMaster in order to flee hardships or prejudice in their home country.

In addition, it is clear that this money is not being re-invested into supporting international students who attend our universities. McMaster’s International Student Services office mainly focuses on helping students with immigration issues and offers some programming like a mentorship program and English classes. The “Student Life” section of their website mainly focuses on getting international students to explore Hamilton and informs them of popular Hamilton events such as Supercrawl. There is little evidence of support services on their website.

“Considering how many extra fees international students pay, it would only be fair to us that other support services were put in place to ensure that international students’ mental and physical health is being cared for,” said Paula Daidone, a McMaster alumna. Daidone was an international student of McMaster’s Communications Studies program, and is currently enrolled in the McMaster Communication Studies Masters’ program.

Under “Campus Support Services,” the three McMaster Student Union-run services listed are MSU Spark, the Queer Student Community Centre and Diversity Services. Spark focuses on first-year transition, the QSCC offers peer support and programming for LGBTQ students and Diversity Services focuses on creating an inclusive environment for students of colour and other marginalized groups.

While these three services are undeniably relevant to international students, why is Diversity Services, a service geared more towards advocacy and education rather than support, listed when services such as Peer Support Line, the Women and Gender Equity Network, Maccess and the Student Health Education Centre all have on-campus spaces equipped with peer-support volunteers? The page reads as though someone looked through the MSU services tab 10 years ago and picked the first three that sounded right.

Similarly, only two MSU clubs are listed: McMaster International and Exchange Club and McMaster Outdoors Club. This is particularly odd given how many cultural associations exist at McMaster that attract many international students who wish to connect with those from their home country.

While this is likely because the ISS wants international students to integrate into the community rather than only befriending other international students, it exemplifies how little they understand the immigration process and how being surrounded by people with the same lived experiences as you can aid in the immigration process.

The website’s focus is clear: recruitment, recruitment, recruitment. International students are expected to crawl through the pages and pages of services and clubs the student union has to offer despite many groups explicitly supporting them. I’d willingly wager that they have not updated most aspects of the Support section of their webpage since it was created.

If a student were to exclusively use the ISS’s website to integrate themselves into the McMaster and Hamilton community, they would struggle.

If McMaster as an institution is going to focus on international student recruitment, the very least they could do is ensure that the immigration process is as smooth as possible outside of the legal aspects. Immigrating to a new country alone is a difficult endeavor, as is adjusting to university. If proper support services outside of simply helping them get into the country and speaking English are implemented, McMaster will continue to be a disservice to the international students who pay for bills.

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Every year, the Student Life Enhancement Fund, a joint collaboration between the McMaster Students Union and the university, accepts idea submissions about improvements around campus. These are vetted down and reduced to a few finalists for the students at large to vote on.

In the past, this has successfully provided improvements to Compass, microwaves and electrical outlets in the McMaster University Student Centre and the fitness and boulder circuit near the track field across from Les Prince. The results from the most recent process that starting in January of this year will bring about a new round of changes.

These changes will be upgrades to second floor furniture in MUSC, upgrades to MUSC atrium furniture, charging stations across campus, investment in composting opportunities and a MSU Maccess resource library.

“I think that there are limited resources across campus, and I think this is a great way to ensure student needs are being met,” said Daniel D’Souza, vice president (Finance).

D’Souza explained the financials behind the fund,

“Students will pay their tuition, they’ll pay the MSU fee and then they’ll pay a [large number] of ancillary fees through the university. ... Some of those fees go to student affairs. In the past, this has been a pool of money that was used by manager of student affairs to say, ‘Okay, we want these projects.’”

The fund has changed a bit since it began in its current, student-driven form in the 2011-12 academic year, but considering that it draws from student affairs, its current level of  $150,000 per year dedicated to SLEF is a comfortable amount.

“It’s a delicate balance between how much is for student ideas and how much should be put towards core student services like career support and health. So that number right now I think is a good number in comparison to what else is in that fund,” said D’Souza.

At the time of writing, it is unknown how long it will take to implement this year’s projects.

While all of the upgrades that have been done and will continue to be done are a direct benefit, there is a major, indirect benefit as well. The ability to gauge student feedback and concerns, even if the ideas do not make it through the final voting phase, has had an influence on larger projects.

"I think that there are limited resources across campus, and I think this is a great way to ensure student needs are being met."

 

Daniel D'Souza

Vice president (Finance)

McMaster Students Union

In particular, the Pulse expansion and student activity building referendum conducted in March of this year may have been inspired by past requests.

“SLEF is a platform for students to voice their concerns. I think [from] some of the things that we’ve seen in the past, it’s clear that students want more space, they want more amenities on campus. And I think those are some of the driving factors behind the building of this new student centre,” said D’Souza.

He also acknowledged that some of the ideas denied in the past may be more feasible in the next few years with this increased access to space on campus. When it comes to the new student activity building, however, the Student Representative Assembly is not going to wait until SLEF to start the feedback process.

“Right now, there is a committee struck by the SRA that is a student activity building consultation committee, so over the summer, they are making a plan right now to consult students on what else students want to go in this building.”

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Students across the province may soon have a little more change in their pockets. On Jan. 11, a letter-writing campaign was launched by the MSU and other schools belonging to the Ontario University Student Alliance with the aim of convincing the Ontario government to fund a five-year tuition freeze.

TimeOut Tuition is the actualization of MSU President Ehima Osazuwa’s much-discussed tuition platform point, an issue whose solution students have been waiting to see come to fruition.

“Tuition and financial aid and affordability has been a priority for the MSU this year, and one of the biggest things we wanted to do was galvanize a lot of student support behind ideas like a tuition freeze for the next tuition framework,” explained Spencer Nestico-Semianiw, VP (Education).

He hopes the letter-writing campaign will help gain much of this support. The letter itself succinctly explains the main concerns OUSA-affiliated schools have with the steady increase in tuition, namely the unsustainable nature of the increase and the serious financial burden tuition and debt place on students. Nestico-Semianiw hopes that students relate to the issues identified in the letter, and welcomes any who wish to write their own personal notes.

Nestico-Semianiw’s goal is to send a package of 1,000 signed letters to Premier Kathleen Wynne and the Ministries of Training Colleges and Universities and Finance. “What we’re urging the government to do is reallocate some money that’s already in the sector, specifically the tuition and education tax credits to fund a fully-funded tuition freeze,” he said. This means that not only will tuition remain stable for the duration of the freeze, but that it will be funded by the government to ensure Ontario and Canada at large remain competitive in the academic world.

“If next year’s teams don’t make this [advocacy] as big of a priority, then it’s going to be very easy for this conversation to be lost in the next framework.”

Nestico-Semianiw was quick to admit the freeze comes at a high price. It would cost the province around $106 million. The MSU and its OUSA colleagues are asking that this be replaced with money from the $340 million the government spends on post-secondary education tax credits. He explained that the issue with these tax credits is that they are not distributed in an equitable manner. Lower income families claim around one fourth the amount that higher income families do because they pay less taxes.

Another issue with the way tax credits are distributed is that none of the money is available to students or their families upfront. “It’s something you only get back after you’ve completed a year or two years or you might not receive the benefit for half a decade,” Nestico-Semianiw said.

If the letter-writing campaign is successful, the Ontario government will freeze tuition rates for five years, following the expiration of the current framework in 2017. Without this constant hike in tuition, a first-year student in the 2017-18 school year would hypothetically save approximately a total of $750 over the course of their four-year undergraduate program during the freeze. Students in a five-year program would save closer to $1,000.

news_writing_off2

While he anticipates a successful outcome for the campaign, Nestico-Semianiw acknowledges TimeOut Tuition is only the beginning of a surge of advocacy for lower tuition in Ontario. He expressed confidence in the soon-to-be-announced MSU presidential candidates, many of whom are eager to work on this project as well. “If next year’s teams don’t make this [advocacy] as big of a priority, then it’s going to be very easy for this conversation to be lost in the next framework if students aren’t at the forefront of that,” he said.

The MSU hopes to gain support for TimeOut Tuition not just from students, but from politicians, community members and even the university. “It’s definitely student-centered and student-run, but we want to show that these are ideas [others] all get behind,” Nestico-Semianiw explained. As of Jan. 12, the campaign had received just over 400 signed letters, including one from Hamilton Ward 1 councilor Aidan Johnson.

Photo Credit: Jon White/Photo Editor

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With a number of Ontario universities facing large pension deficits, the province recently gave universities and other public sector employers a three-year extension to put sustainable pension plans in place.

Prior to the extension, several universities were running pension deficits in the hundreds of millions and had applied for solvency relief from the government, with terms expiring in January 2014. The three-year extension would allow universities to defer their solvency payments, or make interest-only payments, until 2018.

“[The extension] gives universities and their employees breathing room to address their pension plans,” said Graeme Stewart, communications director for Ontario Confederation of University Faculty Associations (OCUFA). The OCUFA lobbied for short-term relief from pension pressures.

Currently, all but three universities in Ontario face pension solvency deficits, according to OCUFA.

Queen’s University, for instance, faces a pension deficit of $459 million. To pay that off in 10 years, the university would have to draw heavily from its operating budget — extra funds it does not have — to allot $35 million annually to its pension fund.

Caroline Davis, vice-principal of finance and administration at Queen’s, recently called the university’s deficit issue “one of the most pressing financial issues facing Queen’s” in a Q and A on the school’s website.

Davis also said that the three-year short-term relief “would not eliminate [the university's] solvency problem and it would come at a cost.”

“It’s a little like making only the minimum payments on your credit card,” she said.

McMaster University’s 2013-14 consolidated budget similarly cited the university’s pension deficit as “the most significant financial pressure McMaster faces.”

The University of Ottawa has a pension deficit of $289 million and was approved for solvency relief this past June. Prior to the approval, the U of O faced the option of diverting $62 million, about 9 per cent of its operating budget, to paying off the deficit over five years.

Unfunded pension liabilities in universities have been an issue in Ontario for a number of years, exacerbated by the 2008 financial crisis.

“There were contribution holidays taken a decade ago when the plans had surpluses – the universities asked to not make contributions and were given that,” said Stewart. “The market crashed in 2008 and still hasn’t recovered. We also have historically low interest rates.”

“This is a short term stop gap,” Stewart said of the extension granted by the province. “OCUFA has received a grant from the government to do research on [sustainable pension options] – and so has the Council of Ontario Universities.

“It gives us time to do research and gives us time to propose some solutions.”

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