Higher Education Funding in Newfoundland and Labrador

As with many Canadian public colleges and universities in the 1990s, those in Newfoundland experienced a huge drop in government funding and had to deal with budgeting challenges. Newfoundland's provincial revenues dropped significantly during this decade, falling 30% from 1992 through 1998 alone, equaling $3,500 per student. Since 1999, after years of funding cuts, program closures and skyrocketing tuition fees, access to and quality of post-secondary education have greatly improved in Newfoundland and Labrador. Freezing and reducing tuition fees, improving student financial aid, and increasing funding to the province's two post-secondary institutions have resulted in increased enrollment. Even in this environment, however, Memorial University and the College of the North Atlantic have turned increasingly to private funding in the form of corporate donations or short-term training contracts.

The Newfoundland and Labrador Government provided $3 million funding in 2006-07 to match, dollar-for-dollar, private sector contributions made to Memorial University and the College of the North Atlantic to support various infrastructure projects. In order to receive the funding, both institutions had to submit all eligible receipts to the Department of Education. This was year two of a three-year, $9 million initiative contained in the White Paper.

For Memorial University, government grants made up 81% of funding in 2009-10. This increased to 83% by 2013-14, while at the same time, funding from student fees decreased from 15% to 13%.

Federal Transfers to Newfoundland and Labrador
The Government of Canada provides financial support to the Government of Newfoundland and Labrador through Canada Health Transfer and Canada Social Transfer payments as well as other arrangements, such as Offshore Accords. The transfers are distinct from equalization payments that go to some provinces to reduce disparities in provincial revenues and in the provinces' capacity to fund the full range of government services in those provinces. The current system makes it difficult to discern any link between the transfers and provincial funding of postsecondary institutions. Funding for post-secondary through the Canada Social Transfer has increased steadily from $243,500,000 in 2007-08 to $353,500,000 in 2011-12 with the largest single increase of almost 33% occurring in 2008-09. However, Canada Social Transfer has decreased as a part of total federal transfers from 20.3% to 19.8% during the same period.

Research Funding
Memorial University has been associated more and more with its research and has experienced a surge in research expenditures and activity over the past 10-15 years. From 1995 to 2005 there was a 215% increase in research expenditures, which is a much larger increase over other areas during the same period. Since that time, funding has remained relatively stable with just an 11% increase in 2010 over 2005. In 2013 research funding surpassed $100,000,000.

In 2005-06, over 30% of research funding came from Canadian (22.4%) or foreign (8.2%) businesses or individuals. This distribution had been historically stable, but shifted beginning in 2006-07 to 13.4% from Canadian and 10.0% from foreign businesses and individuals. This distribution stabilized again as evidenced by the 2009-10 distribution of 12% from each of domestic and foreign business and individual sources.

Tuition
Since the early 1990s, average Canadian tuition fees have increased nearly three times for undergraduate students from $1,464 in 1990-91 to $4,347 in 2006-07. By 2014-15 this national average is expected to reach $5,959. In order to keep post secondary education affordable, and in an effort to keep enrollment high, the government of Newfoundland began a program to freeze tuition fees in 1999-2001. Since then, the provincial government has steadily increased core funding to the College of the North Atlantic and Memorial University. After funding cuts over the previous years, these increases have resulted in both institutions now receiving nearly the same funding they had at the beginning of the 1990s. In an even bigger move, from 2002 to 2005, tuition was lowered each year for a total decrease of 22.7%, then frozen again. In the 2008 Speech from the Throne, it was announced that the freeze will continue for a further four years. In the most recent Fact Sheet of Budget 2015, the government states that it will continue to support the tuition freeze. In lieu of tuition increases, the White Paper on Public Post-Secondary Education recommended that the Government of Newfoundland and Labrador provide increased funding to MUN and CNA as follows: $4.3M in 2005-06; $8.9M in 2006-07; and $12.4M in 2007-08. This replacement funding was followed by a commitment in the 2008 Provincial Budget of $56 million over the next four years specifically to continue the tuition freeze at Memorial University and the College of the North Atlantic. As a result, Newfoundland and Labrador's public post-secondary tuition has been second only to Quebec's in Canada for some years. For 2012-13, Quebec's average undergraduate tuition per student stood at $2,565 compared to $2,649 for Newfoundland and Labrador. However, starting from 2013-2014, Newfoundland and Labrador's undergraduate tuition fees for Canadian students became the lowest of $2,631, while Quebec's tuition was $2,657. The average tuition fees for undergraduate full-time Canadian students in Canada were $5,767 in that year.

Student Aid
Based on actions taken in the 2007 Budget, significant improvements to the student aid program saw Newfoundland and Labrador at the national forefront in reducing provincial student loan debt. The budget provided for a $14.4 million investment to help current and former students reduce their debt-load. Interest charged on student loans was reduced from prime plus 2.5 per cent to prime, at a cost of $3.7 million annually. An up-front, needs-based grant program was introduced, providing financial assistance of approximately $10.7 million annually. The grant split the maximum weekly allowance of $140 into a $70 a week repayable loan and a $70 a week non-repayable grant. This provides the same level of funding, yet reduces the amount of money students with the highest need will borrow. It is also the first time that students in one- and two-year programs at the College of the North Atlantic and private colleges will qualify for a non-repayable grant.

The 2009 Budget introduced even more changes for Student Aid in Newfoundland and Labrador. Interest on the Provincial portion of student loans was eliminated completely. The split in aid between loans and grants was changed to $60 per week in loan and $80 per week in grant thus increasing the amount of assistance available in up-front, non-repayable, needs-based grants. Also, to help married students access financial assistance, this budget decreased the required amount of spousal contribution. The budget provided $5 million to cover the cost of these initiatives.

The 2015 Budget continues to support the elimination of provincial students loans by investing $12.6 million and the students loans will be replaced with non-repayable grants.