With Ontario’s post-secondary system facing financial pressures, experts are urging the provincial government to increase public funding to at least the national average, as Ontario remains the lowest-funded province in Canada.

These concerns have been exacerbated by regulatory changes announced in January 2024 by former Immigration Minister Marc Miller. These include the introduction of mandatory Provincial Attestation Letters (PALs) for every province (previously only required in Quebec), the significant reduction in study permits granted to international students, an increase in financial requirements for visa applicants, and, as highlighted by Durham College President Dr. Elaine Popp, new limitations on college programs eligible for post-graduation work permits (PGWP), a key factor in international students’ decision to study in Canada.

How policy shifts over decades have led to the current crisis

How did we get here?

The roots of the crisis go back to the 1980s and early 1990s, according to Ryan Romard, a research analyst. In 2023, he co-authored a report with Randy Robinson, Ontario Director of the Canadian Centre for Policy Alternatives (CCPA). That report found that a privatization agenda under the Mike Harris Conservative government led to deregulation, reduced public funding and a rapid increase in tuition fees. Prior to these changes, approximately 70 to 80 per cent of the post-secondary education system was publicly funded.

In the early 2000s, Liberal governments reintroduced tuition regulations for domestic students, capping tuition increases at five per cent per year. However, provincial funding continued to decline steadily, and international tuition fees remained deregulated.

Then, in 2019, the Ford government escalated the crisis by further reducing public funding, imposing a 10 per cent reduction and freeze on domestic tuition fees, a policy that remains in place today. Additionally, the government overhauled the Ontario Student Assistance Program (OSAP), making post-secondary education less accessible for many domestic students.

As a result, Ontario now invests the least in post-secondary education compared to all other provinces, while also having some of the highest tuition fees in the country—both for domestic and international students.

Ontario’s post-secondary system relies primarily on three revenue sources: provincial funding (which has significantly decreased), domestic tuition fees (which are capped), and international tuition fees (which, until recently, remained unregulated).

Some institutions also receive funding from private donors, which can raise concerns about institutional autonomy. This financial structure has forced Ontario’s Designated Learning Institutions (DLIs) to rely heavily on international student tuition fees. Colleges and universities have increased international student enrolment and tuition fees, which are typically four to six times higher than those of domestic students.

Popp noted that Durham College has carefully managed its international student intake to align with available resources. DC has “one of the lowest ratios of international student enrolment in the province,” said Popp.

However, even institutions that have taken a measured approach must now adjust to changing policies. Maïca Murphy, manager of strategy and governance at Higher Education Strategy Associates, explained that some institutions will be able to withstand the short-term revenue loss from declining international student enrolment “because of surpluses that they’ve managed to generate over the last decade” from the higher international tuition fees.

André Côté, director at The Dais, a public policy and leadership think tank at Toronto Metropolitan University, said that these reserves “will help them for one or two years, but most will be forced to close programs or campuses, cut costs, and reduce offerings.”

Durham College is actively working to adapt to these changes.

Popp said that DC is exploring new revenue opportunities while maintaining its commitment to delivering quality education.

This aligns with the commitment made by the Ontario Colleges Association and Ontario Universities Council, which have pledged to enhance operational efficiencies.

However, Romard warns that this signals the corporatization of post-secondary education, shifting the system toward a business model rather than a public good.

“We have never embraced this approach,” Popp said. “Our priorities remain unchanged – we continue to focus on delivering quality education, providing an exceptional student experience and ensuring our graduates are career-ready.”

She highlighted DC achieving the highest possible rating in the provincially mandated external quality assurance audit as evidence of its commitment to student success.

To improve financial sustainability, DC is participating in provincial efficiency measures led by KPMG through the Efficiency and Accountability Fund under the Ministry of Colleges and Universities.

The need for reform: Ontario needs a long-term solution that starts with increased public funding

On the path forward, experts agree the only sustainable solution is for the provincial government to increase public funding.

“The provincial government needs to increase funding, or at least targeted funding for institutions that are in real trouble,” said Côté.

Murphy emphasized that “a good healthy system is just one that’s well-funded. That’s what it comes down to.”

Romard, meanwhile, reinforced that Ontario needs at least a four to six billion dollar funding increase to reach the national average.

However, the current Conservative government has consistently resisted calls for greater investment.

Romard recommends one way forward could be developing a plan with a clear cost estimate and then finding ways to generate the necessary revenue. This could include measures like taxing corporations, imposing taxes on windfall corporate profits, implementing wealth taxes and increasing taxation on high-income individuals and businesses.

But for this to happen he believes political pressure is essential. “It would take a movement and a campaign of sustained pressure on the elected government,” he explained. “You need to apply pressure politically. And that seems quite far from where we are currently.”