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Economy

Michael Ignatieff announces Canadian Learning Passport

Posted on March 29, 2011
Learning Passport

Learn more about the Learning Passport and help us make sure every Canadian gets a shot at college or university.

OAKVILLE – A Liberal government will open the doors for every young Canadian who wants to go to college or university with a historic new Learning Passport, Liberal Leader Michael Ignatieff announced today.

“The message we will give every one of our kids is if you get the grades, you get to go,” announced Mr. Ignatieff to a gathering of young Canadians at the Sheridan Institute of Technology and Advanced Learning.

“Right across the country, families are struggling to save enough to give their kids a shot at college or university. We’re standing with them.”

The $1-billion Canadian Learning Passport is the single largest annual investment in non-repayable federal student assistance in Canadian history, providing directly to families:

  • $4,000 tax-free for every high school student who chooses to go to university, college or CÉGEP – $1,000 per year over four years; and
  • $6,000 – or $1,500 each year – for high school students from low-income families.

“Canadian families want to invest in learning,” said Mr. Ignatieff. “But the cost of college and university is slipping out of reach for too many middle-class families.”

Learning Passport funds will be provided through the Registered Education Savings Plan (RESP). Students and their families will not be required to provide any matching funding to receive the Learning Passport.

“Investing in learning is essential for preparing Canadians for the jobs of the future,” said Mr. Ignatieff.  “The Learning Passport will be a powerful tool for reducing barriers to attending college and university, increasing the flow of highly skilled workers into the Canadian economy.”

The Learning Passport will be part of a Liberal government’s Canadian Learning Strategy. The Canadian Learning Strategy aims to build the best-educated, most highly-skilled workforce in the world and also includes investments in affordable early learning and child care, Aboriginal learning, and expanding language training for new Canadians.

“We can strengthen families – without raising your taxes – if we stop corporate giveaways, control wasteful spending, and focus on what really matters: giving every Canadian the tools to succeed in the years ahead,” said Mr. Ignatieff

BACKGROUND
The Canadian Learning Passport

Today’s global economy is increasingly driven by innovation and knowledge.  In order to remain competitive, our country must make the most of all the talent Canadians have to offer.  To be a leading economy in the world and create high-quality jobs for Canadians, we must have the most skilled workforce in the world, educated by our high-quality Canadian post-secondary education system.

Canadian families are willing to invest in learning.  However, with education costs continuing to rise, higher learning is slipping beyond the grasp of too many middle-class Canadian families.  Public opinion research shows nearly two-thirds of parents believe they will be unable to afford post-secondary education for their children.  That anxiety increasingly leads some families to conclude that post-secondary education is not even an option for them.

The opportunities that colleges and universities provide must be available to anyone with the ambition to learn.  That’s why Canada’s approach must be based on a simple objective: “If you get the grades, you get to go.”

To help students address the escalating costs of post-secondary education and rising student debt levels, a Liberal government will invest $1 billion of new funding annually in the new Canadian Learning Passport, the single largest annual investment in non-repayable federal student assistance in Canadian history.

The Learning Passport will provide $4,000 tax-free to every high school student who chooses to go to university, college or CÉGEP, $1,000 per year for four years. Students from low-income families will qualify for $6,000 or $1,500 for each year of study. A reduced amount will also be provided to part-time students. The low-income threshold will be defined using the same criteria as the existing RESP system.

Learning Passport funds will be provided to students through the Registered Education Savings Plan (RESP) program.  To receive Learning Passport funds, a student only needs to have an RESP account opened in their name; no additional financial contribution into the RESP will be required by the student or their family. The Learning Passport will be $1,000 in every RESP account in each of the four years leading up to the typical start of post-secondary education, when the recipient is 14 to 17 years of age.  For low-income families, the amount will be $1,500 in each of those four years.

When the student starts post-secondary education, the Learning Passport contributions will be paid out at the start of each year of full-time study, up to a maximum of four years.

The Canadian Learning Passport will also be fully portable allowing it to be used to pay for post-secondary education at any accredited institution.  If a student completes their studies before Learning Passport benefits are fully paid out (for example, after completing a two-year college program), the remaining value of the Passport will remain available to the student to support future post-secondary education in later years.  If the beneficiary of an RESP does not attend college or university, Learning Passport funds will not be paid out.

The RESP is the right vehicle for a new, national investment in learning.  It already provides incentives for families to save for education by putting aside what they can for the long-term.  A weakness of the current RESP, however, is its low take-up rate among families of modest and low-incomes.  Many families simply don’t have extra money to put aside after paying all the bills.  The Learning Passport will be a significant boost to the RESP system, especially for those families least able to save large amounts.

A Liberal government will work with financial institutions and other partners to assist and encourage all parents to start an RESP for their kids.  Promotion and information about the Canadian Learning Passport will begin early, in order to encourage young Canadians to consider and prepare for college or university.  The guarantee of financial support will help increase post-secondary participation among those families who currently assume they can’t afford it.

Supportive Quotes

“The announcement by Liberal Leader Michael Ignatieff illustrates an understanding of the challenges facing many Canadian students – primarily not having the necessary funds to access PSE. The Canadian Learning Passport is a positive investment that will not only help students, but their families as well.”
–    Zach Dayler, National Director, Canadian Alliance of Student Associations

“Students have long been calling for more generous up-front grants to counter rising tuition fees, and the Canadian Learning Passport is a significant step forward. With the costs of education beginning in September, most students cannot afford to wait for a tax credit that comes months or years later. An increase in up-front grants will undoubtedly have a greater impact on accessibility and will ease the financial burden for far more students.”
–    Meaghan Coker, President of the Ontario Undergraduate Student Alliance

Questions & Answers

Q: How will the Learning Passport work?

A: The Learning Passport will be provided through the Registered Education Savings Program (RESP) as a new, non-taxable, non-repayable, up-front benefit. To receive the Learning Passport, each student must have an RESP open in their name.  When they are in high school, $1,000 will be deposited in their account in each year leading up to post-secondary, when they are 14-17 years old – or $1,500 for students from low-income families.  To access the funds, the student must be attending an accredited post-secondary university, college or CÉGEP program on either a full or part-time basis. While the RESP system will be used to deliver the Learning Passport, no additional contributions into the RESP are required in order to receive it.

Q: How does the Learning Passport operate alongside existing federal education programs?

A: By using the RESP system, the Learning Passport will easily work alongside other federal education programs.  The Learning Passport will be provided in addition to the Tuition Tax Credit, the Canada Student Loans Program and the Canada Student Grants Program.

The Learning Passport replaces and provides significantly more funding than the Education and Textbook tax credits which do not provide funding to students up front, when many of the expenses that students incur – like tuition and textbooks – must be paid.  Because these credits are non-refundable, most students cannot collect their refund for many years, if at all, as they have little taxable income while studying. The Learning Passport provides $1,000-$1,500 in direct upfront funding to post-secondary students.

Q: Why are you using the RESP program to deliver the Learning Passport?

A: The RESP program offers a means for delivering non-repayable assistance directly to Canadian families across the country, while at the same time offering incentives for families to save for education, putting aside what they can for the long-term. Uncertainty about how they will pay for post-secondary leads many students to decide against attending altogether.  By putting Learning Passport funding directly into their RESP when students are in high school and still making decisions about their educational choices, the Learning Passport will have a positive influence on their future planning.

Q: What happens to the Learning Passport if the student decides not to go to school?

A: Not all students will pursue a post-secondary education immediately after high school, which is why the Learning Passport is designed to remain available to a person for many years. Should they decide not to attend a post-secondary institution, the Learning Passport benefit is not paid out. This is already the practice for the other government contributions to RESPs, like the Canada Education Savings Grant and the Canada Learning Bonds, when the RESP holder opts not to attend a post-secondary institution.

Q: Does the Learning Passport apply only to future students, or will current students be eligible?

A: The Learning Passport is intended for future students going into college and university. We will implement a transition period in which current college and university students will be able to open RESP accounts and receive the Learning Passport for the remainder of their studies.