Opinions

 

 

 

Scrap the Millennium Scholarship
Foundation

Foundation is ineffective and unaccountable

Amanda Aziz, Special to Canadian University Press

 

[Editor’s note: Amanda Aziz is national
chairperson of the Canadian Federation
of Students. ]

OTTAWA (CUP) Student financial
assistance can be a complicated issue.
However, one thing is clear: grants are
better than loans. Less debt is better
than more debt. But even this issue
begins to get complicated when we
start discussing the best way to deliver
student grants.

Trial and error has taught us one
thing in this area: the Millennium
Scholarship Foundation is not the
best way to deliver grants to students.
Slipped into the 1998 federal budget at
the last minute, this private foundation
was endowed with $2.5 billion to
transfer to the provinces for needs-
based grants.

When it was introduced, then-finance
minister Paul Martin stood up in the

 

 

House of Commons and declared that
the foundation’s grants would cut the
student debt of its recipients in half.
Although that was a very important
gesture by the finance minister, we have
to ask: has the foundation lived up to
those expectations? The answer is no.
Not even close. The foundation model
has failed as a student aid mechanism,
and it’s time to move on to a better
model.

The Millennium Scholarship
Foundation has two principal failings
that are, beyond the shadow of a doubt,
reason enough to shut it down and try
something else. First, the foundation
was unable to ensure that students
benefited from the billions of dollars
it funneled to provincial governments.
Second, as a private foundation, it is not
accountable to the public, a status it has
seen fit to exploit on a regular basis.

On the first issue, the Chrétien

government chose
to establish a new
bureaucracy with

a flashy name
(“millennium” was
flashy in the late
1990s) to maximize
political points.

It should be
noted that no one
was actually calling
for a student aid
foundation. The
student movement
was calling for a
national system of
needs-based grants
to be delivered
using the existing
Canada Student
Loans Program
infrastructure.

So when the
foundation came
out of nowhere,
it had to build a
new relationship
from scratch with
each provincial
government. Its
lack of leverage
forced it to strike
“gentlemen’s
agreements” that
essentially said,
““We’re probably
going to duplicate
your provincial
grant programs, but
with the money you
save, you have to
use it for more student grants. Please?”

Since the provincial governments
were barely consulted leading up to the
creation of the Millennium Foundation,
many were less-than-willing partners in
the rushed agreements. Not surprisingly,
many provinces simply pocketed most
of the money saved from provincial
grants now paid for with Millennium
Foundation cash.

You read that right: in most
provinces, Millennium Foundation
grants simply replaced provincial grants
or loan remission, leaving students no
further ahead.

A couple of provincial governments
behaved in good faith and re-invested
the savings into more student aid, but
most didn’t. The most extreme example
was Nova Scotia where then-premier
John Hamm eliminated a debt reduction
program the same year Millennium
grants were introduced.

 

In Saskatchewan, foundation
officials say (with a straight face) that
the displaced grant money went towards
keeping tuition fees down. Tuition
fees in Saskatchewan have increased
69 per cent over the short life of the
foundation. Recall that Paul Martin
promised that high-need students in
Saskatchewan would have their debts
cut in half.

Accordingly, an external review
of the foundation conducted in 2003
concluded that its impact on access to
post-secondary education was “limited
and indirect to non-existent.”

In addition to failing at its core
mission, the foundation has a second
critical flaw. Without a structure for
meaningful reporting to the public, the
foundation has been free to act as a
public relations firm for the governing
party. Unlike accountable and
transparent government agencies like
Statistics Canada or the Canada Student
Loans Program, the foundation plays
an overtly political role in Ottawa and
across the country.

In its first year of implementation,
the foundation sent letters to students
telling them they had won scholarships.
In most cases, the scholarships replaced
provincial loan remission. To further
the federal government’s own partisan
goals, the foundation included sample
news releases that encouraged students
to celebrate their “winnings” by sharing
the news with the local community.

More recently, foundation officials
have publicly sung the praises of
one-term Ontario premier Bob Rae’s
report commissioned by the Ontario
government calling for higher tuition
fees and deeper student debt.

Being outside regular parliamentary
scrutiny has also enabled the
Millennium Foundation to establish its
own special brand of ethical standards
for awarding contracts. In 2005, the
foundation awarded a $4-million
contract to the Canadian division of the
U.S.-based Educational Policy Institute,
which employs two former Millennium
Foundation employees.

The Millennium Scholarship
Foundation is seeking renewal as
its endowment is expected to be
exhausted by 2009. For the benefit
of students and their families, the
federal government would be wise to
wind up the Foundation and move on.
The federal government already has
the infrastructure to deliver grants to
students; it’s time that they used it.