University bond gives poor students a start
Canada's new prime minister has announced a plan to encourage pupils from lower and middle-income families to go to university. But a student leader has derided it as bordering on the "absurd".
Paul Martin is offering $325 million (pound;136m) to set up learning bonds for each newborn child in families earning less than $35,000 (pound;14,500) a year to help pay for the cost of tuition, which has tripled since 1990 to $25,000 (pound;10,500).
"Too many Canadians see a post-secondary education as an unattainable goal because the cost is too high," said finance minister Ralph Goodale when he announced the measures.
Under the $85m (pound;35.5m) a yearLearning Bond programme, the government will deposit $500 into a registered education savings plan for each child born to a family with an income under $35,000. It will go to 120,000 babies this year. An extra $100 government contribution will be made each year until the child reaches 15. The federal government will also contribute 40 cents for every additional $1 the child's family contributes.
"The Learning Bond won't provide for the entire cost of an education," says Craig Wright, chief economist of RBC Financial Group. "But it's hoped that it will kick-start parents to further contribute to their children's education savings plans."
However, Ian Boyco, national chairperson of the Canadian Federation of Students, said the idea bordered on the absurd because no one would benefit until 2022, accounts might be worth no more than $3,000 (pound;1,250) and by then a four-year degree could cost up to $80,000 (pound;33,500).