Vol. 146, No. 9 — April 25, 2012

Registration

SOR/2012-79 April 10, 2012

CANADA STUDENT FINANCIAL ASSISTANCE ACT

Regulations Amending the Canada Student Financial Assistance Regulations

P.C. 2012-391 April 5, 2012

His Excellency the Governor General in Council, on the recommendation of the Minister of Human Resources and Skills Development, pursuant to section 15 (see footnote a) of the Canada Student Financial Assistance Act (see footnote b), hereby makes the annexed Regulations Amending the Canada Student Financial Assistance Regulations.

REGULATIONS AMENDING THE CANADA STUDENT
FINANCIAL ASSISTANCE REGULATIONS

AMENDMENTS

1. Schedule 3 to the Canada Student Financial Assistance Regulations is replaced by the Schedule 3 set out in the schedule to these Regulations. (see footnote 1)

COMING INTO FORCE

2. These Regulations come into force on August 1, 2012.

SCHEDULE
(Section 1)

SCHEDULE 3
(Paragraphs 14.3(b), 38(1)(d), 38.1(1)(e),
38.2(1)(f), 40.02(1)(d) and 40.021(1)(d))

INCOME THRESHOLDS

TABLE 1

LOW-INCOME THRESHOLDS, 2011 ($)

Province	ON	NS	NB	MB	BC
Family Size
1 person	23 293	20 061	20 061	23 293	23 293
2 persons	28 999	24 973	24 973	28 999	28 999
3 persons	35 651	30 701	30 701	35 651	35 651
4 persons	43 285	37 277	37 277	43 285	43 285
5 persons	49 094	42 277	42 277	49 094	49 094
6 persons	55 368	47 683	47 683	55 368	55 368
7 or more	61 644	53 087	53 087	61 644	61 644

Province	PE	SK	AB	NL	YT
Family Size
1 person	19 937	20 061	23 293	20 061	23 293
2 persons	24 819	24 973	28 999	24 973	28 999
3 persons	30 512	30 701	35 651	30 701	35 651
4 persons	37 047	37 277	43 285	37 277	43 285
5 persons	42 017	42 277	49 094	42 277	49 094
6 persons	47 390	47 683	55 368	47 683	55 368
7 or more	52 761	53 087	61 644	53 087	61 644

 

 

TABLE 2

MIDDLE-INCOME THRESHOLDS, 2011 ($)

Province	ON	NS	NB	MB	BC
Family Size
1 person	42 124	36 893	32 434	35 994	40 426
2 persons	58 974	51 650	45 409	50 391	56 598
3 persons	73 215	64 269	56 349	63 110	73 528
4 persons	83 319	73 217	64 114	72 133	85 535
5 persons	91 163	80 162	70 136	79 137	94 847
6 persons	97 561	85 837	75 054	84 860	102 459
7 or more	102 980	90 634	79 216	89 696	108 896

Province	PE	SK	AB	NL	YT
Family Size
1 person	33 637	35 609	44 969	32 334	43 769
2 persons	47 092	49 852	62 957	45 269	61 277
3 persons	59 868	62 440	75 460	56 558	72 020
4 persons	68 936	71 365	84 324	65 369	79 644
5 persons	75 965	78 289	91 209	72 200	85 557
6 persons	81 711	83 952	96 828	77 785	90 396
7 or more	86 566	88 734	101 581	82 504	94 478

REGULATORY IMPACT ANALYSIS STATEMENT

(This statement is not part of the Regulations.)

1. Background

In its 2008 Budget Plan, the Government of Canada announced new investments into student financial assistance in Canada, including the creation of the Canada Student Grants Program (CSGP). Implemented in 2009, the CSGP was designed to increase access to post-secondary education by providing more effective grant funding to eligible Canadians. The CSGP currently includes grants for low- and middle-income students, part-time students, students with disabilities, and students with dependants. This regulatory amendment relates only to grants disbursed to students from low- and middle-income families.

The creation of the CSGP enhanced assistance to low- and middle-income Canadians with the introduction of the Canada Student Grant for Students from Low-Income Families (CSG-LI) and the Canada Student Grant for Students from Middle-Income Families (CSG-MI), which offer $250 and $100, respectively, in predictable, non-repayable financial assistance per month of study to qualifying students. These grants reduce student debt by replacing loan amounts (for all but those who have financial need that qualify them for the maximum loan in addition to the grant). Students from low- and middle-income families qualify for the CSG-LI and CSG-MI based on a set of defined income levels set out in the Low-Income Thresholds and the Middle-Income Thresholds, included as Tables 1 and 2, respectively, under Schedule 3 of the Canada Student Financial Assistance Regulations (CSFAR). These thresholds vary by province and territory and according to family size.

Introduced at the same time as the Canada Student Grant (CSG), the Low-Income Thresholds were derived using estimates from Statistics Canada’s Low-Income Cut-Off (LICO), which are used by programs targeting benefits or assistance to low-income Canadians. The LICO is a measure indicating the income level below which a family is likely to spend significantly more of its income on food, shelter and clothing than the average family.

The Middle-Income Thresholds, also introduced in 2009, are based on the Moderate Standard of Living (MSOL) indicators. MSOL is a threshold currently used by the Canada Student Loans Program (CSLP) to determine the point at which the student, or the student’s family, is considered to have sufficient discretionary income to make a contribution to the cost of post-secondary education.

In order to ensure that eligibility thresholds continued to reflect the financial realities of students, the 2009 Low- and Middle-Income thresholds were updated in 2011 to account for inflation.

2. Issue

Without annual adjustments to account for inflation, the real value of the income eligibility thresholds will decrease. This would result in the CSGP becoming more restrictive, as students who were eligible for this non-repayable assistance in a given year could find themselves ineligible in a subsequent year without any real change in their income. The result would be higher debt for those students who would have grant amounts replaced with a loan, or in the case of those already receiving the maximum loan, not enough assistance to cover their financial needs. Consequently, a regulatory amendment was required to adjust the Low-Income Thresholds (Table 1) and Middle-Income Thresholds (Table 2) found in Schedule 3 of the CSFAR to account for increases due to inflation since the last update in 2011.

3. Objectives

The objective of this regulatory amendment was to ensure that students targeted for these grants continue to be eligible for the non-repayable assistance they need to pursue post-secondary education, by updating the Low- and Middle-Income Thresholds used to determine eligibility for CSG-LI and CSG-MI to take into account inflation.

4. Description

This regulatory amendment has updated the Low-Income Thresholds (Table 1) and the Middle-Income Thresholds (Table 2) found in Schedule 3 of the CSFAR according to the Consumer Price Index (CPI) rate of 2.9% for 2011.

To qualify for the CSG-LI as per section 40.02 of the CSFAR, the income of the student’s family needs to be below the income threshold in Table 1 of Schedule 3 for the province or territory in which he or she resides. To qualify for the CSG-MI, the income of a student’s family will need to fall between the threshold in Table 1 and the threshold in Table 2 of Schedule 3 for the province or territory in which he or she resides.

5. Consultation

The provinces and territory that participate in the CSLP, as well as student and educational stakeholder groups, were consulted during the development and implementation of the CSGP in 2008 and 2009. At that time, they were made aware of the CSLP’s intention to update the income thresholds on an annual basis to account for inflation. Overall, these partners and stakeholder groups are supportive of the CSLP using a proxy such as CPI to keep the income thresholds up to date.

6. Rationale

Adjusting the income eligibility thresholds according to the CPI for 2011 ensures that low- and middle-income students will not be denied access to CSG-LIs and CSG-MIs as a result of out-dated income thresholds.

The number of people expected to be impacted by this regulatory amendment is estimated to be fewer than 350. This value was determined by estimating the number of people who would no longer qualify for a CSG-LI or CSG-MI under the previous thresholds if their income increased by 2.9% with a small adjustment for projected increases in enrolment.

Recipients of the CSG-MI receive $100 per month, while recipients of the CSG-LI receive $250 per month. Over a typical eight-month academic year, the incremental costs of disbursing CSG-MIs are $800 per recipient (those who would be ineligible for a grant based on the previous thresholds will receive a CSG-MI of $800 under the revised thresholds) and the incremental costs of disbursing CSG-LIs are $1,200 per student (those who would otherwise have exceeded the CSG-LI threshold and received a CSG-MI of $800 will qualify for $2,000 under the revised thresholds). A conservative estimate of the cost to government (assuming that all affected students are CSG-LI recipients) would be approximately $420,000 annually.

7. Implementation, enforcement and service standards

The participating provinces and territory as well as the federal service provider administer CSLs and CSGs on behalf of the CSLP. The provinces and territory have the capacity to update the tables used in the assessment of need for student financial assistance on an annual basis. There are not expected to be any significant challenges in terms of implementation, enforcement and service standards.

8. Contact

Atiq Rahman
Director
Operational Policy and Research
Canada Student Loans Program
Learning Branch
Human Resources and Skills Development Canada
200 Montcalm Street, Tower II, 1st Floor
Gatineau, Quebec
K1A 0J9
Telephone: 819-994-4518
Fax: 819-953-6661
Email: atiqur.rahman@hrsdc-rhdcc.gc.ca

Footnote a
S.C. 2011, c. 24, s. 155

Footnote b
S.C. 1994, c. 28

Footnote 1
SOR/95-329