While it has been the Government of Ontario’s announcement of “free tuition” for low-income students that has grabbed most of the headlines, lost in the celebration was net billing. Set to come into effect in 2018-19, net billing is something that has been hidden in the depths of this budget, yet has the potential to hugely impact recruitment, transparency, and perceptions of access for students across Ontario. We have been marvelling over the fact that the new student financial aid system is going to be transformed from a complex, hidden, and intricate network of government bureaucracy into a transparent, accountable, and easy to understand social system, however the question that hasn’t come up as often, and the one that will make the most difference, is: how will students know what they actually have to pay?

Currently when universities send out admission packages, they seemingly hide the issue of financial responsibility several pages behind the social programming, campus activities, and opportunities for residence. Tuition prices are also usually hidden behind the eye-catching table of “entrance scholarships” which try to solicit students on merit and academic achievement.

Real “financial aid” is usually a one-liner, telling students to access OSAP online themselves and figure out how much money they will be eligible for. They then have to wait to be a registered student to figure out how much money they will get from the government or their institution and in what form they will get it. Finally, when tax season comes around, about six months into their school year, they may be able to get some extra money back in the form of non-refundable tuition and education tax credits–that is, if they earned enough while in school to be paying taxes in the first place. But maybe some of those tax credits could be transferred to a spouse or parent.

Confusing? Yup.

Through the consolidation of the Ontario Tuition Grant, the Ontario Student Opportunity Grant, other various grants, and the reallocation of tax credits, the Ontario government has created the “Ontario Student Grant” (OSG). This new grant will simplify the student financial aid system and is only enhanced by the possibilities of net billing. Let’s look at a scenario:

Oliver applies for McMaster University in the Arts & Science program and records his family income on his application as $75,000. The average tuition is about $7,200. According to the proposed provincial budget, Oliver would be eligible for approximately $6,100 in grant funding from the Ontario Student Grant. Through collaboration between the provincial government and universities, there is the potential for Oliver to receive his acceptance package with a front page breakdown of all the financial assistance he would be receiving. At McMaster University, entrance scholarships exist which could also be a factor in this cost breakdown. Oliver would know just how much money his tuition would be and how much grant funding he would be receiving from the government and McMaster in order to make an educated decision about his future. In the fall, he would only be charged the difference, just over $1,100 if he does get an entrance scholarship, for his tuition bill. Oliver would then have several months to determine how we will make up the $1,100 difference; either using a government student loan, personal or family savings, or a line of credit from the bank.

This is net billing, and its benefits have the potential to go beyond decreasing financial barriers. While much of this concept is simply about letting students know how much and what kind of financial aid they are eligible for before they register for school, knowing this information when you are making acceptance decisions is a huge benefit. Ultimately, net billing will further combat the issue of sticker shock and many of the perceived barriers students currently face when planning how they will finance their education. By providing them with the full picture sooner rather than later, the government is making bold changes to student financial assistance that decrease informational and psychological barriers to access. We applaud these changes and look forward to seeing their impacts.