Ontario Students Face Debt Crunch as OSAP Grants Slashed

Ontario Students Face Debt Crunch as OSAP Grants Slashed

TORONTO — Ontario post-secondary students are heading into the new academic year with significant financial uncertainty after the provincial government sharply reduced non-repayable student grants and lifted a seven-year tuition freeze. The changes, which took effect Aug. 1, mean many students will now receive the majority of their Ontario Student Assistance Program (OSAP) funding as loans rather than grants, forcing some to take on extra work hours or reconsider their education plans.

The Changes

The Ford government announced earlier this year that it would overhaul OSAP, citing what it called "unsustainable" costs in the provincial budget. As of Aug. 1, the proportion of non-repayable grants a student can receive through OSAP has been reduced from 85 per cent to a maximum of 25 per cent, with the remaining 75 per cent now issued as loans. The province has also lifted the seven-year tuition fee freeze, allowing colleges and universities to raise tuition by up to two per cent per year for the next three years.

For students like Aidan Jeffers, an incoming master's student in library and information science at the University of Toronto, the changes represent a dramatic shift in how they will finance their education. Jeffers, who relied on OSAP throughout his undergraduate studies, said he will receive approximately $19,500 in OSAP funding this year, of which $12,000 will go directly toward tuition. With 85 per cent of that funding now in the form of loans, he said he is "incurring a vast amount more debt" than he did during his undergraduate years.

Students Feel the Pinch

Jeffers said he has been working two jobs over the summer to prepare for the financial strain, and plans to work 25 to 30 hours per week during the school year. "I might have to go to the food bank a couple of times," he said. "I'll be working during my master's instead of completely locking in." He acknowledged that he is "one of the lucky ones" because he had time to adjust his budget before starting his programme, but noted that peers who are mid-way through their studies face a more difficult transition. Some of his classmates, he said, have decided not to pursue graduate studies at all due to the debt they would incur.

Ishan Bijukuchhay, a computer engineering student at Queen's University in Kingston, said his OSAP funding has shifted dramatically. In his first year, his funding was 60 per cent grants and 40 per cent loans. "Now it's more like 85 per cent loans and 15 per cent grants," he said. "I wasn't anticipating this much of a switch." Bijukuchhay said his overall OSAP funding has also dropped by about $3,000. He has worked as a lifeguard to help cover expenses and recently learned he automatically qualified for Queen's work-study programme, which will help offset the grant cuts. He has also received bursaries from the university, but said the tuition increase means he will continue to rely on both OSAP and the school's financial services.

A Government's Case

The Ontario government maintains the changes were necessary to keep the province's finances in order. Bianca Giacoboni, a spokesperson for Colleges and Universities Minister Nolan Quinn, said in a statement that OSAP costs ballooned to $2.7 billion in the 2025-26 fiscal year. "If our government did not make these changes, OSAP would have cost $4.1 billion by 2028-29," Giacoboni wrote. Data previously obtained by The Canadian Press through a freedom-of-information request shows that between the 2023-24 and 2024-25 academic years, the province spent $465 million more on OSAP grants.

The government has framed the changes as a measure to ensure the programme's long-term sustainability, arguing that unchecked growth in grant spending would crowd out other priorities. Student advocates, however, have pointed to survey data showing how heavily students depend on the grants that are being scaled back.

Canadian Context

The OSAP changes come at a time when post-secondary affordability is already a pressing concern across Canada. Student debt levels have been rising for years, and the cost of tuition, housing, and everyday expenses continues to climb. In Ontario, the cost of living — particularly in cities like Toronto and Kingston — has put additional pressure on students who must balance academics with part-time work to make ends meet.

Rory Norris, president of the Ontario Undergraduate Student Alliance and a recent University of Waterloo graduate, said it is difficult to measure the full impact of the changes this year, since many students are only now discovering what their OSAP funding will look like. Norris noted that many students rely on the online OSAP calculator to plan their finances in advance, but the tool was only recently updated to reflect the funding changes. He said surveys conducted by the student alliance over the years have consistently shown how much Ontario students depend on OSAP. "When it comes to what students rely on to support themselves in post-secondary, (OSAP) is the highest ranked out of anything, even ahead of part-time jobs and family," he said. "Even before the changes took place, over 80 per cent of students said OSAP was their highest form of financial aid."

Impact on Students and Families

The shift from grants to loans will have a direct impact on the debt loads students carry after graduation. For many, the change means they will graduate with significantly more debt than they would have under the previous system. This comes at a time when young Canadians are already facing challenges related to housing affordability, the cost of living, and a competitive job market.

For families, the changes may mean re-evaluating how they support their children through post-secondary education. Some students may need to take on more part-time work, which can affect their academic performance and overall well-being. Others may need to rely on food banks or other community supports to get by, as Jeffers suggested he might. The tuition increase, while capped at two per cent per year, will compound over the next three years, adding to the financial burden for students and their families.

Bijukuchhay said that beyond tuition, there are other costs to consider. "There's rent, there's fees, there's supplies," he said. He plans to continue seeking assistance to afford what he called "the traditional university experience," including events like his engineering discipline banquet and the science formal. The added financial pressure, he said, is something he will have to manage carefully throughout his remaining years at Queen's.

What Happens Next

As the academic year gets underway, students and advocates will be watching closely to see how the changes play out in practice. The OSAP calculator has been updated, but many students are still adjusting their budgets and figuring out how to make ends meet. Norris said it remains difficult to measure the full impact because students are only now learning what their funding packages will look like, and he noted that OSAP has consistently ranked as the highest form of financial support for Ontario students in the alliance's surveys.

For now, students like Jeffers are doing what they can to adapt. He said he has calculated his costs and knows exactly how much debt he will incur, but the stress remains. "It's still very stressful," he said. "But for people who are in the middle of their master's or their undergrad, it's definitely a big change." The coming months will reveal whether the government's cost-saving measures achieve their intended goal — or whether they simply shift the financial burden onto the next generation of Ontario students.

Tags: OSAP, Ontario Student Assistance Program, tuition increase, Doug Ford, Nolan Quinn, student debt, University of Toronto, Queen's University, University of Waterloo, Ontario Undergraduate Student Alliance, post-secondary education, student grants

This article was produced with AI-assisted research and editorial support. Sources: Global News, The Canadian Press.

By Alex Thompson, Staff Writer