When should a student be considered independent of his or her parents for the purpose of calculating student assistance? It’s a tricky question, which generates different answers in different parts of the world.
Most student loan schemes require some kind of test of parental income for at least some of their clients. In some places, it’s a way to save money – there isn’t enough to go around, so let’s prioritize the less well-off. In other places (including Canada), it’s because there’s a recognition that education is something that families (not just the student) pay for, and so family incomes need to be taken into account.
Not everyone goes along with this logic. In some parts of Europe – Scandinavia in particular – the age of independence is 18. Everybody, regardless of their family income, is considered equally wealthy (or equally poor, depending on how you look at it), and therefore automatically has access to grants and a fairly generous set of loans (about 85% of Swedish students opt to take the loan). This approach makes more sense from an equity point of view in Scandinavia than it does here, because of smaller disparities in family income, but that’s not really why they do it. Rather, the policy fairly explicitly is about making young people independent of their parents by giving them financial aid. Which, to put it mildly, isn’t a goal most Canadians associate with student aid.
The question for most countries with respect to independence is when to end it. In Australia, it’s essentially when you turn 25. In the US, you’re independent if you’re 24 or over, if you’re a graduate student, if you’re a veteran (or are on active duty in the reserves or national guard), if you’ve ever been in foster care, or if you have children. Quebec has no age limit, per se: if you’ve ever been married, ever spent two years in the labour force without going to school, or have finished 90 university-level credits (which effectively means “in graduate school”), or are seven years out from finishing your last period in full-time studies you’re considered independent.
The rest of Canada has a threefold test – like Quebec, it has the 24-month labour market test and the married test, but otherwise, the requirement to become independent is simply to be more than 4 years out of secondary school. In practice that means independence at 22, which is pretty much the lowest age for any country that makes the dependence/independence distinction.
Why does Canada have such convoluted rules that don’t invoke a specific age? Basically, it’s the quality provisions (i.e. section 15) of the Charter, which says you can’t discriminate by (among other things) age, unless you have a really good reason to do so. Now, in the Gosselin decision, the Supreme Court held 5-4 that governments could in fact explicitly discriminate on age in social programs (the case involved a Quebec policy that provided lower welfare rates to people under 30). But the student aid rules date from before Gosselin, and have never been subsequently re-written or simplified. And, near as I can tell, Justice Department lawyers aren’t convinced that the existing rules would pass muster, even post Gosselin.
Hence the ludicrous rules on the Canada Student Grant, which basically guarantee a $2,000 grant to anyone with “family income” of under (roughly) $40,000, but where “family” for independent students basically consists of the student’s own income. In practice, this means the CSG is a universal grant for independent students. Which is nuts – and also a major reason why CSL program expenditures are rising so quickly.
If we were a little tougher on independent undergraduate students (many of whose parents are relatively well-off), we could probably spend more money on deserving, poorer undergraduates. It’s a trade-off we should think about making.