Dominating the media play on higher education this week was a paper on Aboriginal Post-Secondary Education by Aboriginal entrepreneur Calvin Helin and University of Calgary graduate student Dave Snow and published by the brand new Macdonald Laurier Institute.  The paper has been garnering a good deal of attention and praise in the media because of the radical but elegantly simple re-engineering it proposes to Canada's system of funding First Nations' post-secondary education. 

There are many things to like about this paper, but there are some serious problems with it, too.  Not only does it sweep under the carpet some major costs to government but, if its proposals are implemented, it would also result in substantial reductions in aid available to female students, in particular, as many are also caring for kids while studying.

To recap the situation: Since the early 1970s, Indian and Northern Affairs Canada (INAC) has funded the Post-Secondary Student Support Program (PSSSP) as a means to help First Nations students attend college and university.  The PSSSP does not involve governments assessing individual aid applications, as is the case with student aid programs.  Rather, the money is handed out as a block grant to individual First Nations, who go on to distribute the money themselves.  How they do this is not terribly well documented, though it is in theory subject to a (fairly sparse) set of guidelines issued by INAC.  In practice, the way they ration limited funds is to give very large sums of money to a few students (the average grant under PSSSP is around $13,000) and put others on a waiting list. 

Who exactly gets the PSSSP money is the subject of some debate - it is frequently suggested (not least by Helin and Snow) that these decisions are heavily influenced by band politics, favouritism and nepotism.  These claims crop up too frequently to be dismissed entirely, but it's worth pointing out how thin the evidence for these claims is.  Perhaps it's simply a matter of no one having gone out and played Goldhawk on this issue, but hard evidence of this phenomenon is severely lacking.  Does it happen in some First Nations communities? Almost certainly.  Is it anywhere near universal, as Helin and Snow seem to imply?  If it is, it is striking how few demonstrated instances of it have been brought to light.

The aim of the Helin-Snow proposal is to take money for native  students out of the hands of First Nations administrators entirely.  Their solution is what they call an Aboriginal Post-Secondary Savings Account - which is not really all that different from a Canadian Learning Bond on steroids.  Status Indians would see $4,000 put into an account for them at birth; once they reach Grade 6, another $3,000 would be added for every year of secondary school successfully completed.  That means by the time graduation comes around, a student would have received $25,000 in deposits to the account, plus whatever interest is accrued on the investment.  

We're on the side of the angels up to this point.  Where the trouble starts is when one starts thinking about the implementation.  How would the money be distributed?  Institutions would get their cut first for tuition, but then money would be disbursed on a monthly or semesterly basis in a special account with controls to make sure students don't spend their accounts all at once.  Who exactly is supposed to set those up and police them - and I can guarantee that institutions won't want the job - is a question left unanswered.

Then there's the a huge balloon of a transition cost associated with this project, which the authors mention but prefer not to dwell upon, preferring instead to talk about how annual expenditures would be in the $300-million range, or similar to those of the current program.  That's true, but the way they plan to transition from one scheme to another essentially means doubling outlays for a number of years - and assuming everyone takes up the new system, that double-payment would, over the course of a decade, end up being close to $2-billion over and above what Ottawa already spends.  

Except it wouldn't be, not quite.  If a student does go to school, they would get $25,000.  If they don't within a reasonable time frame, then the money would go back to government.  Since a substantial proportion of native students don't go to PSE (and wouldn't even with these accounts because the primary barriers to success for First Nations students are deeper than mere money), one could easily imagine between 40% and 50% of the fund's annual expenditures going back to government over the medium term.  Unless you increase the initial endowment amounts, this plan actually means a reduction in government spending on Aboriginal education of something on the order of $125- to $150-million per year.  Not good.

And even then, the benefits of "giving students control and choice" aren't necessarily all they are touted to be:  $25,000 may sound like a lot, but once tuition fees and living expenses are taken into account, eight months at university is going to run you about $15,000 if you're single and independent, which a very large fraction of First Nations students are not.  Add in a kid or two (which is very common among First Nations students) and you're quickly over $20,000 per year.  This is why average student costs under PSSSP are in the $13,000 range.  In other words, the new plan would likely only cover about two years worth of costs - less if the student had children. 

In other words, for anyone planning on taking more than two years of PSE study, the Helin-Snow plan would mean a reduction in subsidies - and possibly quite substantial ones at that.  Whatever the benefits of bypassing band councils to get money to students, this is a pretty serious drawback if the purpose of the plan is to improve First Nations' attainment rates.

If First Nations students were all identical, and all went to PSE directly out of high school the way they do in upper-middle class neighbourhoods, this proposal might make sense.  But they aren't and they don't.  Some are young, but many go to school as mature students and many have children to support.  They attend schools for very different lengths of time.  Assuming that a $25,000 lump-sum payment will work for everyone is bananas.  For some it will be sufficient; for others it will be grossly inadequate. 

Though the authors may wave away the idea of need assessment systems, they are nevertheless crucial to ensure that the right people get the money they need for the education they deserve.  Of course, they should be free of band-level politics, but there are several possible options for doing this which do not involve throwing out the baby with the bathwater.

The Helin-Snow paper is a useful one insofar as it raises some interesting questions and applies some interesting principles to an old problem.  But it's shockingly casual about the financial impacts and distributional effects such a radical change would entail.    Media commentators may have embraced the paper because of its elegant simplicity, but a closer look at the details reveals some serious flaws.  As a conversation-starter, it's all right; as a blueprint for an actual education policy, it's a disaster.