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The St. George campus of the University of Toronto in November, 2025.Wa Lone/Reuters
The Ontario government will lift its freeze on domestic tuition fees at publicly funded universities and colleges and boost postsecondary funding by more than $6-billion over four years, in an effort to put the sector on a sustainable footing and address growing financial strain at some institutions.
It is also introducing a major shift in the Ontario Student Assistance Program, to deliver a greater proportion of student aid in the form of loans rather than non-repayable grants.
Nolan Quinn, the Minister of Colleges, Universities, Research Excellence and Security, made the announcement Thursday at Queen’s Park alongside Finance Minister Peter Bethlenfalvy.
“Ontario’s postsecondary sector is facing unprecedented pressures that impact the system’s ability to deliver high quality education and build Ontario’s talent pipeline,” Mr. Quinn said.
“That’s why we are taking decisive action now in order to ensure Ontario’s postsecondary sector is preparing students for in-demand jobs that address labour market needs and that it remains successful for future generations.”
Institutions will be allowed to raise tuition prices for domestic students by up to 2 per cent a year for the next three years. Ontario universities and colleges have been calling on the province to lift the tuition freeze for several years, in line with a recommendation from a government-commissioned panel on postsecondary financial sustainability in 2023.
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The province also says it will boost operating funding for universities, colleges and Indigenous institutes, raising its spending to $7-billion annually, after accounting for the increase. The new money is expected to fund additional seats in programs that have high levels of student demand.
The OSAP program, which provides funding to students in the forms of loans and grants, will be more heavily weighted to loans. A maximum of 25 per cent of a student’s funding will come in the form of grants, according to the government’s new plan, much lower than is currently the case. Students at private career colleges will no longer be eligible for OSAP.
The government said the changes will make OSAP more sustainable in the long term.
Universities and colleges have been under increasing financial pressure in recent years as a result of both federal and provincial policy changes.
In 2024, the federal government announced it would cut the number of international study permits issued to relieve pressure on the housing sector. But the loss of international students, who pay much higher tuition rates, had a significant impact on university and college finances. At the university level, it has meant about $1-billion in lost revenue in Ontario over the past two years, according to the Council of Ontario Universities.
In the province’s college sector, which was even harder hit, there have been more than 8,000 job losses and more than 600 program suspensions since the shift in federal policy was announced.
Mr. Quinn blamed the federal government’s changes to international student policy for launching the postsecondary sector into “unprecedented instability” two years ago.
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The provincial government’s 2019 decision to cut domestic tuition fees by 10 per cent and then freeze them has also had a major effect on the financial health of institutions.
Ontario’s universities said in their prebudget submission to the government that they have made more than $1.25-billion in cuts in recent years as they tried to streamline operations. Nevertheless, they still face deficits that, combined, are projected at $265-million in 2025-26.
The policy changes contain echoes of the government-commissioned blue-ribbon panel report on postsecondary financial sustainability that former university administrator Alan Harrison led in 2023.
At the time, the report recommended lifting the tuition freeze and allowing fees to rise by 5 per cent in the first year followed by increases of 2 per cent or the rate of inflation thereafter.
The changes were well received by the postsecondary sector but criticized by opposition parties.
Steve Orsini, president of the Council of Ontario Universities, called the government announcement a “landmark.”
“This is a bold, substantial investment in higher education,” Mr. Orsini said.
Colleges Ontario president Maureen Adamson said the increase in government funding is a “game changer” for the province’s economic future.
“Skilled workers are needed more than ever, and this funding expands regional opportunities for learners and employers alike.”
Both Mr. Orsini and Ms. Adamson, who attended the press conference alongside the ministers, said they will work with the government to ensure students in the greatest need still have access to assistance. University of Toronto president Melanie Woodin, in a statement, also praised the announcement, and said the university will increase its investment in student financial assistance in the years ahead.
Kayla Weiler, a spokesperson for the Ontario branch of the Canadian Federation of Students, said many students will be pleased to see the increase in government support for postsecondary schools, but they’ll be disappointed by an increase in tuition fees and a reduction in the grant portion of OSAP.
“There’s never a time where a student wants to pay more in tuition fees, especially with the high cost of living,” Ms. Weiler said. “The change to OSAP is ultimately going to lead students into more student debt.”
Interim Liberal leader John Fraser, however, accused the government of starving the sector for years and said that more should be done to ensure its long-term financial stability.
“I’m sick and tired of these dog and pony shows where we talk about historical and generational, and let’s get real. We all know it’s not enough,” he told reporters after the announcement.
The Ontario NDP also criticized the tuition hike, saying young people are already struggling to afford rent, food and basic living costs.
