While wading through the Liberal Party’s platform document I found myself thinking back to September. That’s when Stephane Dion originally announced his “education endowment” that would be worth $25-billion over 20 years.
A quick googling found the following, from an article in the London Topic:
When asked where the Liberals plan to get the money for this post-secondary investment, Dion said Canadians would have to wait until the party unveiled its election platform, but promised they would be prudent.
Yet, while thumbing through the platform I didn’t see anything in the financial information about how the endowment was going to be funded.
The London Topic reports:
In addition, Dion said a Liberal government would create an arms-length, 20-year education endowment that will reach the value of $25 billion.
“Through this fund the federal government will turn a relatively small investment – a few hundred million dollars a year – into a significant long-term investment in students,” Dion said.
All liabilities associated with this endowment plan will be matched by an asset, he explained, resulting in no increase to the federal debt.
The Liberal’s own platform – far from the financial projections - says:
A Liberal government will create a 20-year education endowment fund worth $25 billion. By creating a fund such as this, the federal government will be able to turn a relatively small investment – which would allow for the borrowing of the initial funds needed to start the endowment – into a significant, long-term investment in students. Over the next four years and in cooperation with the provinces, this fund will allow the government at full implementation to provide 200,000 needs-based bursaries of up to $3,500 per year and 100,000 access bursaries of up to $4,000 per year. Needs-based bursaries will be used to ensure that the barrier of cost will be lowered for students who need financial support to pursue their post-secondary education. Access grants will be used to provide financial assistance to help individuals who are members of groups that are traditionally under-represented in post-secondary education.
So, according to the Liberal’s own platform they plan on ‘borrowing’ the funds to start the endowment. How exactly will the Liberal’s creative accounting balance that liability with an asset? I mean, it stretches the bounds of credibility when you suggest borrowing $1-billion and having $1-billion in the bank means you don’t have an increase in debt.
Even the left-leaning Progressive Economics Forum says in its assessment of the Liberal platform:
Last but not least, they say they will borrow $25 Billion to fund post secondary education, but this will somehow be done outside the Government of Canada spending envelope and promised debt reduction.
Maybe its just me, but I instinctively check for my wallet when I hear someone mention Liberals and envelopes.
So, where is the $25 billion coming from? Why is it not included in the projections?
UPDATE: I went back over the numbers and while the Liberal platform document does show some additional funding for education it doesn’t add up. Based on the numbers of bursaries stated in the platform the cost of the program would be over $1.1-Billion by the 4th year.
- Rafael.
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