Part 2 - The ideological choice of the government is for increased tuition fees

This is Part 2 of the CLASSE negotiating committee`s report on the break-down in talks with the Quebec government. Check out Part 1 of this report to see the earlier description of the participants in the negotiation, the first days, as well as links to the French-language original. Please note that this document has been edited and with some explanatory notes. The headings and translation are by RY magazine with special thanks to Roxanne Bélanger.

Back to the table, back to tax-talk

Wednesday at 3h30 pm we go back in our beige room with the government. Michelle [Courchesne, Minister of Education] tells us again that an increase of $0.00 is impossible. Instead, there is a proposal for a kind of tuition hike freeze. This means keeping the 2007 hike, with a further increase of $100.00 per year.

CLASSE states that we didn`t agree with this increase back in 2007 and our position hasn't changed.  [The Minister of Education] also refuses to make any changes to the IQEE (Incitatif Québécois d'Épargne-Études or in English, Québec education savings incentive]



Note -- The Québec Education Savings Incentive (QESI) is a tax credit for parents of children under 18 who live in Quebec and have an Registered Education Savings Plan or RESP. The QESI was introduced in February 2007. The tax credit is paid directly into an RESP by Revenu Quebec. The rate varies according to your family income. However, not all working families can ``invest`` in these funds (and the unemployment rate for Quebec is higher than the Canadian average; it is officially just over 7 per cent for Canada, 8 per cent for Quebec and over 9 per cent for Montreal).

In the end, [Courchesne] proposes an increase of $100 for the first year and $254 for the second year, and then the hike resumes as originally planned. In-between these two increases, maybe the forum [an Estates General on education, described in Part 1] could help change the situation. 

The FEUQ asks what's the problem with making modifications to the IQEE, and the minister responds that the government wants to promote personal savings. At this point as the CLASSE we have to point out that Michelle Courchesne herself built this particular program. She also claims she is very reluctant to meddle with families money and points out that this is a very touchy subject.

'The government are thieves' -- FEUQ

We then have a presentation from Ministry of Finance's Pierre Côté about tax breaks and the IQEE. This presentation is inconclusive / lackluster [original -- trop peu concluante] to say the least, as Mr. Côté is unable to answer many of our questions and proposals.

This inability to provide satisfactory answers to our inquiries infuriates the students. Yanick Grégoire [Executive Vice President of the university student`s federation] looses his temper for the first time; he accuses the government of being thieves since the estimates showed a $10 million dollars payed by the student has disappeared for no reason. After this little feud, a pause is welcomed.

More number juggling

We come back after diner, at about 8pm. During the pause we exposed the situation to the media: the government's hardline stance is back in full force [at the bargaining table] and the negotiations are have hit a wall.

We then come back to hear more estimates from Pierre Côté. [He says] we have to consider the increase of universtity students over the coming years: a increase from 209,000 students to 220,000. This means that an increase in grants and loans announced on April 24th; the total cost reaching $23 million dollars. The additional money recovered from lowering the student tax breaks from 20% to 13.5% is $34.5 million dollars.

View the original table in French.

The parent`s contribution will be changed from $28,000 to $45,000 a year, thus negating any impact that the change might have caused.

Frustrated, the FEUQ asks for the source of this data in order to make offers of their own. Minister Courchesne, also angry, says that the Ministry of Finances can't come up with the charts. Mr. Côté explains that the data is a gathering of informations from three differents ministries: the MELS [Ministry of Education, Recreation and Sport], the Finance Ministry and data from the [provisional] financing plan. He made his estimates based on this data.

Explanation

[Pierre Côté explains that] the total cost of the measure included in the tax break is $140 million. [However] this includes the financial costs from the present year and also of the two preceding years. Thus, the tax break is not worth $140 million / 20% because we have to consider this gap of the present year.

[The gap] amounts to $154 per student which leads to a reduction of the tuition fee hikes to $100. The estimate includes the 1% tax break along with an increase of 100$ for the year 2012-2013 is 7M$ (in case of a tuition freeze, this would be 11M$)

The government informs us that after the 2012-2013 time frame, where there will be a tuition fee increase of 100$, the 3% of tax breaks that where used to pay for the $154 making up the difference will be brought back, thus making the rate increase to 16.5%.

But you could do a freeze...

The FECQ asks what would be the government's reaction if we decrease the tax break another 3%, in order to create additional income that would be used to finance a tuition freeze not costing a single penny to the state. Then we can move on to the second year.

The governement informs us that they are unwilling to budge the least bit about the second year increase. This was apparently hotly debated among government members.

The government says that they must maintain their position about the fees continuing to increase after the forum [an Estates General on education]: the first year will see a $100 tuition hike, [but] a forum could change everything. The planned increase goes on as previously decided... unless the forum was able to convince them of doing otherwise. Then it seems like the future of tuition fee increases will be discussed during this forum.

We`d rather mobilize than waste more time here

The CLASSE doesn't believe that a single year is enough, and argues that if this is all there is to the negotiations [that the government is willing to discuss at the bargaining table] they'd rather withdraw and prepare a plan of action around the Formula One Grand Prix (the government didn't like this threat and reminded the students about the economic consequences this would entail, pointing out that the Grand Prix creates many jobs).

We state that we are fed up. Even the most conservative members of the FEUQ will remain on strike facing such a weak offer, they won't stand for such little gain after being on the front lines for 16 weeks. The government then offers to extend the offer to include the second year, asking if that would be enough for us.

Of course it is not. The CLASSE has always maintained that the 2007 hike was unjust, and won't stand for any further increase. The FEUQ says that a hike along with a lowering of tax breaks is unnaceptable, and that will be the case for a second year too. We suggest that working on the financing plan could lead to a compromise.

A deal or a poison pill?

The government says that they've gone from 325$ to 100$ and that is a big step back for them. The FECQ reminds them that the university would get the same amount and that it would be payed by the students and not the governement or tax payers.

We explain that it would be hard for us to convince our membership to give away their tax breaks, not to mention accepting a tuition hike on top of that. The government thought they could convince us of accepting a reduction of $154 of a total of $1778? That means a total increase of $1624, a single dollar less than the original $1625 increase...

Talk until midnight

We come back from a pause, at 11pm. The FEUQ bring a new offer to the negotiation, a reworking of the tax break decrease. The first year they would be set at $12.5 in order to negate the whole increase in tuition fees. The second year would see the tax break fall to 7.5% so that there is no hike at all for the first two years without the government spending a single dollar.

The Minister tries to see how she could possibly spin this in the media, since she believes a lot of citizens want to see the students pay more for their education. She also can't see how she could explain the planned forum on university financing to the population. But we think this is simple; a public forum lasting two years, during which there is no tuition fee increase since we have to think of other ways to finance universities.

[The CLASSE has insisted that] the forum must last for two years in order so that the population can voice it's opinion, and also that the the whole process be taken into account in the following year's budget. The Ministry [spokespeople] really wants to go home and think about it some more. We  prolong the negotiation until midnight and then everybody leaves in order to prepare for tomorrow.

We have to point out that Michelle Courchesne seemed to be really enthusiastic about the forum, even though she only briefly looked at the document [with the proposal]. It seems like we're spinning our wheels here, [and we agree to] see what tomorrow brings.

Gov. breaks negos

At about 12h30 am we are back...  only to learn that the government is backing off and is breaking negotiations!

Courchesne explains that the discussion allowed [the two groups] to close the gap a little, mentionning the idea of giving away tax breaks in exchange of a reduction of tuition hikes, even thought a freeze is still out of the question. The government can't back down.

They [also] say they are happy that we discussed principles before numbers. They admit that they are ideologically committed [original -- principe immuable] to raising tuition costs even after we made clear that we would not take anything less than a 2 years freeze, and then some.

So, unfortunately, the government declares the situation to be a dead-end. About the IQEE, they say the federal money was granted with the promise of creating a savings program for individuals. They want to encourage families to save up more money.

Things go awry...

Things go awry / the tone escalates. The minister says [again] that the government will never close the door to further negociations, but that for now we've reached a dead-end. There is now further offer.

We are also adamant about the 2 year freeze, and they can't accept that either. Any similar offer will be rejected by the government. They don't want to concede more that the proposed $100 increase for the first year, then the planned $254 hike for the remaining years. We point out [again] that the increase went from $1625 to $1778, only to come back at $1624.

We debate fiercely about the financing of higher education institutions.

For the whole time, on Thursday, we of the CLASSE didn't say a single word. For us, the 2 years freeze wasn't the best position to fight from but was still better than nothing. So seeing the minister say she could not agree on a freeze for such a short time meant the end of negociations. To see the FEUQ and FECQ stand for the same offer made our position so much stronger.