Ontario Unfreezes Tuition & Cuts OSAP Grants: What Grant Seekers Need To Know

Tuition Rising, Grants Shrinking

The Ontario government has announced a sweeping overhaul of higher education funding: after a seven-year freeze, tuition fees at public colleges and universities can rise by up to 2% annually starting in fall 2026. Alongside, the Ontario Student Assistance Program (OSAP) will shift away from grants to mostly loans, meaning future students will graduate with substantially more debt.

For students and institutions accustomed to stable tuition and substantial grants, the landscape just changed overnight. If you’re planning or managing post-secondary financing—whether for yourself, your family, or your institution—it's time to take stock.

Why Ontario Changed the Rules

Ontario’s seven-year tuition freeze (in place since 2019) had been a bulwark for affordability, but colleges and universities warned it left them vulnerable financially—especially after the federal government imposed a cap on international student admissions, costing campuses an estimated $2 billion in annual revenue.[1]

To avert a sector funding crisis, the Ford government is injecting $6.4 billion in new core funding over four years (a 30% increase), including a 6% per-student base funding bump. But with institutions under strain (600 programs cut, 8,000 staff layoffs in recent years), the government is also letting tuition rise again: up to 2% a year for three years, then capped at 2% or inflation average.[2]

However, the biggest impact for individuals comes from overhauling OSAP. Where currently 85% of aid comes as grants, from fall 2026 only a maximum of 25% will be grants, the rest loans. It’s a profound shift, reflecting both budgetary pressures and a bid to stabilize institutional finances.

While some education leaders hailed the funding boost as "substantial," student and faculty groups warn that Ontario still lags in per-student funding and will soon have much higher tuition and higher student debt than much of Canada.

How This Affects Students and Institutions

For Students and Families

• Expect Higher Tuition: If tuition is currently $7,000/year, a 2% increase adds about $140 in year one. Over four years, expect several hundred dollars in added costs, not counting inflation.
• OSAP Grants Shrink: Instead of most OSAP aid coming as grants (non-repayable), by fall 2026 students will get no more than 25% of their OSAP as grants. The rest will be loans—translating directly into higher student debt at graduation.
• Private College Students Lose Out: Those attending private career colleges will only be eligible for loans, with no OSAP grants at all—raising the real costs of vocational programs.

For Postsecondary Institutions

• Short-Term Relief, Long-Term Challenges: The $6.4 billion injection plus tuition flexibility eases immediate financial pressure and helps restore some stability. Still, faculty groups maintain that funding per student is still below the national average.
• Strategic Planning Shifts: Universities and colleges will need to revise their tuition and financial aid policies, prepare for further changes in enrollment patterns (especially among low- and moderate-income students), and possibly increase their own access bursaries under the government’s "Student Access Guarantee" negotiations.

For Grant Writers and Nonprofits

• More Competition for Local Grants: As government aid shifts to loans, more students will turn to external scholarships, bursaries, and emergency funds. Nonprofits and community organizations may see increased demand—and should prepare to communicate the value and urgency of their awards.

What You Should Do Now

If You’re a Student or Family:

• Update Financial Projections: Assume higher tuition (+2%/yr) and a grant-to-loan ratio of 1:3 for OSAP by 2026. Revisit your savings targets, especially Registered Education Savings Plans (RESPs). Try to maximize Canada Education Savings Grant (CESG) matches.
• Apply for External Funding: Expect OSAP to cover less—apply early and often to scholarships, bursaries, and community grants to reduce your loan burden.
• Keep Records Current: Accurate, up-to-date information on income and taxation maximizes OSAP eligibility and prevents administrative delays.

If You’re an Institution or Nonprofit:

• Review Internal Aid Policies: Prepare to see more students with higher debt loads and greater demonstrated need. Adjust your bursary and student assistance plans as needed.
• Increase Grant Application Support: Expect demand for grant-writing and application workshops to rise. Consider expanding resources or staff in these areas.

What to Watch Next

Monitor further details as the province and institutions negotiate the Student Access Guarantee—and as new OSAP eligibility guidance becomes available for 2026 and beyond. Watch also for potential program changes in response to stakeholder advocacy, and for shifts in student demographics as cost barriers increase. Advocacy from student and faculty groups could affect implementation details before Sept 2026.

For more info, see Ontario Government's official announcement.

Need help interpreting funding news, finding scholarships, or preparing competitive grant applications? Granted AI is here to support your journey—every step of the way.