OSAP freeze for private career colleges to last until at least early 2027

Kaitlynn Ford, a paralegal student at Algonquin Careers Academy, says realizing that dream feels uncertain now. She says she is struggling to make ends meet following the province froze OSAP funds on Oct. 6. Photo by Tony Caldwell /POSTMEDIA

Article content

Students at Ontario private career colleges likely won’t see an Ontario Student Assistance Program transaction in their bank accounts until at least the new year as the province works to implement tighter measures for OSAP approvals in 2027. 

Article content

The province froze OSAP funds to students at all private career colleges in Ontario on Oct. 6 after announcing a province-wide investigation into a handful of fraudulent private postsecondary institutions that the government says have gravely abused its student financial assistance system.

Article content

Article content

Article content

The province had been aware of the issue since 2024, according to an online statement from the Ministry of Colleges, Universities, Research Excellence and Security.

Article content

Article content

In a recent update, the ministry says investigators have been conducting in-person inspections into eight private career colleges through the independent third-party auditor KPMG. The province has not said which private career colleges are under investigation, but has said the transgressions go “beyond the career colleges that have been inspected to date and extend to the sector as a whole.” 

Article content

The ministry revealed Oct. 20 that it was working on a new validation process for OSAP approval at private postsecondary institutions for the 2026-27 academic year.

Article content

The new process is expected to be implemented in the new year, according to the ministry, once the provincial government has passed legislation to enhance OSAP integrity and oversight of private postsecondary institutions. The new measures would include an OSAP-enrolment cap, an exclusion of predominantly online-only programs and stricter student identification and verification controls. 

Article content

Article content

The ministry says it is exploring options with external financial institutions to help facilitate third-party loans for students.

Article content

Article content

For Kaitlynn Ford, that work has not been happening fast enough. A paralegal student at Ottawa’s Algonquin Careers Academy, a private career college affected by the OSAP freeze, Ford says she has only received a generic email regarding alternative options for funding.

Article content

“The Ontario government is working on options to provide low-interest, third-party loans for students enrolled at private postsecondary institutions and is in discussions with financial institutions to facilitate these loans. More information will be made available to students when ready,” read the email Ford received from the ministry’s operations division.

Article content

In a statement to the Ottawa Citizen, press secretary Bianca Giacoboni said that, while the ministry’s initial investigations focused on a few schools, since taking action to not renew OSAP at six campuses, in recent weeks the province has seen evidence of “systemic issues.”

Article content

“At this time, we do not have assurances from the audit team that the issues are not more widespread, leaving us with no choice but to pause OSAP payments to all private institutions to protect taxpayer dollars and hold bad actors accountable,” Giacoboni said. “We understand this is creating uncertainty for students and are working quickly to develop options for low-interest, third-party loans facilitated by financial institutions to help students through this period of transition.”