Ontario pauses OSAP to all private schools amid audit, leaving students scrambling

TORONTO — Ontario has paused all Ontario Student Assistance Program payments to private post-secondary institutions while an audit investigates potential misuse of the financial aid program.

Colleges and Universities Minister Nolan Quinn announced last week that the province had tasked KPMG with auditing OSAP usage at career colleges, and that preliminary findings were of such concern that he referred the matter to the Ontario Provincial Police.

While the audit is ongoing, Quinn said, OSAP payments to private post-secondary institutions would be paused.

READ MORE: Ontario inspectors allege third parties completed coursework at career colleges

READ MORE: Ontario to mandate standardized truck driver training following critical auditor report

"I'm heartbroken," said Alessia Di Palma, a student in her final year of a joint teacher training program at Canada's National Ballet School and York University. "My heart sunk when I found out because it's unfair that I've had this funding for four years and then the fifth year it's just gone now because of something that didn't even have anything to do with me."

Quinn said he is "working on" securing low-interest loans for affected students at financial institutions, but he has not indicated a timeline.

Initial concerns stemmed from activity at a few schools, Quinn's office says, but evidence of "systemic issues" has come up in recent weeks.

"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," spokesperson Bianca Giacoboni wrote in a statement.

The broad pause affects all private post-secondary institutions, including private universities, chiropractic and naturopathic medicine colleges, and performing arts schools.

At the ballet school, about half of the students in its post-secondary teacher training program rely on OSAP to pay their tuition, said executive director John Dalrymple.

"The fact that now all of these students who are working multiple jobs to make ends meet, who are at the very beginning of their career, are now left holding the bag to figure out how to finance something that the government had already assured them they qualified for and they were going to receive, I think is unconscionable," he said.

Schools fear financial ruin

Theological schools like McMaster Divinity College are also affected. About 10 per cent of the non-profit institution's revenue is dependent on OSAP-paid tuition, said registrar Ambrose Thomson.

"The impression I get is that the government knows full well what the impacts are," he said. "They're not stupid. All I can assume is that at the highest levels where these decisions were made, they're actually willing to allow career colleges and other schools to shut their doors."

Data obtained by The Canadian Press through a freedom-of-information request showed large increases in OSAP usage at a relatively small number of career colleges from 2020-21 to 2024-25.

The seven career colleges that had the highest OSAP usage in 2024-25 received $385 million in provincial grants, the same amount that went to students at all of Ontario's publicly funded colleges that year.

Career Colleges Ontario has raised concerns since 2023 about what it calls potentially "suspicious activity" with OSAP usage at a few schools.

Deanna Hutten, a second-year master's student in McMaster Divinity College's counselling and spiritual care program, is borrowing money from family and working 10 more hours per week at her marketing job.

"They had known about this since 2023 that there were people kind of (allegedly) fudging the system, and now we as private career, not even career colleges, but private institutions, are kind of being swept into that field or that group of people, even though we're not a part of that," said Hutten, a single mother.

At the Toronto Film School, there is also "tremendous uncertainty and anxiety" for many students, said president Andrew Barnsley.

"The OSAP pause is deeply disappointing, and our greatest concern is the impact on our students who made significant commitments to their education with the reasonable expectation that financial assistance would be available," he wrote in a statement.

The government says it is working quickly to develop options for low-interest, third-party loans to help students through the transition.

Nosy Mag reported in October that the Ontario Liberals have accused the Ford government of having ties to career colleges barred from OSAP.

With files from The Canadian Press, The Globe and Mail and CityNews