Children's Education Fund

Introduction

People are the most important resource in the modern economy. To meet its economic goals, British Columbia will have to train, attract, and retain workers. There will be challenges in meeting the economy's need for well trained employees.

There are 550,000 young people in the K–12 public school system today. Over the next 12 years, the provincial economy is expected to create one million new job openings — a shortfall of 450,000 workers.

The province is taking a multi-pronged approach to addressing this potential shortfall:

• The province is working to close the gaps in education and economic opportunity to help aboriginal youth fully participate in the economy.
• The new provincial training tax credit includes additional benefits for First Nations people and for persons with disabilities to recognize the unique challenges facing these groups.
• As announced, the province is moving to eliminate mandatory retirement to recognize the valuable contribution that older employees can make if they wish to continue working.
• The government reconfirms its commitment to create, in partnership with the post-secondary sector, 25,000 new student spaces incorporating the commitment to create 2,500 new graduate spaces.
• The government will establish a new Pacific Leader's Fellowship for graduate studies. The Fellowship will be available for graduate students in British Columbia institutions and the province's public service.
• A total of 7,000 new apprenticeship spaces will be added by 2010.

Finally to help the province's young people meet their post-secondary skills development needs and learning in the future, beginning in 2007, $1,000 will be invested for each new child born or adopted in British Columbia.

The BC Children's Education Fund will help British Columbia families and children.

Description

• A special account called the Children's Education Fund will be established under the Special Accounts Appropriation and Control Act to hold the funds for the program.
• The legislation will also provide the regulatory authority to determine eligibility and to define qualifying educational institutions.
• Each year, commencing April 1, 2007, the government will transfer to the Fund an amount based on an estimate of the total number of potential new beneficiaries (roughly $40 million annually). For simplicity, the amount transferred will be based on the number of children born plus the number of children adopted in British Columbia in the year.
• Over time, the Fund will grow with new contributions to the fund and with the net investment earnings of the Fund.
• The Fund's investments will be managed by BC Investment Management Corporation (bcIMC).
• Eligible students entering a British Columbia post-secondary institution will apply to receive their grant (estimated to be around $2,200 based on current investment returns).

Eligibility Criteria

• The grant will be available to any child born on or after January 1, 2007 to parents that are ordinarily resident in British Columbia. In most situations this will apply to children born in the province. However, it will also include children born outside British Columbia to parents who ordinarily reside in the province, such as Canadian forces personnel on assignment or mothers who travel to other provinces for specialized medical care.
• In addition, children born on or after January 1, 2007 and adopted by residents of British Columbia will also be eligible.
• Eligible beneficiaries will simply be able to apply for the benefit at the time they enter a qualifying post-secondary institution as long as they are 26 or younger. There will be no need to register and keep track of each child upon birth or adoption.
• Qualifying educational institutions will include a wide range of BC-based institutions providing academic, trades or other vocational training.
• The benefit will be available to contribute towards the cost of tuition or other related educational expenses such as books and living expenses.
• The program has been designed to ensure that all eligible children will benefit from the Fund if they attend a post-secondary institution in the province.

Reporting

• The annual contributions will be investments and as such will not be reported as expenses. The contributions to the special account will be disclosed separately.
• The investment income earned by the fund will be reported as revenue in the financial statements of the province in the year it is earned.
• All payments to recipients, made when eligibility criteria are met, will be recorded as expenses in the year they are paid.

The fund is expected to grow to almost $1 billion after 18 years and will provide a legacy to assist British Columbia's young people with the cost of their education.

The government will provide information on how the investments in the Fund are growing on a regular basis.