Edition 177 - January 2016

US: Obama administration raises game on college completion

As the final year of the Obama administration got underway this month, the White House stepped up the effort to make college completion among low-income students a priority.  Delivering his final State of the Union address on 12 January, President Obama reemphasised his commitment to making access to higher education widely available by easing the financial burden of earning a college degree. As part of his effort to make college affordable, he promised to focus in the last year of his tenure on making his plan of providing two years of community college for responsible students for free a reality.

On the heels of the State of the Union address, the US Department of Education announced two new proposals for expanding the Federal Pell Grant Programme, which provides need-based grants to low-income students towards their tuition fees and other expenses. The two new proposals aim to boost college completion by increasing the provision of the Pell Grant from two semesters to three semesters to allow students to take summer classes more easily, and by creating an annual bonus for recipients who take at least 15 credits per semester to encourage speedy completion. The cost of these proposals is estimated at EUR 1.8 billion (USD 2 billion) in the financial year 2017 alone. Currently, only 60% of those enrolled in a bachelor’s degree programme earn a degree, and a third of those who graduate take longer to do so. Students who fail to graduate on time carry additional costs and accumulate higher debts, and borrowers who drop out of college are three times more likely to default on their student loans than those who graduate. 

These new proposals complement the existing Obama administration proposals aimed at improving college affordability, increasing graduation rates and incentivising speedy completion. Those include making two years of community college free for students in good academic standing, awarding a bonus to high-performing institutions that graduate significant numbers of low- and moderate-income students, and providing grants to support community college programmes in high-demand fields. 

President Obama has championed college affordability since he assumed office in 2009, but despite the significant investments of his administration in federal aid for low-income students, student enrolment numbers in autumn 2015 fell for the fourth consecutive year, according to the latest figures released by the National Student Clearinghouse Research Center. While his latest package of proposals is impressive, securing votes for it in the Republican-controlled US Congress could prove a tall order. 

U.S. Department of Education (Press release)

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