The debt-ceiling deal signed by President Obama last week will cut over $900 billion in federal funding over the next ten years. Yet even in an extremely budget-conscious atmosphere, members of Congress singled out the Pell Grant program for an increase in funding to guarantee college access for low-income students. Under the terms of the new law, Pell would receive $10 billion in fiscal year 2012 and $7 billion in fiscal 2013, for a total of $17 billion. While additional funds are needed to maintain the current maximum grant amount of $5,550, the funding in the debt ceiling law will go a long way toward ensuring college access for the 9.4 million students across the country who depend on Pell Grants for college education. The impact of this additional funding on the federal deficit was mitigated by reducing subsidies for graduate student loan interest and financial incentives, at a net savings of $4.6 billion.
New England is home to hundreds of institutions of higher learning, from large universities to local community colleges. The New England Council has long supported the Pell Grant Program, and earlier this year wrote to the New England delegation urging Congress not to sacrifice programs that contribute to our economic well-being in the name of fiscal responsibility. An educated workforce is fundamental to our national economic competitiveness, and New England’s institutions of higher education play a critical role in developing a highly-skilled and innovative workforce. Higher education is also an economic driver in its own right, providing jobs and generating over $100 billion in New England alone. As the Council noted it its letter to the New England delegation, maintaining robust funding for Pell Grants ensures that colleges don’t have to decide between turning away students and cutting jobs.
While Pell Grants and other education programs may face more stringent cuts as the deficit-reduction committee works its way toward an additional $1.2 trillion in funding reduction, the Council is hopeful that this initial $17 billion for Pell Grants signals a continuing commitment to preserving college opportunities and supporting the nation’s institutions of higher education.
For more information on the New England Council’s work on higher education issues, visit the Education & Workforce page of our website.