As we all know, the recent debt deal has meant some pretty savage cuts across a wide range of what was previously considered “untouchable” programs. Not even federal funding for education has escaped. There were plans for the maximum amount awarded through the Pell grant scheme to be increased in 2013 – 2017 however this now looks very unlikely. In fact, Pell grants were lucky to remain intact for the immediate future.
The truth is that the program is under considerable pressure and is likely to report a loss of $1bn for the 2012 school year. This kind of pressure is unsustainable and if the economy does not improve we’re likely to see Republican plans to impose stricter criteria for approval for the grant along with a reduction in the maximum amount awardable become reality.
In fact, if you look at practically every aspect of funding for college students you’d be hard pressed to find any that have not suffered negatively. The sad truth is that college students are set to graduate with more debt now than every before.
If you’re interested in reading more I’ve written all the details here in Pell grants for students.