Pell Grants: Billions Go to Students Who Don't Graduate, Analysis Finds

From NBC News.

"Billions of taxpayer dollars go to college students who never end up with a diploma in their hands, a new report found.

Pell grants — which are given to low-income families and, unlike student loans, do not need to be paid back — are the costliest education initiative in the nation. But little official data exists on whether they are a good investment, according to the education watchdog Hechinger Report.

Education Department Undersecretary Ted Mitchell last month lauded Pell grants as "one of the key levers that we have" to increase college completion rates. But an analysis published Monday by Hechinger revealed that Pell recipient graduation rates are often considerably lower than the overall graduation rate — even six years after a student starts college.

To make matters worse, the government keeps no official tally of what proportion of those who receive the grants end up getting degrees — despite the fact that money spent on Pell grants has quadrupled since 2000."

"only about 40 percent Pell recipients graduate, significantly lower than the national average of about 60 percent."

"Taxpayers paid $31.4 billion on Pell grants in fiscal year 2015, and since 2000, they have poured $300 billion into them, Hechinger reported.

"It's not surprising that Pell grant students graduate at most schools at a lower rate than the overall student body. We know that low-income students are less likely to get a college degree than their peers," Sarah Butrymowicz, Hechinger's data editor and author of the report, told NBC News.

This could be in part because students from a lower socioeconomic status may come into college less academically prepared, she said."

"the more Pell students there are at a given institution, the lower the chance that they will graduate."

"Maybe a student that is below a 2.0 average two years into a Pell grant should lose their Pell grant. At least we cut our losses earlier than we do now," he said." (economist Richard Vedder)