Redesigning the Pell Grant Program for the Twenty-First Century

By: Judith Scott-Clayton & Sandy Baum | The Hamilton Project | October 2013

In this discussion paper, the authors propose three major structural reforms to Pell Grants. First, augment the Pell program’s financial support with tailored guidance and support services that have been shown to improve academic and/or labor-market success, including separately tailored services for the distinctive circumstances of dependent and independent recipients. Second, dramatically simplify the eligibility and application process to ensure that the program reaches those who need it most, again tailoring the simplification to the distinctive circumstances of dependent and independent students. Finally, strengthen incentives for student effort and timely completion, without leading the program away from its core need-based (not merit-based) mission.

Taken together, the proposed reforms would for the first time make Pell a true program and not just a grant, thus inducing its beneficiaries to become full participants and not just recipients. Although the proposed reforms are substantial, the existing structures for processing and delivering Pell Grants would continue to be relevant, and the goals of Pell supporters and beneficiaries would be furthered. Finally, while significant congressional action would be required in order to implement these reforms proposal, they would not substantially increase the cost of the program, and the authors argue that they are structurally and politically feasible.