The U.S. Department of Education set the maximum Pell Grant award at $5,550 for the 2011-12 academic year, signaling that the largest grant program for low-income students will be fully funded.
This is reassuring to many colleges and education advocates, who worried that in this time of eager budget-cutting Pell might not get enough funding in the federal budget. According to de Vise:
The action carries through on legislation passed last year that added $36 billion to the Pell program, the largest source of grant aid to needy students. The aid initiative calls for the annual Pell grant to rise to $5,975 by 2017 from the current $5,550, and links it to the consumer price index for the first time.
Ever since 1972, when the federal government created higher education grants specifically for low-income Americans, the maximum Pell number relied on the funding whims of Congress. Starting in 2012, the maximum Pell grant amount from year to year will be determined by increases in the Consumer Price Index. In real terms then, the maximum Pell grant will not decline.