1. Contribution amount. This is the original payments into the RESP, paid with after-tax dollars by the subscriber. When you withdraw contribution amounts, as Post-Secondary Education Payments (PSE) they are not taxed.
2. Grant, bond, and income. This includes benefits like the Canada Education Savings Grant (CESG), the Canada Learning Bond (CLB), and any provincial incentives. It also includes any investment income, like dividends, capital gains, or interest, that was earned inside the RESP. When money is withdrawn from this portion it is called an Educational Assistance Payment (EAP) and the beneficiary pays the tax on this income. Consider that its likely students are in a lower tax bracket and will pay less taxes than if it were taxable to the subscriber.