The federal NDP’s plan to tackle student loan debt in Canada, unveiled today, is ambitious — but it misses the mark on long-term up-front access to post-secondary education. The plan is centered on a debt forgiveness scheme, which doesn’t help those from low- and middle-income families get an education without accruing debt in the first place.
“Students have been disproportionally impacted economically by this pandemic,” said Tanysha Klassen, Chairperson of the BC Federation of Students. “Debt forgiveness would go a long way to help those struggling now, but we need a solution to address the up-front barriers to education for future generations of students.”
The Canada Student Loan Program provides students with a mixture of loans and non-repayable grants on a basis of financial need. Over one million Canadians have a student loan from the federal government, collectively owing over 19 billion dollars. In practice, interest on student loans is no more than a tax on the poor, forcing those who cannot afford their education up-front to pay on average $4,000 more for their degree.
The plan announced today by Jagmeet Singh proposes extending the current six-month grace period to a five-year grace period during which payments would not be necessary. After that period, if money is still owing, up to $20,000 would be forgiven on a sliding scale based on income for households earning up to $100,000. Further, the plan proposes to eliminate interest on federal student loans and commits to working towards the elimination of tuition fees.
However, the most efficient way to solve the student debt crisis is to invest in up-front barrier reduction strategies, like bolstering the Canada Student Grant Program. Allocating the money from this back-end scheme into the grant program would effectively eliminate the need to issue loans. This up-front, needs-based approach would create the access to education that the NDP appears to be seeking.
“Students from middle- and low-income families need help at the start of their education,” said Klassen. “Enhancing the Canada Student Grant Program would eliminate the need for all these repayment assistant schemes and would open the doors for more Canadians who want, and need, to attend post-secondary, but can’t afford to.”
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