The challenges faced by student borrowers in Canada and elsewhere in the world have been largely documented, with fears of a generation “lost” to the debt they have incurred in the pursuit of higher education. With a Canadian federal election looming, one of the biggest issues in inter-party debate has been the course of action that future leaders would take to address this issue. In recent days, leaders of three of the major political parties in Canada have announced major policy changes and relief of student debt and tuition fees.
The Liberal Party, led by Justin Trudeau, would exempt graduates from repaying their student loans until they earned at least $25,000 a year; the interest would be paid by the federal government until that time. In addition, the Liberals would increase the maximum Canada Student Grant for low-income students to $3,000 a year for full-time students and $1,800 for part-time students.
Elizabeth May of the Green Party announced: “Green government will implement a new student loan system modeled closely after the current Australian example, with characteristics that include one-time charges in lieu of perpetual interest charges, a higher minimum annual income threshold before repayment is required to occur, and repayment amounts calculated based on a small but progressive percentage of annual income; and that it will immediately transfer all existing student loans to the new system.”
Candidates Sheri Benson and Scott bell announced that the NDP will invest $250 million, over four years, to create around 74,000 new grants for students. The emphasis, the NDP says, will be on “helping students who need it most.” The party says it will begin phasing out interest on loans immediately, and that this change would save the average student $4,000 when it comes to repaying loans.
Running directly in contrast to the measures proposed by these three parties, the Conservative government’s stance on student debt appears to be far less forgiving, especially after writing off over $300m in student debt over the past year. “Overall, despite mounting attention to the issue, debt levels appear to be manageable for the vast majority of Canadian students,” according to current defence minister Jason Kenney. The government credits nonrepayable grants, federal repayment assistance plans and increased savings with keeping average debt levels “largely stable.” The present federal system covers about 60 per cent of average student aid, with the provinces filling in the remainder. The federal government provides key post-secondary funding in the areas of direct assistance to students, tax measures to support higher learning, and incentives for parents and students to save money for education.
Regardless of one’s political inclinations, it is clear that students will be a key part of the future of Canadian economic and social progress.