BY SCOTT BLINKHORN
Canadian students no longer have to pay back their Canada Student Loan from the federal government, until they are earning at least $25,000 a year. The announcement was made by Employment and Social Development Canada on Oct. 28 and took effect on Nov. 1.
The change is one of several that the government has put forward to help post-secondary graduates manage their debt. According to the release, the change, which is part of the Repayment Assistance Plan, will act in conjunction with the increase in Canada Student Grants funding, which was enacted on Aug. 1.
The changes are intended to allow graduates to focus on finding careers instead of being overwhelmed by the pressure of managing loans.
MaryAnn Mihychuk, Minister of Employment, Workforce Development and Labour, said in the release that the new measure would allow graduates to better transition into the workforce after graduation.
“The future prosperity of our country depends on young Canadians getting the education and training needed to succeed in the job market,” she said.
The Repayment Assistance Plan allows students to ask for help managing their debt. Depending on the borrower’s family size and income level, he or she may be eligible for reduced monthly payments or no monthly payments.
The new deferred payment plan will cost $131.4 million over the next five years, according to the 2016 budget.
“I feel like there has to be a catch,” said Joey Leal, a second-year accounting student at Conestoga College. “Like where is all of this money coming from.” Leal also expressed concern that the deficit spending is being used to finance the changes.
“I think the bigger problem is rising tuition costs,” said Lucas Carreira, also a second-year accounting student at the college. He added he believes a more educated workforce would make more money, adding to tax revenue and eliminating the deficit.