Canadian students 13- billion dollars in debt

Quebec has lowest provincial average

Last week the amount of debt Canadian students owed to the Federal Government for student loans surpassed $13-billion.

Rising student debt has been brought to the foreground due to Canada’s current economic crisis.

Quebec’s debt averages are the lowest in the country, at $13,000 per person who has student debt. The Maritimes have the highest regional average at $28,000.

Approximately 360,000 students are currently taking out loans from the Canada Student Loans Program, but an extra $5-billion is taken out from provincial loan programs and more still from other loans, including from credit cards, banks, and family, resulting in a broad spectrum of student debt volume across the country.

“[The student loan process] is all so confusing for young students,” wrote Julian Benedict, co-founder of the Coalition for Student Loan Fairness (CSLF), in an email. “[Students are] just trying to get their education without falling into a debt trap.”

Many believe that the effect of student debt runs deeper than monetary and academic concerns.

“[Student debt] affects people’s health, the chances of their completing their degrees, and their impact on society,” said Katherine Giroux-Bougard, Canadian Federation of Students (CFS) President. “Students with a lot of debt are less likely to contribute to the economy, and are less likely to buy houses, start a family, and raise children.”

The solutions to rising student debt vary widely, from tackling the debt itself, to lowering to interest rates, which are presently about one three per cent above bank lines of credit, to lowering tuition fees.

Giroux-Bougard and the CFS’s initiatives are based on increasing the funding channelled to postsecondary education via the Canada Social Transfer, increasing graduate student funding and financial support for First Nations students, increasing funding for the Canada Summer Jobs program – designed to help students get jobs during the summer to help pay off debt.

The goals for Benedict and the CSLF, the only national non-profit organization in Canada whose mandate is focused on student loan borrowers, include democratizing the student loan system by calling for an ombudsperson office, eliminating high interest rates on loans in repayment, abolishing interest during the six-month grace repayment period following graduation, and improving debt reduction measures.

The issue of student debt in Canada is broad and diverse, and likely will not be solved quickly or comprehensively. Giroux-Bougard was concerned that if high student debt isn’t tackled soon, it could have far-reaching consequences for the already crippled Canadian economy.

“Tuition fees increase year after year,” said Giroux-Bougard. “We’re on a slippery slope in Canada.”