By Anthony Agostino
If you think you’ve got the Ontario Student Assistance Program all figured out, think again.
On Feb. 20, Ontario Education and Training Minister Dave Johnson announced an income-contingent loan repayment program (ICLRP), and asked Canada’s major banks for assistance in revising the student loan system.
ICRLPs base the repayment of student loans on how much a person earns after graduation. The government said it is relieving the debt burden facing low-income graduates. Student activists said it imprisons students paying back loans.
Some of the highlights of the plan, which the government hopes to introduce in 1998, include:
- Giving graduates 15 years to repay their loans instead of the current 10 years, which should mean cheaper monthly payments
- Allowing students who get low-income jobs to make interest-only payments for 12 months
- Graduates in low paying jobs can seek help from the government to pay their interest over an 18-month span
Wally Hill, senior manager of corporation communication for CIBC, said the government is not relieving debt.
“The only request that suggested debt reduction was the term extension [to 15 years], but if that’s their only remedy, it’s not good enough.”
Gord Tanner, RyeSAC’s VP education, said the income reduction plan is a vehicle for the provincial government to raise tuition fees.
“[ICRPLs] will provide a green light for tuition to go through the roof,” said Tanner. “We’ve seen it happen in Australia and New Zealand and it’ll happen here too.”
Hill said a package of reforms to reduce graduates’ debt is what is needed. This would include implementing grants, debt reliefs and loan remission programs to help students pay off debts while still in school.