NDP announces plan to cancel up to $20K in student loan debt per Canadian –
The NDP on Saturday said it will push the Liberal government to cancel up to $20,000 in federal student loan debt per Canadian, as part of its plan to help young people struggling financially amid the COVID-19 pandemic.
NDP Leader Jagmeet Singh is due to announce the plan at the virtual Young New Democrats Convention Saturday afternoon.
The plan also includes giving new graduates a five-year head start without having to repay any federal student loans.
“Young people in Canada have been among the hardest hit (by the pandemic) and have had to make fundamental shifts in their education, employment and financial situations,” Singh said in a statement.
“An education should help young people get ahead, not leave them further behind.”
The federal government announced in March 2020 — as COVID-19 and resulting lockdowns began to sweep across Canada — that it would put a moratorium on student loan payments and interest accruals.
The moratorium expired at the end of September, and was not renewed despite pleas from the NDP and student groups. The party has continued to push Ottawa to reinstate the moratorium until the pandemic ends.
Under the new plan, the Repayment Assistance Plan — which allows for payments to be deferred and even reduced in some cases — would be replaced with an “income contingent debt forgiveness program.”
After the five-year head start period, graduates with an annual household income of $60,000 or less would be eligible for a $20,000 debt reduction. The reduction amount would be less for households earning between $60,000 and $100,000, based on a linear scale, before phasing out for household incomes above $100,000.
The NDP estimates the proposed program would help over 300,000 Canadians in its first year, and more than 100,000 Canadians every year after.
Statistics Canada’s 2018 survey of graduates, published last fall, reported 54 per cent of university bachelor’s degree grads had student debt at graduation, owing an average amount of $28,000.
Singh said Ottawa has taken in over $4 billion in student loan interest payments since the Liberals formed government in 2015.
He also noted that a majority of Canadian youth have seen financial impacts and employment difficulties during the pandemic.
An Ipsos poll for Global News this month found 42 per cent of young Canadians — those between the ages of 18 and 34 — said their financial situation had worsened over the past year.
That number dropped to 37 per cent among those aged 35 to 54 and fell further to 29 per cent for those aged 55 and up.
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