As part of B.C. Premier Christy Clark’s Families First agenda, released June 25, the provincial government has introduced a student loan Repayment Assistance Program (RAP) that targets low-income families and graduates with significant family obligations. Critics of the plan, however, argue that it does not address the unique issues that all B.C. students face, such as high tuition costs and a lack of government grants.
RAP went into effect in B.C. on July 1 and replaces the previous interest relief program. The assistance plan itself, however, is a federal initiative that was first introduced in Ottawa in 2008, and has since been slowly adopted by the provinces.
“This is very simply a re-announcement of a federal program,” says Lucia Orser, director of External Relations for the UVic Students’ Society (UVSS).
The plan differs from previous initiatives by shortening the loan repayment period and offering a two-stage debt reduction strategy based on the size of the borrower’s family and their family income.
The first stage, which covers the first five years, provides payment assistance for the interest portion of the student loan. The second stage, which can cover up to 10 years, provides payment assistance for the remaining principal portion of a loan. If, after 15 years of payment, there is still money owing on a student loan, the provincial government can choose to forgive the remainder.
Both stages of the plan, however, are only approved in six-month blocks, meaning that over the 15-year term a person must apply 30 times to stay in the program.
According to the B.C. branch of the Canadian Federation of Students (CFS), the province currently charges the highest interest rate on student loans in the country at 2.5 per cent above prime, and, since the grants program was cut in 2004, B.C. now offers the lowest amount of non-repayable student financial aid of any province.
The CFS also states that students in B.C. graduate, on average, with $27 000 in student debt, making B.C. citizens with a four-year degree the most debt-heavy in Canada outside of the Maritimes.
“The biggest issue being faced by low-income students is the premiums they are paying for their education in the form of high interest rates on their student loans,” says Orser. “In provinces like Newfoundland and Labrador, they’ve completely eliminated interest on student loans. This really indicates to me the way that B.C. is falling behind.”
Orser suggests the provincial government could have done more to address all students in B.C. rather than the specific group targeted by the Families First agenda.
“These changes to B.C. student aid are seeking to address the family affordability portion of the Families First agenda,” says Orser. “However, some of the real changes that we need to see to post-secondary education, like the need to lower interest rates on student loans and the need to reinstate a needs-based grants program, would better serve the family affordability pillar that’s been cited by this government.”
Kimberly Speers, an associate professor in UVic’s department of political science, says that by making families the focus of the repayment plan, the government is working more towards supporting their own rhetoric rather than doing what is best for the majority of B.C. students.
“In terms of the Families First agenda — because they have to find policies that support that in order to make the policy agenda real — by addressing families as a targeted group, rather than all students who are paying provincial student loan debt, they fulfilled that.”
Despite the program’s limitations, Speers and Orser both agree that it is a step in the right direction.
“The bigger picture is that any policy that addresses accessibility for post-secondary education is good,” says Speers.