CFS Launches Campaign to Abolish Interest Rates on Student Loans
News / June 13, 2018
The Canadian Federation of Students is launching a campaign called “Not In Our Interest” to urge the federal government to eliminate interest rates on the Canada Student Loans Program.
According to the CFS website, Canadian students currently owe $28 billion in debt to all levels of government, and the federal government alone is slated to profit $862.6 million this year off of the interest on that debt. For reference, interest rates for student loans are often higher than those for mortgages.
Peyton Veitch, the national treasurer for the CFS, says that this situation constitutes a “debt crisis” in Canada.
He believes it is “immoral” for the federal government to profit “off the backs of students” by collecting interest on student loans, and stresses that there are more fair ways to fund post-secondary education. Four provinces have already eliminated the interest rates on their provincial loans, with British Columbia slated to become the fifth.
“Eliminating the interest rate on the Canada Student Loans Program is something that the federal government could do tomorrow if it wanted to,” says Veitch. “And it would save students who are struggling to repay their loan thousands of dollars.”
He explains that Canadian students are graduating, on average, with $28,000 in student debt. For students who will spend years paying off these debts, interest rates alone can add thousands of dollars to an already hefty loan.
“That means that students who can’t afford the full cost of their education up front, who have to rely on loans in order to pursue a post-secondary education, end up paying more for the same education than their wealthier peers,” he says.
Veitch adds that, thus far, the CFS campaign has received a lot of attention from students, media, and the general public, and he personally believes that the message is beginning to resonate.
As the 2019 federal election approaches, Veitch says the CFS will continue to pressure the federal government to offer interest-free student loans. To this end, the CFS has already met with the Canada Student Loans Program administration and has reached out to the office of the Minister of Finance and the office of the minister in charge of the program.
“85 per cent of Canadians believe that students are taking on too much debt to pursue a post-secondary education,” he says. “Eliminating interest rates—it’s something that doesn’t just benefit the Canada Student Loan Program …. It’s something that benefits the community as a whole.”