Provincial Government Eliminates Interest on B.C. Student Loans
The decision will reportedly save average B.C student loan holders approximately $2,300
News / March 3, 2019
The 2019 budget announcement made on Feb. 19 included a list of measures the provincial government is taking to reduce taxes for families earning under $80,000 per year. These include introducing child benefit tax credit and, of particular interest to KPU students, eliminating the interest from B.C. student loans.
“Students and young families with loans will save an average of $2,300 after graduation, so they can start their careers off on the right foot,” said B.C. NDP Finance Minister Carole James during the budget announcement.
The provincial government says that the average student loan holder in B.C. will have about $28,000 in debt after they graduate, which includes both provincial and federal loans. $2,300 is the estimated amount of interest students will no longer have to pay towards their provincial loans over a 10-year repayment period.
“We’re happy that they’re taking action to reduce the financial burdens of post-secondary college students,” says Kwantlen Student Association VP External David Piraquive. “It’s something that’s been lobbied for a lot in the past by the ABCS, and it’s something that we’ve heavily pushed for.”
The Alliance of B.C. Students, which Piraquive is board member of, is a student advocacy and lobbying organization that the KSA has been involved with for a number of years. Former KSA President Caitlin McCutchen served as the ABCS chairperson, and current KSA VP Finance & Operations Joseph Thorpe was the organization’s Director of Finance and Operations in 2018.
“Not every single student has the benefit of paying for their tuition up front, so it’s basically like putting an extra tax on low and middle-income students because they have to pay an additional cost,” says Piraquive.
While B.C. student loan-holders can applaud the government’s decision to get rid of the interest, some students who are getting their education here are still bound by interest payments for loans from other parts of Canada.
Mackenzie Rhode, a KPU Journalism student who transferred from the University of Saskatchewan, will still have to pay interest on her loans, even though she is currently attending a post-secondary institution in B.C. She says that the elimination of student loan interest should apply to all students in Canada, and not just those who have loans in this province.
“I think that getting rid of interest on student loans is a great thing, because it’s not your average loan. It’s not me taking money out because I want to buy a car. It’s not me asking for a big purchase like a house,” she says. “It’s just me asking for basic funds so I can get myself educated at a post-secondary level.”
Since Rhode received her loans from the Saskatchewan provincial student loan program, she will still be charged interest on her loans which she says total approximately $40,000. She expects to have to pay between $5,000 and $10,000 more in interest, and is considering taking out more loans in B.C.
“I think it’s unfair that I have to repay another $10,000 on top of that just because I’m not in a financial position—or my family’s not in a financial position—to put me through post-secondary,” she says. “You’re told from birth that you need university to get a high-paying job. I don’t think I should be punished for needing the government’s help for that, and I think that B.C. did something right by eliminating the interest, but I definitely think it should be a country-wide thing. It shouldn’t be just provincial.”