Liberals write off $163 million in student loans feds will never collect
Posted January 28, 2019 5:21 pm.
This article is more than 5 years old.
OTTAWA — The federal government is writing off more than $163 million in outstanding student-loan payments that officials will never be able to collect.
New spending documents show the government is giving up on debts from 31,658 students after “reasonable efforts to collect the amounts owed.”
It is the fourth time in the last five years that the government has written off outstanding student loans.
The government periodically gives up on some of the $19 billion owing in student loans for a number of reasons: a debtor files for bankruptcy, the debt itself passes a six-year legal limit on collection, or the debtor can’t be found.
The Liberals have looked to make it easier for graduates to pay off their loans — and the government to collect the cash — by increasing the minimum annual income a person has to make before they are required to make debt payments.
The threshold is now set at $25,000.
The most recent annual report on the Canada Student Loans Program said that in the 2015-2016 fiscal year, the government provided almost 490,000 full-time students with just under $2.7 billion in loans and a further $24.1 million in loans to 13,712 part-time students.
The report said that the average federal student loan balance at graduating was $13,306, up from $12,783 in the previous 12-month period, an increase of 4.1 per cent.
Borrowers typically take between nine and 15 years to fully pay off their loans and the period usually overlaps with when Canadians are most likely to start families.
The Canadian Press
