Canadian Student Debt Soars
Friday, November 3rd, 2006– By Pushpa Sathish, Staff Writer
If you’re a university student in Canada, you’d better wish on your brightest star that you live in the Quebec area and not in Atlantic Canada. Why? Because you don’t want to be saddled with the burden of a large student debt.
According to research by the Canada Millennium Scholarship Foundation, students from Atlantic Canada graduated with the maximum debt this year ($29,747), followed by those in British Columbia ($26,675), the Prairie provinces ($22,787), Ontario ($22, 589), and finally Quebec ($12,992). The national average debt is $24,047.
The varying levels of debt in different regions across the same country are attributed to the disparity in tuition fees and grants. Nearly 60 percent of those who graduated this year are deep in debt, a significant increase from the 45 percent in 1990. Of the 57 percent who borrowed for a college education, nearly 30 percent owe more than $15,000 while 44 percent are at least $10,000 in debt.
The very purpose of borrowing is defeated when students drop out without completing the course because of large debts. They are unable to pay back the money borrowed without the right education and a proper job. A study conducted in August this year warns that students with large debts are more prone to drop out.
Programs that have been set up to help graduates pay off their loans have not drawn the necessary response. Only around 33 percent of those who graduated in 2002 have enrolled in the scheme which allows those who earn a small income to temporarily stop loan repayments. The government helps by covering the interest on the loan.
According to the Foundation, the situation is expected to go from bad to worse because of the new changes to the federal and provincial student loans program.