October 22, 2008

4,295 LOW-INCOME STUDENTS TO SEE DEBT LOAD CUT WITH $18.8-MILLION IN POST-SECONDARY AID


The debt load of 4,295 low-income post-secondary students will be reduced with an investment of $18.8-million in bursaries from Manitoba and the Canada Millennium Scholarship Foundation this year, Advanced Education and Literacy Minister Diane McGifford announced today.

“The Manitoba government is continuing to ensure post-secondary education is accessible and affordable to as many individuals as possible and we’re proud to say that among all of the provinces participating in the Canada Student Loan Program, Manitoba has the lowest student debt levels after loan remission,” McGifford said. “Reducing debt levels helps students manage the cost of earning a diploma or degree.”

The joint loan-reduction program is funded by $10.6 million from the Canada Millennium Scholarship Foundation and $8.2 million from the Manitoba government. The combined loan remission reduces student debt to a maximum of $5,900 for the most recently completed academic year. A total of 2,183 students are receiving an average of $4,850 through the Canada Millennium Scholarship Foundation this year. As well, 2,112 more low-income students will receive an average of $3,775 from the Manitoba Bursary Program.

Funds currently being awarded are for debt incurred in the 2007-08 academic year. The bursary funds are paid directly to lenders and are applied against a student’s outstanding loan. The benefit is provided to students each year at the end of their study period. Letters will be mailed to students in the next two weeks to let them know the remission they can expect this year.

The province is also assisting military reservists who are on active duty by placing their student loans on interest- and payment-free status to align with a policy decision of the federal government. This program will be implemented in the near future.

The minister noted the most recent provincial budget further improved affordability by reducing the interest charged on student loans by one per cent to 1.5 per cent above the prime lending rate. Prime is 4.75 per cent, which means students are charged 6.25 per cent on their Manitoba student loans. Many provinces still charge 2.5 per cent above prime on their provincial student loans.

The proportion of non-repayable student aid varies significantly from province to province, from a low of 12 per cent in B.C. to a high of 48 per cent in Manitoba, producing differences in the debt burdens of students in each province.

Earlier this year, the Manitoba government conducted a student satisfaction survey. Questions included information about the loan application process to ensure information was readily available, easy to understand and user-friendly. About 1,100 students currently attending Manitoba’s public post-secondary institutions responded to the survey. In response, an overwhelming 91 per cent majority of students surveyed said they believed their education was worth the cost to complete.

“Manitobans understand the value of post-secondary education and are motivated to work hard to achieve their long-term goals,” McGifford said.

As well, more than 4,600 Manitobans have taken advantage of the province’s tuition rebate program in its first year. Of the 4,670 graduates accessing the rebate, which is intended to both retain and attract people to Manitoba, 431 were graduates from institutions outside of Manitoba. The initiative provides post-secondary graduates with a 60 per cent income tax rebate on eligible tuition fees helping recent graduates living and working in Manitoba to pay for their education.

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