By Lindsay George
Beginning in September, the Ontario government will be pulling out its chequebook for students who receive Ontario Student Assistance Program (OSAP) loans.
Education and Training Minister Dave Johnson announced Feb. 13 that Ontario will spend $535 million on grants to students between 1998 and 1999. That’s an increase of $134 million from 1995 to 1996.
The current rule for student loans is that any amount over $7,000 per year is taken care of by the government, leaving the student with up to $28,000 in debt after four years.
“Seven thousand dollars is what the government feels is the contribution that a student should make to their education,” says Danièle Gauvin, a communications officer at the Ministry of Education and Training. “After that we kick in.”
The Ontario government currently gives out $700 million per year in loans. Of that amount, $349 million never has to be repaid. In 1997 to 1998 that money was spread between 175,706 people.
Under the new grant program, students are still responsible for paying back $7,000 of their loan. Instead of having the balance forgiven at the end of their education, the government plans to assess the loan each year and provide the excess amount directly to the bank to cover the balance.
Linda Fielding, financial aid officer at Carleton University, says the amount each student is responsible for under the grant system isn’t new.
“It’s just a different method of calculating it, that’s all,” says Fielding.
Fielding says she hasn’t heard any complaints about the new system yet, but other changes to the program have some students concerned.
Those include new parental responsibility in paying for education (in a family of four with a total yearly income of $40,000 parents will be responsible for $100 while under the old program they held no monetary responsibility); an increase from four to five years in the amount of time students must have been away from high school before they are considered independent under the program; and a requirement that schools provide information on graduation and loan default rates to students entering post-secondary education.
“The changes are pissing me off,” says Tina Bouffard, a fourth-year criminology student at Carleton University. “They only apply to people who get loans this year. That doesn’t help me.”
Bouffard, who owes approximately $16,000 in loans, says she thinks that a block of money should be set aside to help those students who received loans under the former system.
“Help us pay off some of our loans,” she suggests. “Or increase the amount we don’t have to pay.”
Although first-year Carleton student Nick Powers will benefit from the changes, he says this system won’t be any less confusing, or much more helpful, than the old one.
“When I applied for OSAP I was told I’d have six months to pay it back,” he says. But when he went to collect the money, Powers says he was told repayment would begin as soon as he graduated.