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This article was published 25/11/2014 (2335 days ago), so information in it may no longer be current.
The savings, when you dump them in a pot and boil them down, are rather miniscule when measured against the post-secondary education investment.
But for Manitoba students, news the province is planning to erase the interest payments on all open Manitoba Student Loans at some point next year is a welcome break to their already thin bottom lines.
"Every little bit that we can keep in students' pockets helps," offered Zach Fleisher, Manitoba chair of the Canadian Federation of Students, following the announcement by Premier Greg Selinger at the University of Winnipeg Monday.
"Every loan ask is different for each student, and the savings amount on that interest payment will vary, but even if it's a couple hundred bucks, the big thing is that the financial pressure is removed slightly.
"That's great news for students in Manitoba."
The move to eliminate the interest payments from Manitoba Student Loans has been in the works for over a year, with official conversations between government and a collection of student advocacy groups beginning last January. Monday's announcement was actually a re-announcement by Selinger, as the plan to wipe the interest from the provincial student loan system was a part of the NDP government's throne speech last week.
Details on when the change will be implemented are still being finalized, but it's expected to come into operation sometime after the 2015 budget is announced next spring.
"Students will stop paying interest the day that the program is made effective," Selinger said, adding both new students with Manitoba Student Loans and those paying down existing ones will be subject to the break.
Removing the interest from the loans is expected to cost the province -- or save the students -- roughly $1.3 million annually.
According to the most recent Manitoba Student Aid/Advanced Education and Literacy annual report, 9,517 people were authorized for Manitoba Student Loans in 2012-13, for a total amount of just under $32 million.
It's estimated that more than 27,000 students (many with existing loans) will benefit from this latest move. Approximately 16 per cent of post-secondary students in Manitoba require some sort of provincial financial assistance.
According to the province, a student graduating with approximately $10,000 in Manitoba student loan debt will save about $1,500 in interest over the lifetime of the loan under the new system.
Selinger scoffed at the suggestion students may lose the urgency to pay-off their loans in a timely fashion.
"What you'll find is students will pay down their loans faster because they know the fixed price of it," he said.
Selinger added current penalty measures and regulations constructed around individuals defaulting on Manitoba Student Loans remain unchanged.
The province also announced it is removing the vehicle-cost eligibility requirement for students. In past years, a student who owned a vehicle worth $10,000 or more was not eligible for a Manitoba Student Loan.