May 28, 2020

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Students get further loan deferrals

“This deferral of loan repayments is going to significantly lessen the hardship for them, at a time when they really need it,” Ralph Eichler said in a statement Tuesday. (Shannon VanRaes / Free Press files)</p>

“This deferral of loan repayments is going to significantly lessen the hardship for them, at a time when they really need it,” Ralph Eichler said in a statement Tuesday. (Shannon VanRaes / Free Press files)

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Post-secondary students are being given a six-month grace period for both federal and provincial student loans due to financial uncertainties caused by the COVID-19 pandemic.

Premier Brian Pallister and Economic Development and Training Minister Ralph Eichler announced Tuesday afternoon that Manitoba would offer student aid relief, three weeks after Ottawa introduced an interest-free moratorium on federal student loans.

Manitoba has suspended all repayments of loans under the Manitoba Student Aid Program, effective April 1 through Sept. 30. The temporary measure mirrors the announcement made by the Canada Student Loan Program. Neither the provincial or federal policies cover private loans.

"Manitobans carrying student loan debt have become vulnerable to programming and labour market changes resulting from COVID-19," said Eichler, in a prepared release. "This deferral of loan repayments is going to significantly lessen the hardship for them, at a time when they really need it."

One of the few provinces that don’t charge interest on student debt, Manitoba is the last province to announce a student aid payment suspension. In recent weeks, student loan payments and interest attached to them have been put on pause from coast to coast.

The overall impact of COVID-19 on student aid in Manitoba will be assessed as the situation continues to evolve, according to the Tuesday release.

Manitoba Economic Development and Training expected to receive a total of $1 million in repayments from student borrowers on April 1. In total, the suspension of repayments until autumn will defer collection of an estimated $7 million for 2020-21.

At the same time, loan disbursements — tuition and grant payments included — will continue to be transferred to students.

Students will also be able to repay their loans via cheque or electronic fund transfer, should they choose to continue to do so throughout the deferral period.

Chairman of the local chapter of the Canadian Federation of Students, Brenden Gali, called the announcement "a victory for students."

"I pay student loans myself, so that’s going to help me," he told the Free Press. "Now, I have to consider all the floating pieces … What about the Canada Summer (Jobs) Program? If students aren’t working over the summer time, will they even be able to pay them off in the fall?"

Under the Canada Emergency Response Benefit, otherwise known as CERB, Canadians who have lost work due to COVID-19 are eligible for a taxable benefit of $2,000 per month for the next four months. Students, Gali included, have criticized the limited eligibility requirements — including a requirement that individuals have earned at least $5,000 in 2019 or in the 12 months prior to the date of their application — that may exclude students.

Gali said he's heard from students who have had interviews for internships and summer jobs postponed as a result of COVID-19. Many students have also lost significant wages earned in the hospitality sector, which has taken a hit as all non-essential businesses have been ordered to close their doors.

"CERB needs to be expanded because it’s so limited, and it doesn’t affect people who are looking for jobs for the summer and the future," said Emily Leedham, a Winnipeg-based organizer with Fight for $15 and Fairness.

"They haven’t lost employment, but employment they could have potentially had is now going to be unavailable to them."

Leedham added she hopes students and all other employees in low-wage positions such as grocery store clerks are recognized for their important work long after the pandemic.

On Monday, Prime Minister Justin Trudeau acknowledged the financial hardships students across the country are facing at present. Trudeau said work is underway to address the uncertainty of summer jobs for students.

maggie.macintosh@freepress.mb.ca

Twitter: @macintoshmaggie

Maggie Macintosh

Maggie Macintosh
Reporter

Maggie Macintosh reports on education for the Winnipeg Free Press. Funding for the Free Press education reporter comes from the Government of Canada through the Local Journalism Initiative.

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