The federal government recently announced that it will permanently eliminate interest on the federal portion of student loans. This change is a response to the rising cost of living that’s causing financial hardship for students and recent graduates. The government also recently announced they were raising the income threshold for the Repayment Assistance Plan from $25,000 to $40,000 a year, meaning a person earning under $40,000 a year will not have to make payments on their loan.
The Camosun College Student Society (CCSS) and the British Columbia Federation of Students (BCFS) are among several organizations that have long campaigned for interest-free loans to reduce students’ financial stress. CCSS external executive Jessie Niikoi says the CCSS is excited about the federal government’s choice to eliminate interest.
“Ever since we were able to get the provincial student loan interest taken off, we started aiming for something different, which was the federal student loans,” says Niikoi. “We’ve been fighting for this for the longest time.”
Pressure from students and organizations like the BCFS is most likely why the government finally introduced interest-free loans, says Niikoi.
“I feel like it’s because of continued efforts from all the organizations, because this is a time where students are feeling the most,” says Niikoi. “Grocery prices, interest rates on everything, tuition going up, there’s always things that are affecting us, and I think they thought about the fact the students are on loans and how expensive it’s going to be when they’re done [school].”
BCFS Indigenous students’ representative Quinn Cunningham says the BCFS is celebrating interest-free loans at the federal level after years of campaigning for the government to eliminate interest.
“The BCFS is actually celebrating this, because we’ve been advocating for the elimination of student debt on the federal level for years,” says Cunningham. “We’ve been running a campaign this year leading up to this point called Knock Out Interest, which that was the sole focus.”
While the BCFS is happy about interest-free student loans, they will continue campaigning for more funding for BC’s post-secondary education system, says Cunningham.
“The BCFS has a number of campaigns where we’re advocating for increased funding for BC’s high-quality post-secondary education system,” says Cunningham. “We’re asking the BC government, but… we’re also seeking any sort of federal government funding in regards to this because BC’s post-secondary education system seriously needs that money.”
Niikoi believes that the government should look into even bigger changes to make paying for school easier for students.
“I think the government can switch from doing loans to actually doing grants,” says Niikoi. “Then it makes it easier on the students because you’ve been granted something, and you have to use it for your education. For loans, the students are always going to have to pay it back and then some of them would probably not go to school because they know that if they go to school, they would have to take a loan. And then, if they take a loan, they would have to pay it back. So, switching to more grants for students instead of loans is actually a better solution to this whole situation.”