Newfoundland and Labrador eliminates student loans

Newfoundland and Labrador announced over the long weekend that provincial student loans will be replaced with a system of needs-based non-repayable grants.

A student group in Newfoundland and Labrador is welcoming the elimination of provincial student loans, which the provincial government has replaced with non-repayable grants.

The province announced on Saturday that provincial student loans will be replaced with a system of needs-based non-repayable grants. It is the first province to eliminate the loan system, a move that is expected to affect about 7,000 students.

Travis Perry, chairperson of the Canadian Federation of Students for Newfoundland and Labrador, said the new system means that students in the province can get a head start on building their lives after graduation, rather than paying off their debts.

"It means students are graduating with less debt," he told CTV's Canada AM. "They're able to get out of their program of study, start a family, purchase a home, start a small business, and meaningfully contribute to the economy in these ways."

The new system became a campaign issue in the last provincial election, when all of the provincial parties committed to it, he said. It also has support from residents, who recognize how it ultimately benefits the local economy.

"It's definitely something that Newfoundlanders and Labradorians believe in," he said.

Now, the CFS will be pressing the federal parties on the issue in the upcoming election, Perry said.

The new grants only cover 40 per cent of the financial assistance that students receive. Students will still be expected to pay back the remaining 60 per cent of the financial assistance that comes from the federal government, Perry said.

"We're definitely going to be looking to all federal parties to follow our lead, to make commitments to invest in post-secondary education, and to address the student debt crisis we're facing on a national scale," he said.

Perry said that while the new system will benefit many students, it will be especially meaningful for poorer students who may not even consider post-secondary education without receiving a grant.