Ontario improves student support: helps students better manage their student loan repayment

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Ontario improves student support: helps students better manage their student loan repayment

TORONTO, Sept. 4 /CNW/ - Improvements to the Ontario Student Assistance Program (OSAP) will provide students in need with additional assistance to manage their repayable student loan debt, Minister of Training, Colleges and Universities Dianne Cunningham announced today.
"We are committed to providing students with a high quality education through a strengthened and expanded publicly funded postsecondary education system," Cunningham said. "We believe that students should contribute a reasonable portion of the cost of their postsecondary education, but we recognize that some will need additional assistance as they begin to build their careers."
Under the changes announced today, a person who has left school and:

- has a low-income or is unemployed will be eligible to receive up to 54
months of interest relief under OSAP, up from the current 30 month
limit; and

- who has exhausted his/her interest relief options and is still unable
to meet their repayment obligations will have access to an additional
one-time reduction in the balance of his/her OSAP to bring the debt to
an affordable level.

"Our college and university students are vital to Ontario's continued prosperity," said Cunningham. "With an aging population and new occupations, today's students will have tremendous opportunities to pursue their goals."
Students in Ontario are required to pay upon graduation only the first $7,000 of their annual OSAP loan under the Ontario Student Opportunity Grant. In 2000-01, the Ontario government spent $578 million to provide financial assistance to 160,000 students through OSAP, including grants, loans, bursaries and scholarships.

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HELPING STUDENTS BETTER MANAGE THEIR PORTION
OF THE COST OF POSTSECONDARY EDUCATION

The Ontario government has made a commitment that every willing and qualified student finds a space in a college or university program. As part of that commitment, the government, with its SuperBuild partners, is investing $1.8 billion to create 73,000 new student spaces and has announced a multi- year commitment of $293 million in increased operating grants by 2003-04 to attract faculty, improve quality and expand the range of programs available to students.
While public investment in postsecondary education in this mandate is higher than it has ever been in Ontario, the government expects students who directly benefit from these programs to be responsible for contributing a reasonable portion of the cost of their postsecondary education.
To ensure postsecondary education remains accessible to students, the government spent $578 million in 2000-01 to provide financial assistance to 160,000 students through the Ontario Student Assistance Program (OSAP), including grants, loans, bursaries and scholarships. In addition, it has introduced a range of new initiatives and programs to provide additional support to students as well as help them better plan for and manage their portion of the cost of a college or university education.

Improved student support

- Students in a college or university can receive up to $1,700 from
bursaries and part-time work over a typical two-term study period
before their OSAP is affected. If a student is a scholarship recipient,
the maximum total exemption for study period income is now $3,500, of
which up to $1,700 can be in the form of bursaries and part time
earnings. Previously a student would have the first $600 of income
exempted plus 20 per cent of the balance.

- The Ontario Student Opportunities Trust Fund, announced in 1997, has
established permanent trust funds with a total value of $600 million -
half of which comes directly from the province - at colleges and
universities to provide aid to students in need. Over 10 years, it is
anticipated that 185,000 students will benefit from these funds.

- Universities and colleges are required to set aside 30 per cent of
tuition increases for student aid. The total amount of this assistance
in 2000-01 was approximately $125 million.

- More than 4,000 high school students received an Aiming for the Top
Tuition Scholarship in fall 2000. When fully implemented, $35 million
will be invested annually in these tuition scholarships that recognize
academic excellence and financial need.

- The number of Ontario Graduate Scholarships will be increased from
1,300 to 2,000 and their value will increase from $11,800 to $15,000
for three terms of study.

Helping students plan for and manage their costs

- The Ontario government announced in 1999-2000 that tuition increases
for most programs will be capped at two per cent per year for five
years. In 2001-2002, this means a possible annual increase in tuition
of $34 for college students and $77 for university undergraduate
students.

- Under the Ontario Student Opportunities Grant, students are required to
repay only the first $7,000 of their combined annual Canada and Ontario
Student Loans upon graduation. In addition, students are notified each
year of their outstanding loan balance.

- Low-income and unemployed individuals who have left school with
outstanding repayable student loans can have their payments suspended
for up to 54 months under the Ontario Student Loan Interest Relief
Program.

- Ontario, in cooperation with the federal government, provides a tax
credit to help graduates pay the interest on their student loans.

IMPORTANT FACTS ABOUT ONTARIO'S STUDENT SUPPORT PROGRAM

- Did you know that when students begin to repay their loans, the largest
portion goes to the federal government?

On average, Canada Student Loans account for about 70 per cent of the
repayable debt on student loans. Ontario Student Loans account for only
30 per cent of the loans that a student needs to repay.

- Did you know that students taking out loans in Ontario only have to pay
back the first $7,000 of their total annual loans?

Ontario was one of the first jurisdictions in Canada to provide a debt-
relief program that caps the annual amount of loan a student needs to
repay at $7,000 for two terms of study.

- Did you know that students with children in Ontario can apply for
special support for housing and child care services?

Ontario students with dependents can receive up to $500 per week in
OSAP assistance, compared to a single student who can receive up to
$275 per week. This additional assistance takes into account the higher
living and child care costs associated with having dependents.

Students with three or more dependents can receive additional
assistance through Ontario's Child-Care Bursary program.

- Did you know that if you are an Ontario student who is unemployed after
graduation, you can apply to extend the period in which you have to
begin repaying your loan?

Low-income or unemployed students, with outstanding student loans, can
have their payments suspended for up to 54 months.

- Did you know that only 32 per cent of students attending university and
41 per cent attending college relied on Ontario student assistance in
1999-00?

While enrolment at postsecondary institutions continues to increase,
fewer students are applying for assistance through OSAP. This, in part,
is due to the increased range of bursaries and trust funds that are
available to students at each college or university.

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For further information: Contacts: Dave Ross, Ministry of Training, Colleges and Universities, (416) 325-2709; Andrew Bennett, Minister's Office, (416) 325-5748; For more information visit www.edu.gov.on.ca