By Canadian Press

PBO report finds that NDP plan to slash student debt would cost $4 billion

May 19, 2021 | 8:16 AM

OTTAWA — Parliament’s budget watchdog says the NDP plan to cut student debt would cost about $4 billion.

The New Democrats’ campaign-style pledge this spring promised to cancel up to $20,000 in tuition, freeze loan payments through July 2022 and scrap interest payments, among other measures.

In a report released today, parliamentary budget officer Yves Giroux says the proposal would amount to $3.95 billion over five years, with the reduction of as much as $20,000 per student borrower by far the priciest plank.

Giroux also calculates that the plan’s extension of the non-repayment period from six months after graduation to five years would actually cut more than $400 million in upfront government costs.

The announcement of the NDP plan in March came ahead of a possible election this year as federal parties prepare to battle it out for the hearts and ballots of young voters.

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Statistics Canada found last fall that more than 60 per cent of post-secondary students were concerned about using up their savings and taking on more debt.

This report by The Canadian Press was first published May 19, 2021.

The Canadian Press