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thegazette Commencing the two-month weekend since 1906
Friday, June 7, 2013
today high 19 low 12
tomorrow high 21 low 11
canada’s only Daily Student Newspaper • founded 1906
Volume 107, Issue 2
Canadian grads average $10k in debt Richard Raycraft News Editor If you feel overwhelmed by debt from student loans, you’re not alone. Research undertaken by Western’s CIBC Centre for Human Capital and Productivity has found that, on average, student borrowers face more than $10,000 in debt in the Canada Student Loans Program following graduation. “The costs of post-secondary schooling have risen dramatically over the past 10 to 20 years, with students now borrowing substantial sums from government student loan programs, and sometimes, private student lenders or banks,” Lance Lochner, a co-author of the study, explained. “While many onlookers are concerned about the inability of lower income students to finance their education, others are concerned about high debt levels accumulated by some students, and their ability to repay those loans.” Some disturbing numbers are to be found in the study, including the fact that 14 per cent of borrowers who entered the CSLP’s Repayment Assistance Program defaulted on their debt within the first three years after finishing school. In addition, half of Canadian loan recipients are earning less than $10,000 annually at the time they default. “Our results strongly point to the fact that student loan repayment
problems are largely due to a lack of resources,” Lochner said. “Low income and a lack of parental financial support are the main drivers of student loan repayment problems in Canada.” Utku Suleymanoglu, one of Lochner’s collaborators in the research project and a PhD candidate at Western, agreed with this assessment, pointing out there is evidence to suggest even more factors are at play. “Indeed, in our study we find that post-schooling income is the most important factor determining a student’s ability to repay his or her loan, and this is in agreement with previous literature on this topic,” he said. “However, this is not the only factor—we see borrowers with relatively high levels of incomes also experiencing repayment problems,” Lochner added. The study suggests that one of these other factors could simply be a matter of priorities—namely, the belief about the importance of student loan repayment among debtors. It reports that repayment problems are 10 per cent higher among those who say they would stop paying their CSLP loan first if faced with debt from other sources. Unsurprisingly, numerous studies show that many students who default on their student debt face difficulties with other payments, such as credit card debt. A biology student entering his
Logan Ly GAZETTE
HAPPY GRADUATION! A recent study by Western researchers has found that the average Canadian student graduates with over $10,000 in debt due to student loans—bad news for new grads on the job hunt in a sluggish economy.
fifth year at Western, who wished to remain anonymous, commented that student debt repayment would be his top priority. “I owe just under $10,000 in OSAP, and I have a student line of credit as well but I’ve managed to pay off what I use each year,” he said. “I assume it will be my top priority to pay it off and be debt-free as soon as possible once I find a stable career.” Unfortunately, difficult economic circumstances are making the search for a stable, long-term career difficult for many with student debt. Indeed, the study highlights that two-thirds
of student respondents reported that a lack of income was the most important reason for missing payments. This is also one of the primary factors leading students with debt to seek assistance from their family, which in turn has an important role in determining ability to pay off debt. According to the study, students whose parents are willing and able to assist them in making payments are much less likely to experience repayment problems. “I would avoid asking my parents for assistance, though I’m sure they would help me if I asked and they
had the ability to,” the student said. “I feel like my parents have given me more than enough as it is.” Regardless of its cause, it’s becoming clear that the issue of rising student debt, and an inability to repay it, needs a solution. “I would argue that we need to think more creatively about how we deal with students facing financial hardship,” Lochner said. “As the costs of higher education rise in Canada, there will be growing pressure to shift some of those increases onto students and their families.”
City council to consider adding student advisors Julian Uzielli Editor-in-Chief
Students from Western and Fanshawe College may soon have a place on city hall committees, if city council passes a motion from the mayor at their next meeting on June 11. The idea was brought to city hall last week by outgoing University Students’ Council president Adam Fearnall and incoming Fanshawe Student Union president Adam Gourlay. Under the proposal, one student each would sit for a one-year term as a non-voting member on eight citizen advisory committees at city hall, with the duties split between four students from Western and four from Fanshawe. If the motion is adopted at council, students would have a hand in
the decision-making processes for municipal issues like transportation, housing and accessibility. “When you look at a lot of the decisions that are made on a dayto-day basis that affect citizens of London, they’re made on a municipal level, and those decisions affect students,” Fearnall said. “Things like transit, things like social services, all those sort of things really—they’re administered on a city level, and there’s a lot of impact that students could have on the direction the city goes in. I think it’s perfectly valid for us to be involved at the provincial and federal level, but the municipal level is where you can sometimes really change your experience.” The presentation was made to city council’s corporate services committee, which is chaired by Mayor Joe Fontana. Among other
“When you look at a lot of the decisions that are made on a day-to-day basis that affect citizens of London, they’re made on a municipal level, and those decisions affect students.” —Adam Fearnall
Outgoing USC president
recommendations, the USC and FSU also suggested expanding internship opportunities for students at city hall and engaging the USC and FSU in London’s economic development strategy.
Fearnall said the presentation was “shockingly” well-received— several councilors in attendance voiced their approval, and the mayor agreed to bring a motion to “operationalize” the recommendations to the next city council meeting. Fontana suggested the City hire two students immediately to set the plan in motion—meaning if it’s passed, the recommendations may be in place by September. “I was very impressed with the presentation and they reflected my previous discussions with both the Western and Fanshawe student councils,” Fontana said in an e-mail. “I believe their full involvement in the decision making process of our city can help us achieve our collective goal to make our city the most attractive to students.” Joe Swan, councillor for Ward
3, also praised the presenters, saying they “hit all the right notes.” He noted, however, that when student representation in city politics has been tried in the past, it was abandoned due to poor attendance. The difference this time, he said, is the student representatives will be chosen by the USC and FSU. Last time the city chose them. “Students will know students better than we can. That’s the improvement that has to take place if that recommendation is to be successful,” Swan said. Harold Usher, ward 13 councillor, said he was “delighted” by the presentation. “They reached out to us, so it’s up to us to accept the reach, and reach back out to them,” Usher said. “I think they have a lot to offer, so why not utilize it?”