September 28, 1998

STUDENT DEBT

Over The Edge Page 13

NDP to tackle bankruptcy legislation

Source: The Varsity
By Tara Atluri
OTTAWA (CUP) Debt-
ridden students who
need to declare bank-
ruptcy but can’t under
changes to student
bankruptcy laws may
soon be presented with

a ray of hope.

Libby Davis, education
critic with the New
Democratic Party, is
expected to introduce a
private members’ bill as
early as next week that
would amend _ six-
month-old changes to
the Bankruptcy and
Insolvency Act.

Davies wants to undo
section 178 of the act,
which was first passed
last spring. The new
section extends the
waiting period for stu-
dents who need to
declare bankruptcy from
two to ten years for
graduates enrolled in
full or part-time studies
at Canadian post-sec-

ondary institutions.

“This is scandalous,”
Davies said of the
change. “On the one
hand, the Liberals are
crowing about all the
wonderful things they
are doing for students.
And with the other, they
are pushing through this
section.”

“Student debt is so
high it has become an
oppressive part of stu-
dents’ lives,” Davies
said.

She argues the new
section disproportion-
ately targets student
debtors, and will force
students who have
exhausted all other
options to declare bank-
ruptcy twice, making it
difficult to ever get a line
of credit.

But according to
Human Resources
Development Canada,
the point of the new
section is to help stu-
dents, not lock them

into debt.

“The way the system
worked before, students
felt they had to resort to
bankruptcy after just
two years, which is
problematic for the
banks and problematic
for the students,” said
Anna Kapiniari, spokes-
woman for the ministry.

Kapiniari added that
last year’s budget

extended protection of
students to last the life-
time of their loan. “It’s
more helpful now, (the
10 year minimum) is
there to ensure students

are protected when
they're having a hard
time repaying _ their
loans, and they don’t
have to resort to bank-
ruptcy.”

Elizabeth Carlyle,
national chair of the
Canadian Federation of
Students, says the
changes are punitive.
The only other debtor
demographic which
confronts such punitive
measures, she Says,
are those with outstand-
ing alimony and child-
support payments.

Student debtors don’t

deserve these mea-
sures, Carlyle says,
pointing out that only
$70 million of the $3.6-
billion of consumer debt
in 1995 was due to stu-
dent loans.

“This whole thing
seems so Draconian,”
she said, adding the
changes were _ not
announced very pub-
licly.

Carlyle also criticized
part of the legislation
that says graduates can
be refused credit if they
are late with payments
by 90 days three times,

and rack up a total of
$3,000. “Students make
mistakes,” she said.

Many students only
learned of the changes,
which were buried in
last year’s budget, as
they returned to school
this month.

“| never knew anything
about this,” said Binh
Troung, a fourth year
bio-chemistry student at
the University of
Toronto. “I think it sucks.
Interest rates will kill
you alone.”

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TENTION ALL UNDERGRADUATE STUDEN

THIS IS A NOTICE FOR THE NORTHERN UNDERGRADU-
ATE STUDENT SOCIETY'S EXTRA ORDINARY MEETING:

WHEN:
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TIME:

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