Government Student Loans, Government Debts and Bankruptcy: A Comparative Study


Stephanie Ben-Ishai


Osgoode Hall Law School, York University




An increase is projected in the number and the value of loans for post-secondary education funded by the federal and provincial governments in Canada. Given this projection and calls for reform to the treatment of these loans in bankruptcy, we identified a need for a comprehensive review of the treatment of government-funded student loans in bankruptcy in Canada.

Part 1 of this report outlines the basic structure of government-funded student loans in Canada, the treatment of these loans in bankruptcy, and recent proposals for reform. Part 2 outlines both the measures that led to a pattern of convergence in the treatment of government-funded student loans in bankruptcy in the common law jurisdictions under review and the triggers for these measures. Situated in this comparative context, the soundness of the recommendations generated from two recent Canadian government reports on bankruptcy and Bill C-55 are considered, and recommendations and issues that need to be further explored and taken into account in considering these proposals are put forward in Part 3. Parts 4-7 are country surveys that provide a more detailed account of government-funded and guaranteed student loans and the treatment of such loans in bankruptcy in each jurisdiction under review. For the reader that is unfamiliar with the workings of these other systems under review, it may be helpful to read Parts 4-7 after reading Part 1, and before reading Parts 2 and 3. In describing the government-funded student loan programs, the country surveys draw from primary sources and a limited amount of secondary literature. A more comprehensive secondary literature review with respect to the government-funded student loan programs in New Zealand, Australia, the United Kingdom and the United States was beyond the scope of this "mini-paper."

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Contact information

Osgoode Hall Law School
York University
4700 Keele Street
Toronto, Ontario
M3J 1P3
(416) 736-5030
(416) 736-5736

Source: Consumer Policy Research Database

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