The NWT’s education minister says scrapping a program that provides an extra $2,000 a year in student loan forgiveness may ultimately keep more people in the North.
The territory operates an aggressive program of student loan forgiveness worth up to $12,000 a year to people who are at least partly based in the NWT after their studies. The precise value depends on the community they choose to live in.
The overall package, named Student Financial Assistance, is a means of making the territory financially attractive for young people, particularly young northerners who moved elsewhere to study.
As part of that package, the “northern bonus” allowed people to have a further $2,000 of their loan forgiven each year, on top of other loan forgiveness, if they were a resident of the NWT all year and met some other criteria.
The northern bonus was quietly scrapped last year for one group of people: southerners who had come to the NWT with student loans from other jurisdictions. (Two people contacting Cabin Radio on Wednesday said that move had affected them and they had seen no public notice about it at the time.)
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This week, northerners with student loans were told the northern bonus had been dropped for them, too.
Some of the people affected told Cabin Radio the program’s sudden disappearance complicated the financial arithmetic they had been using to plan their lives, and expressed concern that the move arrived in an email earlier this week with little accompanying explanation and no advance warning.
One person who had been claiming the northern bonus, which could be accessed repeatedly up to a maximum of $10,000 if people met the criteria year after year, said losing it meant losing one reason to stay in the NWT.
But education minister Caitlin Cleveland said she sees it differently.
Cleveland said the northern bonus had “acted like a fast forward,” implying that the faster people’s loans were wiped out, the sooner they could leave the North if they wished without losing out on financial incentives.
“By removing the Northern Bonus program, in essence we are removing incentives to make it easier to leave the North,” Cleveland wrote on Wednesday evening.
“Moves like this make it easier to invest in other programs that further support NWT residents.”
Range Lake MLA Kieron Testart said he did not support removal of the northern bonus.
“Budget 2023 added two assistant deputy minister positions. One of those is worth just about the same as the Northern Bonus program,” Testart wrote on Wednesday.
“GNWT has forgotten who it serves. I’ll take students over senior managers every time and I will fight to restore this vital program for all our futures.”
Communications approach
One complaint shared by four people who contacted Cabin Radio this week was the way the removal of the northern bonus was communicated.
They queried why the program’s deletion appeared only in a September email and had not been raised sooner, saying earlier notification would have allowed them more time to accommodate the change in their own plans.
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The NWT government confirmed the removal of the northern bonus had been agreed during budget deliberations much earlier in the year, but said it had chosen not to mention the end of the northern bonus until regulations governing it had been amended.
“Following the approval of the budget, the department had to update the Student Financial Assistance Regulations in order to implement the change,” a spokesperson for the Department of Education, Culture and Employment said by email.
“Once the regulations were updated, the department then communicated this change directly to loan borrowers (afternoon of September 3) and the public (morning of September 4). This approach was taken so loan borrowers would receive the information directly, first.”
Cleveland and the department, in three separate statements, used the phrase “difficult but necessary” to characterize how the GNWT felt about removing the northern bonus.
The minister and department said doing so was an example of the territory trying to adjust to its “fiscal capacity.”
The territorial government has set a target of finding tens of millions of dollars a year in either savings or new revenues, in a bid to improve its financial footing.
