Government of Canada and Government of Newfoundland and Labrador sign student loan integration agreement

John Ottenheimer, Minister of Youth Services and Post-Secondary Education, and Paul Bonwick, Parliamentary Secretary to the Minister of Human Resources and Skills Development with special emphasis on student loans, today officially announced the Canada-Newfoundland and Labrador Administrative Integration Agreement to deliver student financial assistance.

The agreement commits to integrating activities related to the administration of federal and provincial student loans in Newfoundland and Labrador, as the province becomes the direct lender for the Newfoundland and Labrador Student Loans Program. This collaboration between governments will result in better service for student borrowers.

"This new loan servicing arrangement will positively affect the lives of approximately 30,000 student borrowers, either in repayment or in school," said Minister Ottenheimer. "The province is becoming the direct lender for the provincial loan program, and will also continue to determine eligibility for provincial student loans and set provincial loan policies."

"As stated in the Speech from the Throne, the Government of Canada recognizes that lifelong learning and opportunities to upgrade the skills of Canadians are critical to our country�s economic prosperity and to individual success," said Parliamentary Secretary Bonwick. "This new agreement builds on the partnerships we have already forged, and we look forward to a long, mutually beneficial relationship in administering financial aid for students."

Within days, individuals with provincial and federal student loans, including those currently attending a post-secondary institution and those in repayment, will receive letters outlining how this new agreement will affect the administration of their personal loan. Information sessions are being arranged for St. John�s, Grand Falls-Windsor, Corner Brook and Happy Valley-Goose Bay in the coming weeks to provide additional information.

For more information regarding the integration agreement, student borrowers may visit the Department of Youth Services and Post-Secondary Education Web site at www.gov.nl.ca/youth/ or call Newfoundland and Labrador Financial Aid Services at (709) 729-1093 or toll-free at 1 888 729-1093.

The Government of Canada and the Government of Newfoundland and Labrador have entered into an agreement for the administrative integration of their student financial assistance programs. This agreement commits to integrating activities related to the delivery of both federal and provincial student loans in Newfoundland and Labrador. It will be implemented on April 1, 2004.

In August 2000, the federal government moved to direct lending in order to fund the Canada Student Loans Program. Through this direct lending regime, the federal government, rather than financial institutions, became responsible for lending money to student borrowers. A National Student Loans Service Centre (NSLSC) was established to administer these loans. The NSLSC is comprised of two service providers under contract with the federal government. A provision under these contracts enables individual provinces to integrate the administration of their student loans with federal student loans.

The disbursement of funds and management of borrower accounts in Newfoundland and Labrador is currently performed by CIBC. When CIBC advised the Government of Newfoundland and Labrador of its intention to cease active involvement in the program, Newfoundland and Labrador explored other possibilities for the administration of its program and decided to engage in direct lending via an administrative integration agreement with the Canada Student Loans Program. In order to facilitate this change in lending arrangements, the province is establishing the Student Loan Corporation of Newfoundland and Labrador (SLCNL). As a result, the SLCNL is accountable for all funds loaned to students.

Several positive changes for borrowers will occur as a result of this administrative integration agreement. Borrowers will benefit from:

• Funds being directed to their accounts by one institution;
• One single point of contact to manage their student loan;
• One student loan payment to be applied to both their federal and provincial loans; and single applications used to apply for benefits at both the federal and provincial levels.

Various communication tools will be employed to inform Newfoundland and Labrador borrowers affected by this change in administration of their new arrangements. A joint letter from the federal and provincial governments will be sent to borrowers and formal notification of the change will be provided by CIBC and the NSLSC�s service providers. Province-wide information sessions will also be held over the coming weeks.

For further details on the administrative integration agreement, please see the following contact information:

• 1-888-729-1093 information line
• Web site link with www.edu.gov.nl.ca/studentaid
• Email: integration@gov.nl.ca

There will be four information sessions held across the province at the locations listed below:

Grand Falls -            Tuesday, February 24          Mount Peyton Hotel
Windsor                   7:00 � 9:00 p.m.                  Trans-Canada Highway

Corner Brook            Wednesday, February 25     Holiday Inn
                                7:00 � 9:00 p.m. 48            West Street

Happy Valley -          Thursday, February 26         The Aurora Hotel
Goose Bay                4:00 � 6:00 p.m.382            Hamilton Road

St. John�s                  Monday, March 1               Holiday Inn
                                 7:00 � 9:00 p.m.                Portugal Cove Road

2004 02 16                                       11:25 a.m.