Appearance of the Deputy Minister Standing Committee on Public Accounts (PACP) -  December 1, 2020

1. Opening remarks

Official title: Opening remarks for Graham Flack, Deputy Minister of Employment and Social Development for an Appearance Before the Standing Committee on Public Accounts (PACP) regarding the 2020 spring reports of the Auditor General of Canada to the Parliament of Canada – (Report 2—Student Financial Assistance) House of Commons December 1st, 2020

Check against delivery

(2020 PA 001209)

Opening

Madame Chair,

We are appearing before you today to talk about the Auditor General’s Spring Report on Student Financial Assistance.

The report’s recommendations align with our continuous work to strengthen the Canada Student Loans Program, while making post-secondary education more affordable and accessible to all Canadians.

Repayment of student loans

The Government has made significant investments in recent years, including increasing Canada Student Grants and expanding its eligibility to make post-secondary education more affordable.

Since the onset of the pandemic, the Government has taken measures to address the impacts of COVID-19 on students, which included temporarily suspending the repayment of student loans and applicable interest, and doubling Canada Student Grants for the current school year.

The Government has also taken steps to make student loan repayment more manageable. In Budget 2008, the Government announced the introduction of the Repayment Assistance Plan (RAP), which was subsequently approved by the Parliament, and was implemented in 2009.

RAP allows student loan borrowers to repay only what they can reasonably afford given their income and family size; and the Government contributes to their payments such that the loan is paid off within 15 years of leaving school.

In 2016, the Government made it more generous by increasing the zero payment income threshold to $25,000. This is a benefit, like many other Government benefits, and should not be viewed as a loss.

In fact, the Department has made, and continues to make, efforts to raise awareness of RAP so that eligible borrowers can take advantage of it while they are trying to integrate into the labour market.

Spending on RAP is very different from the write-off loss due to default, and therefore they are reported separately in public accounts.

The Parliament has chosen to use grants to help students in financial need, and the RAP as a means to assist students in precarious financial situations to repay their loans.

We agree with the OAG that we can improve informing Parliament on program costs and we are already taking steps to do so. However, we intend to continue reporting program spending, such as RAP, and write-off loss separately.

While we have made great strides, we know that there is still more work to do. We acknowledge the longer-term issues raised by the OAG, we agree with their recommendations, and we are taking action to address them.

Student loan repayment continues to be 1 of the priorities for the Canada Student Loans Program.

Our efforts in this area need to be coordinated with the provinces, as well as other delivery partners, such as the CRA and the CSLP’s service provider. This takes time.

However, given the work that the Department has already undertaken, we are confident that we will be able to implement our Action Plan, though some of the timelines may need to be reassessed due to the pandemic.

Student financial literacy

We agree with the OAG that more needs to be done to improve financial literacy among young Canadians.

To this end, Employment and Social Development Canada, in consultation with the Financial Consumer Agency of Canada, has developed a financial literacy plan to inform borrowers of their repayment obligations and provide them with financial literacy tools.

Since the audit, the Department has already launched a virtual repayment counsellor on the National Student Loans Service Centre web portal. New financial literacy content continues to be added on repayment options and obligations.

The Department also has a plan to consult with provincial partners and external stakeholders on mandatory financial counselling for borrowers.

Evaluation

Finally, the OAG has recommended a comprehensive evaluation of both the Canada Student Loans Program and Canada Education Savings Program.

While our on-going evaluation work has focused on the impact of the 2 programs individually, the Department has also been working with Statistics Canada for several years now on developing appropriate datasets that would allow a comprehensive evaluation to examine the interaction between the 2 programs.

This data has now become available and we initiated an evaluation of the interactions between the CESP and the Canada Student Loans Program. With a better understanding, we will be able to take appropriate steps to reduce financial barriers for students.

Going forward

All the efforts we have been undertaking have ensured that the default rate on student loans continues to decline. The most recent 3-year default rate of 8% is actually the lowest it has ever been. For 2003 and 2004, for example, it was 28%.

Some of this success can be attributed to the Repayment Assistance Plan, which provides support to borrowers in financial difficulty, so they can get back on their feet and focus on their careers. The use of this model is in line with Parliament’s intent in establishing this program.

Closing

Going forward, we will continue to focus on improving the administration of our programs while working to support student loan borrowers so that post-secondary education is more accessible to Canadians.

Thank you for the opportunity to appear before you today.

I will now take your questions.

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2. Auditor General Spring 2020 Report 2 Student Financial Assistance

Auditor General Spring 2020 Report 2 Student Financial Assistance

3. Employment and Social Development Canada Detailed Action Plan

To the recommendations of the Office of the Auditor General Performance Audit of Student Financial Assistance of the Spring 2020 Reports of the Auditor General of Canada

Report ref. no

Para 2.26

OAG recommendation

To maximise repayment of student loans, Employment and Social Development Canada should ensure proper, systematic verification of applications to participate in the Repayment Assistance Plan.

Management response

Agreed. The Repayment Assistance Plan’s objective is to provide relief to persons with employment difficulty or who face sudden income or family composition changes (such as a lost job or a newborn). This is why eligibility is based on previous month’s income and family composition. The Office of the Auditor General of Canada refers to provinces’ use of the Canada Revenue Agency’s annual tax data for student financial assistance. However, annual income information would not identify sudden financial hardship affecting plan applicants.

Employment and Social Development Canada has a systematic, sample-based income-verification process. The department acknowledges that plan verification has challenges, specifically for applicants who report zero income in the preceding monthly period (approximately 20% of applicants) and for family composition. Work is underway to enhance verification using the Canada Revenue Agency’s data. The department has engaged partners on more robust plan- verification methods. An information-sharing agreement, expected to be in place by spring 2021, will allow verification of income and family composition data against the agency’s tax data during the application process while maintaining current systematic sampling practices.

Description of final expected outcome and result

Enhanced verification of income reported on RAP applications via CRA income tax information

Expected final completion date

March 2022

Key interim milestones (description and dates)

Finalization of ISA with CRA – March 2021

Completion of Service Provider, CRA and provincial/territorial participating jurisdiction system modifications and testing – December 2021

Systematic verification of income on RAP applications – March 2022

Responsible organization and point of contact (Name, position, tel #)

Alexis Conrad, Assistant Deputy Minister, Learning Branch, 819- 654-8448

Indicator of achievement (For PACP committee use only)

N/A

Report Ref. No

Para 2.32

OAG recommendation

Employment and Social Development Canada should develop performance indicators that take into account the full impact of the Repayment Assistance Plan on the non-repayment of student loans.

Management response

Agreed. Employment and Social Development Canada reports to Parliament on all program expenses, which include write-offs (resulting mostly from student loan default) and the cost of the Repayment Assistance Plan, through Public Accounts. This information, in more detail, is also included in the Canada Student Loans Program’s annual report. Furthermore, each year, the Office of the Chief Actuary prepares a 25-year forecast of all program costs and revenues. The report is published annually and tabled in Parliament every 3 years.

Write-offs are a loss to the public purse, which the department continuously strives to reduce. The department believes the 3-year default rate reported to Parliament is an appropriate performance indicator to demonstrate and track this loss. However, the Repayment Assistance Plan is a program benefit to Canadians, and program expenditures are based on the parameters approved by Parliament.

Given the diverging program objectives of decreasing the write-off losses and increasing the use of the plan by eligible Canadians, a combined performance indicator would not provide an accurate picture of the repayment cost. However, in fall 2020, the department will work with the Office of the Chief Actuary on the development of an appropriate, but separate, indicator for the plan.

Description of final expected outcome / result

Regular reporting to Parliament on non- repayment of student loans

Expected Final Completion Date

December 2020

Key Interim Milestones (Description/Dates)

Explore possibility of the development of a separate indicator for RAP expense – December 2020

Responsible organization/ Point of contact (Name, position, tel #)

Alexis Conrad, Assistant Deputy Minister, Learning Branch, 819-

654-8448

Indicator of achievement (For PACP committee use only)

N/A

Report Ref. No

Para 2.35

OAG recommendation

To prompt borrowers to be more diligent about repaying their student debt, Employment and Social Development Canada should inform credit bureaus about student debts in default.

Management response

Agreed. In accordance with the provisions of the contract with the Government of Canada, the service provider currently reports regularly to credit bureaus on loans they administer. This reporting is done before a borrower is in default and remains on the borrower’s credit record for approximately 6 years. However, once the loan is in default and is transferred to the Canada Revenue Agency for collections, no further reporting is done. Employment and Social Development Canada is developing a process for credit bureau reporting on loans in collections, by fall 2022, as part of ongoing program enhancements.

With respect to the department's contract with the service provider, the contract has been properly managed. The contract began in 2006, and the Repayment Assistance Plan was introduced in 2009, 3 years later. Although the contract had set performance targets for default before the plan was introduced, the department ensured that the service provider used targeted measures to reduce the default rates. A new contract is currently operational and includes processes to re-baseline default targets to ensure incentive targets are aligned with current realities. Targets will be revisited on an ongoing basis to demonstrate improvement in default rates and will be appropriately challenging and account for program or policy changes.

Description of final expected outcome / result

Reporting loans in collections to credit bureaus

Expected Final Completion Date

December 2022

Key Interim Milestones (Description/Dates)

  • Roll-out of new ESDC Accounts Receivable System (PSCD) – April 2020
  • Revision of student loan agreement with borrowers to receive their consent – December 2021
  • Implement credit bureau reporting functionality in PSCD via system release – September 2022
  • Establish information exchange mechanism with the credit bureaus – December 2022
  • Begin credit bureau reporting – December 2022

Responsible organization/ Point of contact (Name, position, tel #)

Mark Perlman Chief Financial Officer, Chief Financial Officer Branch, 819- 654-6634

Assistant Deputy Minister, Learning Branch, 819- 654-8448

Indicator of achievement (For PACP committee use only)

N/A

Report Ref. No

Para 2.40

OAG recommendation

As soon as possible, Employment and Social Development Canada, in collaboration with the Financial Consumer Agency of Canada, should

  • make available on the web portal of the National Student Loans Service Centre all the financial information needed by loan recipients in the Canada Student Loans Program
  • consult with stakeholders about the costs and benefits of mandatory training for student loan applicants before loans are provided and for student loan recipients who abandon or complete their studies

Management response

Agreed. On the basis of its collaborative work with the Financial Consumer Agency of Canada, Employment and Social Development Canada established an overall financial literacy plan in 2017 as part of its transition to an electronic service delivery model. The department is also continuing the implementation of the multi-year plan to enhance financial literacy tools on the National Student Loans Service Centre web portal. A virtual repayment counsellor was launched in November 2019, which provides borrowers with necessary information on their student loan, including repayment options to help support them.

The Department will continue to work with the agency to implement additional financial literacy tools as part of this plan. ESDC will also consult with provincial and territorial student aid programs as well as external stakeholders, by fall 2021, regarding the costs and benefits of mandatory counselling to determine feasibility and value.

Description of final expected outcome / result

Part 1: Launch of additional financial literacy features on NSLSC portal

Part 2: CSLP to consult stakeholder s on the developmen t of a mandatory financial literacy course

Expected Final Completion Date

Part 1: March 2021

Part 2: Fall 2021

Key Interim Milestones (Description/Dates)

Part 1:

Launch of additional financial literacy content and communications – March 2021

Part 2:

Consultation with provincial and territorial partners – December 2020

Consult external stakeholders – March 2021

ESDC to gather input received and conduct analysis, including costs and benefits – September 2021

Responsible organization/ Point of contact (Name, position, tel #)

Alexis Conrad, Assistant Deputy Minister, Learning Branch, 819- 654-8448

Indicator of achievement (For PACP committee use only)

N/A

Report Ref. No

Para 2.48

OAG recommendation

Employment and Social Development Canada should consider undertaking a thorough evaluation of both of the federal student financial assistance programs to, among other things:

  • further assess the reasons for student loan non-repayment in order to develop appropriate solutions
  • evaluate the impact of the Canada Education Savings Program on participation in and completion of post- secondary education and on the Canada Student Loans Program
  • understand why there is low participation in the Canada Education Savings Program

Management response

Agreed. Employment and Social Development Canada is committed to producing analysis, reports, and evaluations on federal student financial assistance programs.

The department continuously looks at new opportunities to study the impact of student financial assistance programs. For example, a research project will use newly linked survey and administrative data by Statistics Canada to assess interactions between the Canada Student Loans Program (CSLP) and the Canada Education Savings Program (CESP), and the impact of the CESP on post-secondary education outcomes.

Until now, the data required to study the full impact of the CESP on post-secondary education participation was not available, given the first full youth cohort who was eligible for all program components reached maturity only in 2017. The department plans to start an in-depth CESP evaluation in spring 2020 to assess the interactions of the CESP and the CSLP and the unique contribution of the CESP on post-secondary education participation and completion.

The department will incorporate relevant questions pertaining to non-repayment of student loans in a future program evaluation, which is planned to start in spring 2022.

Description of final expected outcome / result

Whenever possible, CESP impact analysis on PSE participation and on CSLP is done through the newly linked data

Expected Final Completion Date

CESP research project: April 2022

Evaluation: June 2022

Key Interim Milestones (Description/Dates)

CESP research project

Validation of data linkages for the Education and Labour Market Longitudinal Platform (ELMLP) – January 2020

Results tables and analysis - September 2020

Program officials and Evaluation staff will examine administrative CESP data, including data from the ELMLP – April 2020

Evaluation

A feasibility study on the CESP impacts will be produced – November 2020

ESDC plans to commence an evaluation on the CSLP – June 2022

Responsible organization/ Point of contact (Name, position, tel #)

Alexis Conrad, Assistant Deputy Minister, Learning Branch, 819-

654-8448

Catherine Adam, Senior Assistant Deputy Minister, Strategic and Service Policy Branch, 819- 654-2992

Indicator of achievement (For PACP committee use only)

N/A

4. ESDC’s management of the service provider contract and incentive payments

In addition to the OAG’s 5 recommendations, the report also provides an observation that the service provider contract was not properly managed.

Recommendation. We found that the department did not properly manage the contracts with the private sector service provider:

  • Some services specified in the second contract were not delivered on time.
  • Incentives were paid to the private sector service provider for lowering the default rates in the first contract, even though the rates were already decreasing automatically as a result of the Repayment Assistance Plan, and despite the fact that borrowers’ eligibility for the plan was not properly verified.

Key messages

  • ESDC manages the contract, and in particular the incentive payments, in collaboration with Public Services and Procurement Canada and provincial partners. Each year ESDC negotiated an increasingly lower target to lower the default rate based on a series of very specific commitments to be undertaken by the service provider. This approach has resulted in a Canada Student Loan default rate that is at all-time low.
  • The Auditor General’s observation that the electronic vision for managing students loans was not delivered on schedule is correct. The schedule for Service Delivery transformation was revised to minimize risks and ensure an error-free transition from a paper-based system to an electronic system. Important changes like the ability to sign loan agreements electronically, and to authenticate borrower identity online without borrowers having to drive to a Canada Post location were rolled out first; many other features that directly benefit students have also been introduced with many others to be introduced in the coming months.

Since 2000, the administration of the Canada Student Loans Program (CSLP) has been contracted to a private sector service provider. The Department maintains full control of the program, including policy design and development, while the service provider administers the grants and loans, including the disbursement of funds and the administration of student loan repayment. Under the same contract, the service provider also administers loans and grants for 5 integrated’ provincial programs (ON, BC, NB, NL and SK).

With respect to incentive payments, the OAG audit focused on the contract that was awarded in 2006 and was operational between 2008 and 2019. A new contract was awarded to the same service provider (D+H) in 2016 and became operational in 2019. This contract will be in place until 2027 with options to extend until 2034 and represents a transformation to a digital service delivery model. Both contracts were awarded after significant industry consultation and an open and transparent competitive process.

The service provider received compensation for (i) ongoing account management; (ii) change management (to introduce program changes); and (iii) performance incentive. As per the contract, 20% of the annual Account Management Fee was set aside for incentive payments, part of which was based on lowering default rates. (Approximately $68 million was paid in incentives for default reduction – out of about $900 million in total payments over 12 years).

The observation made by the OAG is problematic because:

  1. Limited contractual flexibility: The default rate for the first year of operation (2008 to 2009) was specified in the contract, and as per the contract, each year, the 2 parties had to agree on the target for the coming year. As a result, the flexibility was somewhat limited (in recognition of which the OAG appears to have only made an observation but not a recommendation).

The Department’s objective has always been to develop challenging, but not impossible to meet default rate targets. [2 sentences redacted]. While the OAG claims that the service provider did not have to demonstrate any improvement, the data clearly shows that default rate continued to improve during the contract (table below).

  1. Program change alone was not sufficient to lower default rate: The OAG report claims that incentives were paid to the service provider for lowering default rates, even though the rates automatically decreased because of the Repayment Assistance Plan (RAP). If RAP alone were sufficient for the reduction in default, then the reduction would have been instantaneous immediately after the introduction of RAP. However, as data clearly shows, the improvement occurred over time. This is because policy changes need to be accompanied by campaigns to increase awareness, and proactive and tailored communications with the borrowers – none of which the service provider was compelled to do outside of the incentive payment scheme. Under the incentive scheme, the Department ensured that the service provider implemented targeted measures to continuously reduce the default rate. This included various interventions, such as behavioral nudging techniques (some of which were developed in collaboration with Privy Council Office Innovation Hub). Implementation of these interventions ensured that the default rate continued to improve over time.
Table 1: Historical RAP Uptake and Default Rate Performance (title not part of original binder)
Year 2009 to 2010 2010 to 2011 2011 to 2012 2012 to 2013 2013 to 2014 2014 to 2015 2015 to 2016 2016 to 2017 2017 to 2018
RAP uptake 161 000 165 000 185 000 209 000 234 000 256 000 276 000 306 000 326 000
Default rate 15% 14% 13% 12% 11% 10% 9% 9% 8%
  1. Incentive paid for achieving targets and taking actions: Each year, a pre-condition for any incentive payment was to first implement a set of actions aimed at reducing default and achieve the targets. The plan of action and the targets were reviewed and approved by all the parties involved, namely, ESDC, PSPC and the 5 integrated provinces.

The OAG’s second comment notes that some services, specifically the electronic vision for managing student loans, was not delivered on time. After the current contract was awarded in 2016, the contract was revised to reflect a multi-phased approach to mitigate risks and ensure a seamless delivery, consistent with ESDC’s direction. The first phase was delivered in April 2018 and enabled an electronic identity verification and an electronic loan agreement. Phased implementation will continue with new components coming online regularly such as the Online Funding Tracker, the Online Revision of Repayment Terms, as well as the Virtual Repayment Councillor, which have already been implemented.

5. Recommendations

5.A. Verification of Repayment Assistance Plan Applications

One of the OAG’s recommendations focuses on the integrity of the Repayment Assistance Plan (RAP) verification. The OAG observed that the current verification process for RAP is inadequate and does not prevent ineligible applicants from obtaining the benefit.

Recommendation. To maximize repayment of student loans, Employment and Social Development Canada should ensure proper, systematic verification of applications to participate in the Repayment Assistance Plan.

Key messages

  • RAP’s objective is to provide relief to persons with employment difficulty or who face sudden income or family composition changes, such as the loss of a job or the birth of a child. This is why eligibility is based on previous month’s income and family composition
  • ESDC’s verification of eligibility is consistent with industry norms, but ESDC does acknowledge that RAP verification has some limited challenges, specifically for applicants who report zero income and for family size. Work has been underway for several years now with our provincial partners as well as CRA to enhance verification using the Canada Revenue Agency’s (CRA) data
  • ESDC is already working with CRA on more robust RAP verification methods to implement changes that will allow verification of income and family composition data against CRA tax data during the application process.

RAP supports Canada Student Loan (CSL) borrowers who face financial difficulty in repaying their loans. Under RAP, no borrower has to repay their CSL until they are earning at least $25,000 per year (this income threshold is adjusted based on family size), and for income over the threshold, their payment is limited to what they can reasonably afford. For up to 5 years on RAP (recipients are required to reapply every 6 months), the Government contributes to interest payments of a CSL; afterwards, the Government contributes to both principal and interest payments such that the loan is paid off in 15 years since entering repayment (10 years for students with permanent disabilities).

  • When introduced in 2009, the zero payment threshold was $22,000; was increased to $25,000 in 2016
  • In the 2018 to 2019 loan year, approximately 330,000 borrowers used RAP

RAP is primarily intended to help those with financial difficulty due to sudden income or family composition changes (such as a lost job or a newborn). Therefore, RAP eligibility is based on income and family size for the month before when a student applies.

ESDC has a systematic, sample-based income verification process that is in line with industry standards.

  • A percentage of RAP applicants is selected to provide Proof of Income as reported on their applicationFootnote 1.
  • Applicants can provide pay stubs and/or employment records

As documents provided to OAG show, ESDC has identified certain validation challenges, and has been working with provincial partners to address them:

  • for those who report zero income (approximately 20% of applicants), there is no authoritative source to verify that they actually have no income. Currently, ESDC requires that they indicate how they are meeting their living expenses on the RAP application
  • family composition is not currently verified.

As the OAG is aware, work has been underway for several years to enhance the verification of RAP. This has involved working with provinces and territories, the service provider, and CRA. CRA income tax data has been identified as the potential authoritative source for verification, notwithstanding the challenges:

  • CRA does not have monthly income data and the annual income reflects last calendar year’s income
  • Family composition data also reflects the status of last calendar year and may not reflect current statusbnv

Discussion with CRA is at an advanced stage, and an Information Sharing Agreement with CRA is expected to be in place by Spring 2021, which will allow the Department to verify CRA tax data to confirm a borrower’s income, and family sizeFootnote 2.

Next steps

Key milestones, as indicated in the Management Action Plan submitted to the OAG, are:

  • finalization of an information sharing agreement with CRA – March 2021
  • completion of Service Provider, CRA and provincial/territorial participating jurisdiction system notifications and testing – December 2021
  • systematic verification of income on RAP applications – March 2022

Note: The timelines identified in the Department’s Management Response and/or the Management Action Plan may be impacted by COVID-19 and associated workload on CRA and the service provider.

5.B. Informing Parliamentarians about Non-Repayment of Student Loans

One of the OAG’s 5 recommendations is for ESDC to develop performance indicators that consider the impact of the Repayment Assistance Plan (RAP) on the non-repayment of student loans.

Recommendation. Employment and Social Development Canada should develop performance indicators that take into account the full impact of the Repayment Assistance Plan on the non-repayment of student loans.

Key messages

  • The Auditor General’s recommendation to develop performance indicators that combine RAP and write-offs to help Parliamentarians better understand the cost of non-repayment of Canada Student Loans would actually mislead Parliamentarians given the fundamental distinctions between RAP and write-offs
  • RAP is a program benefit that was approved by Parliament in 2008 to support borrowers who have difficulty in repayment, whereas write off is a program loss
  • The Department agrees with the spirit of the recommendation that reporting to Parliament could be improved and has started consulting with the Office of Chief Actuary of Canada on the development of a new performance indicator for RAP. Options are currently being considered

RAP supports Canada Student Loan (CSL) borrowers who face financial difficulty in repaying their loans. Under RAP, no borrower has to repay their CSL until they are earning at least $25,000 per year (this income threshold is adjusted based on family size), and for income over the threshold, their payment is limited to what they can reasonably afford. For up to 5 years on RAP (recipients are required to reapply every 6 months), the Government contributes to interest payments of a CSL; afterwards, the Government contributes to both principal and interest payments such that the loan is paid off in 15 years since entering repayment (10 years for students with permanent disabilities).

  • When introduced in 2009, the zero payment threshold was $22,000; was increased to $25,000 in 2016
  • In the 2018 to 2019 loan year, approximately 330,000 borrowers used RAP

Since its introduction in 2009, more and more CSL borrowers have benefited from it as a result of (i) the work ESDC has done to increase awareness of it, and (ii) the Government making it more generous by increasing the income threshold. Consequently, the spending on RAP has increased over time, as was always intended. Over 330,000 CSL borrowers received RAP assistance in 2018 to to 2019, an increase of over 100% since 2009 to to 2010.

In contrast to RAP, CSL write-off is an administrative loss, a result of borrowers not complying with their repayment obligation. After 9 missed monthly payments, CSLs are considered to be in default, and are transferred to the Canada Revenue Agency (CRA) for collections. CRA attempts to recover the defaulted loans; however, in line with the statute of limitations, after 6 years of non-acknowledgement, the recovery efforts cease and the loan is written off. The Department works with the service provider and the CRA to minimize this administrative loss. As a result of these efforts, the CSL default rate is at an all-time low of 8%, down from 28% in 2003 to 2004 and 15% in 2009 to to 2010, and the annual write-off amount has remained stable at less than 1% of the portfolio despite the volume of the portfolio growing over time.

While the OAG portrays both RAP and write-off as non-repayment of student loans, they are in-fact very different in nature. RAP represents a benefit to struggling Canadians that was approved by the Government, and ESDC continuously strives to increase RAP uptake for those who need it; whereas write-offs represent a loss resulting from borrowers not meeting their repayment obligations, something ESDC continuously strives to reduce.

This fundamental distinction determines how the 2 are reported to Parliamentarians and Canadians. As the OAG notes, the default rate is reported as an indicator of how well the Department is doing to minimize default loss. On the other hand, and as also noted in the OAG report, ESDC reports to Parliament on all program expenses, which include write-offs (resulting from student loan default) and the cost of RAP, through Public Accounts. This information, in more detail, is also included in the CSLP Annual Report. Furthermore, each year, the Office of the Chief Actuary (OCA) prepares a 25-year forecast of all program costs and revenues. The report is published annually and tabled in Parliament every 33 years.

ESDC believes that the write-off loss and RAP expense ought to be reported separately given the nature of these expenses. Nevertheless, ESDC also believes that information provided to Parliamentarians and Canadians can always be improved, and to that end, the Department agrees with OAG recommendation has begun consulting the OCA on the development of an appropriate, but separate indicator for RAP.

Next steps

The key milestone for this recommendation, as indicated in the Management Action Plan submitted to the OAG, is:

  • explore the possibility of the development of a separate indicator for RAP expense – December 2020

Earlier this year, the department met with the Office of the Chief Actuary (OCA) on the development of a separate indicator for RAP. The department is currently assessing options to address the recommendation of the OAG to better inform Parliamentarians about the non-repayment of student loans.

Note:

The timelines identified in the Department’s Management Response and/or the Management Action Plan may be impacted by COVID-19.

Table 2: Canada Student Loans 3-Year Default Rate
Repayment cohort — year loans entered repayment (loan year) 3 year default rate
2003 to 2004 28%
2004 to 2005 19%
2005 to 2006 17%
2006 to 2007 16%
2007 to 2008 15%
2008 to 2009 14%
2009 to 2010 15%
2010 to 2011 14%
2011 to 2012 13%
2012 to 2013 12%
2013 to 2014 11%
2014 to 2015 10%
2015 to 2016 9%
2016 to 2017 9%
2017 to 2018 8%

5.C. Credit bureau reporting of defaulted loans

One of the OAG’s 5 recommendations is that ESDC should inform credit bureaus about student debts in default.

Recommendation. To prompt borrowers to be more diligent about repaying their student debt, Employment and Social Development Canada should inform credit bureaus about student debts in default.

Key messages

  • As the OAG is aware, the Department is developing a process for credit bureau reporting on loans in collections
  • However, ESDC is only expecting marginal improvement in loan recovery from this new functionality. Defaulted borrowers already have negative reports on their credit report for about 6 years based on the reporting that the service provider is already doing on delinquent loans, and 6 years is the statute of limitations for collection by the Canada Revenue Agency (CRA)
  • That said, we have begun developing a process for credit bureau reporting on loans in collections to be implemented by fall 2022 as part of ongoing program enhancements

The CSLP’s private sector service provider administers Canada Student Loans until the loan goes into default (9 months in arrears), at which point the loan is transferred to the CRA for collection.

The service provider proactively communicates extensively with borrowers before they go into repayment and re-engages them whenever a borrower’s payment is overdue to inform them about repayment obligations and assistance measures. In its communications, the service provider applies innovative techniques to nudge borrowers to repay, which include payment reminders and texts. Once a borrower’s payment is overdue for over a month, the service provider reports them as delinquent to credit bureaus. This reporting is done on a monthly basis and includes the length of time an account is overdue. This information remains on the borrower’s credit report for 6 years.

Once the loan is sent over to CRA (after 9 months of non-payment), the service provider stops their reporting, and loans in default are no longer reported since the CRA does not report them to the credit bureaus.

Credit bureau reports from the service provider remain on a borrower’s file for 6 years, and since there is a 6-year statute of limitation on collection efforts (that is, by law the CRA cannot collect on a loan after 6 years have elapsed since the borrower last acknowledged their loan), the change in borrowers behaviour from further reporting by CRA is expected to be minimal.

That said, we have begun developing a process for credit bureau reporting on loans in collections to be implemented by fall 2022 as part of ongoing program enhancements.

Next steps

Key milestones are:

  • roll-out of new ESDC Accounts Receivable System (PSCD) – April 2021*
  • implement credit bureau reporting functionality in PSCD via system release – September 2022
  • establish information exchange mechanism with the credit bureaus – December 2022
  • begin credit bureau reporting – December 2022

*Note: The timeline identified in the Department’s Management Response and/or the Management Action Plan for the first milestone has been delayed due to COVID-19; this item, originally due in April 2020, has been delayed to April 2021 and may have an impact on key milestones that follow (revised timelines on these are still to be determined).

5.D. Financial literacy

One of the OAG’s 5 recommendations relates to financial literacy and has 2 components for Employment and Social Development Canada (ESDC):

  1. to publish financial information on the web; and
  2. to consult stakeholders on mandatory training for student loan applicants

Recommendation. As soon as possible, Employment and Social Development Canada, in collaboration with the Financial Consumer Agency of Canada, should

  • make available on the web portal of the National Student Loans Service Centre all the financial information needed by loan recipients in the Canada Student Loans Program
  • consult with stakeholders about the costs and benefits of mandatory training for student loan applicants before loans are provided and for student loan recipients who abandon or complete their studies

Key messages

  • Since the audit, ESDC has already made significant progress in making available information on financial literacy on the National Student Loan Service Center online portal, as part of new digital service delivery model. ESDC will continue to publish more financial literacy information and tools online as part of its broader electronic transformation
  • The Department has been working with provincial partners on the feasibility of mandatory counselling. It is already part of federal/provincial/territorial workplan. In addition, we will further engage the Financial Consumer Agency of Canada (FCAC) and other stakeholders on mandatory counselling for students

ESDC is committed to increasing financial literacy for Canada Student Loans Program (CSLP) recipients throughout the loan lifecycle. As the OAG report explains, the Department has been working with provincial partners and stakeholders, including the FCAC, for a number of years to better understand student behaviour and find ways to help student loan borrowers better manage their loan repayment obligations.

ESDC established an overall financial literacy plan in 2017. This was done in collaboration with the FCAC, as part of CSLP’s transformation to an electronic service delivery model. The goal of the financial literacy plan is to ensure that clients are fully informed of their obligations and options during every stage of the loan lifecycle by providing user-friendly information on topics such as understanding student loans, budgeting, saving, credit, debt, and money management, career and employment, as well as tips and tools.

The OAG report notes that, at the time of the audit, posting financial literacy tools and information on the website was still in the planning stage. This was due to the rescheduling of CSLP service delivery transformation to minimize risks and ensure an error-free launch of the new model. Since the audit, and as part of the transformation schedule, significant progress has been made in this area.

  • A Virtual Repayment Counsellor was launched on the National Student Loan Service Center (NSLSC) web portal in November 2019, which aims to engage borrowers as they move into repayment by proactively presenting loan repayment details and outlining repayment options that may be available.
  • A new and updated financial literacy web content has also been posted on the NSLSC website, providing student loan borrowers with easy to access information about their obligations and options.
  • Financial literacy features are planned for implementation throughout 2021, in consultation with FCAC. The next release with enhancements to financial literacy resources is planned for January 2021.

Regarding the second component of the OAG recommendation about mandatory training for student loan applicants, ESDC has been exploring this with provincial partners for some time, as the OAG is aware. In the past, the Department experimented with non-mandatory counselling, but the uptake rate was very low since it was not mandatory. Mandatory counselling is currently in place in the United States, however its effectiveness has been questioned by a number of researchers. Furthermore, making it mandatory could require legislation by both federal and all 10 provinces who are responsible for application and assessment for both the federal and provincial portions of student loans and grants.

That said, exploring it further is already part of the work plan with provinces and territories as well as external stakeholders for early in 2021.

Next steps

Part 1 key milestones, as indicated in the Management Action Plan submitted to the OAG, are:

  • launch of additional financial literacy content and communications – March 2021

Part 2 key milestones, as indicated in the Management Action Plan submitted to the OAG, are:

  • consultation with provincial and territorial partners – Winter 2021
  • consultation with external stakeholders – March 2021
  • ESDC to gather input received and conduct analysis, including costs and benefits – September 2021

Note: The timelines identified in the Department’s Management Response and/or the Management Action Plan may be impacted by COVID-19.

5.E. Evaluation of student financial assistance programs

The OAG audit report recommends that ESDC should consider undertaking a thorough evaluation of both CSLP and CESP.

Recommendation.

Employment and Social Development Canada should consider undertaking a thorough evaluation of both of the federal student financial assistance programs to, among other things,

  • further assess the reasons for student loan non-repayment in order to develop appropriate solutions
  • evaluate the impact of the Canada Education Savings Program on participation in and completion of post-secondary education and on the Canada Student Loans Program
  • understand why there is low participation in the Canada Education Savings Program

Key messages

  • ESDC agrees with the OAG’s finding to undertake a thorough evaluation of both the Canada Education Savings Program (CESP) and the Canada Student Loans Program (CSLP) to better understand their linkages and impacts on PSE.
  • In fact, an evaluation of the CESP is currently underway, which includes an in-depth examination of the factors that may influence participation in the program, specifically for low-income families. Results of this evaluation should be available in 2021.
  • The Department has also been working with Statistics Canada since 2017 for appropriate data set that would allow a comprehensive evaluation of the 2 programs, and now that the data is available, we have initiated an evaluation of the impacts of the CESP and its interactions with CSLP that will respond to the OAG recommendation. In addition, an evaluation of the CSLP is currently underway and will examine the impacts of the program on access to PSE and graduation, as well as the ability of CSLP borrowers to repay their student loans.

ESDC delivers these 2 programs to make Post-Secondary Education (PSE) more affordable and accessible.

The CESP encourages families to save for their children’s PSE through education savings incentives because an early commitment of financial support can help children see themselves as future PSE learners, reducing both financial and non-financial barriers to education. More specifically, CESP offers 2 PSE savings incentives: the Canada Education Savings Grant and the Canada Learning Bond.

For both incentives, money is deposited into a Registered Education Savings Plan (RESP) and can be withdrawn for PSE. RESP savings are an important source of funding for PSE. In 2019, Canadians withdrew $4.4 billion from RESPs to support the PSE of 462,730 students. That same year, 3.0 million children received $996 million in the Canada Education Savings Grant. Additionally, 764.501 beneficiaries received $205 million in the Canada Learning Bond, with 185,731 children receiving it for the first time.

However, not everyone can save enough for PSE, especially low- and middle-income families. To support these families, CSLP provides eligible students with grants and loans to help them pay for PSE. In addition, CSLP offers repayment assistance to ensure that student debt is manageable. In 2018 to 2019, the CSLP provided $1.6 billion in non-repayable Canada Student Grants to approximately 533,000 students and approximately $3.6 billion in Canada Student Loans to over 625,000 students.

Together, these student financial assistance programs directly ensure that Canadians can pursue PSE with the financial resources they need and with a debt load that is affordable for them.

To better understand both student financial assistance programs and their linkages, ESDC is currently undertaking an evaluation of the CESP, which includes an in-depth examination of the factors that may influence or predict participation in the program, in particular among families with lower incomes. Results of this evaluation will be available by the fall of 2021.

Furthermore, a comprehensive evaluation of interaction between CESP and CSLP requires linked data from a number of different sources: income data (to better understand their demographics and family background); PSE data from StatCan Post-Secondary Information System - PSIS (institution/program/graduation); and financial assistance data (CESP and CSLP) from programs. Until recently, these data sets were available in different programs/departments, but not in a linked format. Building a platform to connect these data had a number of challenges: (1) making sure that privacy rules are respected (especially in this case where data includes very sensitive personal information); and (2) data from databases of different formats needed to be put in the same format so that they could be linked. ESDC and Statistics Canada (STC) discussion to develop linked data (Education and Labour Market Longitudinal Platform - ELMLP) began in fall 2016.

  • the MOU between ESDC and Statistics Canada was officially amended to allow this in 2017
  • CSLP data was sent over in spring 2018 and the data linkage with the ELMLP was officially released to researchers in March 2019
  • CESP sent over the data in 2019, and the data linkage with the ELMLP was just released in November 2020

The Department has initiated an evaluation of the impacts of the CESP and its interactions with CSLP that will respond to the OAG recommendation. The results of this evaluation will be available by Spring 2023. Additionally, an evaluation of the CSLP is currently underway. Phase 1 of the evaluation examines the impact of the program on access to PSE and graduation and should be completed in 2021. Phase 2 of the evaluation will examine the ability of CSLP borrowers to repay their student loans.

Next steps

Key milestones, as indicated in the Management Action Plan submitted to the OAG, are:

CESP Research Project
  • Validation of data linkages for the Education and Labour Market Longitudinal Platform – Completed in November 2020.
  • Results tables and descriptive analysis – March 2021
  • Program officials and Evaluation staff will examine administrative CESP data, including data from the ELMLP- This is being done through the work on the upcoming in-depth evaluation of CESP and the research project. Underway.
Evaluation
  • Results of the current CESP evaluation (focus on the Canada Learning Bond) will be publicly released in 2021
  • An Evaluability Assessment on the CESP impacts will be presented to the Performance Measurement and Evaluation Committee – November 27, 2020
  • ESDC plans to commence Phase 2 of the evaluation on the CSLP – Spring 2022

Note: The timelines identified in the Department’s Management Response and/or the Management Action Plan may be impacted by COVID-19.

6. Questions and Answers

6.A. Overview of post-secondary education and federal supports

1. How does Employment and Social Development Canada (ESDC) support youth to participate in Post-Secondary Education?

ESDC provides support post-secondary students as well as youth at risk in the K-12 system so that they are ready and financial able to pursue post-secondary education:

  • The Canada Education Savings Program (CESP) offers education the Canada Education Savings Grant (CESG) and the Canada Learning Bond (CLB) for children from low-income families. In 2019, $996 million of CESG was disbursed to 3 million children; additionally, $205 million was disbursed in CLB
  • The Canada Student Loans Program (CSLP) provides targeted grants and needs based loans to help students access PSE and offers repayment assistance to borrowers with financial difficulty. In 2019 to 2020, the CSLP provided $1.6 billion in Canada Student Grants (CSG) to over 528,000 students and $3.4 billion in Canada Student Loans (CSL) to 608,000 borrowers
  • Further, ESDC also supports organizations, such as Pathways to Education Canada who help youth in lower-income communities complete high school and transition into PSE and employment; and Indspire, who provide financial and non-financial supports to Indigenous students

2. What measures have been put in place to make Post-Secondary Education (PSE) more affordable and student debt more manageable in light of the COVID-19 pandemic?

The Government of Canada provided financial relief to post-secondary students during the COVID-19 pandemic. Specifically,

  • All Canada Student Loan repayments were paused and interest did not accrue for the period of March 30 to September 30, 2020. Approximately 1.3 million student loan borrowers benefited from this measure
  • The Canada Emergency Student Benefit, (CESB) provided $2.9B in financial support to over 708,000 to post-secondary students and recent graduates who could not find summer employment due to COVID-19

To support new and returning post-secondary students this fall, the Government also introduced enhancements to Canada Student Loans and Grants, effective for 1 year starting August 1, 2020. These measures are supporting approximately 765,000 returning and prospective students in 2020 to to 2021:

  • Doubling Canada Student Grants for all eligible full-time students to up to $6,000 and up to $3,600 for part-time students. The Canada Student Grants for Students with Permanent Disabilities and Students with Dependents were also doubled
  • Removing the expected student and spousal contribution, in recognition that many students and families will struggle to save for school this year
  • Raising the maximum weekly loan amount that can be provided to a student in 2020 to 2021 from $210 to $350

3. Will the moratorium on loan repayment be extended during the pandemic?

On November 24, 2020, a motion passed in the House of Commons to extend the repayment pause for another 6 months that would be retroactive from October 1 and would expire on May 31, 2021. This motion is non-binding and would require further legislative changes. At this time, we do not have any additional information and as such, there are no further changes being made to extend the repayment moratorium and payments are due as scheduled.

6.B. Debt levels and repayment assistance

1. What is the average Canada Student Loan (CSL) balance per student entering repayment?

Students who left their studies in 2018 to 2019 had an average CSL debt of $13,400, which is roughly the same as the previous year. This amount reflects the federal portion of a student loan and has remained relatively stable over the past decade.

When broken down by institution type, University students have higher debts compared to college students. The average Canada Student Loan balance of undergraduate students upon leaving their studies was $16,400, whereas the average loan balance for college was $10,200 in 2018 to to 2019. The difference in debt load is due in part to the fact that undergraduate studies take longer to complete and therefore a higher loan balance.

2. What is the Repayment Assistance Plan (RAP)?

The Government of Canada recognizes that borrowers may experience financial difficulties at different points in their lives, making it hard for them to repay their loans. The Repayment Assistance Plan (RAP) is available to help.

RAP aims to provide relief to student loan borrowers who face employment challenges, a sudden income drop or family composition changes, such the birth of a child. Under RAP, no borrower has to repay their Canada Student Loan until they are earning at least $25,000 per year; this income threshold is adjusted upward based on family size. For those with an income over this threshold, monthly payments are limited to no more than 20% of their gross monthly family income. Furthermore, for borrowers on RAP, the Government of Canada pays the interest owing on their Canada Student Loan that their monthly affordable payment does not cover. If a borrower remains on RAP for an extended period, the government will begin to cover both the principal and interest that exceeds the reduced monthly payments, ensuring that the loan is paid off within 15 years, or 10 years if the borrower has a permanent disability.

3. How does a borrower qualify for the Repayment Assistance Plan (RAP)?

When borrowers struggle in repayment, CSLP offers the RAP to help alleviate some of the financial burden by reducing or delaying loan repayments. Borrowers apply for RAP in 6 month periods and their income and family size are taken into consideration. Monthly payments under RAP are limited to less than 20% of a borrower’s income and no borrower will have a repayment period of more than 15 years, or 10 years if they have a disability. For borrowers with income below $25,000 per year, no payment will be required. This threshold is adjusted by family size so that a borrower with a family of 4, will not be required to make a payment if they are earning under $59,512.

4. How many Canada Student Loan borrowers in repayment use the Repayment Assistance Plan (RAP)?

In the 2018 to 2019 loan year, approximately 330,000 borrowers used RAP, and 85% of them were not required to make any payments. This is a 1% increase from the 2017 to 2018 loan year.

5. What benefits are offered under the Repayment Assistance Plan (RAP)?

RAP offers different benefits depending on whether clients need short-term assistance soon after entering repayment or longer-term assistance after many years in repayment.

RAP Stage 1:

The Government of Canada pays the interest not covered by a borrower’s monthly payment on their student loan. An eligible borrower could receive this benefit for up to 60 months or within 10 years after they complete their studies, whichever comes first.

RAP Stage 2:

After 60 months of RAP or 10 years after a borrower completes their studies, whichever comes first, the Government of Canada will begin to pay towards both the principal and interest owing. As long as the borrower remains eligible, their loan will gradually be paid off after 15 years.

6. What is the Repayment Assistance Plan for Borrowers with a Permanent Disability (RAP-PD)?

RAP-PD makes it easier for borrowers with a permanent disability experiencing financial difficulties to manage their student loan by limiting payments to what they can reasonably afford.

Under RAP-PD, no borrower has to repay their Canada Student Loan until they are earning at least $25,000 per year; this income threshold is adjusted upward based on family size. For incomes over the threshold, monthly payments are limited to no more than 20% of a borrower’s gross monthly family income. Borrowers can also report disability-related expenses that could further reduce their monthly payments.

Furthermore, the Government of Canada pays both the interest and principal not covered by the borrower’s monthly affordable payments, such that the loan is paid off 10 years after the completion of studies for those who remain on RAP-PD.

7. What is the current Repayment Assistance Plan (RAP) eligibility verification process?

Employment and Social Development Canada has a systematic, sample-based income verification process. The RAP sampling process is based on a random sampling method wherein a pre-determined percentage of RAP applicants are selected for verification based on their RAP term (in other words, the number of times they have been on RAP). When selected for verification, borrowers are asked to provide documentation to validate the income they reported on their RAP application.

8. Why does Employment and Social Development Canada (ESDC) not verify the income of all Repayment Assistance Plan (RAP) applicants?

ESDC has a systematic, sample-based income verification process for RAP. The department uses a sampling methodology that is based on industry and Government of Canada standards which includes risk management principles.

9. What is Employment and Social Development Canada (ESDC) doing to strengthen the current Repayment Assistance Plan (RAP) eligibility verification process?

ESDC has a systematic, sample-based income verification process for RAP eligibility. However, the Department acknowledges that verification of certain groups has challenges, specifically applicants who report zero income in the preceding month, which accounts for approximately 20% of applicants.

ESDC has engaged partners, including the Canada Revenue Agency (CRA), provinces, and its service provider on more robust RAP verification methods. We are working with the CRA on an Information Sharing Agreement that will allow the Department to verify applicant information against tax data. This will include the applicant’s family income, marital status and number of dependants against CRA tax data during the application process, while maintaining the current systematic sampling size and timing.

10. Is the cost of student financial assistance misleading when Employment and Social Development Canada (ESDC) does not include the Repayment Assistance Plan (RAP) costs in their reporting of financial losses?

RAP is a program benefit to which eligible student loan borrowers are entitled. RAP expenditures are not a financial loss, as it is a benefit provided by the Government of Canada to support students who are experiencing difficulty repaying their Canada Student Loans.

The Department already reports to Parliament on all program expenses, including amounts of write-off of unrecoverable student loans and the cost of RAP, through Public Accounts. More detailed information is also included in the CSLP Annual Report. In addition, each year, the Office of the Chief Actuary (OCA) prepares a 25 year forecast of all program costs and revenues. The report is published annually and tabled in Parliament every 3 years.

To add more depth to our public reporting, and increase transparency, the department has started working with Office of the Chief Actuary to develop a new indicator for RAP. This indicator is currently under development and the department is considering it options going forward with regards to implementation.

6.C. Delinquency, default and collections

1. What is a delinquent loan?

A student loan becomes delinquent when the borrower’s payment is late by less than 270 consecutive days. During this time, the CSLP’s third-party Service Provider, branded as the National Student Loans Service Centre (NSLSC), monitors the loan repayment behaviour of borrowers and undertakes follow-up actions on delinquent loans (for example calls and/or sends letters, payment reminders, texts, etc.). The Service Provider also reports to credit bureaus on a monthly basis. Loans for which payments are 30 days late are reported as delinquent, and this remains on the borrower’s credit report for approximately 6 years. Borrowers with delinquent loans are offered repayment options such as RAP, even retroactively, to help bring their loans into good standing.

2. What is a loan in default?

If a borrower does not make a payment or does not acknowledge their debt for 270 consecutive days, the loan enters into default. The Canada Revenue Agency (CRA) is responsible for collecting loans in default or otherwise know as loans in collection.

In 2018 to 2019, $350 million Canada student loans in default transferred to the CRA for collection. As of September 2020, a total of $2.45 billion in Canada student loans were in collections with the CRA.

3. What is the Canada Student Loans Program’s (CSLP) default rate?

The CSLP uses a 3-year default rate as a main indicator of the performance of the portfolio. This rate represents the proportion of loans that go into default within 3 years of entering repayment. There have been significant improvements to the default rate. In 2003 to to 2004, the 3-year default rate for borrowers entering repayment was 28%. As a result of repayment assistance measures as well as targeted interventions by the CSLP service provider, the default rate has continuously improved. In 2017 to 2018 the default rate was 8%, the lowest CSLP default rate ever.

Table 3: Canada student loans 3 year default rate
Repayment cohort — Year loans entered repayment (Loan year) 3 Year default rate
2003 to 2004 28%
2004 to 2005 19%
2005 to 2006 17%
2006 to 2007 16%
2007 to 2008 15%
2008 to 2009 14%
2009 to 2010 15%
2010 to 2011 14%
2011 to 2012 13%
2012 to 2013 12%
2013 to 2014 11%
2014 to 2015 10%
2015 to 2016 9%
2016 to 2017 9%
2017 to 2018 8%

4. What is the Canada Revenue Agency’s (CRA) role once a student loan goes into default?

CRA is the collection agency for the Canada Student Loans Program. Once a student loan payment is not made for 270 days, the loan goes into default is transferred to the CRA for collections. The CRA is responsible for collections activities to recover the loan, including:

  • Contacting the debtor via telephone: The CRA Debt Management Call Centre makes outbound calls and responds to the majority of inbound calls from the Department of ESD program debtors. During this time, if debtors can be reached, the CRA actively promotes the rehabilitation of CSLs and explains the benefits of loan rehabilitation to the debtors.
  • Contact Tracing: The CRA tracing unit performs soft tracing activities for the purpose of locating debtors, employers and sources of revenue for collections.
  • Collections: The CRA Tax Services Office negotiates payment arrangements with debtors, administers and evaluates financial questionnaires to deem whether or not debtors are able to pay, and takes legal action as delegated under CSLP legislative authority, if necessary, to recover Crown debt.
  • Legal Action: When collection efforts are unsuccessful and a review of the debtor’s financial situation indicates that the debtor is able to pay, legal action may be pursued. Only files that meet specific criteria can be referred to CRA’s Collections Litigations and Advisory Services, with considerations given to the costs associated with pursuing legal action versus the amount of potential recovery. Legal action can include income garnishment, withholding government payments from refund set off programs, pursuing judgments, compromise settlements, and placing liens and/or seizing borrower assets until the debt is repaid in full

In 2018 to 2019, the CRA recovered $195.7 million in defaulted Canada Student Loans, a slight increase from the $192 million recovered the year prior. This includes $89.5 million through the refund in set-off program.

5. Does the CRA report loans in collections to the credit bureaus?

When loans are in good standing, the CSLP’s service provider reports to credit bureaus monthly. When a loan defaults and is transferred to the CRA, 1 final report is sent to the credit bureau. Our 2 departments are working together to develop a process for credit bureau reporting. This will be implemented by fall 2022 as part of ongoing program enhancements.

6. What steps can borrowers take to return their defaulted loans back into good standing?

To bring a Canada Student Loan back to good standing, borrowers must enter into a repayment arrangement with the Canada Revenue Agency (CRA). This arrangement involves paying all the outstanding interest, and making the equivalent of 2 monthly payments in accordance with the repayment agreement. Once a loan is in good standing, borrowers can apply to receive further student financial assistance or support through RAP.

Effective January 1, 2020, a borrower can now capitalize all outstanding interest on their loan instead of paying off the interest as a condition of loan rehabilitation.

If a borrower is not in a financial positon to rehabilitate their loan, they may contact the CRA to discuss repayment options, including their financial hardship measure of support.

7. What happens to borrowers who default on their Canada Student Loans?

Failing to pay a Canada Student Loan has consequences for the borrower. The service provider sends the credit bureau a monthly report on the delinquent status of the loan. The borrower’s credit score will also be negatively affected and this will make it more difficult for them to borrow money for future purchases like a house or car.

Once a loan enters collections, the Canada Revenue Agency may also recoup income tax refunds or pursue legal action, potentially leading to wage garnishments or asset seizures.

Furthermore, borrowers with Canada Student Loans that are not in good standing are no longer eligible for further grants, loans or repayment assistance until their loan is paid off or back in good standing. Even if a loan is removed from active recovery and the Government of Canada eventually writes it off, the loan is not forgiven. The borrower continues to owe the money.

6.D. Write-offs

1. Why did the Government of Canada write off $180.4 million in Canada Student Loans?

$180.4 million in unrecoverable Canada Student Loans was recommended for write-off in 2019 to 2020 for a number of reasons; primarily for loans that reached the statue-barred limitation for collection, bankruptcy, compromised settlements, hardship and low dollar value of debt in relation to the cost of its recovery.

2. What are the trends in write-offs?

The write-off dollar value amount varies from year to year though it consistently represents approximately 1% of the Canada student loan portfolio. In each of the past 2 years, student loan write-offs were below 1%, which is consistent with the reports produced by the Office of the Chief Actuary (OCA) who projects that write-off values will continue to represent approximately 1% of the CSL portfolio, even as the size of the portfolio continues to grow. In 2019 to 2020, $180.4 million in unrecoverable student loans were recommended for write-off. In 2018 to 2019, $162.2 million was recommended for write-off, and in 2017 to 2018, $203.4 million was recommended for write-off. The variance in the write-off amount is explained by normal variation from year to year, and partly due to the growing size of the direct student loan portfolio, which has grown 82% in the last 10 years.

6.E. Financial literacy

1. Why is financial literacy important for post-secondary students?

Financial literacy is important at every life stage. For some post-secondary education students, understanding how to apply for and obtain the financial assistance they need to go to school and then how to manage their student loan may be a challenge. That is why ESDC, in collaboration with the Financial Consumer Agency of Canada, is committed to providing them with the financial literacy tools and information they need to succeed.

2. What is Employment and Social Development Canada (ESDC) doing to address the OAG’s recommendation about the making available all the financial information need by Canada Student Loan recipients?

In collaboration with the Financial Consumer Agency of Canada (FCAC), ESDC established an overall financial literacy plan in 2017, which aims to ensure that clients are fully informed of their obligations and options during every stage of the loan lifecycle by providing user-friendly financial information. Since the audit, significant progress has been made in this area. For example, a Virtual Repayment Counsellor was launched on the National Student Loan Service Center web portal in November 2019, new and updated financial literacy web content on repayment obligations and options continue to be posted.

3. What is Employment and Social Development Canada (ESDC) doing to address the OAG’s recommendation about consulting with stakeholders on mandatory training for student loans applicants before loans are provided and for student loan recipients who abandon or complete their studies?

The Department will engage key partners, including provinces and territories, the Financial Consumer Agency of Canada and other stakeholders on the feasibility of mandatory counselling. This has also been identified in our management action plan.

6.F. Student financial assistance program evaluation

1. Has Employment and Social Development Canada (ESDC) assessed the full impact of student financial assistance on post-secondary education?

ESDC is currently conducting, and finalizing work on, an in-depth evaluation of the Canada Education Savings Program (CESP) which will asses the factors that may influence participation among families with lower income. The results of this evaluation are scheduled to be published by the fall of 2021. ESDC is also launching an evaluation specifically on the impacts of the CESP and the interactions between the CESP and the Canada Student Loans Program. These results will be publicly available by the summer 2022.

With a more in depth understanding of these impacts, ESDC will be able to take the appropriate steps to further reduce financial barriers and enhance access and affordability for students.

6.G. Service provider contract management

1. How does Employment and Social Development Canada (ESDC) ensure strong contract management of the service provider performance?

Since 2000, the administration of the CSLP has been contracted to a private sector service provider. The Department maintains full control of the program, including policy design and development, while the service provider administers the grants and loans, including the disbursement of funds and the administration of student loan repayment.

The service provider receives compensation for (i) ongoing account management; (ii) change management (to introduce program changes); and (iii) performance incentive for lowering default rates. ESDC’s objective has always been to develop challenging, but not impossible to meet default rate targets. Under the incentive scheme, the Department ensures that the service provider uses targeted measures to continuously reduce the default rate.

Implementation of these measures ensured that the default rate has continued to improve over time, from 28% in 2003 to 2004 to 15% in the 2009 to 2010 to 8% in the 2017 to 2018, an all all-time low. Moving forward, the Department will continue to ensure that default targets are aligned with current realities, are appropriately challenging, and account for program or policy changes.

6.H. National Student Loans Service Centre (NSLSC) call center

1. Why are student loan borrowers having difficulty talking to an agent at the NSLSC?

The NSLSC has been experiencing significantly higher than normal call volumes since the beginning of October. This was driven by a number of factors:

  • Resumption of repayment after the repayment moratorium ended on September 30, 2020
  • The annual peak of borrowers entering repayment in November (6 months after they graduate in April/May); and
  • Strengthened security measures to protect against cyberattacks
  • Recently a number of government departments discovered attempted cyberattacks through login credentials used by the Government of Canada, including the National Student Loans Service Center. In order to ensure security of student accounts, students are asked to provide additional details to be able to log in; this has caused a number accounts being locked, and students need to call NSLSC to unlock their accounts. To date, our investigation has not found any improper activity in relation to NSLSC accounts

The NSLSC was expecting and had prepared for an increase in calls following the end of the COVID moratorium and for the beginning of the annual peak repayment period of November; however the security measures added significantly to the call volume.

This unprecedented volume of calls led to longer than usual wait times and sometimes to phone system blockage. To address this, the NSLSC has increased its phone system capacity and has added call centre agents. Since then the situation has improved; we continue to monitor the situation closely.

6.I. Jasmin Simpson v. Attorney General of Canada and Attorney General of Ontario caseofaoc

1. What is the government doing in regards to the recent Ontario Superior Court ruling in the Jasmin Simpson v. Attorney General of Canada and Attorney General of Ontario case?

By decision dated October 26, 2020, the Court held that the operation of the Canada Student Loans Program (“CSLP”) in the case of the applicant, who is a person with a disability, resulted in her incurring more loan debt than her non-disabled peers, and that this amounted to discrimination contrary to section 15 of the Canadian Charter of Rights and Freedoms (“Charter) and was not justified under section 1.

The Government of Canada has not appealed the decision.

The Government supports students with disabilities with the cost of post-secondary education through a number of measures, including additional grants available through the CSLP, and will continue to explore ways to ensure that students with disabilities receive the support they need to be able to access post-secondary education.

6.J. One year elimination of interest on loans

1. Why is the Government of Canada only proposing to eliminate interest on Canada Student Loans and Canada Apprentice Loans for 1 year?

As you know, the Government announced a one-year elimination of interest on Canada Student Loans in its Fall Economic Statement. This measure will require a legislative amendment, and we will work on implementing this soon afterwards.

No interest will accrue during this 1 year period, reducing financial pressure on borrowers facing the financial impacts of the COVID-19 pandemic. This measure will help relieve the debt burden of 1.4 million borrowers in 2021 to 2022.

However, borrowers will be still required to continue to make monthly payments on their Canada Student Loans during the one-year period in which interest is eliminated.

7. Integrity measures / Fraud (CERB)

Suggested speaking points for the Standing Committee on Public Accounts Deputy Minister appearance on DDecember 1, 2020

  • The Government of Canada launched the Canada Emergency Response Benefit to address the historically high number of Canadians in financial need due to the COVID-19 pandemic.
  • The primary goal has been getting money into the pockets of Canadians who need it during this difficult time, and doing so in a timely and accurate way.
  • ESDC’s approach follows the best practices promoted by the International Public Sector Fraud Forum and its 5 principles of Fraud Control in Emergency Management.
  • The Department is committed to the financial stewardship of its programs. It is known that the risk of fraud is heightened in times of crisis and ESDC is and continues to conduct file reviews and investigations to identify and address cases of error, abuse and fraud.
  • Between March and August 2020, when Canadians needed support the most, the government introduced the CERB, which helped more than 8.5 million people pay their bills during this challenging time. From March 16 to September 27, 2020, alone, Service Canada received more than 4.96 million EI ERB applications.
  • While the Government of Canada is not looking to punish people who made honest mistakes, the necessary tools are being used to address situations where people have tried to take advantage of the pandemic situation by abusing the CERB/ERB.
  • The Department has a comprehensive plan to ensure the integrity of the CERB program. Legislative changes will be required [end of sentence redacted].
  • Considerable efforts have been made to identify and mitigate fraud in the EI ERB and have yielded significant results.
  • Early actions taken have mitigated and disrupted suspected large-scale, egregious EI ERB fraud; including identity theft.
  • As a result, ESDC imposed over 40,000 stop pays to prevent further payments and referred over 7,000 cases to law enforcement.
  • At the same time, ESDC has worked to ensure eligible clients impacted by potential instances of identity theft can receive their benefits.
  • ESDC uses computer tracking, advanced data analytics and linked data systems to detect fraudulent activity.
  • As new data sources, such as tax returns become available, additional individuals who may have been ineligible for the benefit will be identified.
  • As per ESDC’s regular processes, clients who are found to have made fraudulent claims will be required to repay the amount distributed by the Government and may face other consequences, up to and including prosecution for the most grievous cases of fraud.

8. Parliamentary background and analysis

Official title: Parliamentary background and analysis appearance by the Deputy Minister Graham Flack, Standing Committee on Public Accounts Report 2, Student Financial Assistance, of the 2020 Spring Reports of the Auditor General of Canada Tuesday, December 1, 2020 time TBC

1. Background

The 2020 Spring Reports of the Auditor General of Canada were tabled in the House of Commons on July 8, 2020, and referred to the Standing Committee on Public Accounts for further consideration. On October 29, the Auditor General briefed the committee in camera to update the Committee on the current audits. As such, on November 5, 2020, PACP adopted a motion to study Report 2, Student Financial Assistance.

The purpose of the meeting is to provide an opportunity for Committee Members to question you, as Accounting Officer, on the conclusions and recommendations found in the audit. Overall, Report 2 concluded that Employment and Social Development Canada (ESDC) did not efficiently manage some aspects of financial assistance to post-secondary students. The audit found that ESDC had not thoroughly assessed the individual and combined impact of the Canada Education Savings Program and the Canada Student Loans Program on students’ capacity to access post-secondary education. It had also not assessed the obstacles that keep students from being able to repay their loans. The audit also noted basic weaknesses in program management.

At the request of the Committee, the December 1 meeting will be 2 hours in duration: a discussion with you and the Auditor General of Canada, Karen Hogan. Senior principals responsible for the audit are expected to testify with the Auditor General.

The Canada Revenue Agency and the Financial Consumer Agency of Canada were involved in this audit and will also testify on December 1.

2. Committee proceedings

PACP is composed of 11 MPs.

PACP is 1 of 4 committees where the chair is a member of the official opposition. In addition, in the current minority Parliament, the Government does not hold the majority at PACP. The Chair is Ms. Kelly Block, a member of the Conservative Party of Canada. The 2 Vice-Chairs are Liberal MP Lloyd Longfield and BQ MP Maxime Blanchette-Joncas.

Other members are:

  • Luc Berthold (CPC)
  • Kody Blois (Liberal)
  • Greg Fergus (Liberal)
  • Matthew Green (NDP)
  • Philip Lawrence (CPC)
  • Francesco Sorbara (Liberal)
  • Len Webber (CPC)
  • Jean Yip (Liberal)

At the beginning of the meeting, the Auditor General will be provided with 5 minutes for her opening statement. Once completed, you will also have 5 minutes for your remarks. PACP has also a strong preference to receive opening statements 72 hours in advance. Furthermore, ESDC will have to provide a detailed action plan to address the audit recommendations which have been agreed to - including specific actions, timelines for their completion and responsible individuals - to the committee and the Office of the Auditor General of Canada within at least 48 hours in advance.

The Office of the Auditor General of Canada will typically share remarks in advance if the hearing.

PACP has agreed that questioning of witnesses would be allocated as follows:

Round 1: 6 minutes for the first questioner of each party as follows

  • Conservative Party
  • Liberal Party
  • Bloc Québécois
  • New Democratic Party

For the second and subsequent rounds, the order and time for questioning be as follows:

  • Conservative Party, 5 minutes
  • Liberal Party, 5 minutes
  • Bloc Québécois, 2 and a half minutes
  • New Democratic Party, 2 and a half minutes
  • Conservative Party, 5 minutes
  • Liberal Party, 5 minutes.

3. Parliamentary and Media Analysis

The Report released in July did not generate the same level of interest as previous reports have during a typical sitting. Instead, other issues related to students, such as the Canada Student Service Grant and COVID measures, dominated in the media and in Parliament. In the House of Commons, there were no questions specific to Report 2 Student Financial Assistance. Questions about the OAG Reports included other topics such as immigration or focussed on demands from the official opposition to increase funding to the Auditor General to keep track of expenditures related to COVID.

On November 18, 2020, PACP tabled a Committee Report in the House of Commons asking the government to provide the auditor general with the $31M she has requested that is required for her to achieve the Office of the Auditor General objectives, and that the committee report this to the house.

Unrelated to the audit, on November 24, 2020, the House of Commons unanimously adopted a motion regarding the extension of the moratorium on repaying student loans from October 1, 2020 to May 31, 2021. The motion put forward by NDP MP Heather McPhersonr is none binding, however, it demonstrates an overall support to students.

COVID Response: Capacity to audit

On October 29, the Auditor General Karen Hogan appeared before PACP to discuss the main estimates 2020 to 2021, for the Office of the Auditor General. She was asked to comment about the impact the pandemic has had on delivering the mandate of her office and mentioned that the biggest impact is capacity, both in the departments (and specifically mentioned ESDC) and within her office. Members may ask you to comment and elaborate on ESDC’s capacity to provide innovative measures to help Canadians through the pandemic and the Department’s capacity to collaborate with the OAG on the COVID-19 audit.

The Auditor General said publically that her office would not be able to audit every single program the government has introduced in response to the pandemic but will move forward selectively. Her priorities are to examine the government's ability to buy personal protective equipment for health-care workers, a study of Canada's food supply and a more detailed look at the Canada Emergency Response Benefit (CERB). Although this is not the topic of your appearance, opposition parties may ask you to comment on allegations of fraud related to CERB or other matters related to COVID measures.

Action Plan tabled with PACP

PACP members will ask you to discuss the Action Plan ESDC provided to the Committee prior to your appearance. The members will discuss how ESDC plans to address the recommendations the OAG has identified and request specifics. PACP might ask you to commit to following up with the Committee on progress. The Committee will draft a Report once this study is completed and once tabled in the House of Commons, will request a Government Response to be provided within 120-calendar days.

9. Master overview of the committee

Standing Committee on Public Accounts (PACP)

Mandate of the Committee

When the Speaker tables a report by the Auditor General in the House of Commons, it is automatically referred to the Public Accounts Committee. The Committee selects the chapters of the report it wants to study and calls the Auditor General and senior public servants from the audited organizations to appear before it to respond to the Office of the Auditor General’s findings. The Committee also reviews the federal government’s consolidated financial statements – the Public Accounts of Canada – and examines financial and/or accounting shortcomings raised by the Auditor General. At the conclusion of a study, the Committee may present a report to the House of Commons that includes recommendations to the government for improvements in administrative and financial practices and controls of federal departments and agencies.

Government policy, and the extent to which policy objectives are achieved, are generally not examined by the Public Accounts Committee. Instead, the Committee focuses on government administration – the economy and efficiency of program delivery as well as the adherence to government policies, directives and standards. The Committee seeks to hold the government to account for effective public administration and due regard for public funds.

Pursuant to Standing Order 108(3) of the House of Commons, the mandate of the Standing Committee on Public Accounts is to review and report on:

  • The Public Accounts of Canada
  • All reports of the Auditor General of Canada
  • The Office of the Auditor General’s Departmental Plan and Departmental Results Report; and
  • Any other matter that the House of Commons shall, from time to time, refer to the Committee

The Committee also reviews:

  • The federal government’s consolidated financial statements
  • The Public Accounts of Canada
  • Makes recommendations to the government for improvements in spending practices
  • Considers the Estimates of the Office of the Auditor General

Other Responsibilities

  • The economy, efficiency and effectiveness of government administration
  • The quality of administrative practices in the delivery of federal programs; and
  • Government’s accountability to Parliament with regard to federal spending

Committee Members

Chair

Kelly Block, Conservative, Carlton Trail—Eagle Creek, New Member

Vice-Chair

  • Lloyd Longfield, Liberal, Guelph, Returning Member
  • Maxime Blanchette-Joncas, Bloc Québécois, Rimouski-Neigette—Témiscouata—Les Basques, Returning Member - Public Accounts Critic

Members

  • Luc Berthold, Conservative, Mégantic—L’Érable, New Member - TBS Critic
  • Phillip Lawrence, Conservative, Northumberland—Peterborough South New Member - National Revenue Critic
  • Len Webber, Conservative, Calgary Confederation, New Member
  • Matthew Green, New Democratic Party, Hamilton Centre, Returning Member - TBS Critic
  • Kody Blois, Liberal, Kings—Hants, New Member
  • Greg Fergus, Liberal, Hull—Alymer, Returning Member (Non-voting - 42nd Parliament) - Parliamentary Secretary TBS and Digital Government
  • Francesco Sorbara, Liberal, Vaughan—Woodbridge, Returning Member (43rd-1 Parliament)
  • Jean Yip, Liberal, Scarborough—Agincourt, Returning Member (42nd Parliament)

Kelly Block

(Saskatchewan - Carlton Trail—Eagle Creek) Conservative, Chair

  • Elected as the Member of Parliament in 2015 for Carlton Trail—Eagle Creek, previously for Saskatoon—Rosetown—Biggar from 2008-2015
  • Served as vice-chair on the Standing Committee on Transport, Infrastructure and Communities in the 42nd Parliament
  • Member of the Liaison Standing Committee
  • Previous member of the Standing Committee of Government Operations and Estimates in the 43rd and 41st Parliament, the Standing Committee of Finance in the 40th Parliament
  • Served as the Opposition critic for Public Services and Procurement Canada (appointed by Andrew Scheer)
  • Prior to her election, Mrs. Block served two terms as the first female mayor of Waldheim, Saskatchewan, as chairperson of the Gabriel Springs Health District, and was awarded the Maclean's Parliamentarian of the Year – Rising Star – Award in June 2010

Lloyd Longfield

(Ontario—Guelph), Liberal, First Vice-Chair

  • Elected as the Member of Parliament for the riding of Guelph in 2015
  • Former member of the Public Accounts Committee (PACP) in the 43rd Parliament and is a standing Member of the Environment and Sustainable Development Committee (ENVI)
  • Former Executive Director of the Guelph Chamber of Commerce, and former business executive

Maxime Blanchette-Joncas

(Québec—Rimouski-Neigette – Témiscouata – Les Basques), Bloc Québécois, Second vice-chair

  • Elected as the Member of Parliament for Rimouski-Neigette—Témiscouata—Les Basques in the 2019 federal election
  • BQ Critic for Public Accounts
  • Preceded in his riding by Guy Caron who served as the leader of the NDP from 2017 to 2019
  • Business Administration graduate from the University of Quebec in Rimouski and former administrative officer at the Business Development Bank of Canada
  • Was regional president of the Youth Forum of the Bloc Québécois

Luc Berthold

(Mégantic—L’Érable), Conservative, Member

  • Elected as the Member of Parliament for Mégantic—L'Érable in 2015.
  • Critic for TBS
  • Previously the Vice-Chair of the Standing Committee on Transport, Infrastructure and Communities, and the Standing Committee on Agriculture and Agri-Food
  • Prior to his election, Mr. Berthold was Nathalie Normandeau’s Political Assistant, and communications advisor for the Leader of the Official Opposition in 1999, the Interim Director of communications for Quebec’s Liberal Party in 2006, and worked as a speaker, coach and gave leadership training sessions

Phillip Lawrence

(Northumberland—Peterborough South), Conservative, Member

  • Elected as the Member of Parliament for the riding of Northumberland—Peterborough South in the 2019 federal election
  • Shadow Minister of National Revenue
  • Former member of Standing Committee of Justice and Human Rights
  • Prior to his election, Mr. Lawrence received his BA from Brock University in Political Science, he attended Osgoode Hall Law School and the Schulich School of business to obtain his law degree and MBA, and volunteered at the Financial Planning Standards Council

Len Webber

(Calgary Confederation), Conservative, Member

  • Elected as the Member of Parliament for the riding of Calgary Confederation in 2015
  • Former Vice-Chair of the Standing Committee on Health in the 42nd Parliament
  • Previously a member on the Standing Committee on Health, the Subcommittee on Sports-Related Concussions in Canada of the Standing Committee on Health and the Subcommittee on Agenda and Procedure of the Standing Committee on Health
  • Prior to his election, Mr. Webber was a Member of the Legislative Assembly of Alberta, representing the constituency of Calgary-Foothills from 2004 to 2014, work as an apprentice electrician and managed his own contracting company for 10 years, and served as vice president and director of the Webber Academy, a private, non-profit school in southwest Calgary for children from junior kindergarten to grade 12 founded by his father

Matthew Green

(Ontario—Hamilton Centre), NDP, Member

  • Elected as the Member of Parliament foe Hamilton Centre in the 2019 federal election in the riding formerly held by NDP MP David Christopherson
  • NDP Critic for National Revenue/CRA, Public Services and Procurement
  • Former Councilor for the City of Hamilton (2014 to 2018)
  • Member of the House of Commons Standing Committee on Public Accounts (PACP), the Standing Committee on Government Operations and Estimates (OGGO), and the Subcommittee on Agenda and Procedure of the Standing Committee on Government Operations and Estimates
  • Member of the Canada-Africa Parliamentary Association (CAAF) and the Canadian Section of ParlAmericas (CPAM)

Kody Blois

(Kings—Hants), Liberal, Member

  • Elected as the Member of Parliament for the riding of Kings—Hants in the 2019 federal election, in the riding formerly held by former TBS President Scott Brison
  • Current member of the Standing Committee for Agriculture and Agri-Food, and the Subcommittee on Agenda and Procedure of the Standing Committee on Agriculture and Agri-Food
  • Former member of the Standing Committee for Agriculture and Agri-Food, and the Standing Committee on Public Accounts
  • Blois completed degrees in commerce, law, and public administration - which sparked his interest in serving his community

Greg Fergus

(Hull—Alymer), Liberal, Member

Parliamentary Secretary to the President of the Treasury Board and Minister of Digital Government

  • Elected as the Member of Parliament for the riding of Hull—Aylmer in 2015
  • Member of the Standing Committee on Access to Information, Privacy and Ethics
  • Former member of the Standing Committee on Finance, and the Standing Committee on Public Accounts
  • Current and Former Parliamentary Secretary to the President of the Treasury Board and Minister of Digital Government. Former Parliamentary Secretary to the Minister of Innovation, Science and Economic Development
  • Former National Director of the Liberal Party of Canada and former political staffer in various Ministerial offices

Francesco Sorbara

(Vaughn—Woodbridge), Liberal, Member

  • Elected as the Member of Parliament for the riding of Vaughan—Woodbridge in 2015
  • Member of the Standing Committee on Access to Information, Privacy and Ethics
  • Former member of the Standing Committee on Finance, as well as the Subcommittee on Agenda and Procedure of the Standing Committee on Finance, and the Standing Committee on Public Accounts
  • Parliamentary Secretary to the Minister of National Revenue
  • Sorbara is a chartered financial analyst and worked in the global financial markets for nearly 20 years in both Canada and the United States for Scotiabank, JPMorgan Chase, and global credit rating agency DBRS

Jean Yip

(Scarborough—Agincourt), Liberal, Member

  • First elected in a by-election on December 11, 2017 as the Member of Parliament for the riding of Scarborough—Agincourt. Elected in 2019 as the Member of Parliament for the riding of Scarborough—Agincourt.
  • Current member of the Special Committee on Canada-China Relations.
  • Former member of the Public Accounts committee, and the Government Operations and Estimates Committee.
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