Evaluation of the Immigration Loan Program
5. Findings Related to Program Relevance
Program relevance was assessed in terms of the appropriateness of the federal role in providing loans, alignment of the program with Government of Canada and CIC priorities, and continued need.
5.1 Appropriateness of the Federal Role
Finding: The role of the federal government in administering the Immigration Loan Program is appropriate.
The Immigration Loan Program, in following the directives set out by TB for the establishment of loans, the management of receivables, and debt write-offs, is in alignment with the authorities provided to the Minister of Finance. The Minister of Finance is responsible for the sound stewardship of the Canadian financial system.Footnote 126 Under the Financial Administration Act, one of the mechanisms available to the Minister of Finance to promote the stability or maintain the efficiency of the financial system in Canada is the provision of loans.Footnote 127
In addition, section A88 of IRPA authorizes the Minister of Citizenship and Immigration to administer loans for the purpose of immigration, through an advance out of the Consolidated Revenue Fund. The IRPR stipulates the information surrounding the types of loans, the repayment period, interest, alternative arrangements, and the size of the loan fund.Footnote 128
While other levels of government and the private sector also provide loans to individuals, the role of the federal government in providing loans has been identified in the literature as appropriate as it provides a means of overcoming difficulties felt by certain groups in securing the financing they need on an individual basis due to lack of collateral or other means of securing loans.Footnote 129 These groups include, among others, students and immigrants.
5.2 Alignment with Government-wide and CIC Priorities
Finding: While the Immigration Loan Program facilitates the initial resettlement of refugees, helping Canada to meet its international commitments for the protection of refugees, the program, as implemented, is not fully aligned with Canada’s settlement objectives.
Canada’s commitment to share responsibility for the protection of refugees is demonstrated through Canada’s participation as a signatory to several international treaties concerning refugees and others (e.g. Convention Relating to the Status of Refugees (1951), and Protocol on Refugees and Stateless Persons (1967)). This commitment is also articulated in IRPA, which states that “the refugee program is in the first instance about saving lives and offering protection to the displaced and persecuted.”Footnote 130 Some CIC representatives interviewed felt that the Immigration Loan Program could be considered to be in alignment with this objective, in that the program provides a means to bring refugees to Canada. However, in most cases, interviewees went on to identify aspects of the program that were not in alignment with Canada’s humanitarian objectives and CIC’s settlement objectives.
The evaluation also found that while the assessment undertaken to determine eligibility for a loan is intended to be distinct from the ability to establish assessment for refugees,Footnote 131 they occur at about the same time,Footnote 132 and are essentially trying to meet competing objectives. Some interviewees noted, and the document review confirmed, that the introduction of IRPA relaxed the criteria in relation to ability to establish in Canada to focus on “social rather than economic factors” in light of the humanitarian objectives of resettlement. The IRPR also provided the “authority to exempt refugees in urgent need of protection and vulnerable cases from the requirement to be assessed on ability to successfully establish”.Footnote 133 However, under the Immigration Loan Program, potential loan recipients are required to be assessed against economic factors related to their potential ability to repay, such as income potential, other financial obligations (such as the number of dependent family members), employment history and current ability to speak one of Canada’s official languages.Footnote 134
Some interviewees pointed to the additional burden introduced by the loan as evidence of the program’s misalignment with CIC’s Strategic Outcome 3: Newcomers and citizens participate in fostering an integrated society, and more specifically, Program Activity 3.1 “newcomer settlement and integration”. The main difficulty in confirming the alignment between the program and SO3 appears to be with respect to the mechanism used, i.e., a loan, as a means of providing the support. All interviewees agreed that there is a need to provide support, however, the use of a loan to do so does not appear to be in alignment with the achievement of settlement objectives. Information presented throughout this evaluation report provides clear indications that, for some loan recipients, the loan is having a negative impact on their settlement, which runs counter to the intent of CIC’s SO3 and the overall intent of the loan program itself. Rather than contributing to settlement, the loan program, as it is currently designed, and given the client group it is currently trying to serve, may actually be at cross-purposes to the objectives it is supposed to support.
Thus, while the program supports Canada’s humanitarian objectives, in that it provides refugees overseas with a means to come to Canada, the way it is structured, it may be creating barriers to the achievement of CIC’s settlement objectives.
5.3 Continued Need for the Program
Finding: There is a continued need to provide financial support to refugees who do not have the means to pay the costs associated with their resettlement to Canada. However, the use of a loan may not be appropriate for everyone in this group.
Findings from the loan recipient survey showed that the majority of respondents (74.7%) could not have paid for any of the costs that the loan covered.Footnote 135 These findings were consistent with results from the RAP SPO and SAH surveys and the interviews, which indicated that typically, in the absence of the loan program, refugees would not be able to pay the costs of admissibility and transportation to Canada. Interviewees also mentioned that some refugees may need assistance more than others, for example individuals coming from protracted refugee situations, individuals with health problems, individuals who have limited education and literacy skills, and individuals with large families.
This need for financial assistance is not surprising given the evolving context of refugee resettlement over the past 15 years. The literature reviewed noted that longer term displacement is becoming more common, resulting in an increase in the number of refugees with high needs, such as low literacy, limited to no education, and health issues,Footnote 136 and referred to the large number of protracted refugee situationsFootnote 137 and the “changing make up of post-IRPA Government-Assisted Refugees.”Footnote 138 An analysisFootnote 139 examining the economic outcomes of GARs and PSRs was conducted to verify this reported change in profile of refugees since the introduction of IRPA. The analysis showed that the incidence of employment and average employment earnings were consistently lower, and the incidence of social assistance/income support was consistently higher, for GAR families who arrived after the introduction of IRPA, compared to those who arrived before its introduction. However, this trend was reversed for PSR families, with those arriving after the introduction of IRPA tending to have somewhat better economic outcomes than their predecessors.Footnote 140
In sum, refugees, particularly GARs, coming to Canada since the introduction of IRPA tend to have greater needs than the refugees who came to Canada in the past. This is reflected in their need for financial support to help them to move to Canada and settle, as well as in their early economic outcomes once in Canada.
The evaluation has shown that the loan can cause an additional burden for refugees, and having to start repaying it shortly after arrival can have a negative impact on their settlement. Some interviewees identified a need for the loan; however, they qualified it as a need in the absence of any other mechanism to provide financial assistance.
While contributions may be approved by CIC to cover the loan in situations where refugees are deemed to be “vulnerable” or to have “higher settlement needs”,Footnote 141 the money set aside for contributions is quite limited relative to the amount set aside for loans, and thus, may not fully respond to client needs. Together, these findings suggest that the Immigration Loan Program, as currently implemented, may not be the most appropriate mechanism to provide financial assistance to a refugee clientele, but as it is the primary mechanism used at this time, it has become necessary.
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