moved that Bill C-316, an act to amend the Income Tax Act (interest on students loans), be read the second time and referred to a committee.
Mr. Speaker, it is my honour to speak on my Bill C-316. Like my fellow members of the government caucus as well as other members of parliament, I believe that a well educated, vibrant workforce is the key to Canada's continued growth and prosperity and improved standard of living for all.
Of all the riches the country holds, our greatest resource by far is our people. It is our responsibility as the government of this great country to provide the people of Canada with an environment in which they may reach their full potential.
By giving recent graduates a tax credit for interest paid on student loans, the bill aims to support those Canadians who have decided to invest not only in themselves but in Canada and in our common future.
For years businesses have been given a tax credit for interest paid on business investment loans. This credit was granted based on the reasoning that moneys invested in business were contributing back to the Canadian economy.
Bill C-316 builds on this rationale by promoting the concept that a student's investment in his or her education is an investment not only in himself or herself but also an investment in Canada and in our future.
The government adopted the primary tenant of Bill C-316 in the 1998 budget and for that I thank the Prime Minister, the Minister of Finance and Liberal caucus colleagues for their support. The main issue which remains is the extension of interest relief to all student loans.
There are tens of thousands of students across Canada who do not qualify for government sponsored student loans. For many of these students the only way to pay for their education is to turn to private lending institutions for loans.
Bill C-316 would extend the interest relief credit to involve those loans that have been granted by private lending institutions for the purposes of financing a student's post-secondary education.
Education is a high priority for me and I believe for all members of the House and the government. The growing global economy is creating work that uses minds, not muscle. In the early 1990s more than 60% of new jobs were created in the areas of information and communication technology.
There are few businesses today that do not use a computer somewhere in their organization. Moreover, Canadians who earn good salaries and pay taxes contribute to a strong economy. A strong economy leads to progress and that is why the Liberal government launched a major assistance program this year, the Canadian opportunities strategy. This is good economic policy and good social policy.
The number of jobs requiring a university degree or post-secondary diploma has increased by 1.3 million since 1990. On the other hand, the number of jobs available for people with less education has dropped by 800,000. These statistics speak for themselves and the government is paying close attention.
In addition to transfer payments to the provinces to support post-secondary education, the Liberal government has put in place several initiatives to help Canadians who want to go to college or university. Canadians today must excel at the post-secondary level in order to achieve their personal dreams and to keep Canada at the head of the developed world, a global leader.
The most important direct federal support for post-secondary students is the Canada student loans program. Since the Liberal government brought in this student loan program in 1964, over 34 years ago, 2.7 million students in financial need have received over $12 billion in loans. Loans amounting to $1.4 billion went to 360,000 students in 1996 and 1997 alone. The CSLP is helping 380,000 students this year.
The new Canadian opportunities strategy will help hundreds of thousands of students through a series of measures. The strategy helps students manage their debt load through tax relief for interest on student loans. Graduates with long term problems repaying their loans may be able to reduce their debt or qualify for extended interest relief for up to 54 months. Through an improved student loans program the Liberal government is making it easier for young Canadians to gain the skills and knowledge essential to building an innovative economy.
In 1994 we announced that we would put an additional $2.5 billion over five years into the Canada student loans program. More than $1 billion in Canada student loans helped about 300,000 Canadian students go to college or university this year and the level of commitment is continuing.
We also increased loan limits by more than 50%. They had been frozen by the last government in 1984. We have brought in more flexible repayment rules. Under the old rules borrowers had to begin paying back their student loans six months after graduation even if they were unemployed or earning very low incomes. Under the new rules payment can be reduced or deferred for up to an additional 30 months and the government will pay the interest during that time.
Furthermore, the government introduced Canada study grants of up to $3,000 a year. This will help over 25,000 needy students with children or other dependents. We also doubled the annual limit on contributions to the registered education savings plan to $4,000 so that young families could put more money away for their children's future education. When fully implemented, the budget proposals of last year will increase federal assistance to post-secondary education by over $270 million a year.
This bill is more than a simple tax credit. It is about giving young Canadians the help they need as they enter the workforce, hope and confidence of a prosperous future and the dream of possibilities. It is about telling Canadians that when they choose to invest in their future through education their elected representatives, we here to represent them, will support them.
Since introducing this bill I have received numerous letters of support from students, educators, parents, school administrators from across the country as well as from members of parliament from all parties, all of whom recognize the importance of supporting our young people as they make the transition from classroom to workroom to boardroom.
I call on all members of the House to recognize and acknowledge the importance of supporting Canada's young people, for they are the foundation on which Canada's future will be built.