Mr. Speaker, I will be very brief. I wanted to stand in the House this evening and applaud the member for London North Centre on his concern for students and for bringing forward Bill C-316.
Under the existing legislative provisions students have a credit for tuition fees in an education credit as well as government support in the form of Canadian and provincial loan and scholarship programs. However, growing indebtedness has put many Canadian students and graduates in a difficult situation. That is why the government supports the spirit of the bill, which is designed to facilitate repayment of student loans.
The substance of the bill was an integral part of one of the measures proposed in the 1998 federal budget. The 1998 budget proposed the introduction of a 17% credit rather than a deduction. Only loans obtained under the Canada student loan program and equivalent provincial programs will qualify for the credit. Although the credit is not transferable, it may if necessary be carried forward and used in one of the five years following the year of interest payment. The government believes that the measure proposed in the 1998 budget meets objectives through reducing the burden of student debt for taxpayers with limited capacity to repay and limiting the possible risk of abuse.
The question is often whether it should be a credit or whether it should be a deduction. It is always an issue of debate when it comes to these types of issues. It has been argued that a credit is preferable to a deduction because it provides fair and equitable support to all taxpayers who are repaying loans. There are often many accountants who come before committee or many individuals who are familiar with the tax system who often argue in favour of a credit rather than a deduction because it is in the eyes of those individuals fairer and more equitable.
As I said earlier, the government fully supports the initiatives that will ease the debt burden of students and believes that the carry forward of unused credits should allow the full use of that credit.
The government agrees with the substance of Bill C-316 and that is why the government put forward the proposals it did in the budget and believes that it will provide targeted relief to the graduates who need it most. I to congratulate the hon. member for bringing this forward.