Mr. Speaker, I am pleased to rise tonight and have this opportunity to speak on the issues raised by the hon. member for Victoria.
First of all, we have to correct some of the hon. member's assertions. One of them was that the Government of Canada was making a profit from the Canada student loans program. I want the member to understand and believe that this is just not true. The Canada student loans program does not and has not ever made a profit. The program has existed for one reason and one reason only: to help Canadian students access the post-secondary education that they want and deserve.
This government committed in our Advantage Canada plan to creating the best educated, most skilled and most flexible workforce in the world. We also recognized that a vibrant student loans program is an important tool that will help us to reach this great goal.
I would like to take a minute now to discuss some of the misconceptions the hon. member has around how this program is run, primarily in regard to the charging of interest.
Contrary to the hon. member's suggestion, we do not collect compound interest daily. The Government of Canada collects simple interest, compounded monthly. Second, it is true that the interest collected does go into the consolidated revenue fund, but the costs of the program come out of the same fund. Year after year, the result is a shortfall, not a profit.
I know that members of the NDP have a problem understanding the concept of profit and what it means, so I would like to reiterate for my colleague that in this case the program costs are greater than the interest collected. Quite simply, no profit is made on the backs of students.
There is no confusion about how students go about repaying their loans. In fact, when students first apply for a loan they are told up front that they can choose their interest rate, either fixed or variable, when they start repaying their loan. This is reiterated when they begin the repayment process after they complete their studies. Students are able to get detailed information about their loans at any time simply by calling the National Student Loans Service Centre or visiting the centre's website.
I would also to add that, unlike interest on commercial loans, the interest that borrowers pay on Canada student loans is tax deductible. Moreover, borrowers who experience financial hardship while repaying their loans can apply for interest relief. In 2004-05, for example, over 100,000 borrowers received interest relief from the government. This was worth $64.8 million.
As I mentioned a few moments ago, this government realizes that the Canada student loans program is a vital tool that will help us achieve our long term goals as a country. That is why we have announced a comprehensive review of the program. The result of this review is going to be announced in budget 2008 on February 26. I look forward to those results.