Solberg defends $2-million student loan ad campaign

A “lavish” federal ad campaign aimed at promoting Canada student loans is a waste of money that ought to have been spent on debt reduction and interest relief, advocates for loan reform said Tuesday.

Access to Information documents obtained by the Vancouver-based Coalition for Student Loan Fairness suggest Ottawa has spent more than $2 million on the campaign since February. Nearly $1.4 million alone was used for public relations while the rest went to creative production and focus group testing.

Calling the campaign a “massive and wasteful spending spree,” coalition founder Julian Benedict said the government should instead be putting that money towards reducing student debt and interest payments.

“What we need to do is improve the services that we provide to students and that means reducing high interest rates on student loans,” Benedict said. “One of the other things we’ve been pushing for is the introduction of a national student loans ombudsperson to make sure borrowers have representation in the system when things go wrong.”

Human Resources and Social Development Minister Monte Solberg defended the ad campaign as a crucial element to securing the future of Canada’s work force. Government research has found many people from low-income families overestimate the cost of post-secondary education and underestimate their ability to secure financing, he said.

“We know we simply have got to find a way to get more people into college, university, trade and tech schools than we are today or we won’t be able to meet the labour market demands of tomorrow,” Solberg said. “So we are unapologetically advertising very heavily to make people aware that there is assistance available to them, and when people do take out student loans, it’s a very good investment in their future.”

The multi-media ads, which can be seen on television, in buses and at transit stations across Canada and on the Internet, are meant to highlight the loan program’s flexibility in accommodating the individual needs of borrowers.

Benedict, however, argues many of the ads promote the loans while offering little information about them or simply advertise the government’s revamped $23-million student loan web portal. “It’s really just a feel-good campaign,” he said.

At least one ad, however, does focus on the fact “everyone is unique” and has “different goals, different ambitions and different dreams.”

The federal government took on a massive review of the student loan program in an effort to modernize and improve delivery and announced a variety of changes in the 2008 budget. The changes include up-front cash grants to students from low-and medium-income families and further assistance for the 20 per cent of students who are struggling to repay their loans, Solberg said.

“We’ve made huge changes,” Solberg said. “In fact, they’re the most fundamental reforms to student financial assistance in a generation… so we are stepping up to the plate.”

Still, Benedict argues the changes are merely administrative and do little to improve the service itself or reduce the cost of borrowing. “I think that the program is under so much criticism because it’s so poorly run that a feel good PR campaign is their way of resolving problems instead of actually fixing the system,” he said.

-with a report from CP

Read Julian Benedict’s latest Maclean’s On Campus editorial here