Lift 'devastating' loan burdens for refugees, advocates urge Liberal government

by Kathleen Harris (feat. Candice Malcolm)

CBC News
November 20, 2016

After fleeing conflict, abject poverty or persecution in their homelands, new refugees will be asked to repay their travel costs to Canada under a federal loan policy one advocate calls "inhumane."

The Immigration Loan Program provides individuals and families money to cover costs of medical exams, travel documents and transportation to Canada.

The Liberals had waived the repayment requirement for 25,000 Syrian refugees, but Immigration, Refugees and Citizenship Canada (IRCC) confirmed to CBC News that was "a one-time occurrence."

IRCC Minister John McCallum is considering options to revamp the program, but until then, refugees who receive loans will be required to pay them back.

Janet Dench, executive director of the Canadian Council for Refugees, called the burden of debt "devastating." It adds to the stresses of migration and can lead to the separation of families.

It's also counter-productive because it pressures refugees to get quick jobs at the expense of language and skills training that would improve their chances for successful integration.

"It's a false saving, and just devastating," she said. "We've heard private sponsors talk about people they're sitting down with just breaking down in tears when they see the bill coming in ... just completely overwhelmed by the thought of having this debt to the Canadian government."

'It's just inhumane'

In one case, Dench said a widow was required to repay the costs of her husband's travel to Canada despite the fact he died soon after arriving in the country.

"It's just inhumane," she said. "There's all the stresses of migration, plus this debt."

The Council and other advocates are making a renewed push to scrap the repayment requirement in recent pre-budget submissions.

A senior official in McCallum's office said the minister has tasked the department with looking at options for making the loan program "less of a burden going forward," but no decisions have yet been made.

"Obviously, there are benefits and costs that will need to be weighted when considering changes to the current program," the official said. 

Loan repayment required

Until then, refugees are expected to pay back the money.

On Oct. 25, the federal government pledged to bring in an unspecified number of Yazidi women and girls to Canada within 120 days. The priority is on survivors of genocide who have been raped, tortured and kept in captivity as sex slaves by ISIS.

Dench said the fact they would be expected to repay travel costs underscores the unreasonableness of the loan policy.

"It is counter to everything to think they are going to be in a position right from the beginning to be paying thousands of dollars back to the Canadian government," she said. "Most refugees are in a similar situation. Some people might be in a position to get a decent-paying job soon after arrival, but that is really the minority of refugees."

Repayment critical

Candice Malcolm, founder of an immigration-focused research and education group called The True North Initiative, believes federal loans are a good way to help refugees who don't have access to credit and banks. But she said the repayment requirement is a critical component of the program.

"It is not a huge financial burden, but it does send an important message to newcomers that when they come to Canada, they won't be reliant on government hand-outs and taxpayer-funded resources; that they are going to learn to become economically integrated into the Canadian economy, to get a job," she said.

"I also think it shows good faith to Canadian taxpayers that we can have this generous program to help people from all around the world, but we have limited resources."

Recipients are required to begin paying back the loans within 30 days. If not paid back within a specified period — usually one to three years — then interest is charged.

Extensions requested

An internal evaluation of the program released last fall showed 59 per cent of refugees between 2003 and 2012 managed to repay their loans within the interest-free period. It said on average, $13 million in loans are issued each year, with an average loan amount of $3,090.

Refugees who are struggling financially can request an extension for up to 24 months or a review of their repayment arrangement, according to IRCC spokesman Rémi Larivière.

"People facing hardships will not be removed from Canada if a loan payment is missed. However, interest will continue to grow on the loan, where the client is not subject to a free-of-interest grace period," he said.

The loans are in addition to other federal resettlement assistance and services, including income supports, language training and health care.