Federal government creates Canada Apprentice Loan
By Economic Action Plan
By Economic Action Plan
Jan. 12, 2015 – Economic Action Plan 2014 proposes to create the Canada Apprentice
Loan by expanding the Canada Student Loans Program to provide
apprentices registered in Red Seal trades with access to over $100
million in interest-free loans each year.
Apprentices in skilled trades do most (80 to 85 per cent) of their
learning during on-the-job paid employment. They are also required to
participate in technical training for short periods of time ranging from
six to eight weeks each year. Apprentices can face significant costs to
complete these periods of technical training required by their program,
including educational fees, tools and equipment, living expenses and
forgone wages. These costs can be particularly acute for apprentices who
intend to complete their training after a number of years on the job,
while supporting their families.
Economic Action Plan 2014 proposes to create the Canada Apprentice
Loan, which will offer interest-free loans to help registered
apprentices with the cost of their training. The Canada Apprentice Loan
will assist more apprentices in completing their training and encourage
more Canadians to consider a career in the skilled trades.
"I think it's great that they are funding a program however in order to really attract people to the skilled trades sector some serious motivation needs to be in place in order to cover the labour gap which we are currently experiencing,” said Angelo Cairo, president of the Ontario Glass and Metal Association. “We all know will get worse over the next five to ten years considering the baby boomers are currently between the ages of 51-69. I believe for the program to be effective the funding needs to be only paid back if the person does not continue with that trade for the next ten years or more and they may only choose one trade to enroll in."
Apprentices registered in a Red Seal trade apprenticeship will be
able to apply for interest-free loans of up to $4,000 per period of
technical training. Interest charges and repayment of the Canada
Apprentice Loan will not begin until after loan recipients complete or
terminate their apprenticeship training program. At least 26,000
apprentices per year are expected to apply for over $100 million in
loans. The estimated net cost of these loans to the Government would be
$25.2 million over two years and $15.2 million per year ongoing.
"We definitely think this is an area that is worthy of supporting and encouraging,” said Al Dueck, past president of Fenestration Manitoba. “A better educated and more capable workforce will add value to Canada’s building stock and the efficiency of the fenestration industry, be it windows or aluminum glazing."
Further details will be announced by the Minister of Employment and Social Development in the coming months.
For more information