This is the first in a three-part series of stories about student debt in Canada.

When I got into McMaster University in 2004, there was no question how I was going to pay my tuition: the Ontario Student Assistance Program — OSAP.

My parents didn’t have RESPs or savings to put toward my education. And while I had been working since I was old enough to do so, I had nowhere near the income needed to cover the costs of tuition and residence fees. Using student loans to cover my costs was a foregone conclusion.

I’d still work part-time. I’d get bursaries to offset my tuition costs. And I was sure that in no time, I’d be able to pay off my loans with the fulfilling and gainful employment my degree would help me land.

Ten years later, sitting in a bankruptcy trustee’s office, I wondered at my naïveté. I had used all the OSAP allotted to me, every year. I didn’t get a great job after university, so I went to law school instead, sticking it out for three miserable years. I graduated in 2012 with no job, no desire to practise law, and an accumulated debt of $151,755.43: OSAP, professional student lines of credit, and credit cards.

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I struggled to understand how I’d reached the point of having to make a consumer proposal — an agreement to pay off only a percentage of my total debt (the debtor’s last resort before bankruptcy, it has a negative impact on credit scores during and three years after the completion of the proposal). I knew I’d made many bad decisions: I hadn’t budgeted. I’d lived beyond my means for far too long. And I hadn’t taken control of my finances until it was much too late.

While my indebtedness is admittedly extreme, I am not alone. Across the country, the total amount of government-issued student loans currently taken out and in repayment as of 2016 is more than $16.9 billion. There were 497,000 students enrolled in the Canada Student Loans Program in 2015-16. The majority of students enrolled in the program from 2010 to 2016 were in Ontario, where, during the 2015-16 school year, more than 300,000 full-time students had $1.7 billion in loans.

The average graduate of a four-year program in 2016 walked away with just over $13,000 in debt from government-issued student loans. The more education you get, the more debt you end up with. Doctoral students graduated with an average of $29,040 of debt.

I wanted to better understand the student-loan system I — and so many others — am indebted to. So I set out to answer what I thought were simple questions: Why was it that I could declare bankruptcy on my lines of credit but not on my OSAP loans? I would have to wait until seven years after I graduated from law school before that was even an option. Why, at 18, had I been given access to thousands of dollars but not to any tools I might’ve used to budget effectively? And why had I assumed OSAP was the only option?

These are important questions, and I found my answers. But after years of sifting through research, government documents, financial reports, and contracts, I found so much more. Since its humble beginnings in the 1960s, the Canada Student Loan Program has morphed into a multi-billion-dollar system — one that has made millions for the players involved in running it while students debt loads have increased.

Here’s how it happened. These levels of student debt are a relatively new phenomenon in Canada. In 1964, there were just 42,113 loan borrowers across the country — the total value of their loans was about $26.7 million. In the 1980s, tuition did inch up — and the number of full-time loan borrowers passed the 200,000 mark — but it was still reasonable for students to save up to pay for their educations. “In 1984, my final undergraduate year of university, tuition cost more or less $1,000,” wrote Rob Carrick, the Globe and Mail’s personal-finance columnist, in 2012. “I earned that much in a summer without breaking a sweat.”

How did we get from students being able to pay for their education with a summer job to students being thousands of dollars in debt before the age of 23?

According to Glenn Burley, who wrote about changes to post-secondary funding in a 2016 Canadian Centre for Policy Alternatives paper, a series of legislative developments reduced the level of overall funding transfers to universities. “Government funding,” he notes, “dropped from over 77 per cent in 1992 to less than 55 per cent in 2012.” To make up the difference, post-secondary institutions turned to a more dependable source of money: students. Tuition fees began to rise — 115 per cent between 1980 and 1995. By 2016-17, the average Canadian university tuition was more than $6,000 a year, about 40 per cent higher than it had been in 2006.

In a 2017 CCPA paper, Joel Harden pointed the finger squarely at tax cuts and austerity measures as the reason for cuts to funding for universities. “As elsewhere, Canadian decision-makers embraced neoliberal ideas that promoted lower taxes, greater ‘personal responsibility’ (for education, training, etc.) and the reduced scope of social programs,” he writes. “Post-secondary education was often framed as an individual investment, a private service for which students must bear a far higher cost.”

But students, faced with rising fees, needed help. And so, like me, they turned to the Canada Student Loan Program and provincial programs to finance their education.

When the CSLP was established in 1964, loans were paid out by private financial institutions and 100 per cent guaranteed by the government. Since tuition was already fairly low, student loans were small. But as tuition has increased, so has the amount of money the CSLP and provincial programs give out — and as those loans have grown, so has the risk of default. In the 1980s, only about 9 per cent of borrowers defaulted, according to Saul Schwartz, a professor at the school of public policy and administration at Carleton University. By 1990, one in six borrowers was in default.

According to a 2008 Parliament of Canada report, in 1992, the federal government “abolished preferred-creditor status for debts owed to government.” (Before the change, debt owed to the Crown took priority in any discharge of debt — after, they were on the same level as any unsecured creditor). At that point, a student could theoretically declare bankruptcy on their student loans immediately after they graduated. The debt owed to the government wouldn’t have any kind of priority over other debts included in the discharge.

Three years later, the administration of the CSLP underwent a series of changes. Government-guaranteed private loans were replaced with a risk-premium financing agreement with private financial institutions, under which “participating financial institutions managed the repayment of student loans and accepted the risk of nonpayment,” according to according to the 2008 Parliament of Canada report on student loans. “In return, the Government of Canada paid the financial institutions an annual risk premium of 5 per cent of the value of the loans. The risk premium was designed to compensate financial institutions for the high number of student loan defaults.”

“In early 2000, the federal government canvassed interested financial institutions about a new CSLP arrangement,” the report continues. “According to a Human Resources Development Canada communiqué, too few financial institutions expressed an interest in concluding a new arrangement to make the program viable.” (This communiqué is, to the best of my knowledge, no longer available online.) In a 2000 Toronto Star article, a bank official “described student loan writeoffs as a ‘hemorrhage’ of cash.” The federal government took over the program, directly financing the CSLP out of the annual budget.

However, at least one big bank wasn’t done working with the CSLP. In 2000, Edulinx — a company owned by CIBC and USA Education Inc., an American student-loan provider — won a tender to run the new National Student Loan Service Centre and to administer loans for students attending public institutions. (Loans for students attending private educational institutions were administered by a separate contractor until 2008.) The National Student Loan Service Centre, which was formally established in 2001, administers federal student loans and grants, as well as integrated loans for five provinces.

Not long before Edulinx won the contract to administer the CSLP, the federal government made it harder for borrowers to discharge government-funded student debt. In 1997, a two-year exemption for discharging student loans was introduced — students would have to wait two years before they could declare bankruptcy on their loans. In 1998, that exemption was increased to 10 years.

Between 1990 and 1998, a spectre had been raised by certain politicians — that of the student who maliciously takes out a loan with the intent of declaring bankruptcy the second they receive their diploma. “Concerns about abuse prompted the introduction of the two-year nondischargeability provision for student loans,” wrote Osgoode Hall Law School professor Stephanie Ben-Ishai in a 2006 study on how governments treat student loans in bankruptcy.

There was, and remains, little evidence that such a student exists. “The economic situation of all those declaring bankruptcy suggests that bankruptcy is used primarily as a last resort,” writes Schwartz. “The economic situation of those seeking bankruptcy protection with student loans among their debts, or whose student loans were critical in their bankruptcy, is even worse than the already desperate situation of the whole group. To be sure, they are younger and have more education, but they have lower annual household income and lower monthly income at the time of filing for bankruptcy.” And that was in 1999. Since then, there has been a 50 per cent increase in precarious employment in the Greater Toronto and Hamilton Area; tuition and student debt have continued to rise, and, as of 2016, 490,000 full-time students got a total of $2.7 billion in government-funded loans.

But for the companies that have become the contractors of the CSLP, Canada’s students are good business.

H.G. Watson is a journalist based in Toronto. She is the managing editor of J-Source, the Canadian Journalism Project.