UNITED STATES
The controversial US Public Service Loan Forgiveness program is proving to be a disaster for participants, with almost 99 per cent of applications rejected since October last year, when the first tranche of borrowers became eligible.
This outcome is leading some frustrated borrowers to speculate that the Administration of President, Donald Trump, which has twice proposed eliminating the program, is trying to kill it off with technicalities.
However, observers believe the low number of successful applicants reflects both the complexity of the program and the lengthy timeline for meeting requirements, rather than policy choices made by officials at the Department of Education.
The problem is likely to increase political debates over the cost of the program, which has been the focus of complaints by some conservatives, especially when large numbers of borrowers begin to qualify.
The program was established in 2007 to encourage graduates to apply for low-paid Public Service and non-profit employment — as social workers, public defenders, teachers and the like — for the first 10 years of their working lives.
Borrowers could have the balance of their loans forgiven by certifying that they worked for an eligible employer during which they made 120 qualifying monthly payments on their loans.
October 2017 was the earliest any borrower could meet those requirements, but, as of June, only 96 borrowers had been approved and had their loans forgiven out of about 28,000 borrowers who had applied.
Deputy Director for Federal Higher Education Policy at the New America think tank, Clare McCann said the low number of approvals was unsurprising given the many hurdles borrowers must clear to qualify.
Washington, DC, 28 September 2018
