Loan Forgiveness Expanded to 10 Occupations

Summary#

These are proposed changes to the Canada Student Loans Regulations and the Canada Student Financial Assistance Regulations, put forward by the Department of Employment and Social Development. The proposal would permanently expand the federal student loan forgiveness program so 10 more health and social‑service occupations can get partial loan forgiveness when they work in eligible rural or remote communities. The notice was published February 15, 2025 and the government says the changes are intended to come into force on November 1, 2025; the proposal is open for comment for 30 days from publication.

What it does#

• Adds these 10 occupations to the loan‑forgiveness program: early childhood educators, dentists, dental hygienists, pharmacists, midwives, teachers, social workers, personal support workers, physiotherapists, and psychologists.
• Groups eligible occupations into three payment tiers tied to typical education length:
  • Group 1 (longer training) — up to $60,000 over five years (annual amounts: $8,000, $10,000, $12,000, $14,000, $16,000).
  • Group 2 (medium training) — up to $30,000 over five years (annual amounts: $4,000, $5,000, $6,000, $7,000, $8,000).
  • Group 3 (shorter training) — up to $15,000 over five years (annual amounts: $2,000, $2,500, $3,000, $3,500, $4,000).
• Caps total years of forgiveness at five years per borrower, even if they change eligible occupations (no stacking separate five‑year periods).
• Requires applicants to have provided at least 400 hours of in‑person service in the previous year, with limited medical, caregiving, pregnancy and parental exemptions.
• Uses the recent definition of eligible location: communities with a population of no more than 30,000 or rural areas. Legacy communities that kept prior eligibility are not extended to the 10 new occupations.
• Introduces a definition for personal support worker (because that role is not regulated in any province/territory) and defers to provincial/territorial definitions where professions are regulated.
• Sets an application timing rule consistent with the current program (applying within 90 days after the qualifying year).
• The text in the Gazette is a proposal — comments were invited for 30 days from February 15, 2025.

Who's affected#

• Borrowers with federal student loans who work (or plan to work) in the newly listed occupations in eligible rural/remote communities.
• Residents of those rural and remote communities who may gain better access to health, education and social services; the government estimates roughly 11.2 million people (about 30% of Canada’s population) live in areas that could be eligible.
• Indigenous communities: the document estimates about one million Indigenous individuals live in rural/remote regions and could benefit. The Indigenous Physicians Association of Canada was consulted and suggested other complementary approaches.
• The federal government and, indirectly, taxpayers, because the proposal increases the amount of loan forgiveness the government would pay and the program’s administrative costs.
• Provinces and territories and local employers may notice changes in recruitment and staffing in rural areas. (The federal program is delivered with nine participating provinces and one territory; some jurisdictions operate their own student‑aid systems but work in those places can still count under certain conditions.)

Why it matters#

• It aims to encourage more health, education and social‑service workers to move to and stay in under‑served rural and remote communities. The goal is better local access to services such as primary care, mental health support, child care and school teaching.
• The government’s benefit‑cost estimate projects the change would incentivize about 27,822 professionals to work in these areas over 10 years, with monetized benefits of $944.1 million, costs of $653.8 million, and a net present value of $290.3 million (all over 10 years).
• For individuals in the newly eligible occupations, the change can meaningfully reduce student debt if they meet the location and hours rules. For rural communities, it could mean more available services and, for example, more early childhood educators that can increase local child‑care capacity and parent workforce participation.
• This is a proposed regulation, not final law. Interested people and groups had 30 days from February 15, 2025 to comment, and the government signalled an intended start date of November 1, 2025 if the rules are adopted.