Is New Legislation Expected Soon?
On May 5, 2005 the government of Canada announced plans to create a Wage Earner Protection Program to help pay up to $3,000 owing to workers in the event that their employer goes bankrupt. Buried deep within that press release was a reference to further comprehensive bankruptcy reform, which may include changes to how student loans are handled in a bankruptcy.
Specifically, Industry Minister David L. Emerson stated that “The Wage Earner Protection Program is designed to remedy this gap and to form part of a comprehensive insolvency reform package, which I intend to introduce this spring.”
It is therefore possible that at some point this spring the long-awaited reforms to the Bankruptcy & Insolvency Act may be introduced. Unfortunately we have no idea what the reforms will be, although the speculation is that the 10 year waiting period for student loans to be discharged in a bankruptcy will be reduced to 5 years.
Of course if the government is defeated and we are thrown into an election campaign, legislation will not be passed, so stay tuned to this space for further developments.
