The federal government hopes to help boost the number of people working in the skilled trades with the introduction of the “Canada Apprentice Loan.”
The new loan program is an extension of the existing Canada Student Loans Program and will provide apprentices registered in Red Seal trades with over $100 million in interest free loans per year, according to budget documents.
Generally, people learning a skilled trade do so while on the job and they are paid for their time. However, apprentices are also often required to complete an annual six to eight week unpaid training program.
The program, part of a broader government strategy to boost labour participation (see “Helping people with special needs“), will provide Red Seal apprentices with interest-free loans, according to budget documents, which will help them complete their training while still meeting their financial obligations.
Red Seal trade apprentices will be able to apply for up to $4,000 in interest free loans per period of technical training. Apprentices will not be charged interest or have to start repaying the loan until after they complete or exit the apprenticeship training program.
The government expects 26,000 apprentices per year to apply for over $100 million in loans and estimates. Furthermore, the government expects the net cost of these loans will be $25.2 million over two years and $15.2 million annually.