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The Vancouver Sun
Fri 19
May 2006
Page: H5
Section: BusinessBC
Byline:
Source: Vancouver
Sun

Allowing student loan repayments to depend on income
after graduation would reduce the risks associated with investing in higher
education and increase access for students from low-income backgrounds, the
C.D. Howe Institute says.

Income-contingent student loans could eliminate both the possibility of
default and the risk of having to shoulder unreasonably high repayments when
income is low, policy analyst Yvan Guillemette says in a commentary posted Thursday.

Even students who would not normally need to borrow could use the loans as a
form of insurance to ensure that tuition and other expenses paid for with loans
are shouldered only if the investment pays off.

Guillemette argues the reform would encourage risk-averse students to pursue
post-secondary education and acquire specialized skills.

The study, The Case for Income-Contingent Repayment of Student Loans, is
available at www.cdhowe.org

- - -

The Canada Pension Plan posted an investment return of 15.5 per cent for the
12 months ended March 31, almost doubling its 8.5 per cent gain the previous
year.

In dollar terms, the fund grew by $16.7 billion, including $3.6 billion in
surplus contributions, to $98 billion.

David Denison, president and CEO of the CPP Investment Board, told analysts
the fund will increase its foreign holdings to reduce over-exposure to the
Canadian market.

The Canadian equity portion of the fund's portfolio totals $63 billion and
accounted for the lion's share of the returns, earning 29.9 per cent for the
year.

Contributions to the CPP are expected to exceed benefits paid until 2022,
giving the board another 16 years to grow the fund before starting withdrawals.

- - -

Vancouver-based Inhance Investment Management, formerly known as Real Assets,
has joined 68 other institutional investment managers, firms and advisers in
adopting the UN Principles of Responsible Investment.

The voluntary principles, launched in April, are underpinned by a set of 35
possible actions that institutional investors can take to integrate
environmental, social and corporate governance considerations into their
investment activities.

Edition: Final
Story Type: Business
Length:
324 words