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Student loan program mistakenly forgives loans to doctors, nurses, documents show

A stock photo of doctors performing brain surgery.

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The federal government is keeping closer tabs on a student loan program targeting doctors and nurses after many of them had loans mistakenly forgiven over the past two years.

The federal government launched the doctors and nurses loan forgiveness program in 2013 to act as an incentive for medical school graduates to practice in underserved areas of the country, or communities that had a hard time attracting new family doctors.

But documents show 30 of them should never have received the help during the program's first two years of existence.

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Documents from Employment and Social Development Canada, which oversees the student loans program, show the mistake was first noticed in September 2015 when provincial officials in Saskatchewan alerted their federal counterparts.

The Saskatchewan government set up its own loan forgiveness program for nurses the same year the federal program launched. The documents suggest the private company contracted to administer both programs, DH Corporation (also known as D+H), made the errors that saw about $113,000 in loans mistakenly forgiven.

A March briefing note to Labour Minister MaryAnn Mihychuk, a copy of which The Canadian Press obtained under the Access to Information Act, shows that between February and August of this year ESDC officials verified every decision by D+H to forgive a loan while system upgrades were made.

The briefing note says all 30 loan recipients were told they didn't have to pay back any of the money, but warned they wouldn't be eligible to have more of their loans written off unless they work in eligible communities.

ESDC didn't say precisely how the error happened. A spokeswoman said errors could occur when workers enter postal codes into the system that are used to verify the doctor or nurse is in an underserved rural or remote community and eligible to have their student loan forgiven.

"ESDC has conducted a thorough review of all errors and has taken the necessary steps to correct errors going forward," spokeswoman Julia Sullivan said in an e-mail.

"Additional quality control measures have been put in place to ensure such an error does not occur in the future and the department is continuing to closely monitor the program."

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Since its launch, the federal program has forgiven about $31-million in student loans to about 5,000 doctors and nurses.

Doctors are eligible to have up to $8,000 of their federal student loans forgiven annually. For nurses, the figure is $4,000.

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