$6.3B in loans? Just keep it

Feds write off handouts to biz, students

OTTAWA — The federal government is writing off more than $6.3 billion in loans to businesses and students as the Trudeau government marks a new annual high in money it never expects to get back.

The Liberals have already written off some $3 billion in loans in each of the past two years, but they jumped past that mark in the fiscal year 2017-2018 with help from one loan.

The $2.6 billion writeoff came through Export Development Canada as part of a loan the previous Conservative government made in 2009 to keep automaker Chrysler afloat.

There have long been concerns the government would never collect the cash it gave to the automaker out of fear its collapse would have devastating economic effects on Canada.

The company used the cash — a $1.125 billion US loan — to restructure.

The decision to swallow the loan happened in March after the Liberals “exhausted every possible avenue” to recover it, a spokesman for International Trade Minister Jim Carr said Monday.

Separate from the writeoffs, the government is also forgiving other debts and loans to the tune of about $1.1 billion, including nearly $344 million that officials don’t expect to recover from student loan recipients.

Combined, the annual public accounts documents show the Liberals decided that the government wouldn’t collect $7.4 billion in loans and debts owed the federal treasury in the 12 months ending in March — a record since they took office in late 2015.

The detailed accounting documents tabled annually provide a window into how much the government spent in the last year, what it spent money on, and just how much wasn’t spent.

Lapsed spending this year, for example, totalled $10.7 billion.