Higher education spending set to rise dramatically

By María Elena Hurtado. As a placatory gesture to protesting students, Chile’s President Sebastián Piñera has enacted a law that cuts interest rates on student loans and has also increased education spending in his budget proposal for 2013. But despite all government efforts, students appear to remain unsatisfied.

The new legislation, announced at the end of September, reduces interest on loans for private university students from 6%-2%. Once they secure employment, monthly repayments will amount to only 10% of salary, a 40% reduction to what had previously been on the books.
Piñera said the new law would offer improvements to the current situation. “The government’s previous system did not link repayment to earnings. Students had to pay a fixed sum, independent of their level of earning or whether they were in employment or not.”