OTTAWA - Student groups gave the federal government a robust “A” Monday for its overhauled system of post-secondary loans and grants, which takes effect in September.

“There’s a huge challenge for students and their families right now,” said Arati Sharma, national director of the Canadian Alliance of Student Associations. Because of the tough economy, “students are looking more toward loans and grants.”

The program, a 2008 budget promise whose details were fleshed out by Human Resources Minister Diane Finley, follows on from the Millennium Scholarship Foundation set up by the former Liberal government, which winds up this year.

The government says the new Canada Student Grant program and Repayment Assistance Program will direct grants to 100,000 more students than the program they replace. In addition, students in danger of missing loan payments will have an opportunity to renegotiate how they pay their debt.

Average student debt is about $25,000, said Katherine Giroux-Bougard, chairwoman of the Canadian Federation of Students.

She said she was pleased the program was being administered through Finley’s department and not as a stand-alone foundation. In the past, Canada’s auditor general has expressed concern that arms-length foundations are not sufficiently accountable to Parliament.

Asked her advice to young people trying to decide whether to continue their studies or find a job in a difficult economy, Finley said, “There’s no question that going forward, most jobs are going to require some post-secondary education.

“I think in these difficult times this may be a good opportunity for students to take advantage of these two new programs.”

Giroux-Bougard said 70% of new jobs require at least two years of post-secondary education.