Education Secretary Outlines Dismal Consequences of Sequestration
February 19, 2013
U.S. Education Secretary Arne Duncan warned lawmakers in a Senate Appropriations Committee hearing last week of the dismal consequences of the looming across-the-board spending cuts scheduled to take effect on March 1, reports the Chronicle of Higher Education.
Sequestration would slash financial aid for thousands of students and force the department to reduce payments to contractors that administer the federal student aid programs. Funding for Federal Work Study and Supplemental Educational Opportunity Grants would shrink by $49 million and $37 million, respectively, resulting in 33,000 fewer work-study awards and 71,000 fewer supplemental grants.
The process of sequestration could also compel the department to cut payments to non-profit servicers of student loans, potentially forcing those agencies to lay off and furlough employees, or even close, Secretary Duncan told the committee. “If we do not collect on loans, fewer funds will be repaid to the Treasury, and our deficit will increase,” he added. “That is the opposite of what sequestration is supposed to achieve.”
In addition, the cuts may force the department to furlough its own employees, which could cause delays in the awarding of aid and “significantly harm the department’s ability to prevent fraud, waste, and abuse in the very large, complex student-financial-assistance programs,” Duncan cautioned.
He called for replacing sequestration with “balanced budget reduction that includes revenues,” and argued for “selective cuts” rather than “mindless across-the-board sequestration.”
Related Links:
U.S. Senate Appropriations Committee Hearing
The Chronicle of Higher Education
Michelle Cormier Mott
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