The Ontario Student Loan Program has experienced problems with default on student loans, as have loan systems in other countries where governments rely mainly on banks and special departments of quasi-public institutions to monitor or police the borrowers. This report discusses the need for radical modifications of the student loan program to enable students and universities to tap more private funding and abolish the present means testing of student loans, and investigates trends in the level and structure of university fees. It offers a summary of changes in student assistance schemes in New Zealand and Australia, which incorporate use of the income tax machinery in the collection of loan repayments and the implementation of an income contingent loan system. The report presents simulations of outcomes of introducing an income contingent loan system, using different assumptions concerning rates of interest chargeable to students, the length of the repayment period, and the minimum income repayment threshold. The report concludes that full incorporation of the tax machinery into the loan collection process would substantially improve the operation of the loan program as it would allow borrowers to spread repayments over a longer period to accommodate fluctuations in their incomes. (Contains 32 reference notes.) (JDD)