The Trump administration has transferred a portion of its student loan portfolio to the Treasury Department, marking a significant step towards dismantling the Education Department.
As part of a conservative bid to shrink the federal government's role in education, President Donald Trump had promised to dismantle the Education Department during his 2024 election campaign.
The Education Department has announced new partnerships with four other federal departments to share or transfer some of its functions, and the interagency agreement with Treasury will see the latter assume responsibility for collecting on defaulted federal student loan debt.
The student loan portfolio currently stands at nearly $1.7 trillion, with less than 40% of borrowers in repayment and almost 25% of borrowers in default.
The Department of Education was created by Congress in 1979 to administer college loans, track student achievement and enforce civil rights in schools.
