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No.7 Student Loan Eligibility Rules Ain't Right

MEDIA RELEASE - PTE Budget Policy Awareness Group

25 July 2006

Ten Reasons Why Implementation of the New Student Loan Eligibility Rules Just Ain't Right (Reason Number 7)

Reason Number Seven: Hammers and Nuts

We already know from papers uncovered by the media that the Government's advisors warned the new loans and allowances might be viewed as "a large hammer to crack a small nut".

We already know from those same papers that much responsibility for the loans "blowout" can be laid at the feet of government agencies who had not been monitoring to ensure unsubsidised PTEs were complying with the cap on loans for fees, simply because details of how to implement that monitoring were never finalised.

But now, it has also been revealed just six PTEs (two of which are under investigation anyway) were responsible for the loans "blowout".

Not only that, but according to Education Review it seems that "most, if not all, of the six PTEs offer both subsidised and unsubsidised courses."

"It is totally unreasonable that dozens of PTEs have to be wiped off the map because of growth in loans at a handful of PTEs and because the bureaucrats never found the time to do their job. It seems we are the very unfortunate collateral damage of somebody else's blunder."

That is only part of the story.

Reason number eight to follow tomorrow.

The Issue:

Without warning or consultation with the sector, it was announced that only student enrolled in courses funded by the TEC would be eligible for student loans and allowances, and that this new rule would apply from January 2007.

More than 100 PTEs provide courses not funded by TEC. Between 40 and 50 only provide courses not funded by TEC. Many of these PTEs will be forced to close at the end of the year.

The PTE Budget Policy Awareness Group is calling for a fair and reasonable transition period to the new loans and allowances regime.


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