Freeze on loan interest rates welcomed
Today's announcement by the Associate Minister of Education (Tertiary education), Steve Maharey to freeze the student interest loan rate for 2000/01 tax year, while reviewing the current interest rate setting methodology, has been welcomed by the New Zealand University Students Association (NZUSA). Under the currently methodology, the interest rate is proposed to rise from 7.0% to 7.6% on the 1 April 2000.
"Students are relieved that this Government is taking positive steps to thoroughly investigate one of the fundamental impediments of ever increasing student debt," says Tanja Schutz, Co President, NZUSA. "Especially after the previous government's avid reluctance to proactively address any issues pertaining to equity, access or social and economic barriers to participation within tertiary education - it is a welcome respite."
"After almost ten years since the implementation of student loan - which led to Generation Debt - we are seeing the broad flow on effects of the loan scheme" says Sam Huggard, Co President NZUSA "Graduates are seeing their loan repayments only moderately affecting their interest, whilst never getting near the principal."
"Our hope is the government continues this progress and moves toward a reduction in fees - which is the real cause of massive student debt," concluded Tanja Schutz.