Independent Report Shows Need For Private Loans
Today's independent report on the processing of student loans illustrates the need to open the loan scheme up to banks and other private financial instuitutions, according to student group, Prebble's Rebels.
Auckland Rebel President, Stuart Wilson, said the report from Karen Ernslaw Associates was a damning indictment on the state monopoly loan scheme.
"This report highlights again what we already knew - that the Department of Work and Income (DWI) can not handle student loans effectively, and operates as an inefficient monopoly, providing substandard service. Allowing competition in the provision of loans would encourage companies to outbid each other, offering better service and lower interest rates."
"Allowing competition from private loan providers would not just encourage the department to improve in the four key areas identified by the report, but would force this improvement so that they remain a competitive provider."
"The way to fix an inefficient government department is not to make it more bloated, but to expose it to competition. Students who aren't happy with the service provided by the government should be able to choose to receive their loan from a private provider, rather than being forced to deal with the state monopoly."
Mr Wilson also said he doubts that Mr Mallard will be able to call Christine Rankin into line over her handling of the loan scheme.
"While in opposition, Steve Maharey ran a strong campaign against Ms Rankin, but since his election, has given nothing but a string of excuses for her. Mr Maharey has to show who is in charge of his department - himself as Minister, or his Chief Executive."
Mr Wilson said "the real answer to our bloated, inefficient and over-expensive student loan scheme is not to just take it away from the Department of Work and Income, but from centralised control altogether."
For more information, contact:
Stuart Wilson (+64)(021) 443525