NZ Out Of Step By Setting Student Interest at 7%
NZ Out Of Step By Setting Student Loan Interest Rates at 7%
“The New Zealand Government is out of step with the global economy when setting the new interest rates” stated Keith Clark, the National President of the Aotearoa Tertiary Students’ Association (ATSA). Clark noted NZ calculates interest rates by using the Ten Year Bond rate as its initial starting point. Such an approach is out of step with the more equitable loan programs operated by Australia and the United Kingdom.
Clarks statement follows the announcement that the student loan interest rates in the 2001-2002 loan period (April 2001-March 2002) were to remain at 7%.
“NZ students therefore continue to face heavy debt burdens as a result of the entire student loan scheme” advised Keith Clark. “Dr. Liz Gordon, the Alliance Education spokesperson has stated that these countries operate student loan interest schemes based on an inflation rate index. From its inception nearly a decade ago, the loans scheme has always economically disadvantaged those who require financial assistance to access tertiary education”.
“Student loans place an unnecessary constraint on the government’s economic desire to build a ‘Knowledge Based Society’ in this country” said Clark. “Education is the key to unlocking our nation’s economic potential – it is absurd to firstly charge exorbitant entry fees, and then hit students even more with interest on their loans.”
“ATSA will continue to advocate strongly for the whole loan programme to be abolished” Keith Clark stated. “While the loans system injustice was of little concern to the last government, continuation of the scheme sits uncomfortably with the present Labour-Alliance administration’s vision of an inclusive society”.
“Keeping the interest rate at 7% is no cause for celebration. We look forward to the government’s next movement towards real educational equity. Ideally, this would be to align the loan interest rate with an inflation rate index, prior to the final binning of the whole misguided programme into the out basket labeled ‘Failed Policies”.