Troubled past for student loan scheme borrowers
30 November 2005
Data set shows a troubled past for student loan scheme borrowers
The integrated data set released by Statistics New Zealand today focuses on how students have been struggling with student debt between 1997 and 2003.
"This data shows how the debt burden has negatively affected students between 1997 and 2003. It shows that only a minority of borrowers have been able to repay their loans, and that high debt is forcing graduates overseas," said Camilla Belich, Co-president of NZUSA.
"Those with the highest debts overseas are those who studied in high fee courses like health or medicine. These people are desperately needed in New Zealand, but this data proves that they are being forced overseas by their huge loans."
"The mean debt for graduates overseas is almost $10,000 more than those still in New Zealand. This extraordinary difference proves that there is a link between graduates leaving the country and their level of student debt."
The report also shows that only 14% of all borrowers, only 7% of Maori and 8% of Pasifika students, from 1997-2003 have repaid their loans fully.
"There is clearly a disproportionately negative effect of getting into debt for Maori and Pasifika students. This shows that the loan scheme in its current form is just not working for the majority of borrowers," said Belich.
"Interest free student loans will help to mitigate the effect of student debt. However, the only way to fully deal to debt is to look at the drivers of debt - high fees and lack of access to a living allowance," said Belich.