John Key is on the money

John Key is on the money

John Key says student debt is a disaster – echoing what we have been telling the government since 1992 when the scheme was introduced.

“Like Key, students agree the student loan system doesn’t stack up. Why would New Zealand want to produce generation after generation of graduates who are mired in a debt that is currently close to $11 billion?” said OUSA President Harriet Geoghegan.

She notes that 562,000 students and graduates currently have a loan with the Inland Revenue Department.

“This debt is driving our graduates offshore and keeping them away from New Zealand at a time their skills are desperately needed”

John Key and students part ways, however, over interest-free loans.

“The interest free system, while not addressing the issues of affordability of education, is making staying in New Zealand a more attractive prospect for graduates. Key feels the government cannot afford to maintain interest free loans, but New Zealand knows we can’t afford not to.”

It would be unfortunate if the Vice Chancellors Committee were to support a reimposition of interest on student loans under the misguided assumption the revenue would somehow end up back in the tertiary education system.

Student debt is a recognised problem for our country. It was recognition of this fact that saw interest-free loans being introduced in 2006. The Government needs now to focus on reducing the need for such debt in the first place, rather than looking for ways to make it harder to pay off loans.

ENDS