Young Nats endorse National's student loan policy

Media Release

For Immediate Release

20 October 1999

Young Nats endorse National's student loan policy

"Under National, students will pay less interest while studying and will pay back their loans faster," said National's Youth Vice President Daniel Gordon."

Daniel Gordon was delighted with the Government's decision to bring forward the changes to the Loans Scheme announced late last year."

"Young Nationals have had several discussions with the Minister and believe this is a sensible solution to an issue which needs action. Unlike other parties National recognised that there is a need to make the changes as soon as possible.

"The changes make a lot of sense and it is great that students will benefit from them next year," he said."

The changes were originally not due to take effect until 2001 but the Government announced today that the changes would apply from 2000."

Daniel Gordon said there were four main changes."

The majority of students who borrow while studying will get up to a 25% reduction in the base interest rate. At least 50% of compulsory repayments (less inflation adjustment) will go first to repaying the loan principal. The amount that students can borrow for course costs will be restored to $1000 from $500, but the borrower will still have to supply receipts. A new repayment step of 15 cents in the dollar will come into effect for income earned over $50,000.

"Because of the cut in interest and the changes to repayments, students will be able to pay back loans many years earlier, and in the process, save tens of thousands of dollars," he said."

Daniel Gordon was particularly pleased that the changes were beneficial to women and other groups traditionally under-represented in tertiary education, and to those who borrow large amounts."

"Labour's attempted bribe of an interest-free loan of taxpayers money will do nothing but escalate debt. Students are likely to borrow the maximum amount - even if it is just to invest in the bank. I seriously doubt Labour, in the unlikely event of being elected, would ever deliver such a policy. Labour's policy is simply loopy. National will deliver.

"I hope the likes of Karen Skinner will take the time to read the policy before making the usual knee-jerk reaction and condemnation of anything National does. Read it Karen, read it!""

"The changes announced today will see total student debt reduce by a quarter by 2024. That's a big difference," said Daniel Gordon.

ENDS

For further information please contact: Daniel Gordon (021) 229 6812

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