Student interest astronomical

Student loan borrowers have paid more than $76 million in interest this year alone, Labour associate education spokesperson (tertiary) Steve Maharey said today.

Steve Maharey said the interest debt mountain was further evidence of how huge the burden of interest was on students. Since the student loan scheme began in 1992 - nearly quarter of a billion dollars of interest had been repaid.

"It is figures like this that lead to Labour developing our policy of no interest on student loans while full-time and other low income students are still studying," Steve Maharey said.

"While the Government figures have not differentiated between interest paid by students who are still studying and interest paid by former students, there is little doubt that Labour's policy will make a significant difference to these shocking debt levels.

"Total student debt is more than $3.44 billion and growing. Yet the Government treats it as an asset!

"Labour is totally committed to lowering the costs of tertiary education starting off with a fairer student loan scheme.

"National on the other hand is refusing to acknowledge that interest is a problem. Instead it prefers to defend its lack of action on this issue by saying that providing interest relief would be unfair on the 30% of full-time students whose 'mums and dads can afford to pay for them' while they are studying.

"Labour says it is unfair to mortgage the lives of nearly 300,000 young New Zealanders when they are trying to get themselves an education. For example a former dental student - now working in the public health system, has such a huge loan that the compulsory repayments do not even cover the interest she is accruing and as a result she is leaving the public health system for a private practice," Steve Maharey said.

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