Cabinet Moves On Loans, Minimum Wage, F-16's

The government has moved fast on student loans, saying students who enrol at tertiary institutions early next year will pay no interest on their loans while studying or while earning under $25,000.

At the coalition government’s first cabinet meeting on Monday the minimum wage level was discussed, with the Alliance favouring a 50 cent increase for all workers and Labour supporting this only for those workers over 18.

The progress on student loans has been well received by the tertiary education sector. University of Otago Chancellor, Eion Edgar, said he hoped the development would encourage more people into tertiary education and was pleased at the speed with which the government was acting.

Karen Skinner, President of the New Zealand University Students’ Association also welcomed the news but hoped the coalition would address the bigger issues such as introducing allowances, cutting fees and reinstating the unemployment benefit for students out of work over the summer break.

A decision on increasing the minimum wage is expected before Christmas.

Prime Minister Helen Clark also announced a complete reassessment of the total defence budget and ACT MP Derek Quigley will review the decision to purchase the F-16 strike aircraft. He said he has already started the review.

Clark said she understood there was no penalty for backing out of the purchase and that the decision would depend on the comprehensive review of the total defence budget. However she has also said she may prefer to spend any money on Hercules transport aircraft than the F-16’s.

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