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Increased support for tertiary students

19 May 2005

Hon Trevor Mallard Minister of Education

Increased support for tertiary students

Budget 2005 widens eligibility for student allowances and introduces new scholarships to support our most academically capable students, Education Minister Trevor Mallard said today.

"The Labour-Progressive Government is committing an additional $57 million over four years for this package to improve the tertiary student support system," Trevor Mallard said.

"These initiatives are designed to lower Student Loan Scheme debt levels for borrowers. They provide additional assistance to students from larger families, students whose parents have separated, and medical students.

"The government wants to make sure that all students, regardless of their background, can have fair access to student support. Students will also be able to earn more from part-time work before their student allowances are affected.

"A new service will offer financial information and advice, to first-year students in particular, on funding their studies. Based on a pilot service run by StudyLink, this will help students make informed choices about borrowing.

"New Bonded Merit Scholarships will help pay the course fees of up to 500 of New Zealand’s most academically capable students a year. The scholarships will provide $3000 per academic year for course fees, from the student's second year for up to four years study. Following graduation, students will be bonded to work in New Zealand for a period as long as the duration of their scholarship."

Details of the package, effective from next year, include: The amount students can earn per week before their student allowance is affected will rise from $135.13 to $180. Instead of losing their entire allowance if their income goes above the limit, there will be a dollar-for-dollar abatement. The allowance of a student earning $185 a week, for example, would be reduced by $5. (Cost: $6.3 million over four years).

More students under 25 with separated parents will be eligible for allowances with the introduction of a new $3400 annual adjustment to the parental income threshold for these students. This recognises the additional costs separated parents have in running two households. (Cost: $5.2 million over four years). More students under 25 with siblings who are also studying will be eligible for allowances.

The annual adjustment to the parental income threshold for these students will rise from $2200 to $7000. This recognises the additional costs faced by parents supporting more than one child in fulltime tertiary study. (Cost: $14.3 million). The pilot StudyLink financial information and advice service, aimed particularly at first-year students, will be enhanced. (Cost: $5.8 million). Trainee Medical Intern Grants increase by $10,000 to $26,756 a year for sixth year medical students, to reduce their need to borrow and encourage them to stay and work in New Zealand. (Cost: $8.8 million).

Detailed information on student allowances is on www.studylink.govt.nz Questions and answers are available on www.beehive.govt.nz/mallard

ENDS

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