No cash windfall in student loan policy

Many students and their families wrongly believe Labour’s student loan policy means a cash windfall for them if they vote Labour, says National’s Education spokesman, Bill English.

“I have spoken to parents and students who think they would be able to stop part-time work and focus on their studies if loans were interest free,” says Mr English.

“In fact, a student with a $30,000 loan could wait more than 10 years to get any cash benefit from the policy.

“No borrower gets a cash benefit until their loan is fully paid off. Until then, borrowers would have to make the same compulsory payments each month under both National’s and Labour’s policies.

“Borrowers who have already paid interest for years and have nearly paid off their loans, as well as borrowers with small loans, will get a cash benefit sooner, but nothing like the thousands of dollars Labour has promised.

“In the meantime, every other taxpayer has to foot the interest bill. Why would voters support a policy that benefits a few in three election’s time, but costs everyone else right now?”

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