John Key MP National Party Finance Spokesman

25 November 2005

Cullen admits defeat in move on loans

National Party Finance spokesman John Key says Michael Cullen appears to have conceded defeat in the scrap over voluntary student loan repayments.

Reports today suggest Dr Cullen is on the verge of pushing through a rushed change in the rules to discourage students from claiming back voluntary student loan repayments made over the past six to nine months.

"Dr Cullen has been saying all along that his 'no interest' policy won't change borrower's behaviour, yet today he's revealed a rushed law change to plug the holes in his leaky ill-considered policy.

"One minute he's saying his policy won't encourage further borrowing or abuse of the system, the next minute he's confirming he is worried about precisely that.

"The Finance Minister has been shown up by a graduate, who clearly knows more about the law than the former Attorney-General.

"A significant feature of the student loan policy as it stands has been the level of voluntary repayments and this week in Parliament Dr Cullen confirmed that these repayments will all but dry up.

"Commonsense New Zealanders understand that if you offer 'no interest' it will tempt people to borrow. It's time Dr Cullen faced facts," says Mr Key.

ENDS

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