Students Paying For Others Bad Debt
5 October 1999
STUDENTS PAYING FOR OTHERS BAD DEBT
New Zealand First Education Spokesperson Brian Donnelly says students paying for their defaulting fellows debt is just another example of the flawed present student loan policy.
The formula for calculating the interest rate on student loans includes 0.9% to cover bad debt.
“It is absolutely unjustifiable that those who remain and work in New Zealand struggle to pay off their student debt, while at the same time they are also paying for the debt of their less responsible fellows,” said Mr Donnelly.
“The Minister of Tertiary Education, Max Bradford, is unconcerned about this state of affairs, claiming it is normal financial practice. As Minister of Revenue he was unwilling to look at this factor in the interest calculation”.
“New Zealand First will replace the whole student loan formula with a much lower, fairer, interest rate”.