Overseas student debt results disappointing
Lack of government interest in reducing the level of
overseas student debt disappointing
The New Zealand Union of Students’ Association (NZUSA) says it is disappointed with the government; accusing it of making no effort to actually address the repayment of overseas student loan debt in the Student Loan Amendment Bill. The Bill was forced through Parliament yesterday with 61 votes in favour and 60 votes against.
“Submitter after submitter, NZUSA amongst them, made suggestions that would address repayment rates, but the submissions were ignored in favour of a gimmicky ‘criminalise and arrest at the border’ proposal that was opposed by the Police and Parliament’s own regulatory oversight committee”, said Daniel Haines, NZUSA President.
“Treasury advice is that the changes are actually likely to increase default rates, and officials from IRD have also said they were not predicting an increase in student repayments, despite proposing to spend $600,000 in one-off costs in updating airport screening capacity, said Haines”
In their submission, the New Zealand Police said they did not want to be IRD’s debt collectors, and questioned the use of Police resources in this way.
Haines continues, “more than half those overseas are behind in their payments, owing approximately $3 billion. But forty percent of those overseas have access to a non-New Zealand passport, making the government’s ability to penalise those students toothless.
“NZUSA believes that any student who borrows has an obligation to pay back their loan. But the chorus of opposition to this Bill shows that more logic and common sense is needed to encourage repayment. Punishing people who borrowed for their education isn’t the solution, this scheme needs more carrot and less stick.”
NZUSA is acting independently to encourage repayments, providing its own plain-English advice and pushing this out via social media. Students overseas can access our fee-free transfer service for overseas based borrowers through NZUSA’s website at www.students.org.nz.