Gordon Campbell | Parliament TV | Parliament Today | News Video | Crime | Employers | Housing | Immigration | Legal | Local Govt. | Maori | Welfare | Unions | Youth | Search


Government thinking about selling student loans

The government is looking at selling the student loans scheme.

Alliance Education spokesperson Dr Liz Gordon today released Ministry of Education briefing papers saying 'securitisation' of student loans is 'an option'.

Securitisation is a technical term for bundling up the $3 billion of outstanding student debt and selling it to private investors.

The proposal is contained in briefing papers presented to the Minister of Education last year.

Three options were looked at for reducing total debt. A 5th August 1998 paper headed 'Student Loans Scheme Paper B: Longer Term Initiatives' contains a table summarising options. Option 7 is to 'Securitise (sell) debt of high income borrowers'.

However officials were not able to fully evaluate the options, and said 'a full analysis of securitisation would need to involve extensive consultation with the banking and securities industry'. Consultation with students or borrowers was not proposed.

Securitisation was also mentioned in papers on the 5th of June, 15th of June, the 23rd of July and the 14th of October 1998.

Liz Gordon said that the sale of the student loans scheme would severely limit the ability of a new government to provide relief for borrowers.

"It would throw students borrowing for their education to the mercy of the market.

"If the government sells the debt it will have to give the banks a substantial discount to account for loans that will not be paid back. The government would essentially be forcing students into massive debt so that it can offer tax cuts to high income earners with the cash raised from students.

"The government is looking at these madcap options because the debt is out of control.

"Instead of making the scheme workable the government is looking to squeeze as much cash out of students as possible so that it can spend it bribing voters with tax cuts," Liz Gordon said.

© Scoop Media

Parliament Headlines | Politics Headlines | Regional Headlines


Also, Loan Interest: Productivity Commission On Tertiary Education

Key recommendations include better quality control; making it easier for students to transfer between courses; abolishing University Entrance; enabling tertiary institutions to own and control their assets; making it easier for new providers to enter the system; and facilitating more and faster innovation by tertiary education providers... More>>


Higher Payments: Wellington Regional Council Becomes A Living Wage Employer

Councillor Sue Kedgley said she was delighted that the Wellington Regional Council unanimously adopted her motion to become a Living Wage employer, making it the first regional council in New Zealand to do so. More>>


Scoop Images:
Dame Patsy Reddy Sworn In As Governor-General

This morning Dame Patsy Reddy was sworn in as the New Zealand Realm’s 21st Governor-General. The ceremony began with a pōwhiri to welcome Dame Patsy and her husband Sir David Gascoigne to Parliament. More>>


Ruataniwha: DOC, Hawke's Bay Council Developer Take Supreme Court Appeal

The Department of Conservation and Hawke's Bay Regional Investment Company (HBRIC) are appealing to the Supreme Court over a conservation land swap which the Court of Appeal halted. More>>


With NZ's Marama Davidson: Women’s Flotilla Leaves Sicily – Heading For Gaza

Women representing 13 countries spanning five continents began their journey yesterday on Zaytouna-Oliva to the shores of Gaza, which has been under blockade since 2007. On board are a Nobel Peace Laureate, three parliamentarians, a decorated US diplomat, journalists, an Olympic athlete, and a physician. A list of the women with their background can be found here. More>>

Gordon Campbell: On The Key Style Of Crisis Management

At Monday’s post Cabinet press conference Key was in his finest wide- eyed “Problem? What problem?” mode. No, there wasn’t really a problem that top MPI officials had been at odds with each other over the meaning of the fisheries policy and how that policy should be pursued... More>>


Mt Roskill: Greens Will Not Stand In Likely Post-Goff By-Election

“The Green Party’s priority is changing the Government in 2017, and as part of that we’ve decided that we won’t stand a candidate in the probable Mt Roskill by-election... This decision shows the Memorandum of Understanding between Labour and the Green Party is working." More>>


Get More From Scoop



Search Scoop  
Powered by Vodafone
NZ independent news