Student loan debts rise while repayments vary

28 February 2008

Student loan debts rise while repayments vary

The number of students borrowing in a year under the Student Loan Scheme reached a high of 167,400 in 2006, Statistics New Zealand said today. The 8 percent increase from 154,404 in 2005 is the biggest annual percentage increase in the number of borrowers since 2001. This is despite total enrolments dropping 3 percent from 527,211 in 2005 to 512,694 in 2006.

The average student loan leaving debt reached a high of $15,590 in 2005, up 6 percent from $14,730 in 2004. This continues the upward trend in average student loan leaving debt recorded since 1992.

The total number of students receiving an allowance increased 5 percent to 58,194 in 2006 from 55,554 in 2005. This is the first increase in the number of students receiving an allowance since 2002. The average amount received increased 3 percent to $6,580 in 2006 (from $6,380 in 2005).

Repayment rates varied by ethnicity. Those identifying as Pacific peoples had repaid the smallest proportion of their student loan leaving debt five years post-study, at 4 percent in 2006 for students who left study in 2001. This compares with 26 percent of those borrowers identifying as European, 20 percent for Asian and 10 percent for Māori.

Repayment rates also vary considerably among students leaving from different provider types. Students who had borrowed and left wānanga owed more in 2006 on average, than they did on leaving study in 2001. Their average student loan leaving debt in 2001 was $10,930 but by 2006 their student loan debt had increased 1 percent to $11,040. In comparison, students who left colleges of education in 2001 had repaid 30 percent of their student loan debt over the same period, the highest proportion for all provider types ($14,410 in 2001 reduced to $10,080 in 2006). Only 12 percent of students who left study at wānanga in 2005 had borrowed, compared with 45 percent of students leaving colleges of education.

Students who left study from engineering and related technologies qualifications at level 7 bachelors in 2001 had the highest average income for those at this level five years post-study, at $50,420. This compares with an average five-year post-study income of $31,490 in 2006 for students who left study from creative arts qualifications, the lowest average five-year post-study income for students studying at level 7 bachelors. Dallas Welch (Mrs)

Acting Government Statistician 28 February 2008

ENDS

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