$12 billion student debt a national liability
The recent release of the Student Loan Scheme Annual Report 2011 comes on the back of student protests over of the rising cost of education, and provides official confirmation that total student loan debt now exceeds $12 billion, highlighting just what a liability the Student Loan Scheme has become for the country.
“It is ironic that in accounting terms the annual report refers to the scheme as a significant financial asset, when in reality this $12 billion debt manifests itself as a liability on individuals, the country, and our economy,” said David Do, Co-President of the New Zealand Union of Students’ Associations (NZUSA).
negative social impacts of student debt include affecting
family formation, a loss of graduates overseas and the
psychological burden of debt. NZUSA’s Income & Expenditure
Survey 2010, a comprehensive survey of students at
universities and polytechnics, showed the highest perceived
social impacts of having a student loan as:
· Deciding when and whether to go overseas (69% and 62%)
· Deciding when and whether to have children (45% of respondents, and 24% respectively)
The highest perceived negative economic effects included the ability to buy a house (72%), and saving for the future (65%).
“The issue of this massive $12 billion student debt must be addressed. Just as many are now suggesting the country cannot afford to ignore the superannuation debate much longer, we also can’t afford to let the student debt mountain keep growing,” says Do.
“$12 billion of student debt has not come about by accident. It is the result of deliberate policy choices by successive governments, and is the continuing legacy of 21 years of user-pays education in this country. Lack of access to student allowances and high and rising tuition fees are driving all this debt, and this flows back to the fundamental issue of underfunding in the sector.”
“We urgently need our governments to do better. We need bold solutions to kick start the economy, boost education, and start tackling student debt for the benefit of the country. We believe the best solutions are to invest properly in tertiary education and to ensure that all students have a basic level of income support.”
“New Zealanders have a choice this election to either allow the problem of student debt to continue or to choose leaders who will tackle the debt and create a fairer future for all,” concluded Do.
For those worried about the burden of
student debt and other tertiary education issues, several
parties offer solutions and policy options. Voters can learn
more about these and read NZUSA’s voting guide at
NZUSA is the national representative body for tertiary students and has been advocating on student issues since 1929.