ACT to privatise student loans

Media Statement

For Immediate Release

Thursday 7th October 1999

ACT to privatise student loans

ACTs tertiary policy released today indicates their intention to privatise the student loan scheme" said Karen Skinner Co-President of the New Zealand University Students’ Association (NZUSA).

"I am shocked that any party would advocate such a destructive policy. Richard Prebble showed that he is prepared to leave access to tertiary education up to the whims of the market" said Ms Skinner.

"Private business should not be allowed to profit out of students. The loan scheme is meant to exist as a means for people without parental income to participate in tertiary education. This clearly shows that ACT exists for the benefit of business profit and not for students or the public.

"Privatisation would mean that financial institutions could deny some students loans if they deemed them to be to risky. This means students may not receive loans for certain courses of study, or if they come form lower socio-economic backgrounds. Recent research has shown that those from poorer schools are not coming to our Universities, ACTs policy would be the final nail in the coffin.

"Prebble said that privatisation would lower the interest rate – however at the moment the government has the ability to lower interest if they want to. Privatisation would mean that neither students nor the public would be able to influence the loan scheme or negotiate for better conditions.

"Under privatisation interest is in fact likely to rise" said Ms Skinner. "The government has admitted that student loans is unsecured debt, which means that if financial institutions were willing to take on debt, they would be likely to charge high interest rates to cover their risk.

"ACTs overall tertiary policy is yet another reason for students and the public to reject ACT in the upcoming election" concluded Ms Skinner

For further comment contact:

Karen Skinner

NZUSA Co-President

025 86 86 73 or 04 498 2500.

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