Student Loan Scheme (Repayment Bonus) Amendment Bill
Third Reading; Thursday 17 September 2009
Rahui Katene, MP for Te Tai Tonga
I rise to take a very brief call as the issue of student loan repayment is a significant one, facing the nation.
It is a collective challenge, as the mountain of debt is threatened to grow to $15 billion by 2014.
But as other speakers have pointed out it is not just the quantum of the debt that concerns us; it is the huge impact on
students and their families.
An estimated 120,000 holders of student loans are in arrears or are failing to make repayments.
We have a particular concern for the future for Maori students.
The evidence tells us that more Māori have a student loan debt than any other group, although the level of debt held is
similar to other groups.
Five years after study, Māori students are also less likely to have made progress towards repayment of their student
loans than non-Māori students
In a study undertaken by Jefferies he concludes that the increasing participation in the student loan system by Maori
students reflects the necessity that for many Maori, the student loan scheme provides the financial support that is
necessary to participate in higher education.
So there are many complex issues which in and by themselves need to be addressed – not just the issues of this Bill
related to student loan debt.
There is the core issue, of course, about why it is that Maori have the lowest post-study incomes and repay their loans
more slowly than other groups.
The annual report from Te Tahuhu o te Matauranga three years ago, tells that Maori Certificate level students carry a
larger student loan debt five years after study, reflecting notably lower earnings. Māori with bachelors’ degrees or
postgraduate qualifications also had notably higher average leaving loan balances than non-Māori.
We will support this Bill at the third reading, as we know that current student debt is capable of impairing the long
term financial base and self-confidence of young students. We must do everything we can to protect their interests, and
safeguard their futures.
However, I want to leave with a couple of comments that I have drawn from the excellent submission of students from
within my rohe of Te Tai Tonga, from my home town, the Student Association of the Nelson-Marlborough Institute of
Technology.
They told the select committee that the
• Bill is just a band aid solution;
• only those graduates who can afford to pay $500 above compulsory payments will benefit;
• Living costs are rising from recession;
• The Bill does nothing to address initial costs of tertiary education in the first place; and
• If education was affordable, government would not have to propose such measures in the first place.
While I agree with the previous speakers that we must incentive New Zealanders to pay off debt as fast as they can, I do
not think we can overlook the systemic issues that this Students Association has brought to the House.
And we would hope that further legislation to effect these issues will also come before the House as a matter of urgency
in the direct future.
ENDS