The New Zealand Union of Students’ Associations (NZUSA) has lambasted Treasury’s recent evaluation of the Student Loan Scheme.
In a statement released on February 5, NZUSA co-presidents Sophia Blair and Jordan King took umbrage with last year’s brief to the incoming Minister of Finance, suggesting it patently ignored the scheme’s disadvantages.
“Treasury’s ludicrous suggestion that a generation burdened by debt is insignificant, [and] is out of touch with the harsh reality for many kiwis,” said Blair.
“Particularly concerning and insulting are Treasury’s assertions regarding the consequences of student debt,” King added.
“A generation of skilled New Zealand graduates have been lost offshore, and further to this, they’ve had to delay parenthood and have been blocked from buying their first homes due to high student debt.”
The brief presented to Minister of Finance Bill English recommended several possible alterations to the Student Loan Scheme, including lowering the existing repayment threshold and increasing compulsory repayment rates for those on higher incomes.
The brief also pitched the idea of aligning student loans with current student allowance policy, stating that it “… could include requiring students to pass a certain number of their courses or limiting the number of years students can borrow for.”
Treasury spokesperson Phil Barclay said in spite of NZUSA’s gloomy take on its assessment, Treasury held tertiary education in high esteem.
“The Treasury recognises that tertiary education benefits individuals, the nation and the economy,” Barclay said.
“The BIM [Brief for the Incoming Minister] points out the importance of skills and suggests more people need to be taking graduate degrees.”
“As the Government’s economic advisor, the Treasury must look at the whole economic picture and the quality of policy in all areas to achieve the maximum national benefit from taxpayer dollars.”
“We believe the [NZUSA statement] misrepresents what the Treasury BIM says. We never, for example, suggested that a ‘generation burdened by debt is insignificant’,” Barclay said.
NZUSA, however, found Treasury’s response “disappointing.”
“The briefing did suggest that policies that aimed at easing student debt had little impact on students and graduates. Our research, as well as observations and research of government departments and academics would point to the exact opposite conclusion,” said Blair.
“It is glaringly contradictory that Treasury admits that New Zealand needs more graduates, but encourages barriers to education by suggesting the lowering of the loan repayment threshold, (one of the harshest in the OECD), and penalising those that do seek to further their education and contribute to our economy.”
Blair called for greater transparency and for Treasury to actively engage with the NZUSA’s concerns.
“NZUSA raised these points because these suggested policies will have a negative and detrimental effect on the student body. We think students deserve answers if such policies are to be advocated,” she said.