2. DARREN HUGHES (Labour—Otaki) Link to this
to the Minister for Tertiary Education
Has he received any reports on reactions to the interest-free student loan scheme, which came into effect on 1 April 2006?
Hon Dr MICHAEL CULLEN (Minister for Tertiary Education) Link to this
I have received many reports of positive reactions, such as the one from the New Zealand Educational Institute, which notes that the changes will help to keep new teachers in New Zealand, and describes how one typical new teacher will save over $40,000 over the life of his or her loan.
Has the Minister seen any reports of reactions to the scheme that have led to changes in any policy settings?
Hon Dr MICHAEL CULLEN Link to this
I have seen a report describing the changes as “the most irresponsible election bribe I can ever remember seeing”, and another describing the scheme as “rushed and reckless”. But I have also seen a report stating: “Maybe we can leave the scheme as it is.” The first comment came from the leader of the National Party, the second from its finance spokesperson, and the third from its education spokesperson.
Hon Bill EnglishDoes the Minister agree with estimates by his own officials that the number of borrowers is forecast to rise by 27 percent over the next 3 years, and with their estimates that the total amount of debt under his scheme will be greater than under the old scheme; if so, why has he pursued a policy that deliberately increases student debt?
Hon Dr MICHAEL CULLEN Link to this
I released those numbers in December. They came from Treasury. Of course, whether they are correct we will soon find out. It does not explain why, when faced with people who support the policy, that member said: “We may well keep it.”
Judy TurnerDoes the Minister agree that preventing student debt has greater merit than merely making payments of debt more affordable; if so, is the Government considering any initiatives to reduce the accumulation of student debt?
Hon Dr MICHAEL CULLEN Link to this
There are two main moves. One is better education of students about what they may or may not need. The second is improving the access to student allowances and continuing to work with parties such as United Future and New Zealand First in respect of that.
Can the Minister explain how under his stewardship the student loan scheme managed to lose over 20,000 borrowers who were overseas, making no payments and running up huge penalties, and why did the Inland Revenue Department lose track of over 20,000 New Zealanders living overseas who have student loans?
Hon Dr MICHAEL CULLEN Link to this
Addressing the last part of the question, I can tell the member that it is because in the past there has been no proper information-matching to ensure that when people move offshore, that information is made available to the Inland Revenue Department. We will be moving to introduce that information matching, to make that tracking possible.