National is promising to crack down on people abroad who are failing to pay back their student loans.
If re-elected, the party would ease compulsory student loan repayments from 12% to 10% – and charge those living overseas an extra 1% in annual interest.
This would result in annual interest on overseas-based balances being increased by one percentage point to 6.6%.
Arrest warrants could be sought for serious, ongoing defaults.
Leader Christopher Luxon has said 93% of overdue payments are overseas, and about 21% of overseas borrowers haven’t paid back for 15 years and have no payment plan.
Victoria University Student Association president Aidan Donoghue told The Front Page that the announcement was a bit “meh”.
“I think the real crux of the issue is they’ve increased our loans by a third by the removal of fees-free, and now they say, ‘Oh, don’t worry, you can pay it back now slower’.
“$20 a week if you’re making over $75,000 a year, it’s a benefit, so I won’t complain about that, but that’s above the median wage of New Zealand. So, what graduate’s going out and getting that straight away? I’m not too sure,” he said.
In last year’s Budget, the Government confirmed an indefinite freeze on the repayment threshold at $24,128, effectively forcing 370,000 borrowers to pay more as inflation rises.
“If you hit that threshold, I think it’s $464 a week before you start getting repayments; you’ll hit that at 20 hours of minimum wage,” Donoghue said.
“So even while you’re still studying, you’re expected to start making those repayments. Which is so gut-wrenching for those students who are just trying to get by or do a little bit more so they can actually participate in society.
“We did a survey of about 1300 students, and we found that a third of them had missed a meal in the last two weeks. A third of them missed class because they couldn’t afford the cost of public transport.
“In that same survey, 70% said they were already looking overseas. There used to be this idea that you go through a little bit of poverty during student life and you’ll get rewarded with a job at the end of it, and that’s what makes up for it.
“But when that social contract of getting that job at the end is being broken, we’re gonna find that people aren’t that keen to study anymore and will fall behind and are just gonna look elsewhere where those jobs are.”
Meanwhile, Labour has promised to offer every New Zealand-trained nurse a job in our public health system when they graduate.
“Graduate nurses are being trained here, but instead of starting their careers in New Zealand, too many are being forced to look overseas because National won’t give them a job,” leader Chris Hipkins said.
A subsidy for primary care employers to recruit nurses would also be doubled, increasing the current rate for rural nurses from $20,000 to $40,000 and for nurses in urban areas from $15,000 to $30,000.
Listen to the full episode to hear more about:
- Why young people are leaving NZ
- Cost of living and lifestyle
- Overseas default rates
- Comparison with Australia.
The Front Page is a daily news podcast from the New Zealand Herald , available to listen to every weekday from 5pm. The podcast is presented by Chelsea Daniels, an Auckland-based journalist with a background in world news and crime/justice reporting who joined NZME in 2016.
You can follow the podcast at iHeartRadio , Apple Podcasts , Spotify or wherever you get your podcasts.
