4 March 2002 Media Statement

Prebble Gets It Wrong Again – The Cost Of Tertiary Education Has Come Down

Facts are getting in the way of Act leader Richard Prebble’s attempts to mislead students about the impact of the government’s no-interest-while-studying policy.

A media statement issued by Mr Prebble this afternoon criticises Auckland Issues Minister Judith Tizard for correctly telling students that they have saved $14.3m in interest charges which would have been added to their loans under a National-Act government. He goes on to incorrectly claim that graduate debts are getting much larger.

Associate Education (Tertiary Education) Minister Steve Maharey said he is happy to put Richard Prebble right.

“Students know that Labour and the Alliance have invested a lot of money in them to keep our promise to cut the cost of tertiary education – in fact a total of $800m is being invested over four years.

“This is having a real impact. In the year to June 2001 the average student loan actually decreased in real terms for the first time in the life of the loans scheme. In cash terms the average loan that month – at $12,496 – was only 0.7% higher than the previous year.

“Richard Prebble claims that students are paying interest on a much larger debt after they graduate – the facts prove him wrong.

“The number of students using the loans scheme has increased slightly in recent years – as has the total debt owed – but the changes Labour and the Alliance introduced mean that average debts at graduation are lower and are being paid much quicker and growth in overall student debt has slowed from a 50% increase in one year in the mid-1990s to around 15% today.

“As an unelectable party Act is in the lucky position of never having to implement their policies which is presumably why they are still advocating tax cuts as some kind of debt relief measure. Of course this is a nonsense since tax cuts would reduce the revenue available to the government to hold and lower fees and to stop the interest accumulating on students Mr Prebble and Act were happy to support during the 1990s,” Steve Maharey said.

Ends

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