Student debt keeps going up

Simon Power - National Tertiary Education Spokesperson

The increase in student debt by $650 million over the last year is disappointing, but no surprise, says National’s Tertiary Education spokesman Simon Power, in response to the Student Loan scheme annual report.

“Student debt has continued to grow under Labour as more and more students take out loans. Not only has the debt level grown to $4.75 billion, but so have all the projections. By 2020 total debt will be a staggering $17 billion.

“The figures show that from 1999 to 2001 an extra 33,000 students took out a loan, encouraged by the policy of interest-free loans. On a day when Family Budgeting Services has pointed out the high levels of indebtedness by New Zealanders, this news is worrying.

“For Mr Maharey to claim a ‘decrease in the increase’ of the size of debts as a success is absolute waffle, when the average student loan balance has increased to $12,463.

“Tertiary education is facing a crisis on three levels, thanks to the Government. As well as the level of student debt, the fee freeze is putting huge financial pressure on Universities and the Government’s flagship reforms are floundering. Despite Parliament being in urgency, the legislation containing the tertiary reforms and the formation of the TEC has been shunted down the queue.

“Mr Maharey has some big challenges in front of him, and National will monitor this carefully on behalf of students and institutions,” said Mr Power.

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