Universal student allowance is key to unlocking debt problem

As long as students have to borrow money to live off, student debt will continue to escalate, the Alliance says.

Alliance President Jill Ovens says while it is good news that Labour is promising to wipe the interest on student loans after next April, it was Labour that recently toughened up conditions for the “living alone” allowance, making it even harder for students to qualify for a student allowance.

“Most of those who don’t qualify for an allowance (more than half of all students) have to borrow money to pay for rent, power, phone, and to eat. That’s why students build up such massive debts,” she says.

Half a million New Zealanders have borrowed well over $7 billion under the Student Loan Scheme since it was introduced by the National Government in 1992. And fear of being saddled with a huge student debt prevents many young people from low-income families from accessing tertiary education.

“It is not only the cost of living, but also escalating tertiary fees that keep working class kids out of tertiary education,” Ms Ovens says.

“Before 1990, tertiary education was practically free, and 90% of students received an allowance. Labour introduced a $1250 flat fee in 1990 and fees have risen ever since. For awhile, with the Alliance in Government between 2000 and 2002, fees were frozen, but since last year fees have actually increased under the current Government's Fee Maxima Policy.”

Ms Ovens says scrapping free community-based courses, as National plans to do, would further restrict access to tertiary education for those on low incomes.

She says free, universal tertiary education with open access to knowledge is critical in a democratic society.

“The thing is, it is possible to do it. The amount of money needed to implement the Alliance policy of fully funded public tertiary education, including a living allowance for all students, is $1.15 billion. Instead of investing the Superfund overseas, we say it should be invested in our younger generation.”

Ms Ovens says the Alliance in Parliament will fight for a living allowance for all students, the removal of tuition fees, and writing off all loans under the Student Loan Scheme.

The Party also supports increased funding for public tertiary institutions, especially regional polytechnics, and adequate funding for libraries [ www.alliance.org.nz ] .

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