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Closing Gap With Australia: How about Loans and Allowances?
Closing the Gap With Australia – How about with Loans and Allowances?
The National Government was elected in 2008 promising to close the gap with Australia. Four years in, there’s instead been a widening disparity. As the final touches are put to the 2012 Budget, student leaders are pointing to loans and allowances as an obvious place to start. This comes amidst reports that some of New Zealand’s best students are already taking advantage of Australia’s better resourced institutions and student conditions to study, perhaps never to return.
“There are two obvious differences with the loans and allowance schemes between Australia and New Zealand,” says Pete Hodkinson, President of the New Zealand Union of Students’ Associations. “The first is that Australians get more money, and though also means-tested they continue to get money with higher levels of parental income. The second is that their income contingent loans scheme doesn’t require payments until there’s an actual proof of higher income.”
“The irony is that our colleagues in Australia argue that their scheme is unfair and that students can’t afford to live on it, a view supported by the recent Bradley Review into Student Support. If that’s true at their higher levels how much more true it must be here.”
A big difference between the level of Australian student support and New Zealand’s is that is that Australia takes account of the actual costs of living. In Australia, students can get up to $120 per week to support their rent costs. New Zealand students can only get $40 per week.
“The other difference is that the allowance, while also means-tested on parents income, has greater understanding of the ability of families to support their children. New Zealand’s scheme denies any support if both parents are earning even the average wage, while we know most parents in their mid-to-late forties will be earning more than that. Australia’s scheme is simply more sensible.”
While New Zealand graduates with student loans have to start paying back their loans at a rate of 10 cents in every dollar earned over $19,084, Australian graduates pay back on a graduated scale that starts at 4% of their total earnings once they earn over $48,000.
“The New Zealand rate kicks in at a level barely above poverty, where graduates are certainly not demonstrating any private benefit from their study, and at precisely the time when they are going to be faced significant other costs of setting up their homes, their families, or potentially their businesses. At $30,000 a year, that $40 a fortnight is a big deal. The Australian repayment level is fairer and makes more sense in terms of the nation’s economics.”
NZUSA is the national representative body for tertiary students and has been advocating on student issues since 1929.
ENDS
NZUSA - New Zealand Union of Students' Associations
We stand for opportunity, for all.
NZUSA is the New Zealand Union of Students' Associations, the national body that represents New Zealand's students' associations and the interests of New Zealand's 400,000 students at universities, polytechnics and in trades training.
We conduct original research, advocate to Government and through the media, and support New Zealand's students' associations to be more effective on behalf of their members. We advocate alongside Te Mana Akonga – The National Māori Students' Association, and Tertiary Women New Zealand – The NZUSA Women's Caucus.
Since 1929, we've believed in a society rich in opportunity, where anyone from anywhere can become any thing. We support accessible, affordable quality public tertiary education.
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