Will They Or Wont They? The Future Of Interest Free Student Loans In Question Again
Will They Or Won’t They?
Like many recent graduates I am a beast of burden. What am I carrying? Student debt, a rather large load. I’ll also say right now I voted for Labour, based purely on an awareness that I will be financially crippled once my loan starts getting charged interest.
Four years ago when I first started Uni I never stopped to consider that loans might not always be interest free. Labour had been in power for quite a while, and I was 18 and studying for a fashion degree, what did I know about politics?
I lived at home, but I claimed living costs and used them to go overseas on student exchange, not once, but twice. I got course costs for books, materials and a laptop. With four years in course loans and four years in living costs I’ve managed to rack myself up a constant niggling worry. A massive loan.
It’s a pretty common story, In Unison investigated what students were spending their money on in our last issue.
I don’t see interest free loans sticking around much longer. A major amount of my job involves watching the press releases and speeches of Minister of Finance and Minister of Tertiary Education Steven Joyce, and believe me, the hints are starting to stack up.
Yesterday Prime Minister John Key said student debt was a disaster, and condemned the massive $11 billion of student debt. He said national had only kept the current system as a political move, even though it “didn’t stack up” economically. He was quickly answered by leaders in the tertiary education sector. NZUSA, the New Zealand Union of Students’ Association were quick to reply that “The Government is rightly concerned about the economic impacts of high household debt and government debt, and acknowledges that student debt is also a major problem. That’s why policies such as interest-free loans and voluntary bonding have helped by relieving the burden of debt.”
The Otago Polytech Students Association chimed in that “Interest on graduate debt was highly unfair; it meant that a lower-income graduate could end up paying more in total for their education than a higher-income graduate, who could pay off their debt more quickly.”
In Unison wants to know your thoughts on the matter. Will they or wont they? And should they or shouldn’t they keep loans interest free? Send us your letters and comments and vote on our online polls to have your say.