The Average New Zealand student:

Owes $28,000+ in Debt.
Lives away from home.
Receives little financial support from family.
Works part time. (around 15 hours a week) often for minimum wage.
Doesn’t qualify for a student allowance.

The rich student:

Owes nothing in debt. Either their parents have paid their entire way through or they have a scholarship (often because their parents have paid for extra school lessons).
Either lives at home or away from home. Pays nothing in rent because parents cover it all.
Receives full financial support from family.
Doesn’t work part time. They can therefore spend more time on studies and do better.
Qualifiers for a student allowance because their families have creative accountants who tie all the money up in trusts, investments, and company expenses.

My situation:

32,000 in debt.
Lives away from home.
Receives no financial support from family.
Worked 20 hours a week while studying.
Did not qualify for a student allowance.

I am fired up. As blogged below do not critise those who are below you. We have just as much a voice as you do.

If you want to know more about student support and how little students get check this page out: http://www.students.org.nz/index.php?page=livingallowances

Here are some highlights:

Students are the only group in our society who are not entitled to public income assistance when out of paid work. While the cost of living increases more and more, full-time students are being forced to scramble together income from a range of sources to meet ever increasing weekly living expenses - whether through working long hours on top of full-time study or borrowing to live from the loan scheme.

New Zealand’s low level of living allowance eligibility and relatively high cost of living forces a large number of students to borrow to live from the Student Loan Scheme and/or scramble together income from a range of sources.

In a 2005 report by the North American-based Education Policy Institute, research compared countries on six different measures of tertiary education and student living cost affordability. Out of a total of 16 countries, New Zealand only scored 15th, while understandably Sweden and Norway, two countries that have a fully funded tertiary system, scored first and second.

NZUSA believes that students must be relieved from the burden of being forced to borrow to live and plunged into high debt. Students must be provided with a living allowance as of right while enrolled in full-time tertiary study, and out of full-time paid work. Full-time study is just that – full-time! We strongly deplore the current and previous government’s view that debt constitutes a form of income for students.

30% of all borrowing under the Student Loan Scheme includes borrowing for student living costs, and 50% of all loan scheme borrowers in 2004 borrowed for living costs.

The maximum a student can borrow per week is $150.00. Despite being the longest un-inflation adjusted figure on the government’s books, this is not a sufficient amount to live on, in light of increasing costs, and particularly if students have no where else to turn for income.

The logic from parties who support age related means testing tends also supports the view that if a student is ineligible for an allowance then their parents will support them.

However, only 28 percent of all respondents to the TNS Income and Expenditure Survey (2004) reported receiving some parental support while studying, and this was not necessarily on a weekly basis. The median amount gained from this source for the year was $1,999. The 1998 Income and Expenditure Survey revealed that 31 percent had received some form of monetary gift from their parents.

And there is plenty more in the linked article read up before you blindly critise.

This is old but good. Why National cannot be trusted.

Go the Greens and New Zealand First! Good on you for standing up for students!

Tomorrow is going to be huge. Student Debt hitting 10 Billion is already in TV3 News as the third story, New Zealand Herald, Stuff, Scoop. And probably lots more.

http://tinyurl.com/3mw9zc

9. Debt, Student-Increases

[Uncorrected transcript-subject to correction and further editing.]

9. METIRIA TUREI (Green) to the Minister for Tertiary Education: Has he received any reports that student debt will reach the milestone of $10 billion this week; if so, what, if anything, does he plan to do about it?

Hon PETE HODGSON (Minister for Tertiary Education) : Yes, I have. Next month’s Budget will contain some measures to further increase student support, just like each of our first eight Budgets have already done. I acknowledge in passing the Green Party’s consistent support for progress in this area, and I also acknowledge that the National Party has consistently voted against such progress.

Metiria Turei: Does the Minister stand by this statement, which he made in January of this year: “Each year under Labour-led governments student support has strengthened,”; if so, how does he reconcile that comment with the fact that the latest figures show that fewer students received a student allowance in 2006 than when Labour came to power in 1999?

Hon PETE HODGSON: The proportion of eligible students who are receiving the allowance now is well over half-it is about 57 percent-about three-quarters of whom are receiving the full allowance and one-quarter of whom are on the cusp, if the member might see what I mean. That is a great many more students than when we first came into office. I cannot express the difference in a percentage, however, because I do not have the figures with me.

Hon Mark Burton: In the light of the Minister’s response to the primary question, does he expect that total student debt will go on to reach $11 billion or even $12 billion; if so, why is the total debt still rising?

Hon PETE HODGSON: It is a very good question. The total debt continues to rise because, apart from inflation, there are more students, and more students are studying to a higher level. That is a good thing. It is a good thing. The question is what is happening in the life of an individual student, and what is happening there is that conditions continue to improve. They would say “too slowly”, but conditions do improve. The average debt is now rising more slowly than the average wage, with the average wage being the way that one pays the debt off. For that reason the average repayment of the debt has reduced from where it was in 2001, at 9½ years, to where it is now, at less than 6 years. So there is an improvement for students. The Greens have assisted with that improvement. We need to make more improvement.

Dail Jones: Does the Minister accept that the problem associated with student debt, with or without interest, can be substantially reduced by the introduction of New Zealand First’s policy, which for many elections has stated that New Zealand First will introduce a universal student allowance that does not require repayment?

Hon PETE HODGSON: Having a universal student allowance is the policy of a number of parties in this House. For my part, we are happy in our party to move towards, but not to, a universal student allowance, and this is why: I have other priorities. I need to pay attention to the quality of tertiary education. I need to ensure that the completion rates continue to rise. I need to ensure that the access-especially for Māori and Pacific Islanders, which is well below par-must be increased. These things all cost money and I happen to place them above the move to a universal student allowance. On the other hand, we make progress towards that universality in most years, and I hope we may do so again next month.

Metiria Turei: Does the Minister disagree, however, that his inadequate student support policy, which includes interest-free student loans, has actually led to a 9 percent decline in the enrolment of students from poor backgrounds; and will he then make a real commitment to fulfilling the policy of the Green Party, the New Zealand University Students Association, and, obviously, New Zealand First, for having a universal student allowance, which would ensure that today’s students are able to have the same opportunity to learn, to buy homes, to choose when to have families, and to take control of their financial destiny, as he and most of the Labour Party leadership have also been able to do?

Hon PETE HODGSON: The short answer is no. I have no advice to the effect of a 9 percent reduction in whatever the member suggested might be occurring for New Zealanders who are from more modest backgrounds. On the contrary, there is documented evidence of higher access for Māori and Pacific Islanders, but not high enough, and of higher completion rates at level 7 and above, but not high enough. We have had some dramatic, outstanding improvements in education amongst Māori and Pacific Islanders in the tertiary sector in this country-especially in the years 2002 to 2006, which is the latest data available-but I would be the first to say, along with all of my colleagues, that progress is not yet sufficient.

Dail Jones: Is the Minister aware that student debt can begin to be decreased by increasing the current parental income maximum for a student allowance from $71,000 before tax, if one lives in a parental home to study, and just over $77,000 before tax, if one lives away from a parental home-the current rate-to, say, $100,000 before tax, if one lives in a parental home to study, and $105,000 before tax, if one lives away from a parental home, which would cost an estimated, and I emphasise “estimated”, additional expenditure of about $300 million to the Government, and surely this would be a good investment in education and in the future of New Zealand and it would encourage qualified people to stay in New Zealand?

Hon PETE HODGSON: Yes, I am aware of that, which is why, although the member was not able to be with us, this Government shifted parental thresholds three times in each of the last three Budgets-by 20 percent, 10 percent, and 10 percent-and we do not rule out the possibility in the future of a further shift in the thresholds.

Metiria Turei: Is the Minister aware that the Minister of Finance recently told the TaxAgents’ Institute: “We have real ambition for New Zealand and our economy. And we know that by refusing to burden our children and grandchildren with a legacy of debt, we are removing one of the biggest obstacles to realising that ambition.”; if so, does it worry him that the Minister of Finance is so ignorant of the $10 billion legacy of student debt left by this and previous Governments, which has a proven, disproportionate exclusionary impact on women, Māori, and the least well-off New Zealanders?

Hon PETE HODGSON: Just a couple of comments in response: first, the level of participation of, say, New Zealand Māori in our universities is still below that of, say, New Zealand Europeans, but it is getting better, not worse. The member shakes her head-she needs to go back and look at the statistics. Second, I did not have the pleasure of being in the room when the Minister of Finance made his quoted remarks, which is a shame, of course, but I would not mind betting he was talking about KiwiSaver, and that is a magnificent policy that will change the face of this country.

Metiria Turei: I seek leave to table a chart showing that the numbers of students receiving an allowance in 2006 are 5,000 fewer than in 1999.

* Leave granted.

Metiria Turei: I seek leave to table an article describing how the under-35s are now effectively shut out permanently from financial security.

Madam SPEAKER: Leave is sought to table that document. Is there any objection? There is objection.

Metiria Turei: I seek leave to table “Freedom from debt, freedom to prosper”-the Minister’s speech to the TaxAgents’ Institute of New Zealand given in March this year.

* Leave granted.

Dail Jones: I seek leave to table a document to introduce a universal student allowance, being New Zealand First’s election policy.

* Leave granted.