This one appeared in Issue 9 of Nexus this year, from this point on most of what I write are of about this length.
The government has announced that it will make life tougher for all of us who live on a student allowance. The parental income threshold will be fixed over the next four years, meaning that in effect less people will be able to access the allowance. Meanwhile the government will be ensuring that people only have access to the allowance for a short time, in the words of the Minister, Steven Joyce “In practice this means removing access for masters and PhD students and for long courses beyond the first 200 weeks of study”
This may prevent some people from coming to university, most people do not like having to borrow money to live and unfortunately people who come from the least financially secure background will be the least likely to risk the debt.
But since we are talking about debt, this proposal will make debt worse for both the government and current and future students of New Zealand. Joyce is adamant that the money saved from not paying out the student allowance will be spent on more teaching and research. Which means that the extra money people take out on their student loans will have to come from government borrowing in the present, and the students will have to pay this extra money back in the future.
Which by the way the government is making a bit more difficult for graduates, they are raising the repayment rate from 10% to 12%. In effect this is like a 2% tax increase for people with a university education, which is a bit second rate considering the government just finished giving a 6% tax cut for the highest earners in our country.
Of course the government’s justification for this policy is that we are in too much debt at the moment, which not only shows you that they haven’t thought this policy through; but also that they are really just trying to put the costs of the tax cuts they handed out onto the poorer members of society.
So well done National, you have managed to develop a policy to make the government more indebted, while piling more debt onto the private citizens of New Zealand and reducing access to education. I’m not sure, but you must be either an evil genius or truly stupid.
