Robertson Grant: Student Loan Scheme Amendment Bill — In Committee 
Robertson Grant: Student Loan Scheme Amendment Bill — In Committee 
[Volume:678;Page:1444] 
GRANT ROBERTSON (Deputy Leader—Labour) 
: 
 My colleague Mr Hipkins has raised what is a serious issue because the commencement clause of the Student Loan Scheme Amendment Bill does bring in a retrospective date for commencement. I think that in principle that is something we should be very careful about in this House—to have legislation having a provision that is retrospectively coming into force. I think it really does require a Minister to stand up and take a call and explain to this Committee firstly why it would be that we even have a retrospective commencement date and secondly why on an issue such as this that is deemed to be something that is OK.  
For clarification for members what subclause (1) of clause 2 in schedule 5 which is being removed says—and as my colleague has said the clause is entitled “No interest charged by loan manager”—is that “The loan manager must not charge interest in relation to any loan advance made by the loan manager in accordance with this schedule.” We will come back to some of the earlier elements of the schedule in a moment. But to clarify for members of the Committee what a loan advance is a loan advance means according to the interpretation section of the Student Loan Scheme Act: “all—(a) money that is advanced by the loan manager to a borrower under the student loan scheme; and (b) student loan establishment fees charged by the loan manager to the borrower under section 14;”—which is what National introduced last year—“and (c) student loan establishment fees and any other type of fee charged by the loan manager to the borrower in accordance with a loan contract.”  
That is basically everything. A loan advance is pretty much everything that is provided to borrowers under the scheme. So this clause retrospectively coming into force repeals retrospectively the provision that the loan manager must not charge interest in relation to any loan advance. That is what is now being removed. So this is an interesting change.  
The Student Loan Scheme Act is a complicated Act. There may well be an innocent explanation for this but we do not know. That is the problem with this being done through the commencement clause rather than through a process that is more open to the Committee because as we know the subject of interest and whether interest is charged or not is obviously at the heart of the debate over the student loan scheme. We have heard already tonight that the Prime Minister and the current Minister for Tertiary Education Skills and Employment have concerns about whether or not they think the student loan scheme is economically sound. They think it is politically sound but they do not believe it is economically sound. So that is why we become worried when we see clauses such as this included in the bill.  
Essentially it is removing one clause within schedule 5 of the principal Act and that is the clause that says no interest shall be charged. What this is referring to is actually people who took out loans in a certain period. It refers to people who took out loans between 31 December 2011 and 1 April 2012 so we are in that period now. It is affecting people right now today who under this provision in schedule 5 of the Act passed last year in this House were to be charged no interest because that is the situation for every borrower in the student loan scheme at the moment.  
So really we do need someone on the other side of the Chamber to take a call to explain what this means to explain why for borrowers in the current period we are in now who had a piece of legislation that told them that no interest would be charged by the loan manager on their loan advances that has now been taken away. If there is an innocent explanation I am quite sure members opposite are capable of getting up and telling this Committee why that is the case and then we can get on with the rest of the debate around the title and commencement clauses.  
But it is very different to see a commencement clause with a retrospective date in it. We have now been able to identify what that is and it is a serious matter. There is not much more serious with the student loan scheme than the issue of whether interest should be charged or not. The whole schedule is one that obviously relates to a specific period in time with the loan scheme but it does raise concerns on this side of the Chamber. If there is an explanation for it we would like to hear it but in the absence of an explanation we simply are left with the impression that for some borrowers the requirement not to be charged interest has been removed.  
We have heard a lot tonight from Government members of the House wanting to see borrowers treated the same wanting to make sure that people who have borrowed money are treated the same. Well at the moment if you are resident in New Zealand there is no interest being charged. Does this clause somehow only apply to people who are overseas? There is nothing in the schedule that I can read here in front of me that indicates that. I think it really highlights the dangers of passing something like this under a commencement clause rather than doing it in a more open way. This is a serious matter and I would expect someone from the Government to reply.