Robertson Grant: Taxation (Budget Measures) Bill — In Committee 
Text is incorporated into the Bound Volume 
Robertson Grant: Taxation (Budget Measures) Bill — In Committee 
[Sitting date: 24 May 2012. Volume:680;Page:2476. Text is incorporated into the Bound Volume.] 
GRANT ROBERTSON (Deputy Leader—Labour) 
: 
 It is a pleasure to rise this morning to speak on Part 3 of the Taxation (Budget Measures) Bill. Mr Hipkins has just been discussing the folly of the Government in bringing this particular proposal forward. I note in the regulatory impact statement around Part 3 the following statement: “The voluntary repayment bonus is part of a wider student support package and is not a stand-alone policy.” Never a truer word has been said in a regulatory impact statement because the Government’s overall student support package in this Budget is one where the message is very very clear indeed: if you are from a low-income background this Government does not want you undertaking postgraduate study. That is the message from the student support package in this Budget.  
To be absolutely clear about what the Government did yesterday it said that student allowances will not be available for anyone studying postgraduate qualifications—anyone at all—from 2013. If we look at this measure as part of that package as the regulatory impact statement tells us to do we can see quite clearly that in fact Mr Joyce’s answer to the people who say “I cannot get a student allowance. How am I going to be able to do postgraduate study?” is for them to take on more debt through the student loan scheme which is the very thing that the Government told us it did not want. The very thing that is meant to sit at the heart of the so-called student support package is that there will actually now be more debt for students if they are going to be able to carry on. 
 A very important point on that is that students who currently receive an allowance for postgraduate study will in most cases be getting far more than the $171 a week that is paid out in the student loan scheme living costs component. So the overall package of student support which this voluntary repayment bonus repeal is part of is actually a package of declining support. It is actually restricting access to allowances and meaning that many people who would have been undertaking postgraduate study will not be doing so. That is a great shame. It is something that is going to limit the potential of many New Zealanders and add to the debts that they and their families have. It is a retrograde step and as part of this wider package of student support it is simply not on.  
This particular measure in Part 3 is designed we are told by the regulatory impact statement to “encourage greater contribution to tertiary education costs from students who can most afford to pay and who are more likely to receive higher levels of private return from their study; and reduce unnecessary borrowing.” Well the very thing this package of student support will do is increase borrowing and the notion is that a greater contribution to tertiary education costs comes from students who can most afford to pay. That is what this regulatory impact statement says—“students who can most afford to pay”. The students who are on student allowances now are people who cannot afford to pay for their postgraduate qualifications and this Government is saying to those people: “We will not support you into postgraduate study.”  
We need more people going into postgraduate study. We want more people qualifying with master’s degrees and PhDs to help grow the economy but because there is nothing in this Budget about growing the economy anyway this Government has said: “Well we are not going to bother with actually supporting people into those postgraduate qualifications.”  
The voluntary repayment bonus was as my colleague Mr Hipkins said brought in by the National Government in 2009. It decided that this would be a good way of getting borrowers to pay off their loans more quickly. I just want to note at that point John Key and Steven Joyce’s recent conversion to the idea that the thing that will allow people to pay off their loans more quickly is the interest-free nature of the student loan scheme. That is something the Labour Government was heavily criticised for by National. John Key said he would oppose that policy with every bone in his body but now he has realised that that is actually what is allowing people to pay off their loans quicker because the scheme that National put up to try to get people to pay off their loans quicker actually did not work. In fact the one thing that did work was the interest-free nature of it but that was the goal of this.  
The regulatory impact statement tells us that despite the fact that the goal of this policy was for people to pay off their loans more quickly many borrowers who undertook it were actually already the very people who were paying off their loans quickly. The bonus it says is also encouraging some students to borrow when they do not need to do so. So the policy actually had exactly the opposite effect of what the Government said it wanted to do. The regulatory impact statement tells us: “In 2011 2611 borrowers repaid their student loans in the same year they borrowed” so actually they were gaming the system which is what the Labour Party told the National Government would happen.  
If the National Government wants people to pay off their loans more quickly it should make tertiary education more affordable. It should actually support students to study. It should make sure that fees do not go up. It should give more people access to student allowances if it wants to make tertiary education more affordable which is what it said was the goal of this policy. Instead what it did was run up a policy that was doomed to failure.  
It was not as Mr Hipkins said just Anne Tolley Peter Dunne and Louise Upston who were hugely behind this policy. John Key trumpeted it in a press release on 31 January 2008. He said he was announcing “a plan to help student loan holders get out of debt quicker.” Well that did not work out very well. He said: “We will keep interest-free student loans”—good on you John that is well done. “Many have made long-term financial decisions on the basis of the current policy and”—this is what Mr Key said—“we want to ensure they can plan with certainty.”  
That is what John Key said in 2008. He said that this policy would be introduced so that students and their families could plan with certainty. Well here we are 3 years later. Certainty is out the window because the policy just did not work but John Key said he wanted students to plan with certainty. That is not what happened. He said: “What I’ve announced today is aimed at helping borrowers get out of debt sooner”—that did not happen—“and give them certainty so they can plan.” That did not happen.  
Then we have the following statement from John Key: “National has no intention of doing anything that impedes people from realizing their own educational ambitions.” Let us read that again: “National has no intention of doing anything that impedes people from realizing their own educational ambitions.” There are words for that that I am not allowed to use in this Chamber but we can look at the Budget and it tells us for sure that the impeding of people achieving their educational ambitions will be happening as a result of this Budget if allowances are taken away from anyone trying to do postgraduate study. That impedes educational ambition.  
I have had students contacting me via social media and via email over the last 24 hours— 
Hon Tau Henare 
: Prove it. 
GRANT ROBERTSON 
: I can table them if you like Mr Henare. 
Hon Tau Henare 
: Go and get them. 
GRANT ROBERTSON 
: I will. I will do it for you later. I would like you Mr Henare to go and talk to some constituents—you do not have an electorate any more—and actually ask them about how this is going to impact on them. What this means for the students who have contacted me is that people part-way through master’s programmes are now not going to be able to carry on. These are people who have families and who have planned for this. They are halfway through a master’s programme or a third of a way through a PhD programme and they will not be able to get the allowances to allow them to carry on.  
Mr Key tells us that National has no intention of doing anything that impedes people realising their own educational ambitions. This Budget impedes people realising their educational ambition. It increases the repayment rate on student loans. It says that student allowances are only for rich people to do a postgraduate qualification. That is what the message is from this Budget. Part 3 of this bill is part of a student support package that is actually about limiting the number of people who can go into tertiary education. Steven Joyce’s goal from day one as Minister of Tertiary Education was to “dampen demand”—those were his words “dampen demand”—for tertiary education. That is the opposite of what this country should be doing. This country should be encouraging more people into tertiary education more people into training and more people into postgraduate qualifications but instead this Government is determined to take money away from supporting students to do that. That is a great shame.  
Part 3 of this bill repeals something the Government should never have done. It was a silly part of its package. But what it should really do is put forward proposals that actually enable participation and enable people to carry on with the study that they want to do so that they can get qualifications that will get them higher incomes that will support their families and that will add to economic growth for New Zealand. We have seen none of that in this Budget from the Government. What we have seen is simply a proposal to get rid of a silly policy it had in the first place. I want to see a commitment from this Government to encouraging more people to do postgraduate qualifications. That will not happen.