Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill — In Committee Third Reading 
Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill — In Committee Third Reading 
[Volume:660;Page:9407] 
Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill 
In Committee 
Debate resumed. 
Part 2 Consequential amendments to and revocations of other enactments ( 
continued 
)  
CARMEL SEPULONI (Labour) 
: 
 I will continue with my speech on Part 2 of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I was saying that Part 2 basically makes sure that there is consistency with regard to what is in Part 1. We were discussing the importance of student loans for particular groups in our society and the need to ensure moving forward that those groups have access to student loans because of the fact that unfortunately not every member of this society has parents who can afford to pay for their tertiary studies. We need to make sure that particular groups in society have equal opportunity to access quality tertiary educational opportunities. That is what we were touching on. 
Forgive me Mr Chairperson if I cannot do this but I want to check whether I can put something from Part 1 to the Minister. You are shaking your head; OK then I will not go there. 
We talked earlier about our own experiences with student loans at university and I talked about the fact that not only did I spend 11 years at the University of Auckland but I spent it working and studying there so I have had a lot of experience with Maori and Pacific students and also with students who are sole parents. We discussed the fact that for many of those students their time at university does not necessarily fit in the 3-year or 4-year degree time frame or whatever time their programme was meant to take. In fact I think that when I was at the University of Auckland there was some research done on the fact that quite often not just Maori and Pacific students but students in general struggled to finish their degrees within the time periods that were set. There are good reasons for that. I alluded to the fact that for some students the tertiary environment and the university environment in particular can be quite foreign given that some students come from families where they are the first to go on to study at a university. It is important that we take that into consideration. 
I heard one member from the other side of the Chamber in a speech about 2 years ago talk about his own experience at university. He went on to do a PhD but he said that it took him longer than 3 years to complete the initial BA. If he had taken out a student loan—even though I know that during his time he did not need to access a loan because in his day he was actually paid to attend university—then that would not have been a waste of money because that particular member although taking I think 5 years to complete a 3-year BA degree did go on to do a master’s degree and later a PhD. So moving forward we need to make sure that the Government does not narrow the criteria with regard to student loans and it needs to make sure that it does not limit access to the opportunities that tertiary education has to offer. 
When Labour was in Government for the previous 9 years it placed a concerted effort on making sure that it lifted the tertiary participation rate of particular groups—on making sure that it improved the numbers of Maori going through to higher level tertiary education and on doubling the number of Pacific people who were achieving bachelor degree qualifications. That is something that we on this side of the Chamber hope that the Government will continue to support. We hope that it continues to invest in tertiary education and continues to support the participation of groups that have been under-represented in higher-level tertiary education in the past. 
Unfortunately we have not seen any signals from the Government with regard to that. Not only has it slashed the important funding that went to adult and community education but it has refused over the last year and a half to lift the caps on the numbers of people being able to access universities and polytechnics at a time when we know that employment is scarce. So when there are all these young people—I think there is something like a 30.8 percent youth unemployment rate for Maori and a 29.8 percent youth unemployment rate for Pacific people—out there searching for opportunities to upskill and train this Government has shut things down for them. I think that is actually abhorrent. Not only do they not have opportunities for employment but also this Government is not supporting them with opportunities for going on to training or upskilling. At the end of the day that will be detrimental not only for those individuals but also for their communities. In the future in the long term it will be quite detrimental to this country because we know that future estimates of the demographics show us that down the track a large proportion of the population will be Maori and Pacific. Ageing Pakeha will be reliant on a young Maori and Pacific working base being able to support them. 
Those are just some of the issues that have come up in respect of this bill and of what the Government is proposing. It is not just the bill in front of us that concerns us; it is the wider discussions that are taking place. It is the public statements that the Prime Minister and the tertiary education Minister are out there making. Those statements are of concern for members on this side of the Chamber because we are concerned about heading down a track where the Government will make tertiary education less accessible for some groups—the groups for whom we have supported an increase in the numbers participating in tertiary education. We are very concerned that the Government will be basically cutting them off. 
Part 2 agreed to. 
Clauses 1 to 3 
Hon MARYAN STREET (Labour) 
: 
 I will speak to clauses 1 and 2 in particular. There are things I want to say about the fact that the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill is being progressed under urgency. I do not lay the blame for that at the door of the Minister in charge of the bill the Hon Peter Dunne. It is clear in clause 2 that the commencement date of some clauses is 1 April 2010 so it is important that the legislation is passed before that date. 
The House is sitting under urgency on Tuesday 23 February although it is actually 25 February outside this Chamber. Under urgency of course time stops on the day that urgency is accorded. The point about urgency is that it should be used sparingly for matters that really require it and for matters that are in fact urgent. There is time between now and 1 April to address this issue and to see this bill through to its conclusion but no the Government has chosen to put it through in urgency. This bill was presented to the House for the first time in August last year and the second time was in November last year. Now we are in the Committee stage of the bill at the end of February—under urgency. It is completely plain to everybody that it has simply been a subterfuge for the Government to excuse itself from at least one question time this week. So urgency was not essential and it has been applied. 
This is one of the few bills that has in clause 2 a reference to a date that I perfectly understand as being an essential date for the application particularly of taxation legislation—1 April 2010. But it could have been managed differently. That is not the fault of the Minister in charge of the bill but it is directly the fault of the Leader of the House who determines the agenda of the House at any one time. This is a sign again of a deal of incompetence that we have seen coming from the Government in even managing a simple bill which the Minister introduced to the House in perfectly good time. It was properly considered by the Education and Science Committee and was reported back in November of last year. Since then the Leader of the House has been unable to bring it through in a reasonable and measured way in time for it to be implemented by 1 April. This is a notice to all Ministers in Cabinet that they need to take the Leader of the House aside and say that they will not be made fools of in this way. They need to weigh up whether being protected from question time is worth being made fools of in terms of parliamentary procedure. Clause 2 the commencement clause is apposite and it is entirely reasonable to make some comment upon the progress and process surrounding this bill in this way. 
I want to talk about the title of the bill. When it is enacted it will be the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act 2009. It should perhaps be named the “Student Loan Scheme (Exemptions and Miscellaneous Provisions For Now) Amendment Act 2009.” It is not entirely clear whether this legislation will survive subsequent legislation that the Government may have in mind to narrow restrict shut down and make less accessible student loans and allowances. That is what we heard signalled by the Prime Minister in his Prime Minister’s statement at the beginning of this parliamentary year. It is what we have had underscored since then by the new Minister for Tertiary Education the Hon Steven Joyce. Steven Joyce is a man who does what he says he will do and he is a man who clearly has plans for his portfolios. 
Hon David Cunliffe 
: Except for telecommunications where he has no plans. 
Hon MARYAN STREET 
: With the now glaring exception my colleague reminds us of telecommunications and the roll-out of broadband. However let us assume that the Minister does have a plan for student loans and let us hope that this bill does not run foul of that. Let us hope that what endures after the Minister Steven Joyce has finished with student loans and allowances is access to those loans and allowances still extended to Tokelau still extended to the Cook Islands still extended to citizens of Niue and still extended to those who might one day live on the Ross Dependency—where in the meantime the penguins currently inhabit that part of the realm of New Zealand. Although it says it is a Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Act I would suggest it is in fact an Act for now only. 
GRANT ROBERTSON (Labour—Wellington Central) 
: 
 I want to talk a little about the title clause of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. We were advised earlier on by Louise Upston I think when she was speaking in the second reading that we were not focusing enough on the importance of some of the provisions in this bill. Putting some of them under the title “Miscellaneous Provisions” probably does not adequately reflect the importance of what we are doing here. In particular I think the clause that increases the deduction rate from 10c in the dollar to 15c in the dollar is potentially a very serious thing for the people who will end up having to pay that additional rate. I would not necessarily see that as a miscellaneous provision. 
I think it would be better for us to look at the reality of the bill and then work out what it should be called especially given the present environment which we have already discussed recently. Steven Joyce has come in as the Minister for Tertiary Education and we know that Mr Joyce has already told us that the support for the interest-free student loan scheme by the National Government is a political call. It has nothing to do with principle nothing to do with what National thinks is good for education in New Zealand and nothing to do with what it thinks is right for the economy of New Zealand in ensuring that our graduates stay here and contribute to the economy rather than go overseas—there is nothing about that. He said it was a straight-out political call. 
Therefore I think this bill could aptly be renamed the “Student Loan Scheme (Exemptions and Miscellaneous Provisions) Political Call Bill”. That is what is going on here. The National Party members do not want us to really focus on the fact that Steven Joyce has taken over the tertiary education portfolio with a clear instruction from John Key to look at it and look at tightening up the eligibility for student support. That is what Mr Key said in his Prime Minister’s statement to Parliament in early February this year. He said the Government would look at the issue of those people who spent too long in tertiary study and at whether there should be restrictions on their eligibility for student support. He said perhaps there would be something introduced around people having to pass their courses sufficiently quickly. 
On this side of the Chamber we are concerned about those potential developments. We see a bill in front of us now that makes some reasonably important but minor changes and they are useful. But at the same time we face a situation where the Government is hanging on to its belief in interest-free student loans only because it is a political call not because it thinks they are a good idea and they are delivering for New Zealand. Therefore I think the bill could easily be retitled in that way. 
Perhaps another title though that would pick up the overall essence of the Government’s policy around interest-free student loans would be the “Student Loan Scheme (Missing Bones) Bill”. This may be confusing for some people who have not been following the story so far. But when Labour introduced interest-free student loans in 2005 John Key was the finance spokesperson for the National Party and he stood in this Chamber and said the interest-free student loan policy that Labour was bringing in was ridiculous. He said it would be opposed by the National Party members with every bone in their bodies. Well here we are in 2010 and following on from the 2008 election when the political call that Steven Joyce mentioned was made we do not see much in the way of every bone being used. In fact the bones are missing. There is no attempt by National to turn this scheme round because politically it knows it cannot. But National is not committed to the scheme. In the long term we know that National would rather roll back the interest-free student loan scheme. The introduction of Steven Joyce as the Minister for Tertiary Education is a clear sign that National wants to get at interest-free student loans. It wants to restrict the number of people who can take out student loans and restrict the ability of people to take them out over a period of time. 
We believe that is a very dangerous path to go down. There is nothing more important as we come out of the recession than to have people increase their skills so that they can contribute to the economy. Earlier in the debate I mentioned the fact that the Australian Government responded to the recession by moving quickly to ensure that people who lost their jobs had access to training and tertiary study. It made sure that there were incentives for them to be able to do that so that they could contribute to the economy when Australia came out of recession. In New Zealand we saw none of that. We saw a continuation of the cap that sees tertiary institutions turning people away particularly at the polytechnic level where polytechnics face budget cuts from the National Government. Therefore we do not see New Zealanders being trained and upskilled to be able to contribute to the economy as we come out of the recession. That is a great shame. This bill and the activity of the National Government around tertiary education could be so much more than they are. We could be sitting here today to work out how to increase the skill level of New Zealanders but unfortunately we are not doing that. This bill is misnamed; it is actually about National wishing us to look elsewhere. 
MOANA MACKEY (Labour) 
: 
 I am happy to take a call on these clauses and I too have some suggestions for alternative names for this legislation. This legislation which Labour will be supporting is of course part of a much bigger picture around interest-free student loans. The title could be “Student Loan Scheme (I’m Glad the First Piece of Legislation We’ve Had Come to the House Isn’t Very Bad But I Worry About the Next Ones) Amendment Bill”. We know as my colleague Maryan Street has said that the interest-free student loan scheme is in trouble. We know that National does not like interest-free student loans because it rallied vociferously against them when the previous Labour Government introduced them. We were told that the interest-free loans were corrupt. In fact John Key said they were corrupt— 
Lynne Pillay 
: “Irresponsible”. 
MOANA MACKEY 
: —“irresponsible”. They were a bribe says the man who I bet never had a student loan. That brings me to my second suggestion for a title: “Student Loan Scheme (Why Don’t You Actually Ask Students Who Have a Loan About What It’s Like to Have a Student Loan) Amendment Bill”. One of the things that concern me is that even in this debate we have been lectured at length by people from the Government who have never had a student loan. I have had a student loan. I had it at the worst time to have a student loan in the 1990s. I had it when I was paying interest while I was studying. It was daily compounding interest. I was working 20 hours a week. I say to Government members that if they are concerned about people who are failing their courses look at how many hours that students have to work to support themselves which should be hours spent studying but they are working long hours to support themselves. I worked 20 hours a week while I was at university and it was to the detriment of my studies. I did not fail but I could have done an awful lot better if I had been able to focus solely on my studies and not have to worry about how the rent would be paid or how we would be able to afford to pay the power bill that week. 
The title “Student Loan Scheme (Why Don’t You Actually Ask Students Who Have a Loan About What’s It’s Like to Have a Student Loan) Amendment Bill” might be a good way to go. We have heard some pretty patronising speeches about how I should just be grateful that I had a student loan. Well I was not grateful for it. I was grateful that I got to go to university but I was not grateful for the fact that I worked 20 hours a week to keep my loan down. I was at university for 4 years and I left university with a loan of about $15000 or $16000. By the time I had graduated the loan was already into the $20000s and I had not even started working yet. I was not grateful for that aspect of the student loan scheme. 
I notice that all the members opposite who are chipping away had free university education and I ask them again why they do not actually talk to people who went through the scheme. If members do not understand the incentives around repayment then how can they put that into place in the policy? If they do not understand what it is like to have a student loan what it is like to think that one will never pay it off— 
Hon Georgina te Heuheu 
: She thinks that some of us have never had offspring with student loans. Some of us have. 
MOANA MACKEY 
: I say to Minister Te Heuheu that people can think they will never be able to pay it off because when they graduate the 10 percent that comes out of their income automatically is actually less than the interest for that period so they are repaying their loan and it is going up and up. So people think they will never be able to repay it. Those members opposite who have never had that experience should talk to people who have and they will tell them what they need to do— 
Hon Paula Bennett 
: Get the facts. 
MOANA MACKEY 
: Paula Bennett who had the training incentive allowance to help her get off the domestic purposes benefit and then cut it for every other domestic purposes benefit mother who wanted to get off the benefit should probably— 
Hon Paula Bennett 
: Look at the facts. 
MOANA MACKEY 
: How did the Minister get to university? 
Hon Paula Bennett 
: I had a student loan actually. 
MOANA MACKEY 
: How did the Minister get a student loan to go to university? That Minister cut the tertiary training incentive allowance to every other domestic purposes benefit mother who wanted to get off the benefit. She pulled the ladder up behind her after that scheme helped her to get off the domestic purposes benefit. Good on her for doing that but I think it is mildly repugnant when the scheme that that Minister benefited from was cut so that no other domestic purposes benefit mother could climb that same ladder. 
But I come back to the bill and suggest the title “Student Loan Scheme (Save Our Interest-free Student Loan) Amendment Bill”. The interest-free student loan scheme is at risk. We can see from the reaction of those on the other side how much they do not like having to listen to us explain about the value of the interest-free student loan scheme. I am proud about Labour’s record in this area. I am proud that the first thing we did when we became the Government was to remove the interest from loans while students were studying because that was horribly unfair. 
LYNNE PILLAY (Labour) 
: 
 I start my speech by congratulating Moana Mackey. It is really good to hear from a relatively young person and I must say that Moana Mackey is celebrating a birthday very soon. Moana Mackey is very aware of the costs of being a student and the advantages of what happened with the interest-free student loan scheme. The introduction of interest-free loans was one of the proudest moments in Labour’s term in office. Students were absolutely delighted at having some hope of cutting into the principal of the debt they had incurred while they were studying. 
As other speakers have said—and I say it again—the previous Labour Government’s interest-free loan scheme was labelled by then National Opposition as “irresponsible” as “buying votes” and all sorts of other things. National members were absolutely opposed to it. They said it was the worst thing that the Government could ever do. So I guess the name of this bill could be the “Student Loan Scheme (We Didn’t Actually Get Rid of the Interest Free Student Loan Scheme: We Will Make Some Technical Amendments; There Are Other Ways to Fleece Students in This Country) Amendment Bill” 
What would those other ways be? I see Paul Quinn wondering what they could be. Certainly it would be the ability of students in this environment to pay back their loans. The reality for most students is that they study during the year. They have part-time jobs so they do not have to take on so much of a loan. Maybe they work during their holiday period so they are able to pay off some of the principal of their loan. Well that cannot happen under this Government. Has this Government done anything to assist in providing jobs and opportunities? Has it done anything to assist our industries to get through these tough times? No it has not; it has done quite the opposite. Again students are on the wrong side of that but they will go out and look for jobs. 
I know that many members opposite denigrate students but we know that students work very hard. They work hard in their studies and then they try to secure employment to assist them during their study time so they can get rid of some of the principal on their loan. I have spoken to so many students who have said that it just is not possible to get jobs despite the Minister standing in the Chamber and talking about all the opportunities that the Government will give young people. We know in the substance of it that there no jobs or opportunities out there. 
This bill is technical but we also look at what else is on the Government’s agenda. This bill does no harm to students but what could be on the agenda for students in the future? We know there is a veiled threat because we heard the Prime Minister talk about lifting the cap on fees’ institutions. So what do we know will happen? When Labour was in Government we took some very responsible moves which were not supported by the National Opposition at the time to ensure that student fees did not escalate way out of control as they had done under the previous National Government. 
Mr Key has referred to an “inflexible and bureaucratic funding and policy framework”. What does that mean? It means a framework that ensures that student costs do not romp away—that there is a cap on the fees that institutions are able to pay. So Mr Key’s comment tells me that tertiary education will soon move into the National Government’s market approach to things. 
Hon PETER DUNNE (Minister of Revenue) 
: 
 Yesterday I was listening to a discussion about language on that great national icon Radio New Zealand. It was stated that the great American writer Mark Twain was known for his precision in language. He was very critical of adverbs and adjectives and he wrote in short sentences. Members may be wondering what the relevance of this discussion is to the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I have been here for a little while avidly listening to some very strong arguments being advanced from members on the other side of the Committee about how the bill could be retitled. I have mulled over in my mind some suggestions from various members. I say to Moana Mackey that she fails the Mark Twain test. Her suggested amendments were far too long. 
Hon Maryan Street 
: I passed. 
Hon PETER DUNNE 
: I will come to Maryan Street in a minute. Lynne Pillay’s amendment seemed to never end. The problem I have in trying to apply the Mark Twain test to this is— 
Hon Trevor Mallard 
: That’s why they couldn’t circumcise Muldoon isn’t it? 
Hon PETER DUNNE 
: I do not know what he had to do with Mark Twain but that may be another story. 
The point I am making is that this bill’s title is an accurate description of what the bill contains. It might not be the most exciting title but it is certainly the most accurate and it passes the Mark Twain test. That is why having heard the arguments put forward from members opposite I am not persuaded that a change is in order. 
I heard the Hon Maryan Street make reference to the timing of this bill in the context of the current urgency. I was grateful for her that I was excluded from her excoriating criticism. However I am concerned that this bill be passed as soon as possible and I will tell members why. In one of the earlier parts of this bill we passed some very important provisions relating to students being able to study overseas and access a student loan. Members will be aware that that provision is backdated to 2007. A lot of students have been waiting for this provision to pass because they will now be able to access it and they have been uneasy—I know this from the correspondence I have received from many of them and in particular from their parents—at the uncertainty that has prevailed. 
I am very keen to see the bill passed. I would have loved to see it passed last year but other circumstances got in the way. I am very pleased that it now will pass and those people will get the benefit. From the bottom of my heart I thank those members of the Opposition who have taken such a constructive interest in the grammar and construction of the title. I have listened to what they have said but I think on balance the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill captures it all really. 
CARMEL SEPULONI (Labour) 
: 
 I have some ideas for what we could rename the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill but I will get on to that shortly. I refer to something that Moana Mackey talked about. She said that while she was studying during the 1990s even though she was not working full time—she was studying part time—every time she got that statement from the Inland Revenue Department she saw that interest had been added on to her student loan. That is something that I saw that Grant Robertson saw and that a number of us saw. 
We were very thankful when the Labour Government introduced interest-free student loans in 2005 despite opposition from the National Party at that time. National thought that it was corrupt and irresponsible of the Labour Government— 
Chris Hipkins 
: A hoax they called it. 
CARMEL SEPULONI 
: National called it a hoax and thought it was irresponsible of the Labour Government to bring in a provision that ensured all New Zealanders had the opportunity to have equal access to tertiary education. We know that one of the biggest barriers to participation in tertiary education is the finances. As a person who went through tertiary study during the very very bad 1990s all I can say is that I appreciated the fact that in 2005 student loans were made interest free. 
Across the course of this debate we have had a few interjections and comments from the floor. I want to clarify something for Mr Garrett who interjected earlier and asked whether I had even graduated. That is typical of the attitude from Mr Garrett. I will clarify for him that yes I did graduate. I graduated three different times with three different qualifications so I thank him very much for that query. 
If we look at the title of the bill we see it is the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I think that when thinking of different titles for this bill we need to look at the broader picture with regard to the public comments that have been made by National members of Parliament including the Prime Minister and some of the actions that National has taken on tertiary education during its term in Government. One possible alternative title for the bill could be the “Student Loan Scheme (Does Not Really Make Up for Paula Bennett’s Training Incentive Allowance Cuts But Anyway) Amendment Bill”. That goes back to what I was saying before with regard to some of the actions that have been taken with tertiary education and the fact that the National Government does not take seriously the need for a range of different people particularly those who are marginalised or underrepresented in tertiary education to have equal access to tertiary education. 
Another possible title I think we could add to the mix might be the “Student Loan Scheme (We Will Tutu With It Now But Make the Drastic Changes Later) Amendment Bill” because that is basically what the Prime Minister and the Minister for Tertiary Education have indicated to the public they will be doing by their recent comments that they will be taking a serious look at the student loan scheme. The Prime Minister has alluded to the fact that some students have taken advantage of the scheme or he believes that they have been mucking around and not taking it seriously. All of those things indicate that down the track National will be looking to make drastic changes. 
As has been mentioned in this Chamber today the ones who will be affected by the changes that we anticipate the Government will make down the track are those from lower-income families Maori and Pasifika and also as I mentioned before women. Already we have received a number of letters and emails from women stating that it would be very difficult for them to study this year knowing that the training incentive allowance will not be available for them. The Minister for Social Development and Employment said that she would put in a provision so that they could have an extra $500 on their student loan but for a student $500 on a student loan is nothing compared with the $3800 that was cut from the training incentive allowance. That money was a cut for women who are looking after children by themselves and who are already struggling with things like childcare and even transport with regard to getting to their tertiary institution. Many of them have come out of sometimes tumultuous relationships and we have this Minister for Social Development and Employment deciding to cut something from them. 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 I will take a very brief call; this time I will be reasonably brief on this final point. We are debating the title and commencement clause of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I do not intend to suggest a whole raft of alternative titles to the bill as some of my colleagues have. However I acknowledge the contribution of the Minister in the chair the Hon Peter Dunne in this debate. I have been in the Chamber for most of the Committee stage on this bill as I know the Minister of Revenue has been although a little earlier in the day than we might have initially anticipated. I thank him for engaging with the debate. We on this side of the Chamber are not used to having the opportunity to put questions to a Minister in the Committee stage and have the Minister stand up answer them and engage in that kind of interaction. That is what the Committee stage of a debate should be all about; I can see the Chair is agreeing with me on that. It is unusual but it is very welcome. 
I think the Minister has answered a number of the questions we put forward. I put forward questions to him earlier on about diplomats and about the thresholds. He has engaged with us on those issues and I think that provides some reassurance to people who are listening in on this debate that even though this bill does not necessarily address all of the issues or the technical concerns that exist with the current interest-free student loans scheme the Government has at least taken on board some of those issues. I was also very pleased to hear the Minister acknowledge the concern around diplomats and he gave us a commitment that he would look further into that issue. I am more than happy to talk to him about that issue further at any point if he wishes to do so. I am happy to give him some examples of people who have been captured by that particular problem. 
That was all I wanted to say on this particular part of the bill. I just wanted to acknowledge the contribution the Minister has made and to thank him for it. 
CATHERINE DELAHUNTY (Green) 
: 
 Tena koe Mr Chair. I will take a very short call. I would like to start by saying that urgency does not always bring out the best in us. It sometimes leads to flogging a dead horse or working out just how many ways one can say the same thing as someone else without using or stealing his or her precise words. I do not want to do that. But I would like to disagree with the Minister of Revenue about the title of the bill. I feel that the title although it has a certain musical ring is somewhat disingenuous. 
“Miscellaneous” is a beautiful word. It is a marvellous colourful word but it suggests very very small random issues and it is not accurate in terms of the way the Green Party sees this bill. I have also learnt in my brief time in this Chamber that we take on words like “miscellaneous” at face value at our peril. In this place it is essential to read the fine print and not only to read the fine print but also to get 12 other people to read it and then consult widely and exhaustively and extremely—as a result of urgency—with at least the groups who are most affected by the bill and then after all of that assume the worst. 
I like Mark Twain’s idea of brevity and I would like to suggest some brief titles that would satisfy the Green Party. One is “Give With One Hand Punish with the Other”; the other is “Fifteen Cents in the Dollar or Else”. Kia ora. 
Hon Sir ROGER DOUGLAS (ACT) 
: 
 The Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill is a relatively— 
Hon Member 
: Was it a good book? 
Hon Sir ROGER DOUGLAS 
: Do not get me sidetracked! This bill is a relatively simple one. I think it is fair to say that the title of the bill reflects the purpose and intent of the bill. I think it is time that members stop wasting the time of this House. 
A party vote was called for on the question  
That clause 1 be agreed to. 
Ayes 113 
New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Clause 1 agreed to. 
A party vote was called for on the question  
That clause 2 be agreed to. 
Ayes 113 
New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Clause 2 agreed to. 
A party vote was called for on the question  
That clause 3 be agreed to. 
Ayes 113 
New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Clause 3 agreed to. 
Bill reported without amendment. 
Report adopted. 
Third Reading 
Hon PETER DUNNE (Minister of Revenue) 
: 
 I move  
That the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill be now read a third time 
. This bill includes a suite of mainly technical changes to the student loan repayment rules to ensure that the law is clear and consistent and that it operates as intended. The bill also extends interest-free loans to borrowers from Niue the Cook Islands and Tokelau which share a special relationship with us as part of the realm of New Zealand. As the Ross Dependency is also part of the realm of New Zealand people who go there will also be eligible for an interest-free loan. There was some debate in the Committee stage about how many people would actually go to the Ross Dependency and be eligible for a loan and whether we would be in fact producing a nation of well-educated penguins. The reality is that there will be some people on scientific exchange who will benefit from this provision. Although they will not be great in number I suspect that their contribution to New Zealand in future years will be great in substance. 
These borrowers will have to comply with the same requirement to be in one of those countries for 183 days in the same way as New Zealand borrowers so that borrowers from a realm country have an incentive to return home after their study and to make a positive contribution towards their country’s future. That provision is probably of greater impact with regard to Niue the Cook Islands and Tokelau than the Ross Dependency but the same point applies nonetheless. 
The bill also extends interest-free loans to include students who choose to further their education overseas through full-time study under formal exchange programmes or formal agreements between New Zealand and overseas tertiary education providers. There is some anomaly in this area at the moment and this change will be of considerable benefit to a number of New Zealand students particularly as they go further through their studies. 
The bill also includes a number of small refinements that provide greater clarity to borrowers. They were added at the select committee consideration. The first of those changes defines the term “overseas tertiary provider” so that it is clear what type of overseas organisation borrowers must be engaged in full-time study with in order to qualify for interest-free loan status. That will immediately deal with some concerns there might be about the bona fides of some of the organisations and institutions that people are enrolled with. The other change extends the overseas exemption to include those who are engaged in full-time postgraduate study overseas if their studies cannot be completed in New Zealand. When we talk about having a highly skilled nation and upskilling the intellectual capacity of our public that ability to go overseas to complete postgraduate study when it is not available in New Zealand is particularly important. The purpose of these measures is to recognise the value that students who pursue further training and study overseas bring to New Zealand as well as encouraging them to take up the opportunities to do so. 
The remaining changes that the bill introduces are largely technical or remedial in nature. They include an amendment to correct an unintended change to the hardship relief provisions that was made by the Student Loan Scheme Amendment Act 2007 a change that allows the Inland Revenue Department to raise the compulsory repayment deduction rate from 10 percent to 15 percent to help ensure that borrowers pay their correct loan repayment amounts and the removal of a technical problem so that borrowers who return to New Zealand and wish to fully repay their loans before they have met the 183-day requirement to qualify for an interest-free loan can now do so. 
There was some debate during the Committee stage about the adequacy of its title. A number of suggestions were made by members particularly from the Opposition side of the House to greatly extend the title of the bill to maybe more accurately in their minds reflect some of its provisions. But on balance and I am sure the House will concur with me having heard what this bill is about it was decided that the title Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill was in fact a more accurate if less colourful description of the bill’s title. 
As the bill comes to its third reading I acknowledge all of those who have contributed to its successful passage thus far. In particular I acknowledge the policy officials from the Inland Revenue Department and our drafter for their work on the details of the bill. I acknowledge those who made submissions to the Education and Science Committee and others who made submissions aimed at improving the practical application of the measures. I want to record my thanks to the select committee for the detailed consideration that it gave the bill and for its recommendations which have given greater clarity to the legislation. I also thank those who participated in what was I think a good-natured and constructive debate. 
As the bill now stands the measures that are contained in it will help to ensure that the student loan scheme works in the way that it should for both borrowers and the Crown. That has to be important given that the opportunities the student loan scheme provides to so many students have to be matched by the Crown’s responsibility to manage what is now a multibillion-dollar asset in terms of outstanding loan liabilities. It is a balanced process. I think that it has been widely accepted by the House and with that I have great pleasure in commending the bill to the House for its third reading. 
Hon MARYAN STREET (Labour) 
: 
 I rise to support this legislation which was introduced by the Minister of Revenue who has just resumed his seat. At its third reading I have to say that I have been feeling sorry for the Minister. This Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill should have been reasonably pedestrian legislation to usher through the House. It had the support of the Labour Party and the only dissenting voice was from the Green Party for the reasons that its members have described earlier in this debate. This legislation has been loaded into urgency for no good reason. It could have been dealt with in December; the report of the Education and Science Committee was presented to the House on 27 November and if I remember correctly we sat quite late in December. It could have been dealt with in the ordinary scheme of things with sufficient attention being paid to it allowing it to be in force by 1 April which is one of the critical dates. 
However for the reasons that we have described previously in this debate the Government has seen fit to cover its own sins and inadequacies by putting this bill into an urgency motion that was sought predominantly to avoid question time and to thereby protect weakened ill-performing Ministers from the democratic scrutiny that occurs at 2 o’clock every day of parliamentary sittings. On top of that I have been feeling sorry for the Minister about this because—[ 
Interruption 
] Members opposite might not have noticed but we did not have question time yesterday. Because of the sting that the Government received from that in the media it decided to give in today. But more important I have been feeling sorry for the Minister in his presentation of something that should have been reasonably pedestrian legislation because since the select committee reported back on the bill to the House we have had an explosion of antagonism towards students by the Government. Now this Minister has to front a perfectly good bill in the context of several depth charges that have been dropped into the tertiary education arena by this Government. Let me cite three. 
First of all there was the Prime Minister’s statement at the beginning of this year in which he said that the Government will take a careful look at the policy settings with regard to student support. Of course that left everybody wondering what it meant. Does it mean that the Government intends to restrict access to tertiary institutions by not making them open entry for people over the age of 20? I will come back to that one in a moment. Does it mean that the Government is intending to make loans and allowances harder to access? I will come back to that one in a moment too. The Government unleashed that set of imponderables to begin with upon this Minister and upon a perfectly ordinary piece of legislation. I say that without meaning to be dismissive of it at all I tell the Minister. Secondly the Minister for Tertiary Education was removed from that portfolio; Anne Tolley was taken out of that portfolio and replaced by Steven Joyce. Steven Joyce went on to say just last weekend in the Christchurch  
Press 
 newspaper that the student loans policy was in his sights. What are we meant to take from that? I ask whether we are to assume that he is also inclined to make student loans harder to get thereby limiting access to our tertiary institutions and limiting people’s ability to take up educational opportunities and reducing the cost of tertiary education to the Crown. We on this side of the House say that the cost is justified and that investment ought to be made by the Government and increased in line with other comparable nations as a way of promoting economic growth and development and as a way of securing our future. 
On top of that the Government decided to support at its first reading the voluntary student membership bill which was drawn out of the ballot and is Sir Roger Douglas’ member’s bill. That was an antagonistic gesture as well. The Government will not say whether it will support that bill at its second reading. It will support the bill at its first reading but it could have stymied it in its tracks as it has done with other bills that have been drawn out of the ballot and not been given the privilege of being referred to a select committee. This Minister now has to field a bill in that context. Perhaps people are wondering why we have been getting so agitated about a bill that would not normally cause this much fuss. It is because it is being dropped into an environment that is now explosive for students. Students around the country have launched a website in response to the voluntary student membership bill. It is called Save our Services and they are getting support in the process. 
I will say a couple of other things particularly about whether this Government intends to make it harder to access student loans—access that this bill expands. If that is the case then let it say so. If it is the case that the Government wants to make it harder by virtue of ramping up the NCEA qualifications required to get into university then that is one issue. If it wants to make it harder to access student loans by ramping up the requirements to pass while at university wananga or polytech then that is another issue. But let us be very clear that whichever way the Government goes about it there will be people who will miss out. I will cite two examples of people who accessed education after the age of 20 or who accessed education not in the usual way of progressing from school and I will demonstrate how important access to education is. 
The first example is the chief executive officer of the Universal College of Learning Paul McElroy who is now in the position of having to turn students away because this Government will not renegotiate the student caps and it will not invest in additional student places in order to equip our country adequately for the future. That breaks his heart because of his own background. He said that he knows firsthand about second-chance education because as a teenager he ran away from home without university entry qualifications. His life was transformed when Wellington Polytechnic took a chance on him. It took a chance on him. He did not come in through having UE or any kind of entry qualification but the polytechnic in Wellington at that time took a chance on him and it changed his life. If this Government is proposing that National Certificate of Educational Achievement (NCEA) qualifications be made more difficult or that the threshold be raised so it is more difficult for people to enter tertiary education then members should look at Mr McElroy who has now gone on to be the chief executive officer of a polytechnic. 
The second person I will cite is somebody who came to New Zealand at the age of 23 years as a young mother. In fact she needed to do something to improve herself and her prospects. She enrolled in education at Massey University and in her first year she passed all her courses. It took her 4 years to complete her BA and she was awarded a Massey scholarship as a top graduate in psychology. Later after a series of courses and scholarships having benefited from open entry after 20 years of age she graduated with her PhD. The rest is a matter of public record: a lectureship at Massey University a promotion a move to Canterbury University 6 years as a member of Parliament and now 8 years of running her own research company. That person is of course Liz Gordon. Those are examples of people who have contributed to this country by virtue of accessing tertiary education. If this Government wishes to inhibit that— 
Mr DEPUTY SPEAKER 
: I am sorry but the member’s time has expired. 
COLIN KING (National—Kaikoura) 
: 
 It is a pleasure to speak on the third reading of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. It is very easy to look at the student loan situation in isolation. From listening to Opposition members one would imagine that it was an enormous part of the overall context of things. I think that during this third reading it would be appropriate to give the wider context of the student loan situation as it relates to exemptions and miscellaneous provisions. 
The scheme’s nominal value is $10.3 billion. According to the last financial report the basic value of the student loan scheme is $6.5 billion. If members look at the situation in 1994 when the student loan scheme was put in place they will see that only 252000 people were accessing tertiary education loans. Today that number is approaching half a million. Even though collectively we might have our varying views on the scheme this country has gone from having one of the very lowest rates of entry into tertiary study to having one of the very highest. That is laudable and applaudable. I say that is well done. 
This bill in its context recognises the fact that education is portable and valuable but we do not want to forget that the taxpayer is still picking up 70 percent of the cost of tertiary education. Half a million people have student loans. The desire of the bill is make sure that the student loan scheme functions as it is intended to. 
Principally the bill refines the process for two particular groups. Those two particular groups have been spoken about regularly in the House this afternoon. One group is those countries that are included in the Realm of New Zealand—principally Niue the Cook Islands Tokelau and the Ross Dependency. The second group is affected by an anomaly that the Minister of Revenue has brought to the House for speedy remedy. It relates to people who have gone on to an institution overseas to undertake a course of study above level 7 that is not available in New Zealand. 
I will not go on too much further. I think matters have been well and truly canvassed. This bill will greatly aid the running of the student loan scheme and I am sure that the Minister will feel more comfortable when it is passed in a speedy and responsible way. From that point of view it gives me great pleasure to commend this bill to the House. 
KELVIN DAVIS (Labour) 
: 
 The Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill amends the Student Loan Scheme Act 1992 by extending interest-free loans to borrowers who are present in Niue the Cook Islands Tokelau or the Ross Dependency for 183 or more consecutive days in order to encourage borrowers from those countries or that territory to return to their country and contribute to its development. It also covers students who enrol with a New Zealand education provider and engage in full-time study overseas under either a formal exchange programme approved by the New Zealand Government or a formal agreement between a New Zealand tertiary provider and an overseas tertiary provider. The bill also makes eight minor or technical amendments to the principal Act. 
As has been mentioned numerous times this is largely a technical bill but that does not diminish its significance for those whom it affects. They are the students who have taken up interest-free student loans in order to support their decision to better themselves personally and professionally. It is a big call to choose to study. It involves time money and opportunity costs. I say make no bones about it the decision to study is the right decision for many young and old New Zealanders to make and New Zealand benefits through having an educated highly skilled workforce. That is why I say the interest-free student loan programme is one of the most progressive pieces of economic development legislation passed in this House. It helps to drive New Zealand’s economic development. An educated workforce is imperative in this day and age as we will never compete—nor do we want to—with low-wage economies. That is why I am astounded that the National Government is making noises about cutting the scheme. How will the 75 percent of people who earn under $40000 per year be able to afford to send their children to university and polytech when they can barely afford to pay their power bills? They cannot and that is why access to the funds those students need in order to further themselves is so important. In fact it is vital. Education needs to be accessible to all Kiwis who wish to access it. 
Why did the Prime Minister say recently he would take a careful look at the policy settings around student support? Why did Louise Upston in her second reading speech spend a few minutes telling members about how expensive the student loan scheme is for New Zealand taxpayers? Society bears this cost in the knowledge that the benefits to the country and to communities far outweigh those costs. Why did Amy Adams stand up to talk about the tax debt relating to student loans? I will tell the House why. It is because National is priming the public for the removal of interest-free student loans. Steven Joyce has told the  
Weekend Press 
 that the student loan policy is in his sights. The Government’s intention is clearly to make it more difficult for tertiary students to get a loan to cover their fees in the first place. 
If the Government starts to pick winners in the tertiary education system before people enrol then those who have not done well at school for a variety of reasons and who want to have a second chance at learning should beware. I have a friend who is a doctor and she said that when Labour introduced the interest-free student loan legislation it removed a weight from around her neck as she was struggling to pay even the interest on her loan and was beginning to conclude that a move offshore was the only way to kill off her debt. She is now working at Wellington Regional Hospital and she sees light at the end of the tunnel. 
I will go back to the Prime Minister’s comments about taking a careful look at the policy settings around student support. What does he mean? The Government will make access to student loans and allowances more difficult. I suspect it will make tertiary education opportunities in universities and polytechs available for the few not the many. Once again legislating for the few at the expense of the many is simply not fair and it takes away the aspirations that Labour works to foster in our communities. The Prime Minister referred to students who do not take their studies seriously or who do not get a job quickly after qualifying. Who will determine which students those ones are especially when there are students who go to a university or polytech and then find that the first course of study that they take is not exactly what they want? They can find that out only by going to university in the first place. As I said earlier on in the day my brother was one of those students. He initially took business studies when he went to Waikato University only to find that was not right for him. He then went on to get a BA in Maori then after that he decided that a degree in law was what he after. He is now a very successful lawyer up north. 
Will student support stop after students graduate with a degree preventing them from choosing to do postgraduate study? What about the students who need more support to succeed because they have started further back from the starting line than others? I refer to many Maori students whom I have seen go through the schools I have been involved with who take time who do not succeed to the same extent initially as many other students but who have the ability to go on to university. The problem is just that they start from a little further back than other students especially financially. Most of the family and friends I know from up north are not financially well off so it is a lot harder for young people to make the decision to head off to university knowing that that will be a big strain on their family and on finances. A number of those family members and friends who go to university do really well in the first year but they find that the financial struggle for their families is too much to bear and many tend to drop out. That is supported by the research of the Starpath project based at the University of Auckland. We all know students who work at their studies and at part-time paid work often for low wages and who struggle to make ends meet. Setting out criteria for discontinuing student loans or allowances is dangerous and elitist territory. Again I say it is about providing more of the same for the few at the expense of the many. 
John Key is threatening students who put up with a low income now so they can study and contribute to the country’s well-being in the future. Right now it looks as though he will punish them for doing that but first he will hit them with a higher rate of GST just to make things even harder. What will happen if there are not enough jobs for graduates to go into? What about the redundant workers who want to enrol in courses in order to improve their skills and who need allowances and loans to do that? What about students with disabilities who find it difficult to get employment so continue to study in order to improve their quality of life? Over 45000 Kiwi 15 to 19-year-olds are now unemployed; that is over 12000 more than for the same period a year ago. That number increases to over 72000 Kiwis once we include those aged 20 to 24. The danger now is that many of these young people will stay jobless for a long period of time as the National Government takes away the opportunity for them to aspire to better themselves. 
There is also the veiled threat of lifting the cap on the fees that institutions can charge students contained in Mr Key’s reference to “an inflexible and bureaucratic funding and policy framework”. It looks as though tertiary education will soon become the sole domain of the rich but New Zealand’s crying need is for the upskilling of the many not the few. If Mr Key wants to see a step change in the New Zealand economy where does he think it will come from if not from post-compulsory education and training? He should be nurturing and investing in it not threatening it. 
The fact is that National in its short time in office has already proven it is no supporter of students. Here are just two examples of that. Firstly the Institutes of Technology and Polytechnics of New Zealand revealed that about 6000 aspiring students could be turned away from polytechnics as a result of the Government’s refusal to waive financial penalties if polytechs exceed their enrolment caps. This is another short-sighted decision by the Government which clearly prefers to see people being stuck on the dole rather than engaged in the study and training required to ensure we emerge from the recession with a work-ready and productive workforce. Secondly the Government has passed legislation that reduced the number of seats on polytech councils from a maximum of 20 to just eight. The legislation allows the Minister to appoint nominees to half the council positions. Requirements that Maori staff students and the community must have a representative on polytech councils have been cut. This will enable the Government to take a much more dominant role and disappointingly will remove the existing provisions for almost all student community and academic staff representatives to sit on the councils. 
CATHERINE DELAHUNTY (Green) 
: 
 Tena koutou katoa. The Green Party will be voting against the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. As the only party opposing it at the third reading I think it is important that we try to explain to others the reasons rationale and analysis behind that decision. 
Firstly I acknowledge what Kelvin Davis just said about unintended consequences although he did not refer to it like that; he talked about recent education bills. The Education (Polytechnics) Amendment Bill is a good example. We were lobbied only yesterday by the New Zealand Union of Students’ Associations about the consequences of that bill in terms of reducing the number of students who anecdotally are not getting elected to the new polytech councils. Obviously the jury is still out and the elections are not all over but already we can see the effects of that bill and that more and more students are reporting back to that organisation that their campuses have no students on their councils. That is why we take a very precautionary view on any legislation that impacts on students because we believe that we must take the big picture into account. 
We are voting against this bill because of our consistent belief that despite the positive technical tinkering in parts of the bill and the good intentions within the narrow definitions of the bill the original student loan scheme itself remains one of the most oppressive pieces of legislation in the history of this House. It cannot compete with some of the mean-spirited colonising laws from our history such as the Maori Prisoners Act or the Tohunga Suppression Act but elements of this bill fit well with the retrogressive punitive pieces of law that have been selected recently from the ballot such as the Minimum Wage (Mitigation of Youth Unemployment) Amendment Bill and the Education (Freedom of Association) Amendment Bill. We are talking about punishing people who are already in debt. 
The student loan scheme was designed to make education a commodity and individuals responsible for the costs. Now the country has a $10 billion student debt which is absolutely no surprise to anybody. The scheme has worked to silence collective student political power and to stop people from even objecting to it because they are too busy paying for it. It has led to a generation of people who believe that the common good is a fairytale and that being in serious debt is the normal financial status of a young person. The idea of health and education being available for minimal cost is a foreign language to most young people. So big ups to the free-marketeers who have achieved their goal. No one saw it coming. 
Coincidentally or perhaps conveniently the global free market has promoted credit to young people and their right to new clothes and cheap travel all paid for on the plastic. Many middle-class younger people would feel deprived if they had to dress out of op shops and sleep on mattresses on the floor which was the norm in my student days. They have been sold materialism as a reward for debt. Other speakers have referred to many who are struggling to survive as students or are too intimidated even to start. That is why we look at the bigger picture in terms of this bill. 
Many students have been persuaded to borrow against their future freedom to build a life beyond working to pay back that debt. However it is now 2010 and the headless chickens who failed to stop the student loan scheme in the 1980s have sewn their heads back on and started to deconstruct what happened to tertiary education. Many of us have figured out that the credit and debt cycle distorts the opportunities of young people and gives them a burden that has been so normalised that they cannot really believe it when my generation talks about paying $150 a year for university fees and books. If members believe that the quality of what students are paying for is so much better than our free education they cannot have been in a tertiary institution lately. 
Our children and older learners do not need an increase in the repayment rate of their loans especially if those children or older learners are already unable to pay. That is why we stand alone against this bill. It is a popular tactic to make the broke pay more. In this brave new world anyone who can pay up front is automatically privileged be it a parking ticket a dog licence or a university education. If you can pay now you are automatically better off. 
Mr DEPUTY SPEAKER 
: The member is bringing the Chair into the debate. 
CATHERINE DELAHUNTY 
: I beg your pardon Mr Deputy Speaker—a person is automatically better off. 
So the Green Party rejects new section 20A(2)(a) in clause 7 which allows for a 15c in the dollar repayment fee to be taken from a person’s wages if that person is a late payer of his or her student loan. That provision alone undoes all the positives in this bill that we would very much like to support. It does not feel great to vote against the common-sense parts of the bill but we clearly need to uphold the principles that few other parties even bother to mention any more. Those principles are that education is a human right and that our young people are taonga to be nurtured rather than an economic resource to be captured. 
If we are to start the work of restoring social equity and building a fair society we have to include the student loan scheme and the broader economic context especially when 72000 young people are out of work or out of training. We have to listen to the stories and struggles of “Generation Debt”. We have to assess in every single bill before this House the quality of the so-called commodity we are selling at this price. We must do that assessment. Does the bill help students and people who are no longer students and have families to support to do better? In what context is this bill being proposed? The debates are raging outside this House about access to education. Despite all the Government’s rhetoric about education there are worrying signals. Student organisations are telling the Green Party that that even if we save the interest-free aspect of the loan scheme entry levels and additional-year entry levels are under threat and fee caps are under threat and there is now even a suggestion that the Government may be dropping the open entry to university at the age of 20. 
We cannot ignore the signals or the context in which we are operating. It is not paranoid to ask where we go from here. In considering any changes to things like open entry at age 20 there are many many stories. We heard the story of Dr Liz Gordon who was a chair of the Education and Science Committee as one example of someone who went to university aged 20. I have family members who did the same thing. Many of us were wayward adolescents who did not know what we wanted to do and we left school despite our parents’ concerns. Many of us returned to education older and wiser and because of open entry we were able to access education and do well with it. 
We are very concerned about where the whole picture is going. We oppose the changes in this bill because we are very nervous that they add to the burden and we do not support the increase in repayments to 15c in the dollar for people who are already behind. We are watching the changes in the weather in the student loan policy arena and it is certainly getting rough. Followers of the political machinations and the student loan scheme will notice the role of the Green Party and the “careful look” to quote the Prime Minister that we will take at any changes to the student loan scheme in terms of who will benefit and who will pay more. We stand here to be consistent about the bad parts of this bill and to vote against it because of our consistent advocacy for the vulnerable and the marginalised instead of the people who already have their wealth. 
TODD McCLAY (National—Rotorua) 
: 
 It is a pleasure to speak in the third reading of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. The National Government is committed to having in place a student loan scheme that is balanced and at the same time to putting in place incentives for people to pay off their loans more quickly. More than half a million New Zealanders have a student loan and many of those New Zealanders have made long-term financial decisions on the basis of current interest-free student loan policy. We want to ensure that they can plan with certainty. 
Through this bill the National Government has fulfilled its commitment made during the election campaign to keep interest-free student loans for tertiary students. I support this bill fully. Thank you. 
HONE HARAWIRA (Maori Party—Te Tai Tokerau) 
: 
 Kia ora Mr Deputy Speaker. The American poet Robert Frost once said about the privilege of a higher education that education that does not change life much it just lifts trouble to a higher plain of regard. That is a cynical view perhaps but it is one that is no doubt shared by heaps of tertiary students here in Aotearoa. Although people prattle on about broadening horizons and the intellectual challenges of undergraduate and postgraduate education the fact is that the issues that really matter for students are simple ones: access and affordability. Can they get in and can they afford to stay there? The Maori Party believes that a good tertiary education is an investment in our country’s future that it should be freely available to all and that students should get an allowance that is set at the same level as the unemployment benefit. We are a long way away from that point at the moment. 
The Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill raises the issue of eligibility. It allows students who live mainly in their homelands of Niue the Cooks and Tokelau to get interest-free student loans while they are here as a way of encouraging them to go back and help development in their homelands after they get their degrees. That is a notion that fits well with our kaupapa of supporting our whanaunga right across the Pacific to feel free to come here to gain the skills they require to help build their nations. Secondly the bill enables students who are enrolled with a New Zealand institution and who are on approved overseas study to also access interest-free loans. That is welcomed by the New Zealand Vice-Chancellors Committee because it recognises the internationalisation of tertiary education and reflects the increasingly international nature of a great deal of university research. Both areas of course will increase the number of students who can get interest-free loans which is a good thing in itself. Given the importance of tertiary education to our economy that will no doubt receive support from right across the House. 
Another reason the Maori Party supports this bill is that Te Mana Akonga itself welcomes the commitment to look at increasing the income threshold for those getting a student loan as well as the decision to shift the interest-rate mechanism from regulations to the Act making it more transparent to understand and easier to monitor. The Maori Party still raises its concerns about the philosophy of user-pays continuing to dominate our thinking about tertiary education when we should be more focused on investing and keeping our students here. We are concerned about the deplorable state of secondary education which sees too many Maori students still leaving school without even the necessary qualifications for tertiary education and about the cuts in funding for adult education and second-chance learning which makes those inequalities even greater. But in the interests of opening up the tertiary sector to a greater number of students we will be supporting this bill. Kia ora. 
LOUISE UPSTON (National—Taupo) 
: 
 I rise in support of the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill in the third reading. This bill is another example of great work done in the parliamentary process so that the outcome from the select committee process is that the majority of the parties in the House support the legislation with the exception of the Green Party. I must add though for the benefit of people watching the debate that Labour supports the bill. People who have heard some of the comments from the Labour side of the House would I think be quite surprised to realise that it is voting for the bill. I think it is important that when people listen to these speeches they do have a clear view of who is voting for the bill and Labour voted for this bill. 
Labour members got distracted by some other stuff but I think that the important point to notice is that we all recognise that tertiary education is a vital part of growing our economy and our country. As Hone Harawira from the Maori Party has just said tertiary education is an investment in our future and in this particular instance the Government is again delivering a brighter future for all New Zealanders. 
Let us have a quick look at some of the numbers. The number of tertiary students as at July 2008 was approximately 460000. Of that 460000 178000 have student loans. The average student loan with the Inland Revenue Department as at 30 June last year was $16213. The average time taken to pay off a student loan according to the student loan scheme annual report of October last year for students who left study in 1999 appears to be about 8 years. So in effect what we are doing with this legislation is making some improvements to the student loan scheme. There is nothing significant to it. It is basically looking at how we can improve what is already in place recognising the importance of tertiary education to our economy and to our future. 
In terms of the conversations we have had about the value of the debt I want to reinforce the points we made earlier. The sum of $10.3 billion is a lot of money in anyone’s book. So it is important that that debt is managed well and that we are able to look at improvements to the student loan scheme and that we make sure that that Crown asset of $10.3 billion is managed in an efficient and consistent manner. 
The other side of the Chamber has thrown some comments around trying to do its usual tactic of scaremongering and going way off the topic in terms of this student loan bill which has just some technical changes and improvements. I want to reiterate what the points were because for those listening to some of the Labour members they probably have not realised exactly what this bill does. First of all it extends the interest-free loan to two special groups in recognition of the high value of tertiary education in building a strong economy. It extends interest-free loans to borrowers who live in countries that are part of the realm of New Zealand. An important part of its improvements is to extend the interest-free loans to students who are furthering their education overseas. So for example if they are studying a course of a very technical or specialised nature that is not available in New Zealand they are able to still access the student loan through that process. There are a few technical and remedial changes to the bill which I will not repeat given that they have been discussed at length. 
This bill will ensure that the student loan scheme continues to function as intended. It improves the student loan scheme. That is why I am proud to support this bill. 
CARMEL SEPULONI (Labour) 
: 
 I rise to speak on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. I go back to something that Louise Upston the member on the other side of the House just said. She pointed out that she feels that members on this side of the House have gone way off the topic of the bill and in respect of the issues we have at hand. I think it is really important to note that this side of the House looks at these issues broadly in respect of public statements that have been made by the Government and past actions in tertiary education. We do not take just a narrow view when looking at legislation like that side of the House. I thought that was a really important point to make before I get into what I would like to discuss about this bill. 
This bill is largely technical and Labour will support it. We agree with some things in this bill. We agree with them to such an extent that we actually support this bill. I want to discuss those things but I will also discuss during this speech some of the concerns that we have with the direction that the Government is taking this country with the actions it has already exercised and with some of the statements its members have made about tertiary education. 
One of the main things this bill does is amend the Student Loan Scheme Act 1992 by extending interest-free student loans to borrowers who are present in Niue Cook Islands Tokelau or the Ross Dependency for 183 or more consecutive days in order to encourage borrowers from those countries or that territory to return to their countries and contribute to their development. We on this side of the House support that amendment. We think it is very important that our Pacific people from the territories of New Zealand have the opportunity to return to their homelands if they wish in order to contribute to the social and the economic development of those countries particularly Niue Tokelau and the Cook Islands. It has been mentioned that the population of the Ross Dependency is probably very small and we are probably talking about scientists wanting to come here to train rather than a population of people. We support that amendment. 
Some issues arose during the Committee stage and I have to say that the Minister in the chair the Minister of Revenue responded well to some of the questions that came up. One of them was on what mechanisms the Government might put in place to ensure that those who return to their territories have the mechanisms to pay back those student loans. I think the Minister addressed those concerns. There are still a few concerns. One that I was thinking about but did not get the chance to discuss in full during the Committee stage on Part 1 of the bill was about the Tokelauans. I was thinking of the large number of Tokelauans who work as public servants and who are based in Samoa for long periods of time. We know that Tokelau is very difficult to access. In terms of the public service that Tokelauans have many of their workers are based in Samoa. So I wondered about the provision in the bill that states that students cannot be outside of New Zealand or any of the territory countries for more than 31 days. Samoa is not one of our territory countries and that could affect Tokelauans down the track. I guess that issue will need to be discussed at a later date. We support that aspect of the bill and we commend the Minister for putting it forward. We support it wholeheartedly. 
We are concerned about not necessarily the aspects of this bill but the general direction that the Government is taking tertiary education in this country. We have been disturbed by the lack of attention the National Government has paid to tertiary education. In our minds on this side of the House it would have made absolute sense to invest and to put a focus on tertiary education given the recession and given the high levels of unemployment in this country. Instead we saw as Maurice Williamson likes to refer to a slash-and-burn mentality. We saw cuts to adult and community education; we saw in a concerning way statements put out by the Prime Minister and the Minister for Tertiary Education that student loans will be looked at more closely. A number of other things have been very disturbing to this side of the House and we are watching very closely. 
With regard to what is happening in this bill the irony is that we on this side of the House know that National does not believe in interest-free student loans. We know that in 2005 when the Labour Government introduced interest-free loans the attitude of members opposite including the current Prime Minister—who was National’s spokesperson on finance at the time I believe—was that it was corrupt and it was irresponsible of the Labour Government to do it. I am sure that all those thousands of students out there would disagree with the opinions of the spokesperson on finance at the time and the Prime Minister now John Key on making student loans interest-free. For those of us who—and this has been discussed broadly across the debate as well—have had to access student loans the fact that interest was taken off those student loans and we were not charged interest along the way was a relief to us. It was an issue for those of us who were out working. All we saw every 2 months—or whenever it was when we got the statements—was increasing interest and very little paid off despite the fact that money was coming out of our pay weekly or fortnightly. We have to commend the previous Labour Government for that change; we need to remind the National Government of it. Government members fundamentally do not believe in interest-free student loans. 
This weekend just gone we heard Steven Joyce admit that it was a political call to endorse the interest-free student loan policy in 2008. The members opposite know that if they had made any changes they would have had big trouble with support moving forward. Last year they started to soften the ground for the removal of interest-free student loans with the introduction of the Student Loan Scheme (Repayment Bonus) Amendment Bill. The 10 percent top-up scheme favours high earners who can afford voluntary repayments although they might game the system and decide to invest their spare cash elsewhere and keep the interest-free loans. They are doubly advantaged as the Government assists them to game the system. 
The Prime Minister recently said the Government was going to take a careful look at the policy settings around student support. In our minds the question we straight away think of is what that means. Will the Government make access to student loans and allowances harder? Will it make tertiary education opportunities in universities and polytechs available for the few and not the many? I guess it goes back to what Hone Harawira said when he spoke on this bill: at the end of the day it comes down to access and affordability. We on this side of the House are definitely concerned with those things. 
John Key has referred to students who do not take their studies seriously and who do not get a job quickly after qualifying. Who will determine who those students are? It has been discussed across the course of this debate that unfortunately the research shows that Maori and Pacific students take longer to complete their degrees. As I have discussed earlier and as other people have also said it is not due to lesser intelligence; for many it comes down to their having come from backgrounds where university education or higher-level tertiary education has not been the norm in the family. Many of them are going through university—and I know this from having worked with many Maori and Pacific students—as the first in their families to undertake university study. It is a very foreign environment for many of our students who are going through. Why should they be the ones— 
David Garrett 
: Same speech—heard this. 
CARMEL SEPULONI 
: —I ask Mr Garrett who I know disagrees with everything I am saying—who have their lives placed in jeopardy and who have their futures put at risk because this Government does not understand the need to make sure that tertiary education is kept affordable and accessible for a wide range of people not just for those who have the money to pay for tertiary education? 
Those are some of the concerns that have been raised. Labour members support this bill but it brings to light some of the wider issues we have with the tertiary education system and with the direction that this Government is taking it. In light of the high levels of unemployment particularly for our youth—and particularly for our Maori and Pacific youth where the unemployment rate is sitting at around 30 percent—it is very important that the Government takes tertiary education seriously. It is important that alongside creating jobs for this country and for those groups of people the Government is also providing quality tertiary educational opportunities. Thank you very much. 
JO GOODHEW (National—Rangitata) 
: 
 This debate on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill has been really revealing. What a load of drivel we have had to listen to at times. I will take a few moments to address some of the concerns that have been raised. We have heard in this House this afternoon concerns that students are having to buy their clothes at op shops. Well that raised for me some really serious questions. I believe that students have an understanding of the cost of their education their tertiary education to this country. They certainly understand how much it is costing them and in many cases costing their parents as well. I can think of some really good examples of young people who in fact are very happy to go and get fantastic bargains from op shops or second-hand clothes shops. 
In fact I have a story from close to home a story about a retro party that is happening tonight in Dunedin at Otago University. My daughter has purchased a bright orange frock from an op shop and she is adding that to her bright yellow shoes—so she tells me—and the wonderful pink tights I sent her away from home with. So there we go; what is wrong with young people understanding how to get a bargain? In fact their tertiary education is a bargain because roughly speaking they are being asked to contribute to about only a quarter of the cost. 
Speaking of bargains I have a story of my own. Prior to becoming an MP I was walking along an Auckland street and I spotted a gorgeous jacket in a second-hand shop. I thought “My goodness I will just see if that fits me.” It was a lovely jacket. I purchased the jacket wore it for quite some time—again prior to getting into Parliament—and one day I saw a photograph of a very famous person wearing that very same jacket. It crossed my mind: “Oh my gosh did Helen Clark own that jacket before me?”. Maybe! Who knows? 
Anyway we know that young people attending universities and polytechnics who have student loans have to learn how to budget. They have to learn the value of money. Hopefully at the same time they are getting an excellent tertiary education. But this bill is simply about maximising the benefit of the Crown’s $10.3 billion asset in student loans because really we—and I confess I include myself—have been getting a little bit off-track. We have also heard suggestions that back in 2005 there were words that revealed that National at the time was not keen on Labour’s student loan policy. But hang on a minute! Times change. What we have now is a $10.3 billion investment. Let me repeat: National’s commitment is to having in place a student loan scheme that is balanced while at the same time putting in place incentives for people to pay off their loans more quickly. 
For young people to get out of debt more quickly what can possibly be wrong with those sorts of levers? What can possibly be wrong with a fresh-eyed National Government looking at the student loan scheme and finding ways of improving it with the mechanisms used by the Inland Revenue Department finding ways of improving it for those who are studying overseas and finding ways of improving it so that it continues to function as the student loan scheme was intended to? 
National is absolutely committed to the importance of tertiary education to build a strong economy but at the same time there are settings all around that that we have to make sure are correct. That is why the Hon Peter Dunne has brought this bill to the House why we are passing it now and why before very much longer—in fact just shortly after the House meets again—it will be enacted on 1 April. 
I reiterate National’s absolute commitment to having a fresh look at legislation a fresh look that I have heard has meant that Ministers are competing against each other because they have so many bills they want to bring to the House in order to make New Zealand a much more productive economy and a better place to live in in the hope that our tertiary-educated students will continue to live here and be productive people in our economy. I am certainly looking forward to that and hoping that it means that our three daughters will get that message stay here in New Zealand and bring up their children close to me. Thank you. 
CHRIS HIPKINS (Labour—Rimutaka) 
: 
 I listened quite carefully to that contribution on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill from National member Jo Goodhew. I thought that what was quite revealing was not so much what she said but what she did not say. At no point did she commit National to retaining the interest-free student loan scheme beyond the end of this term. She responded to a lot of the points that Labour members had made but at no point did she deny that some time in the future National wants to do away with interest-free student loans. It would not at all surprise me if that is what National wants to do because it was so vocal in opposing the interest-free student loan policy when it was first introduced. 
I will go back and respond to some of the comments that have been made. The debate in this third reading has ranged reasonably widely. I think that that is probably because in the nature of urgency we have canvassed a lot of the specific material of the bill already today. Members have talked a lot about the value of tertiary education as an investment in the future of our country and I echo some of the comments raised by members—particularly by those on this side of the House but even by some of the members on the other side of the House as well. We cannot view investment in tertiary education narrowly and only in economic terms; we have to look at the investment we make in all forms of education including tertiary education as an investment in the development of New Zealand society. Not all of that investment will necessarily lead directly to an improved economic return. But overall if we build the level of social capital within New Zealand by having a more educated society then in turn the effects of that will flow on to a more economically prosperous country—one with a higher standard of living higher wages fewer long-term health problems and so forth. So we have to look at the investments that we make in education including through the student loan scheme with that very broad picture in mind. 
With that in mind I tell the House that there has been some fairly recent research. I have just been reading a book called  
The Spirit Level 
 which talks about the fact that countries that are more even—where there are higher levels of education and where the gap between the rich and the poor is lower—generally tend to have far fewer other problems than other countries. They have lower crime rates longer life expectancy fewer health problems and so forth. So investing in education including tertiary education is an important part of making sure we increase our social capital and decrease some of those wider social problems. The student loan scheme provides a step on the ladder into tertiary education for those who otherwise could not afford it. It is a fairly recent initiative; it extends back only as far as about 1992. Of course we would not have the student loan scheme had National honoured the pre-election promise it made in 1990 to abolish all student tuition fees so that tertiary education would return to being free. Of course that is what many of the members in this House received when they undertook tertiary study. They received their tertiary education for free and a lot of them received some form of allowance during the time they were studying. Some of them may have been bonded during that time. I know that one of my parents received a tertiary education paid for by the State and was bonded as a teacher as a result. There is a whole generation of New Zealanders who benefited from policies such as those which have been taken away from the several generations that have followed. 
I note that one of the reasons the student loan scheme was established was to make sure that despite the increased cost of tertiary education people can still access it. They are not excluded on the basis of cost. Having said that I say that it is not the ideal mechanism. I for one hold out hope that one day we will return to a situation where tertiary education is far more accessible and the costs are not as prohibitive as they are now. I appreciate the economic realities of that; it will not happen overnight. I acknowledge that back in 1999 when the Labour Government was elected we were not suddenly going to revert to the days when tertiary education was completely free. That is why over time I was very supportive of the initiatives that the previous Labour Government put in place to progressively lower the cost of participating in tertiary education. It began in the early days with the cap on student tuition fees so that they did not continue to grow to the massive extent they grew in the decade prior. 
There were other things such as the abolition of interest on student loans while a student was studying. When I first entered tertiary study one of the most frustrating things about the student loan scheme was that during the time I was studying I was accumulating interest on my loan despite not earning anything and not having any ability to make any repayments. All of the money that I was earning through my part-time job—stacking bread for Quality Bakers—I was putting into reducing the amount of money that I needed to borrow in the first place. I was not making any student loan repayments and in the meantime the interest was accumulating. When the Labour Government came in in 1999 it put an end to that. I think that was a very welcome initiative although it took another 6 years before the Government was finally in a position to do away with interest on student loans altogether. As somebody who was involved in the development of that policy I can say that I am particularly proud of that. I know the huge impact that that has had on the repayment times for some of our student loan borrowers. When talking about discouraging people from leaving New Zealand—we want them to stay in New Zealand— we understand anecdotally that one of the things that drove people away was the huge mounting student loan debts they had by the time they had finished studying. Removing the interest on their student loans if they stayed in New Zealand provided an incentive for them to stay here contribute to the New Zealand economy to our country and to our society and get rid of their student loans. I think that was a very very good thing. 
There were many other things in the overall mix such as the Step Up Scholarships. Stepping up is a term that seems to have been adopted by members on the other side of the House these days but it was the last Labour Government that introduced Step Up Scholarships to make getting into tertiary education a little bit easier for some people who had previously been disadvantaged. It should be noted of course that all of the initiatives that I have just talked about were opposed by the then National Opposition and quite vocally so as well. National opposed all of those initiatives. We have well and truly canvassed John Key’s pledge to fight the introduction of interest-free student loans with every bone in his body. 
Moana Mackey 
: Oh! 
CHRIS HIPKINS 
: That is right. He pledged he would fight it with every bone in his body. Here we are a year and a bit into a National Government and interest-free student loans are still there. He pledged to fight it with every bone in his body so one can only conclude that he does not have any spine left as my colleague Moana Mackey said. 
National members have clearly demonstrated during their time in office that they do not have a lot of time for tertiary students. They are quite intent on cutting a lot of things in tertiary education that lead to an increase in social capital that help those people at the bottom end of the spectrum to get into tertiary education—or into any form of education—to upskill themselves and to move on through the system. An example is the abolition of night classes. People cannot get a student loan for night classes but they did not need one because they were relatively cheap. People did not need a student loan to get into a night class. Night classes are gone now. They were a stepping stone that led into other forms of tertiary education but they have gone. The training incentive allowance reduced the amount that people needed to borrow when they undertook tertiary education but that has gone. It was cut by the National Government. I turn to voluntary students association membership. If the Government cannot get the students associations on board with it it will do away with them altogether. It is a tried and true trick from the National Government. If the Government cannot get its opponents on board it will do everything it can to put them out of business. I think that is pretty sad. 
I think this bill is a good bill. We have talked a lot about the details and I want to thank once again the Minister in charge of the bill for his willingness to engage in the debate. I have raised several issues with him and he has responded to me. That included a commitment on behalf of both of us to work together on one or two of those issues to see whether we can further them outside the scope of this bill and I want to thank him for doing that. But my main concern with the bill is not so much with what is in it because Labour supports it but with what is not in it and what might be coming further down the track. I would be very concerned if the National Government moved away from its promise to keep the interest-free student loan scheme. That certainly seems to be what it is lining up for. John Key mentioned in his speech that the Government will be taking another look at all of the settings around student support in tertiary education. Similar comments have been made by the new Minister for Tertiary Education Steven Joyce. I think it would be very sad if the National Government went back on its promise to retain the interest-free student loan scheme whether the Government was going to go back on it at this election the next election or the one after that. I hope that the Government will maintain interest-free student loans. I think it is a very good scheme. It is one that we are very proud of; I am very proud of it. It was passed by a Labour Government despite very vocal opposition from the then National Opposition. I would like to see the scheme stay in place. 
NICKY WAGNER (National) 
: 
 I support the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. As we have heard today in the House it is mainly a technical bill which includes as everybody agrees several useful technical amendments. It clarifies some exemptions for students living outside but within the realm of New Zealand and for those who are studying overseas. 
The bill also makes some very sensible changes to interest payments. It has a softening of the conditions for those students who are fully repaying their loans and an extension of relief for other students on hardship grounds. But there is also a firming up of consequences for students who have failed to make payments failed to correct deductions or failed to pay any due amount. For those students the Inland Revenue Department will be allowed to increase the standard rate of repayment deductions from 10 percent to 15 percent. 
As we have heard in the House today it is great that New Zealand students have the opportunity to have a student loan scheme and it is great that it can help them to get a good tertiary education so that they have a future and a good career proposition. It is also great that the Government is joining with students to invest in their future. Thank you. 
A party vote was called for on the question  
That the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill be now read a third time. 
Ayes 113 
New Zealand National 58; New Zealand Labour 43; ACT New Zealand 5; Maori Party 5; Progressive 1; United Future 1. 
Noes 9 
Green Party 9. 
Bill read a third time.