Little Andrew: Student Loan Scheme Amendment Bill — In Committee 
Little Andrew: Student Loan Scheme Amendment Bill — In Committee 
[Volume:678;Page:1433] 
ANDREW LITTLE (Labour) 
: 
 The principal point about this legislation is that nobody objects to improving the administrative requirements of the student loan scheme under the Student Loan Scheme Amendment Bill. But the point is that the requirements set out in this bill—which Mr Simon O’Connor my friend opposite finds so entertaining—is that it simply will not make a material difference to the Crown’s balance sheet and to the efficacy of this scheme.  
For a scheme that presently has an outstanding balance of $14 billion of which $2.5 billion is for overseas students the value of that $2.5 billion is increasing mainly because of those who are subject to compounding interest. A scheme that is going to net the Government an extra $14 million a year can be described only as creating a drop in the ocean. That is all it is going to do. With all of the other challenges before this Government and before us all there are different ways not only of skinning this cat but also of achieving a much more material effect that will improve the Crown’s balance sheet and the income and expenditure statement.  
The real question is why go to these lengths. Why shorten the repayment holiday when it is simply not going to have a significant effect? The message that it is sending young people who complete their studies is that we will just make it harder. You will not get your 3-year holiday; you will get a 1-year holiday. The signal that it sends however much that may be psychological or not is that we are going to take something off you and we are going to make it harder—and all for the benefit of $14 million.  
In fact it is not even that; it is actually $5 million because $9 million of the $14 million benefit relates to excluding business losses in the calculation of repayments in the particular year. So in reality this is a $5 million gain against a $14 billion problem. It is laughable. It is risible. The real question is why we are going to these lengths for this purpose.  
The other point too is the contact person requirement. Having to provide a contact person on paper—and let us face it it is on paper—might sound like a sensible idea but the truth is that the way this clause is drafted it is actually meaningless. It could be anybody whose name is put down as a New Zealand contact person when a person takes their holiday. It might sensibly be the parent but it may not.  
And even if it is the parent what will be the material effect of that provision? There is no suggestion that the parent will be chased for any outstanding payments or the outstanding loan nor your best buddy whose name you might provide or some name that you made up—because that is not unknown. That is not unknown in this country. It is not unknown for New Zealand citizens to make up names on forms. It is not unknown for New Zealand citizens to apply for passports in names that have been made up and indeed for MPs to behave in that sort of way. Fortunately they are former MPs now so we do not have to dwell too much on that.  
When it comes to efficacy—not only the efficacy of this bill but also the efficacy of this Parliament—and the time we spend on things creating a $5 million solution to a $14 billion problem hardly measures up. We have to do more and we have to do better. We all know and there is a wide consensus that we want to maximise access to tertiary education for the nation’s young people. At a time of great economic change there is one thing we must do and that is invest in our young people and invest in their skills and skills formation and their training. That is why the scheme plays a crucial and important role in the life of New Zealand and our young people in our tertiary education system. We do want a more effective repayment regime but a regime that simply improves the collection in any one year by $5 million when there is so much outstanding is hardly worth the many pieces of paper it is written on. So even with that even with reducing the repayment holiday even with that marginal improvement there is very little else in it.