Cunliffe David: Student Loan Scheme Amendment Bill (No 3) — First ReadingText is incorporated into the Bound VolumeCunliffe David: Student Loan Scheme Amendment Bill (No 3) — First Reading[Sitting date: 27 August 2013. Volume:693;Page:13017. Text is incorporated into the Bound Volume.]Hon DAVID CUNLIFFE (Labour—New Lynn): I rise in the first reading of the Student Loan Scheme Amendment Bill (No 3) to say that Labour fundamentally and categorically opposes this bill.Tracey Martin: Hooray!Hon DAVID CUNLIFFE: Thank you very much—thank you Tracey. The interest-free student loan scheme was one of the great achievements of the Clark Labour Government. It was actively supported and developed by my colleague Trevor Mallard who is sitting to my right—Hon Trevor Mallard: Ably assisted by Grant Robertson.Hon DAVID CUNLIFFE: —and was ably assisted by Grant Robertson in a backroom capacity. I am not sure that he sits as far to my right as Mr Mallard but that is a different matter.Removing punitive and unsustainable interest charges from student loans de-fanged what had been an increasingly impractical andgenerationally unfair system for funding tertiary education. Generations of students built up a mountain of debt and if they got behind in their payments the debt mountain grew with interest and penalties. It became like a lead collar—like a lead collar that would bow them down when they wanted to hold their heads up and get a decent start in life. It was like graduating with a mortgage before you had a home.Labour is very proud that in its last Government it was able to provide a pathway to the future for our young people by taking the interest component off student loans. National knows that it cannot repeal this policy because it is wildly popular with middle New Zealand as well as providing a ladder up for all young New Zealand students. It is the kind of ladder that people like I do not know Paula Bennett or John Key might have enjoyed in their youth—the kind of ladder that National MPs seem to have a habit of pulling up after they have climbed it to make the climb harder for others.David Bennett: Change the line.Hon DAVID CUNLIFFE: The member at the back may not like it but that is the honest truth of what we are seeing here.It is not just a little bit of fiscal nip and tuck. Like the Government did with the odious Government Communications Security Bureau legislation just a couple of short weeks ago this bill crosses the line. It crosses the line from prudent financial management to an erosion of civil liberties because it imposes criminal sanctions on young New Zealanders trapped in the Kiwidiaspora who might want to come home and start a family. But what the National Party is saying is: “Sonny Jim you step your foot inside our territory you come back through that airport and we’re going to slap an arrest warrant on you for criminal sanctions because you haven’t kept up with your student loan payments.” That is not only morally wrong but also brain-dead. It is brain-dead.“Glossy” there might be smirking away. He will be smirking on the other side of his pate very soon because the Labour Party is coming after National’s majority. The Labour Party is coming after this tired useless National Government and the Labour members are going to be claiming back those Treasury benches in just 1 year’s time from now. When we do the students of New Zealand will know that we are not going to criminalise them if they get behind in student loan payments. It is as simple as that.We all know the situation of people who have gone overseas to seek a bit of experience or on an OE. Sometimes you go through hard times while you are away. You cannot always get continuous employment. You get behind and the old debt repayments mount up because the student loan interest-free remission does not apply when you are overseas. To be hit with a criminal penalty is reprehensible.This bill is overly punitive. It turns a civil matter into a criminal matter by introducing arrest warrants. The Tertiary Education Union says it is a poor alternative to making tertiary education more affordable and accessible. Instead of providing an easier pathway up a gentler slope what the Government is doing is putting a rock at the top and if you slip you get crushed by it. It is so very National with due respect Mr Speaker because of course you have graduated to impartiality in your current form.Hon Trevor Mallard: I don’t know about that.Hon DAVID CUNLIFFE: I find myself tempted to agree with my learned colleague from time to time but not too much on this occasion perhaps because it would be against the Standing Orders and I am the one who is going to get booted out. So let us not go there but thanks Trevor for the suggestion on that one.The other thing about this bill diving down into the grubby details is that Treasury’s analysis is very poor. Treasury’s analysis is very poor. It claims that overseas repayment obligations reduce the percentage of borrowers whose obligation does not cover their interest from 14 percent to 3.5 percent. That takes no account of the fact that interest rates are at historic lows just because the current Government could not manage economic growth out of a wet paper bag. So the interest rates are artificially low and the analysis is skewed but Treasury makes no allowance for it.There are thousands of Kiwis who are currently overseas who are keeping up with their loan repayments but how many of those repayment obligations are increased dramatically and arbitrarily by this Minister of Revenue who appears to have nothing but contempt for young New Zealanders? There is no means testing here. There is no acknowledgment of circumstances just a Government that cannot and will not listen.A better approach would be to create more opportunities for young New Zealanders to stay in the country and earn decent wages. [Interruption] Mr Bennett knows that in a 30-year time series of data mapped against different Governments economic growth is higher under Labour Governments than National ones. Business confidence can sometimes be lower but economic growth is higher which is why it is kind of ironic that the Government has the Minister for Economic Development having that title. He should be more like the “Minister for Economic Stagnation”. That would be a more apt title for him. That is right. There he is trying to sniff the breeze in the National caucus to work out which way Judith Collins is going to come at him from. [Interruption] John Hayes says it is coming from him. There we are. That is wonderful. That is wonderful.The interest-free student loan scheme was one of the most important means of social mobility introduced by the last Labour Government. It meant that young people from modest backgrounds could take on the debt they needed to get a tertiary education without having to worry that the interest component of their repayments would snowball to the point where they could not repay. We agree with the fact that when you are offshore that particular subsidy should be suspended but we do not agree that the failure to keep up—often through circumstances beyond anybody’s control—should give rise to criminal sanctions. Just like in the Government Communications and Security Bureau Amendment legislation where in the name of protecting New Zealanders from foreign espionage we have stripped them of their civil liberties here we are crossing the line from the prudent management of public debt to the incursion into New Zealanders’ civil rights.This Government does not really care about young people getting ahead. This Government does not really care about climbing up the ladder of advantage. If it did it would not be pulling the ladder up in front of a generation of young Kiwis who have yet to make the grade. It would not have stood by when the Reserve Bank introduced loan-to-value ratios without an exemption for first-home buyers. It would not have passed in this very House today the stages of a bill which once again concede what ought to be the right of Government to the same Reserve Bank this time prostituting fiscal policy at the altar of Milton Friedman and giving the Governor of the Reserve Bank effective control over the Minister’s portfolio.Is it because that Minister does not want to govern for economic growth? Is it because he thinks his department is so inferior to the Reserve Bank? Is it because he has lost hope in the future of our country? If that Minister has lost hope colleagues why do we not give him a rest? Why do we not give him some time to recover his energy? The members on this side of the House are full of energy. We are ready to give it a go are we not colleagues? The members on this side of the House think it is time for a change and so does New Zealand. And guess what fellers? A change is coming very soon. A change is coming very soon. We are coming after the Treasury benches and you lot can be very afraid. Thank you.