Adams Amy: Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill — First Reading 
Adams Amy: Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill — First Reading 
[Volume:656;Page:5870] 
AMY ADAMS (National—Selwyn) 
: 
 I am very pleased to rise tonight to take a call on the Student Loan Scheme (Exemptions and Miscellaneous Provisions) Amendment Bill. The student loan scheme has become a central part of our tertiary education system. This bill is all about ensuring that it is working in the way in which it is intended that it is a balanced scheme and that it is applied fairly equally and appropriately. Most important it is about ensuring that repayments are incentivised. That is a big plan for this Government because we work on the basis that it is not good for people to have that debt hanging over them for longer than need be. It is not good for the country; it is not good for the borrowers. So anything we can do to incentivise borrowers to have that debt cleared away we would certainly support. We have this bill before us and later in the year we will be looking at the repayment bonus which will help achieve that goal. 
The scheme as we have heard has over half a million borrowers. It has a nominal value of approximately $10 billion. The really important thing about the scheme is not the numbers; what is really important about it is that it enables every single New Zealander to advance his or her tertiary education. No New Zealander can say that funds are not there to be taken advantage of for his or her education because the scheme is available to all. 
I had just started my university education when the scheme came into force. It was really interesting to see the transition from the previous scheme where that was not the case; fees were low and students could do the proverbial 7-year scenic tour BA. Students suddenly realised that they were there to get an asset that would help them and enrich their lives for many years to come. They realised that their education was an asset and like every asset it had a value. By attributing that value to it students started to understand that they were there to get an education that would put them in a better position for the rest of their lives. I for one had no problem paying for it. I had no problem racking up debt and I certainly did not get any State assistance in terms of welfare allowances. I had to work very hard and I had my student loan but I knew that tertiary education was my path to a brighter future. That is why I took it on. 
I am a big proponent of the scheme and as I said anything we can do to incentivise borrowers to pay back that debt sooner is worth supporting. As we have heard from the Minister of Revenue the bill will encourage those within the realm of New Zealand—which is a bit of an antiquated term—to study. We have a special relationship with the Cook Islands Niue Tokelau and the Ross Dependency and we want to ensure that people there are treated in the same way as our own residents are. We are also ensuring that New Zealand residents who are studying full-time under approved schemes are entitled to an interest-free loan. 
There are some very interesting and important technical amendments within the bill that tidy up issues. An interesting one is that the setting of the interest rate is moved from a matter set by regulation to a matter of primary importance that is in the primary legislation. That is a move I endorse. The rate now is the average Government bond yield rate times a multiplier of 0.74 percent. It is moved to the primary legislation which emphasises the importance of it. 
The other important point that I want to touch on briefly is the entitlement of the Commissioner of Inland Revenue to issue a 15 percent deduction rate where there is a shortfall in repayments to ensure that that shortfall is caught up with quickly and to move borrowers towards the goal of getting themselves debt free sooner. 
The bill is an excellent bill. It is an overdue bill. I commend the Minister and I support the bill. Thank you.