Mahuta Nanaia: Student Loan Scheme Amendment Bill — Second Reading 
Mahuta Nanaia: Student Loan Scheme Amendment Bill — Second Reading 
[Advance Copy - Subject to minor change before inclusion in Bound Volume.] 
Hon NANAIA MAHUTA (Labour—Hauraki-Waikato) 
: 
 The contribution of David Bennett before me raised a very important point around the issue of capping student numbers. He put a fine point on the fact that— 
David Bennett 
: Labour brought it in. 
Hon NANAIA MAHUTA 
: Yes Labour did do it but you have to understand the context of the time. When Labour was in Government significant tertiary reforms were needed. At that time unemployment was sitting at around about 3.2 percent from memory. So we did not have high unemployment; we had low unemployment. We needed a skilled workforce and we needed a tertiary sector that was better aligned and was specialising in areas that aligned to labour market needs. That is the context that that member failed to comment on. 
So when we are talking about the challenge ahead of this country to reduce student debt by the same measure we need in times of recession to lift the skills of our people. We can do that only by investing in our people and sending the right signals to say that in a time of recession now is the time to upskill so that we can ensure that productivity can be increased so that we have a highly skilled workforce able to meet the demands of the newer economic challenges. At least that is the vision that Labour sees. We see that as a very serious challenge that is partially understood by National but not fully embraced. The signal that National is sending indeed is that it wants to reduce student debt it wants to continue to put caps on tertiary education at a time when we should be lifting them and it wants to limit the numbers of people who can access student loans to get a higher education. All the signals are in the wrong place. 
We will be supporting the Student Loan Scheme Amendment Bill because we do believe that efficiencies can be gained in terms of reducing the student loan debt. However there need to be incentives. A regulatory measure in itself will not do a great deal to send important signals to our people that by reducing their student loan debt and by ensuring that the student loan scheme continues to be available to them they can continue to upskill and increase their skill set to become more productive in an economy that would be thriving if the National Government had a plan. But under Labour there is hope—under Labour there is hope. 
I want to pick up on some of the comments that were raised by speakers before me. Firstly there was the reduction in the student loan repayment holiday. The one question that I had—and I am not a member of the Finance and Expenditure Committee—concerns the arbitrary rationale in terms of reducing the student holiday from 3 years to 1. If you look at the bilateral agreements that New Zealand has with other countries in terms of working holidays they all exist for about a 2-year period. So even then common sense would say that if the working holiday schemes exist for 2 years the holiday period should be for 2 years and they would align. That way you are sending signals to those young people who want to have their OE maximising on our bilateral partnerships with other countries that say: “Look have the holiday for a 2-year period and you know get a job and if you can repay then repay.” But the signals are all in the wrong direction and there is no strong rationale for the reduction in the repayment holiday. I think some very important questions were raised in this House that should come out in the Committee stage and be answered by the Minister of Revenue around the rationale for the reduction. 
The other point that I wanted to comment on is the profile of those people who have access to student loans and looking at how flexible types of arrangement might be a greater incentive to mature people going back into study and to mums and women going back into study. They will want to ensure that they do meet their debt obligations and they will want to earn a track record but also they want some flexibility around just some everyday life challenges that come up. If we take that kind of approach in working with people and being more responsive to their life context and challenges then I think we have a fully functioning student loan scheme that is operating on a high-trust basis on an incentive basis and on a basis where people are actually saying: “Look it is good to continue to make repayments. I can earn a track record here with the Inland Revenue Department and there will be an opportunity in the future to continue to take up student loans should I wish to upskill in the future.” Those are all very real questions when people start to consider whether or not to go back to a tertiary institution to upskill and get a qualification. They are all very real considerations that I think underpin a broader context for considering the New Zealand student loan scheme. 
There were other comments made by speakers before me around the Government’s changes and the way in which they are restricting those over 55 years of age new migrants and part-time students from accessing the student loan scheme. Again the signals are all in the wrong place here. What we need more than ever before is for an ageing workforce to continue to ensure that their skills are relevant to the new workforce labour market demands and we can only assure them of that if they have pathways into higher education. For a lot of people especially a lot of mature people whom I certainly come across who have a family and who have to weigh up the cost of taking up tertiary education with that of looking after their family student loans sometimes become a option. They can manage with maybe their partner who is working part-time and then they go back to study. So I think people cannot simply shake their head and say that that is not a reality because it is a reality for many. I think the needs of upskilling young people are just as important as upskilling a maturing workforce who actually can continue to work at 50 and 55 if they are upskilling and transitioning perhaps to a new career pathway through a supportive loan scheme. 
There are a lot more questions here to be asked and a dearth of responses from the Government on some very fundamental challenges that certainly Labour set it which are that in a time of recession we should be sending signals to New Zealanders to say that they matter and we want to invest in ensuring that they have access to be able to improve their skill set in order to be part of a productive economy in a labour market that will be able to ensure that there is a place for them. 
Again the thing I am most concerned about in the contributions from the Government today is that this is all just about reducing debt. Well if it is all just about reducing debt then you can tick the box on this bill but it has to be about people at the end of the day. If we are serious about investing in people and lifting their skills so that they continue to be a part of a productive economy then all of the signals are in the wrong place and we are certainly not going in the right direction. We do support efficiencies in the Student Loan Scheme Amendment Bill but we have concerns and we want to raise them so that during the Committee stage those questions can be responded to by the Minister. Kia ora.