Clark David: Student Loan Scheme Amendment Bill — Third Reading 
Clark David: Student Loan Scheme Amendment Bill — Third Reading 
[Advance Copy - Subject to minor change before inclusion in Bound Volume.] 
Dr DAVID CLARK (Labour—Dunedin North) 
: 
 Treasury Budget advice has stated that the student loan restrictions passed by the Government over the last 2 years are likely to see 25000 current borrowers lose access to student loans and will likely mean that they cannot afford to study any more.  
I rise to speak following Mr Banks who made a number of observations many of which I would wish to disagree with. I will select a few just to put on the record some concerns about the general direction he would like to take this loans scheme. Mr Banks suggested that loans have been growing and tertiary student numbers have been declining. As far as I am aware there would not be a long-term data set that would indicate that student tertiary numbers were in decline. I am not sure which particular data set he has been reading or perhaps what country he has been living in but perhaps recently— 
Hon David Parker 
: ACT Party pass rates. 
Dr DAVID CLARK 
: The member suggests the ACT Party pass rates have been declining but I cannot comment further on that matter. That may or may not be true. I am also advised that Mr Banks had his pilot’s licence at 16 years of age. I am aware that the student loan restrictions that have now come in have restricted access to loans for training in just that area and there is a deep irony in that.  
Labour will be opposing the Student Loan Scheme Amendment Bill and that is unfortunate. It is because the National Party was unwilling to consider a very reasonable amendment that we put forward to ensure that the student loan repayment holiday remained at 3 years. The current Government wishes to cut that to 1 year. It fits I guess with its general approach which is to further restrict access to loans and to allowances. We have recently heard about thresholds not being adjusted with inflation and this is because its view about this is fundamentally different to ours.  
The Labour Party believes that education should be something that is accessible to all people because for the Labour Party it is about fairness and opportunity. It is about making sure that people have an opportunity to make the best of their talents and are then able to make their best contribution to our society. This is something that benefits all New Zealanders. When people make their best contribution it benefits us socially it benefits us individually and in terms of our own well-being and that of our families and it benefits the economy more widely. There is plenty of evidence that suggests that those who are from less fortunate backgrounds ought to be fully supported into tertiary studies as our country can afford it because the returns to GDP are so strong.  
Unfortunately National does not seem to wish to listen to this logic and over the last couple of years it has made a series of further restrictions to student loan eligibility. That has seen tens of thousands of New Zealanders shut out of higher education and that is a great shame. The unfortunate thing too is that it has declared it is not finished yet. Its leader John Key recently suggested that National would rein in student loans in a big way—that it is not finished yet. He should come clean I think sooner rather than later to let students know just how much further access is going to be restricted for study purposes because people are being shut out of the opportunity of tertiary education and shut out of the opportunity to better themselves and to better their lot for them and their families and for our country as a whole.  
We are particularly concerned as a party about clause 17 of the bill which slashes this student loan repayment holiday. To use an example when one takes out a mortgage and repays the terms of that mortgage it is quite legitimate to go and get another mortgage with a bank and receive similar terms and conditions. The National Party here is putting forward a situation where if you have taken one student repayment holiday on your loan you will not get another. The terms and conditions change. That will adversely affect second-chance learners. I think that is a great shame because second-chance learners are often those who have been through hard times and who have through no fault of their own perhaps not appreciated the opportunities the first time round and are determined to make the best of their opportunities next time round. The more people who are shut out of tertiary education the worse it is for our country.  
It is also true that it will shut off people from taking longer overseas experiences as young people and that will restrict the contacts they can build up during their time overseas. It will also restrict their ability to mature in their particular industries and bring that experience back to New Zealand. Some studies suggest that it is 12 to 18 months on average before a person on an overseas trip finds their niche finds relevant experience in their chosen field and finds an ability to repay their loan balance effectively and also the requisite opportunities to better themselves in order to come home to New Zealand and contribute further. So Labour opposes this cutting of the repayment holiday from 3 years to 1 year. It opposes the restrictions on young New Zealanders and the putting in jeopardy of that overseas experience which is so rich in our cultural imagination and so beneficial to those who undertake it.  
The worst point of all—a point I have not yet made—is that these changes risk forcing New Zealanders not to come back. We already know that many New Zealanders once they incur interest overseas and once it starts getting a wee bit out of hand choose not to come home. We lose the benefits of their education and their experience by making this all too difficult. We should be looking for ways to make it easier for New Zealanders to come back and make their contribution not easier to stay away.  
It is interesting that this repayment holiday proposal has been put forward by Mr Peter Dunne who just 5 years ago had a very different view. To put it on the record I will quote if I may Peter Dunne on his Student Loan Scheme Amendment Bill (No 2) in its Committee stage in March 2007. Mr Dunne said: “The reality they all faced was a very massive debt upon their return to New Zealand which in some cases would be enough for them to make the decision not to come home at all and our country would be the loser. We needed to take a pragmatic way through this and being someone who places great virtue on pragmatism it struck me that the logical course of action was to derive the solution that we have: to extend the holiday period for 3 years recognising the fact that young New Zealanders take that extended period overseas;”.  
Well as we know the Labour Party put forward an amendment to the current proposal to ensure that that 3-year provision stayed in place. We are yet to hear a convincing argument— 
Michael Woodhouse 
: I raise a point of order Mr Speaker. I apologise for interrupting but I do want to remind the speaker with the call of the Speakers’ rulings around referring to amendments put forward in the Committee stage and defeated which is that they should not be referred to in the third reading. I wondered whether he was straying into that area. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Well this is a third reading. It is generally a wrapping up of what has gone on in the Committee and times before. 
Michael Woodhouse 
: I raise a point of order Mr Speaker. I am just aware of Speakers’ ruling 123/1: “On the third reading of a bill a member cannot discuss—… (3) the merits of an amendment proposed by the member and ruled out of order in committee;” and I do fear—[ 
Interruption 
] 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Order! When we have a point of order on the floor it is heard in silence. 
Hon David Parker 
: I raise a point of order Mr Speaker. I think the mistake of the senior whip for the National Party is that the amendment was not ruled out of order but it was voted down. It is a different matter. 
The ASSISTANT SPEAKER (H V Ross Robertson) 
: Yes I had just noticed that. I would ask the member to continue his speech and just be careful. 
Dr DAVID CLARK 
: Thank you very much Mr Assistant Speaker. We are wrapping up here what has happened through the stages and the general point I am trying to make is that the National Party continues to put barriers in the way of access to tertiary education whereas the Labour Party wishes to make tertiary education more accessible to more people to ensure that we have the kind of social mobility in our society that we would like to have. It is true that we do not have the social mobility that we would desire. We know that the greatest determiner of a tertiary level of success for a student—and studies have shown this—is the mother’s level of education. It dictates how likely a student is to achieve tertiary success. The second biggest determinant is the father’s level of education. Socio-economic status is indeed up there as well but not quite as high. So there are various barriers already in place. Socio-economic status is one of those and it is significant and restricting access to loans and allowances moves in exactly the wrong direction when we are trying to achieve access to tertiary education.  
The worst part about this bill is that Treasury and the Ministry of Education have both said that it is unlikely that the gains expected will be realised in terms of restricting this holiday. It is unlikely that money will be recouped and that the coffers will be the richer for this policy that is being enacted so it is a bit of a farce. We are spending $2.6 million worth of parliamentary time which is what one estimate on this particular bill is and the estimates that the Inland Revenue Department has provided is that it will recoup $14 million for the taxpayer. The Labour Party supports efforts to make sure that those who have debts pay them—make no mistake about that—but these estimates from the Inland Revenue Department are not supported by other departments and it appears that they are based on a best-guess scenario. That is what we were told in the Finance and Expenditure Committee. We were told that there was an element of guesswork in just what would be recouped through these changes to the student loan scheme legislation.  
So I put it to you that there would be better ways of ensuring that we achieved the goal of making sure that people pay their debts. This bill is something that the Labour Party will oppose because we believe in fairness in opportunity and in access to tertiary education. Thank you.