Robertson Grant: Student Loan Scheme Amendment Bill — In Committee 
Robertson Grant: Student Loan Scheme Amendment Bill — In Committee 
[Volume:678;Page:1435] 
GRANT ROBERTSON (Deputy Leader—Labour) 
: 
 The transitional provision in this Student Loan Scheme Amendment Bill relates mostly—in fact entirely now because one clause has been deleted—to the question of the definition of “contact person” which is a matter that I was discussing in my earlier call. Had I had another call on Part 1 I certainly would have got up and expressed my concern that the National Government had not taken up the compromise position of a 2-year period for the repayment holiday. This was a pragmatic solution proposed by members on this side of the Chamber and it is very unfortunate that it has not been taken up by the Government. It certainly runs in the face of the good old-fashioned Kiwi OE and I am very disappointed that the Committee has not seen fit to support New Zealanders in the rite of passage that they have had for many years to take that OE for a couple of years. That is what that amendment would have done.  
The transitional provision specifically relates to the question of the definition of “contact person”. The reason there needs to be a transitional provision is that the definition is changing and those people who already are I guess contact people will not necessarily know. So the particular clause in question here contains the definition that will be found in new section 193A(5) of the Student Loan Scheme Act. For people who are reading along at home that new section is inserted by clause 29 of the bill. Basically what that is saying is: “(5) In this section … ‘contact person’ in relation to a borrower means—(a) an individual whose name has been notified under section 16A in relation to the borrower; or (b) an individual nominated by the borrower under section 107A or 193B.”  
The big difference here as we discussed earlier in the debate on this bill is that the person who has previously been listed as a contact person for a borrower is now going to be more likely to be contacted than they ever were before. Previously when people have given contact details it has really been a fairly perfunctory exercise. It is one where simply contact details are given and if someone is in default they would be contacted. Now the provision—and why there is an important transitional provision on this—is that that is changing. It is a transition so it is important that the contact people who have been identified by borrowers will now know that they have an additional responsibility. That is covered in new section 193B which is referred to via new section 193A(5) in the transitional provision.  
New section 193B actually lists some of the responsibilities of a contact person. It is worth noting that section 193B(2) states: “If there is a change in any of the details of a borrower’s contact person the borrower must promptly notify the Commissioner of the changed details.” That is actually something that now impinges not only on the contact person but also on the borrowers themselves. Will they know necessarily when they are overseas that the person they have listed as a contact person has moved? Perhaps that is why this new clause ends up being referred to as part of the transitional provision. It is to give time for people to get used to this new role that is put on both the contact person and the borrower.  
So these are actually substantive changes and I guess at one level it is good then that there is a grace period through to the end of the year put in place by the transitional provision. But on the other hand as I said during my earlier call I actually think these changes are significant enough that it will come as a surprise to some people. As I was discussing earlier on parents who have become the contact person by default virtually for their children now actually have a set of responsibilities. If they move they had certainly better let their children know because that is actually the responsibility that now falls upon the borrower. The transitional provision is one that clearly is necessary in order to put in place the changes but I guess on this side of the Chamber we raise some question about those changes because just being a contact person has been a very low-level activity; now it is a much higher-level activity.  
We do have to remember that the student loan is a loan contract between the borrower and the Crown. These contact people actually have no responsibility for the loan itself so they are getting quite an additional role. They are going to be contacted by the Inland Revenue Department. They are going to be contacted by the State. Their name and their details are going to be kept by the State and will obviously be updated on a regular basis if the borrower is fulfilling section 193B which has been included in the bill. So it is actually quite a substantive change and I know that Mr Dunne acknowledged that when he was in the chair earlier on. I do think that if this bill passes in its current form it is going to be something that will be different.  
I am not going to take much more of a call other than to note that the transitional provision is not just the normal one about dates and things. It actually relates to a substantive change around what it is to be a contact person for a student loan borrower. It is now a much bigger job; one where you will be contacted more often. I do think that is going to come as quite a surprise particularly to some of the parents in New Zealand and I hope they are huddled over their radios tonight to know what the change will be.