Barry Maggie: Student Loan Scheme Amendment Bill — Third Reading 
Barry Maggie: Student Loan Scheme Amendment Bill — Third Reading 
[Advance Copy - Subject to minor change before inclusion in Bound Volume.] 
MAGGIE BARRY (National—North Shore) 
: 
 I rise to speak to the third reading of the Student Loan Scheme Amendment Bill with great pleasure. As a member of the Local Government and Environment Committee I have heard some of the issues that other people in the committee have had against this bill. I would like to remind them that New Zealand has one of the most generous student loan schemes in the world and although we want to keep it that way we also need to ensure that students know what they are getting into when they take up a loan. If you have a loan it is exactly that. It is something that you have to pay back. I think that is something that the Opposition has often lost sight of. It is a loan; it is not a gift. In an effort to make our very generous student loan scheme more sustainable and not to have to borrow more as others would want to do we need to be able to be pragmatic and to look at how to fund it as a nation. We have introduced a number of performance criteria. They have been focused on targeting the money towards those who need it and are importantly prepared to pay it back whether they go overseas or not. These are very fair and very reasonable changes.  
A lot has been made of this idea of having the reduction in the amount of time from 3 years to 1 year for a repayment holiday for students overseas. I think that is fair and reasonable and I utterly support it but a lot of time has been spent on that. So let us look at some of the other changes that have been made. The basic criteria for eligibility for the student loan have been tightened up in a number of ways which I think make the scheme more sustainable and fairer. So we are requiring for example students to pass 50 percent of their courses over 2 years to continue borrowing. What is wrong with that? If you are a failed student why should you continue to get money for something that you are just not actually delivering and performing on? 
I think that limiting borrowing to 7 full-time studying years for undergraduate degrees is only fair. How long does it take to get a 3-year degree? If you are up there at 7 years it may be OK for the other side of the House who think that they can stay on benefits and allowances for the rest of their adult lives but it is not actually the way of the future for this nation. It is unsustainable. 
We have also introduced administration fees. They cover more of the administration costs of the loan. So you borrow you pay for it. It is not as bad as all that. A voluntary repayment bonus I think is an excellent thing to do. 
I am all in favour of people having a nominated contact person. The previous speaker spoke of the fact that a parent might agree to let their child persuade them to be the person who can be contacted if the loan is in default and that the parent might want to get out of that obligation because it might be onerous. I think that is a crock frankly. I think that basically if you stand as somebody who is able to be a contact person for someone you should do that. Let us face it: even if the people on the other side of the Chamber were in default of their loans and had skived off and not bothered to pay them back a call from the mother or the father or someone whom they had put forward as their mentor— 
Todd McClay 
: An auntie. 
MAGGIE BARRY 
: —or an auntie—could in fact be the spur that they need to do the right thing and be honest and actually repay the money that they need to pay. That is what it comes down to—personal responsibility. Some of course on the other side of the House shirk that on every level. But the Inland Revenue Department and StudyLink having access to a compulsory contact person is I think a very fair thing. It will counter the problems that have occurred when you are trying to trace these people. The Inland Revenue Department holds overseas addresses for less than a quarter of the estimated 91000 overseas-based borrowers. In addition to that it also holds details for nominated people for some borrowers overseas. This is very fair. This is not an onerous responsibility. It is the Inland Revenue Department getting in touch with you and saying: “Look we’ve lost contact with this person. They have given us a fake address or they have moved on from there. We need to get in touch with them to remind them of their obligations.” A loan is a loan; it is not a gift. This is something that has been missed on a number of occasions from the questions that have been put when we have been in the select committee. 
I again remind the people on the opposing side that this is a very important thing. A break from compulsory repayments is a privilege rather than a right. Todd McClay has spoken already about the statistics around this. The number of people who actually do not bother to pay back their loan is mostly the borrowers overseas. Fifty percent of those who are overseas are in default. Seventy percent of the amounts overdue are from borrowers overseas. We need to bring these people back into line. We need to have a compulsory ability to get in touch with the people who are the ones who hold the addresses. These are not unfair and unreasonable demands at all. Although opposers might say that we are in a situation where we are trying to make it difficult for people to get an education it is actually anything but. They are missing the point but there you go. That is what happens in a democracy. We are prepared to listen to their viewpoints but we are determined to proceed on the track of making the amendments to the student loan scheme go through in the way that they have. The changes that have been made are full and fair and not too difficult to follow. So I rise happily to support the third reading of the Student Loan Scheme Amendment Bill.