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Early Day Motion

EDM 263
 
STUDENT LOANS
14.11.2007


Mitchell, Austin

That this House accepts the principle that young people from all levels of society should be encouraged to go into higher education; is therefore concerned to find that the interest payable on student loans has now doubled from 2.4 per cent. to 4.8 per cent.; considers that such a high level of interest was never envisaged when the student loan was tied to the Retail Price Index to bring it down; and has never been charged at such a high rate since then because the tie brought rates payable as low as 1.3 per cent. in 2002-03 and was regularly between 2.0 to 2.6 per cent.; notes that today's high rate of 4.8 per cent. will constitute a serious deterrent on taking on loans and will produce an arrears burden too heavy to bear by young people leaving college and university to start a life in today's debt burdened society; and therefore suggests that the interest charged on student loans should be either abolished as the New Zealand government has done or pegged at a maximum of one per cent. to give a fairer deal to students and maximise recruitment to higher education.