The Government has again been criticised for cutting student
allowances after figures released to the Otago Daily
Times show those affected will have to take on an average
of $4610 in extra debt to get by this year.
Figures released under the Official Information Act by the
Ministry of Education estimated that because of the changes,
an extra 5140 students would borrow money through the student
loan scheme for living costs - or be more reliant on
borrowing than before.
The affected students would be faced with having to borrow on
average an extra $4610.89 this year, on top of the amount
they borrowed to pay for their tuition. All up the changes
are expected to add an extra $23.7 million on to the national
student debt this year and save the Government $29.2 million.
This comes as changes to student allowance eligibility
announced by the Government in last year's Budget came into
force. The changes mean postgraduate students can no longer
receive the allowance and there is no option to apply for
exemptions allowing students to receive allowances beyond the
Labour deputy leader and tertiary spokesman Grant Robertson
said the extra amount students would have to borrow was a
''That will act as a disincentive for a number of them to
carry through with their studies,'' he said.
He also said the $5.5 million difference between the amount
the Government was saving and the extra amount borrowed
showed those affected were being forced to get by on less -
going against what Tertiary Education Minister Steven Joyce
had previously said.
''One of the things that Mr Joyce has not been willing to
acknowledge is that people will be worse off financially,''
Mr Joyce said that prior to the changes it made this year,
Government spending on student allowances had increased to an
''unsustainable level'', in one of the ''many spiralling
costs we have inherited from the last Labour Government''.
As a consequence, the Government sought to ''focus student
allowances more on students who are from low-income families
and the early years of study'', he said.
People who finished postgraduate study were likely to earn
''much more'' than those who did not have a tertiary
education, he said.
Mr Robertson said the Government's argument that cuts were
necessary and that postgraduate students could afford to
borrow more did not tread water.
''I think Steven Joyce has got to stop seeing education as a
cost to cut and start seeing it as an investment in our
Otago University Students' Association president Francisco
Hernandez said $4610.89 was a significant amount for
He said the changes sent students a message. It mean that the
Government ''doesn't want students to be studying [at a]
postgraduate [level]'', Mr Hernandez said yesterday.