New measures to catch tardy overseas student loan borrowers
are working, despite arrears passing half a billion dollars
in the last year, Tertiary Education Minister Steven Joyce
He made the comments after the student loan scheme annual
report, released this month, showed overdue payments from
overseas borrowers increased from $409.7 million at the end
of the 2011-12 financial year to $535.1 million at the end of
the 2012-13 year.
The extensive report also showed 710,968 New Zealanders had a
student loan, with the total value of debt growing by more
than half a billion dollars in 2012-13 to $13.562 billion.
Of those owing money, 4413 had debt of more than $100,000,
including 967 who owed more than $139,999.
Mr Joyce said the report showed the situation was improving,
but the Government was ''not there yet''.
''It was good that we collected a billion dollars in
repayments in a year and the overseas-based borrowers'
initiative is starting to work quite well, but we are still
in a scaling-up phase for that.''
The effective initiatives to get overseas borrowers to pay
included hiring debt collectors in Australia and
data-matching between government departments, so people
living overseas could be contacted when they came back to New
Zealand for visits.
It had also just started hiring debt collectors in Britain
and was working on legislation meaning the worst loan
defaulters could be arrested on the border - something that
would be done sparingly.
''You don't want to see many, and frankly with child support
[payments] you don't see many, but it does make people think,
because they don't want to be stopped at the border.''
The amount of overdue overseas payments was continuing to
rise because of Labour's three year repayment holiday policy,
which had since been reduced to one year by the National
''What was happening was that at the end of the three years
they were even less likely to start repayments, because they
had long since got busy with their lives or whatever,'' he
Outgoing Otago University Students' Association president
Francisco Hernandez said the ever-increasing loan balance
showed the need for a review of the loan system.
It was also more evidence the Government was shifting more of
the cost for tertiary education on to students.
''We'd like to call for a comprehensive review of the student
support scheme, including looking at readjusting the parental
income threshold for student allowances, raising the
course-related costs ... and raising the living cost