Student allowances are now a thing of the past for New
Zealand's postgraduate students.
Changes to the student loan scheme, announced last year,
kicked in yesterday and the Labour Party has warned the new
system will cost the country dearly.
Under the new scheme, postgraduate students are not eligible
for the student allowance. A cap of four years has been
placed on undergraduate students receiving the allowance, and
the loan repayment rate has increased from 10 per cent to 12
per cent for any earnings over $19,084. The parental income
threshold for student allowances has also been frozen for
Labour's Tertiary Education spokesman Grant Robertson said
students from low-income families would be worst hit.
"Thousands of students, mostly from low income backgrounds,
will no longer have support to do postgraduate
"For many this will mean that they simply will not be able to
complete or even undertake their course.
"This means they may never achieve their potential and that
as a country we will all miss out," Mr Robertson said.
Tertiary Minister Stephen Joyce said the new rules would save
millions of dollars.
Over four years, $33 million will be saved by removing the
eligibility of the student loan allowance for post graduate
When the changes were announced, Mr Joyce said the Government
wanted to focus student allowances on the first years of
tertiary study and on students from low-income families.
But a recent survey indicated cutting student allowances
would result in a lack of research in New Zealand.
Of the 202 participants in the Victoria University study, 158
said they would be severely disadvantaged by the changes, and
76 said they would cut short their postgraduate studies as a
Mr Robertson said many Kiwis would head overseas because of
the new scheme.
"I've heard from students and their families who are
distraught about these changes.
"It's especially hard on people, such as those wanting to be
clinical psychologists or architects, who have to undertake
postgraduate study to be able to work in New Zealand."