National MP Nicola Willis unveiled a new policy which the party promises to implement if reelected in November. They announced they would reduce the student loan repayment rate to 10% from 12% after having been the ones that increased it to 12% back in 2012 to begin with. Far be it from a full-bow sorry to students, you can bet your ass that they’ll get that lost 2%, half of which will be – allegedly – made up for by harsher penalties inflicted on borrowers who do not stay in the country such as a 1% interest increase on overseas borrowers who do not pay. This is a policy targeted at patching up the ‘brain drain’ New Zealand is experiencing, with many university-educated residents departing for kind of slightly more greener pastures in places like Australia to, like, work spreadsheet jobs in Auckland and Wellington instead of Melbourne.
These penalties raise a few questions, and a particularly nagging one is whether this might mean young people avoid University entirely if they feel like it would restrict where they are able to take their talents or stick them with a penalty for circumstances out of their control. This is on top of the year’s earlier cutting of Fees Free, the money previously spent on which then directed to trade programs instead of back into academia.
Other critics of the policy have said that it would cause graduates to be paying off their loan for longer and that the potential penalties for those going overseas really aren’t enough of a deterrent compared to the potential benefits.
