Media Release; Australia Streets Ahead
Otago Polytechnic students welcome the recent announcement that the student loan repayment threshold will be raised. From 1 April next year, the income level at which borrowers will have to start repaying their loans will increase from $17,160 to $17,784 per annum. However, students believe that the increase is not enough.
“It is pleasing to see that the threshold heading in the right direction, but such small increases mean nothing when compared to tertiary fee increases every year,” said OPSA Co-President Richard Mitchell.
Further, students feel New Zealand’s repayment threshold is ridiculously low: “The idea that people on $17,000 are ‘rich’ enough to be paying their debt at the same rate as someone on an income of over $100,000 is laughable” said Mr. Mitchell.
“Indeed New Zealand has one of the harshest student debt repayment thresholds when compared to countries with similar loan schemes” said Mr. Mitchell. Australia’s repayment threshold is over double New Zealand’s threshold, at over NZ$37,000; Canada NZ$29,614; and United Kingdom NZ$37,400.
“The threshold should well above an income level where people are having difficulty meeting the costs of every day living such as food, rent and power.” said Mr. Mitchell. OPSA urges the government to considerably increase the repayment threshold so that those on lower incomes are not forced to repay 10 percent of their loan when they are struggling to make ends meet.