Hot Topic

Interest-free student loan legislation tabled

Labour's election promise of interest-free student loan legislation has been tabled. Students have praised it but many others say it will cost New Zealand dearly.

A range of resources on the government's policy and on student loans in general is below.

When the legislation was tabled in early November, finance and tertiary education minister Michael Cullen said it had been designed both to cut the cost to students of tertiary studyand to encourage skilled New Zealanders to invest their skills in the New Zealand economy.

National Party finance spokesman John Key says the proposed legislation is comparable to giving away a state-owned enterprise.

New Zealand once had the world's best student loan scheme but, since the late 1990s, the loan scheme has been transformed from a model of sensible student financing to a political football, and in the election campaign both parties gave it a good kicking, argues economist Mark Harrison.

When the Labour Party first released its policy we put out this hot topic: Interest-free student loans: when good policy goes bad.

After the Treasury released its costings of the policy, we put out this hot topic: No-interest student loans - much will it cost?

Government information on the student loan scheme says it was introduced in 1992 to assist students to overcome financial barriers to undertaking tertiary study.

Ministry of Educationinformation and resources on the loan scheme.