Dr Cullen loses his calculator

new-zealand-national-party

Thu Jul 28 2005 12:00:00 GMT+1200 (New Zealand Standard Time)

Dr Cullen loses his calculator

Thursday, 28 July 2005, 9:31 am
Press Release: New Zealand National Party

National Party Finance spokesman John Key says the figures issued in relation to Labour’s irresponsible student loans programme don’t add up.

“The cost to future taxpayers is staggering. Using the most generous assumption, the foregone revenue from moving to a zero interest rate will start at around $350 million.

“With interest free credit available, no sane person would not borrow to the maximum. Existing students who don’t borrow to the maximum now will do so. Of those who currently don’t borrow, most will in the future.

“This could lead to a borrowing blow-out of close to $1 billion a year.

“People who voluntarily paid more than the minimum no longer will. Why would they when it is free money?

“That will cost taxpayers another $200 million to fund in the interim.

“After four years the taxpayer will have had to find another $3 - $4 billion to act as the banker offering zero interest loans to students. After ten years that will be around $6 - $7 billion higher.

“The real cost to the taxpayer of Labour’s promise will be closer to $550 million a year.

“This policy will lure young people into borrowing more than they should, then tax them for the rest of their lives to fund it.

“The policy combines the economics of the old Social Credit Party, with the integrity of a drug pusher,” says Mr Key.

Ends

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