Loans changes an attack on families
green-party
Thu May 03 2012 12:00:00 GMT+1200 (New Zealand Standard Time)
Loans changes an attack on families
Thursday, 3 May 2012, 12:00 pm
Press Release: Green Party
3 May 2012
Loans changes an attack on families
Hard working young families are being targeted as the group the Government will hurt in order to balance its books this budget, the Green Party said today.
The Government has indicated a raft of changes will be made to the loans scheme including lifting the repayment rate, which will force graduates to pay more each week.
“Graduates repaying student loans are set for a cut in income this budget that could wipe out large parts of the tax cuts they received last budget,” Green Party student spokesperson Holly Walker said today.
“John Key has blithely waved away concern about the impact of increased loan repayments saying the effect will be ‘fairly mild’ while, in the same breath, saying he’ll rake in “tens of millions” of dollars from them.
“What Key has failed to acknowledge is that these people are not just young, single professionals.
“Graduates have grown up. A significant proportion of those paying off a student loan are also parents, who are set to be hit with a double whammy this budget as they expect cuts to their early childhood subsidies as well.”
About 40 per cent of couples with children aged between 18 and 24 have student loan debt and about 30 per cent of those aged 25 to 34 are also paying off student loans.
“This group is already shouldering a completely unreasonable burden and rightly feels it’s the victim of an intergenerational attack by this government.
“A person on the average full time wage for someone with a tertiary qualification ($59,000) would lose half their tax cuts from an increase of the repayment rate from 10 % now, to 12%. That’s a loss of more than $15 a week.
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“That same person would have their tax cuts entirely wiped out by an increase to 14%.
“That’s a huge loss for a young family.
“These young parents did not have the benefit of a free education, like most ministers did, and are locked out of the housing market by a lack of a capital gains tax that concentrates wealth among older home owners.
“And now they’ve been singled out to lose more. No wonder they feel under attack.”
Ms Walker added the Green Party would support and invest in these New Zealanders with a universal student allowance that would stop them from getting into debt in the first place.
We would also introduce a debt write off scheme and adjust repayment thresholds to start at a higher income level.
ENDS
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