Limit on student borrowing must keep up with rent

act-new-zealand

Wed Jul 12 2017 12:00:00 GMT+1200 (New Zealand Standard Time)

Limit on student borrowing must keep up with rent

Wednesday, 12 July 2017, 3:11 pm
Press Release: ACT New Zealand

Students should have the right to borrow more each week, says ACT Party Leader David Seymour as he visits Otago University’s Clubs Day.

“Students are struggling with increased rental costs caused by a chronic housing shortage,” says Mr Seymour. “ACT’s priority is to allow new housing, but we also need a short term measure for students who are desperate now.

“Since 2006, rents have increased by about 45%. In other words, a $120 room now costs over $180. The weekly borrowing cap for living costs, however, has only increased by 19%, from $150 to $178.81, meaning many students can’t even cover rent with their borrowings.

“The low cap on borrowing is essentially a form of nanny statism that says students can’t be trusted to manage debt,” says Sam Purchas, ACT’s candidate for Dunedin North and #9 on the Party List.

“ACT will allow students to borrow enough to pay their bills. We should increase the borrowing cap in line with rental costs. If we’d done this since 2006, the cap would be about $40 dollars higher than the current level.

“A stronger ACT will force National to make this belated adjustment, and then index the borrowing cap to ongoing rental inflation.

“And we’ll help students pay off their debt too, by cutting tax on what they earn when they join the workforce,” says Mr Purchas.

ENDS

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