Salient. Newspaper of the Victoria University Students' Association. Vol 42 No. 13. June 11 1979
Why Loans should be Opposed
Why Loans should be Opposed
1. | First of all it means reducing the amount given to students in the form of a grant. A grant does not have to be repaid; a loan does. The present STB is a grant. |
2. | The danger of a two-tier system with grant and loan components is that the grant component will proportionally diminish and the loan component increase. Sweden has such a system. When introduced in 1964 the grant component represented about 25% of the total assistance. By 1968 it was 22% and in late 1975 it was down to 15%. |
3. | It has not been shown that where loans have been introduced they have been successful in fact an OECD study concluded that no perfect loans system has yet been introduced. Attempts to introduce loans in Australia and Britain have failed. |
4. | For a loan system to be just, a tertiary qualification would have to be a guarantee of future lucrative employment so that students will readily be able to pay back their debts. However in New Zealand this does not appear to be the case. As Treasury noted in its submission to the 1977 Bursaries Conference: "....One factor we would see operating against extensive use being made of loans in New Zealand is the fairly egalitarian relativity of wages. In the first few years at least most graduates are not paid significantly more than the average wage." |
5. | New Zealand's unemployment situation suggests that the introduction of a loans scheme with the subsequent repayments would be inopportune. The following figures taken from the Vice Chancellors' Committee's Graduate Employment survey suggests an alarming and politically sensitive trend. |
Year | Graduates Seeking Permanent Employment (Percentage of Total) | |
---|---|---|
1976 | 6% | |
1977 | 6.3% | |
1978 | 8.5% |
A break down into selected disciplines for 1977 and 1928 is also pertinent.
Furthermore the general situation in white-collar employment is not encouraging. The March 1979 Monthly Abstract of Statistics provides some insight into trends in this area where many ex-students can be expected to be employed.