The New Zealand Union of Students’ Associations (NZUSA) says that any discussion about retirement must address the issue of student debt.
‘With those born after 30 June 1972 affected by the government’s proposed new pension age, it is precisely the generation of student loan borrowers and who have had to pay for their tertiary education who will be most affected by a rise in the pension age’ says National President Jonathan Gee.
‘It is a particular irony that the dates chosen match exactly with the school leavers in 1990 who faced tertiary fees for the first time.’
‘Far more than those initial tuition fees, many students today are having to borrow more to meet their current living costs, which increases their debt burden and therefore their ability to save for the future’
Students tell us that they are extremely worried about the coupling of the issues of debt and retirement, with 72% of respondents in NZUSA’s recent Income and Expenditure Survey saying they believed that student debt would have significant impact on their ability to save for their future, including retirement.
‘Raising the pension age without any form of student debt relief for ‘Generation Debt’ will make students worse off than they have been not just as recent graduates, but for a lifetime.’
‘If the Government wants to make a difference to the lives of Generation Debt, then they need to be exploring ways to reduce the debt burden that students currently face.’
‘It is worth remembering that those with student debt include many in highly physically demanding jobs, as the period that has seen the introduction of fees has also seen many trades and other occupations that used to be learned on-the-job shifted into polytechnics and other training institutions where the learners incur debt. Often these debtors take longer to repay their debt, but also, necessarily, will not be able to work as long. They are also dominated by groups of New Zealanders who do not live as long.’
‘As an immediate step, we’re calling on the Government to increase the Student Allowance from its current rate of $176.86, and broaden its availability, so that students can borrow less and therefore graduate with less debt.’