Saturday, 1 October 2016

Students go bankrupt at a rapid rate.


Did Paula Bennett pay Student fees.

Questions: How much did Paula Bennett pay in student fees? How much did she received as a solo-mum? 

How much did Steven Joyce pay in student fees? 

How much did John Key pay in student fees and how much did his Mum get as a solo parent?

All of the above got a free education at the tax-payers expense…it was the ‘done’ thing back then, education was free and individuals paid it back via their future income earnings.

But we [NZ Voters] accepted with great gusto the Roger Douglas and Ruth Richardson insane Ronald Regan Maggie Thatcher driven neoliberalist approach that encouraged greed expansion around capitalist nations.

The NZ Labour Party supported by National introduced ‘User pays’ for tertiary education and from there on its downhill, all the way to the bankruptcy court for thousands of NZ tertiary students. This latest report from Inland Revenue says it all.    

Student loan borrowers seeking bankruptcy as millions in debts wiped due to insolvency
TALIA SHADWELL
Last updated 10:53, October 1 2016
NZ Union of Students' Associations president Linsey Higgins, left, says graduates abroad are struggling with interest-laden loans to the point of declaring bankruptcy.
Overseas graduates declaring them-selves penniless are among the 483 debtors whose $18 million in students loans have been wiped by bankruptcies.
Inland Revenue has revealed the latest figures as the amount owed by student loan defaulters’ tips over the $1 billion mark. The 10 biggest overseas debtors owe more than $300,000 each.
Some are dying in debt. Ministry of Education figures show that, in the year to June 2015, $19m of student loan debt was written off because of the death of the borrower. That compared with $16m written off because of bankruptcy.
One Auckland-based accountancy website advises graduates: "If you are living overseas, a New Zealand bankruptcy may have no negative impact on you at all."
Soon, information-sharing powers between Australia and New Zealand's tax departments will be boosted, after two student loan-related arrests at the border this year, and as overall student debt reaches $15b. 
The students best mate...yeah right!
Tertiary Education Minister Steven Joyce says Inland Revenue does not seek to bankrupt anyone solely because of their student debt.
But student leaders say the crackdown on defaulters is treating bright young Kiwis seeking careers overseas like "traitors".
It is not clear how many of the bankruptcies were overseas debtors applying specifically to wipe their student loan debt. IRD was not able to immediately provide the breakdown.
The bankruptcy figures include people owing creditors for other reasons, such as business failures.
However, New Zealand Union of Students' Associations president Linsey Higgins confirmed cases of Kiwis overseas going bankrupt as they faced mounting student loan debt.
She said the union received calls from one to two borrowers a month seeking advice on bankruptcy. 
"We know it's most often happening in circumstances where there's a consistent inflexibility by IRD to work with the overseas borrower and that has put them in a position where they have literally no other options."
"This is making the OE become a lot harder . . . Medical students used to graduate and work in British hospitals under the NHS. They want to do that because they want more experience and [access to] the facilities and technology.
"They would come back to New Zealand and pay most of their debt. But now, the interest accumulates on the loans.
"I think it's treating people like traitors to leave. This idea that if you leave New Zealand to go abroad, we're going to punish you."
IRD said its debt recovery initiatives included offering methods to make repayments from abroad easier, and installment options. Legal action and arrests at the border were a "last resort".
Tertiary Education Minister Steven Joyce said on Friday: "There is no evidence that significant numbers of people who have declared bankruptcy have done so because of student loans. Most people who declare bankruptcy do so because they owe money to a range of creditors and, as a result, their student debt is also written off.
"Inland Revenue doesn't seek to bankrupt anyone solely because of their student debt.
"Entering into bankruptcy is not a decision that should be taken lightly. There are significant negative consequences, including the effect on a person's credit rating, their ability to get a loan in the future, their possessions being sold, needing approval to travel overseas and being unable to be the director of a company."
Labour leader Andrew Little said he was personally against interest on loans for graduates abroad, but the party had not discussed policy on it.
"We do want people to get overseas experience and, ideally, most of them will come back and bring back their skills they've learned overseas."
STUDENTS' BAD DEBT
About a third of the more than $1b of student loan debt in default has been racked up through penalties. Overseas-based debtors were the biggest culprits, making up just over $982m of the bad debt.
Latest IRD figures show that, of the 100,589 overseas and New Zealand-based debtors behind on their loans, $344.2m was made up of penalties. The late payment penalty rate is currently 8.8 per cent.
Overseas-based debtors
Default loans: 78,528
Penalty amount: $311.1m
TOTAL: $976.2m
NZ-based debtors
Default loans: 22,061
Penalty amount: $33.1m
TOTAL: $84.6m

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