I have been getting heaps of questions about Mr Joyce’s announcement last week. He does not seem of a mind to get into any details, so this is what I have been able to piece together. Feel free to get in contact with further questions. I have put quite a few in through the written question system where we have not been able to get other answers.
Is future eligibility going to be four years of allowances or 200 weeks?
Steven Joyce caused huge confusion last Thursday by talking about allowances stopping after four years. This was wrong. It is clear that the change he is proposing is to restrict allowances to 200 weeks. This would equate to five years of allowances for most undergraduate courses. This has acted as the default rate of allowances unless you were doing a “long course”. This includes most degrees, postgraduate and longer courses. If you were doing these courses you were eligible for another 50, 100 or more weeks worth of allowances depending on the length of the course. That is now gone.
If you have used up your 200 weeks already does this mean you will be ineligible for future allowances?
I asked Mr Joyce about a case such as this in Parliament today. He said the “final transitional arrangements will be confirmed in the Budget”, but he did go on to acknowledge that the example I gave (a real one) of a student who had used their 200 weeks already and was in the first year of a two year Masters programme would not be eligible for allowances next year.
How many people will be affected by the allowance changes?
Half an answer today as Mr Joyce admitted 4000 to 5000 postgraduate students would no longer be eligible for allowances. He did not give the number of those who would not get allowances because of the changes to parental income thresholds.
Can the government change the terms of student loan contracts that have already been signed to increase the repayment rate to 12% without the agreement of the borrower?
Sadly, yes. Clause 203 of the Student Loan Act says that the Act will override anything that is in a loan contract. The Act contains the repayment rate, but also has a clause 37(3) that says that if the rate is changed by regulation then that rate is deemed to be the rate rather than the one listed in the Act. So, basically the government can do anything it likes to a loan contract as long as it is in the Act. One small caveat is that, through Clause 20, they do have to inform borrowers of any changes to their loan contracts within seven months of the change. Let’s see if they manage that.
There have been a number of questions about limited full time students and how this effects them, which I am chasing up with the Minister. Will come back when I get the results.
As I said the other day I can not believe that Steven Joyce would make these announcements without more information being available. Its simply not fair on students, graduates and their families.