Student tax ‘lesser evil’

Press, 25 January 1989, Page 5

Student tax ‘lesser evil’

By

BRENDON BURNS,

political reporter

A tax on graduates is considered by the Labour Party’s women’s council to be a lesser evil than enforced bank loans for tertiary students.

The Labour Women’s co-ordinator, Ms Jo Fitzpatrick, said both payment systems were unfair. The Government this week confirmed it is investigating whether students should be made to take out bank loans to help pay for their studies. This is an alternative to the Hawke report proposal of a 20 per cent tax on students once they earnt more than the average wage. Ms Fitzpatrick said any system which taxed or charged for education disadvantaged women. They earnt 80 per cent of the average male wage and often had to take

time out of the workforce for child rearing. But the labour Women’s Council favoured the tax proposal rather than bank loans.

“At least in this system the repayments are made once people are earning the average wage,” said Ms Fitzpatrick. Mr Michael James, the president of the Lincoln College Students’ Association, said compulsory bank loans for students would be “an administrative and funding nightmare.”

Compulsory student loans had been tried by many countries for some time, and results showed the schemes to have been a nightmare, Mr James said.

The Government’s alternative, the graduate tax proposal, was so new, that little was known world-wide on how successful such a scheme

would be in practice, he said.

“I find it very peculiar that the Minister is supporting a scheme which has been proved to be a nightmare, over a scheme which although unknown, at least has a chance of success.”

The Government should commit itself to a publicly funded education system, Mr James said. “If the Minister truly believes that bank loans or tax debits will not be a significant disincentive to students to continue their education, then he has been ill-advised,” he said.

Polytechnic students say employers should pay more toward the costs of tertiary education before students are landed with a bigger bill. The Young Nationals rejected the idea of student loans, saying the last thing tertiary education needs is further

impediments to learning.

The chairman, Mr Andrew Harvey, called on the Government to “signal its firm plans to students” in the next two weeks so they can decide “whether they can afford the luxury of education.”

The Opposition spokesman on education, Dr Lockwood Smith, said the Government must consider all alternatives before putting up financial barriers to study. He said National’s policy had attracted much interest in Britain, when he made a recent visit.

The policy provides all school leavers with a basic entitlement to study at an efficient tertiary institution. Inefficient institutions would have to brings costs down to attract students.

Higher studies, beyond the basic entitlement, would involve a cost for students.