Labor want students to languish in debt
Labor has taken the approach of ‘opposition for oppositions sake’ by opposing the closure of the Student Financial Supplement Scheme in the Senate today.
The Government announced in April this year that this Scheme was being closed because it was creating massive debt traps for poor students – especially indigenous students. Loans that have been taken up by some of the poorest students can result in effective interest rates of up to 16 per cent.
The Scheme is also a bad investment for taxpayers. More than half the outstanding loans are considered doubtful and could eventually cost the taxpayer $1.4 billion in accrued debt that is unlikely ever to be repaid. Eighty four per cent of loans to indigenous students are considered doubtful.
During the debate Labor spokesman, Senator Mark Bishop, called the Scheme “less than ideal” and that it was “not without difficulties.”
Yet they have supported the retention of the Scheme. Why?
Labor is fraudulently using the retention of the Scheme to pay for their higher education promises. This is a sham.
In simple terms retaining SFSS has a positive $159 million fiscal impact on the budget in the short term. They have decided to turn a blind eye to the billion dollar debt to taxpayers that the Scheme has created. This debt will continue to rise if the Scheme is retained.
Even the National Union of Students welcomed the announcement that Scheme would be abolished.
“This is a great victory for students unions…NUS opposed the Student Financial Assistance Scheme because it places students in a debt trap.”
Daniel Kyriacou, President National Union Of Students Media Release, 24 April, 2003
The hypocrisy and financial incompetence of Labor and the minor parties has been exposed.