NEW ZEALAND: Student allowances an election bribe

University bosses are fuming after the ruling Labour Party admitted it was considering extending student allowances to all tertiary students. The party is polling badly with a general election due to take place before the end of the year, and Labour knows from past experience that students' finances are a vote-winner: a policy of zero interest for student loans helped it win the 2005 elections.

Minister for Tertiary Education Pete Hodgson said the net cost of universal allowances would be an extra $200 million (US$149 million) a year. But New Zealand already directs a significant proportion of its tertiary education spending to students - 42 per cent according to OECD figures, and more than any other OECD nation.

That money goes on allowances to about 57 per cent of students and interest-free loans which students can use to pay their fees and in some instances to cover living costs.

The New Zealand Vice-Chancellors Committee denounced the possibility of universal allowances as "unhelpful" given that New Zealand was spending well above the OECD average on student financial support.

The money would be better invested in tertiary education institutions which had experienced a sustained rundown in their per student funding, the organisation said in a statement.

University of Auckland vice-chancellor Professor Stuart McCutcheon was more outspoken, describing the plan as "an unjustified election bribe".

"Given that there is only a certain amount of money to be spent on tertiary education, this would further impoverish universities at a time when government support of students is already the most generous of any western country," he said.

"At the same time, government continues to constrain university incomes by funding them at a level far below their rising costs and by capping tuition fee increases."

The low level of investment in New Zealand universities would inevitably harm the quality of the education they offer, McCutcheon said.

"Pouring money into student allowances simply to catch votes will deny New Zealanders the world-class university system which the country needs as universities' infrastructures are neglected."

The cost of such politically-driven expediency was incalculable, not simply to the students but to New Zealand's economic and social development which university research underpins, he said.

*John Gerritsen is editor of NZ Education Review

john.gerritsen@uw-news.com