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Observations on the 2017 Election campaign thus far… (tahi)

6 September 2017 Leave a comment

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So many little occurrences and huge events have transpired over the last couple of months, to brand this as one of the most intriguing (and tumultuous) of election campaigns in my life. Only the 1984  and the 2014 General Elections rank as memorable. In all three, there were two threads weaving through the campaigns;

  1. Events which have successfully engaged even the most disinterested, cynical Citizen;
  2. A  subtle – but palpable – shift in the political concensus.

Over-laying those two threads are the desperate scramblings of a decaying third term government; the rise of a new, popular leader (this time on the Left); and an unreconstructed, vindictive side of New Zealand society.

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It’s just a… jump to the Left!

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The onset demise of neo-liberalism/globalisation has been an on-going topic of discussion since the “Brexit” referendum and the ascendancy of Donald Trump and (to a lesser degree) Emmanuel Macron.

Some have suggested that with our MMP system – which has a diluting-effect on political revolutions whether Left, Right, or Populist – that New Zealand will dodge the rising groundswell of international public resentment against the neo-liberal concensus.

Well, that won’t be happening. Regardless of electoral systems, New Zealand is not immune to the winds of international political change.

Just as neo-liberalism swept over this country in the 198os – imported from Reagan’s USA and Thatcher’s Great Britain – the counter-counter-revolution will happen here, and it has been televised since the courageous Metiria Turei put her hand up and showed us why things were so broken for those left behind by Roger Douglas’ so-called “reforms”.

One of the litmus-tests for ideological positioning on the Left-Right spectrum is the concept of user-pays. Since the late 1980s, user-pays has been gradually implemented by way of “mission-creep”.

Done gradually so as not to alienate the public, National learned a bruising lesson in public resentment after it attempted to implement a $50-per-day public-hospital charge in 1991. The public defied the charges and simply refused to comply with  invoices demanding payment. The policy was dropped prior to the 1993 general election.

User pays for medication has been gradually increased from fifty cents to three dollars (in 2007, by Labour), to five dollars (in 2013 by National).

The other big-ticket item targeted for user-pays was tertiary education. Student fees were raised and student loans implemented by National in 1992 (the same year ‘Shortland Street’ began broadcasting).

Until then, tertiary education was near-free, with student allowances paid to students to meet basic living costs.

Former Prime Minister, John KeyMinister Steven Joyce, and previous Finance Minister, Ruth Richardson (who implemented the policy) were amongst those National Party politicians who benefitted from near-free tertiary education. Like Paula Bennett, who gained a free tertiary education as a young woman whilst on the DPB, using the Training Incentive Allowance – and which she then scrapped in 2009 – Richardson, Joyce, and Key made sure no other young New Zealander would gain from a free (or near-free) tertiary education.

The user-pays regime has remained in place ever since, and student debt had spiralled out of control to a staggering $15.3 billion owed by 731,800 students.

Resentment by students, and refusal to repay this monstrous debt, was such that in 2013 Minister Joyce employed draconian Soviet/Nazi-style policies to arrest and prosecute rebellious loan defaulters;

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Just because people have left New Zealand it doesn’t mean they can leave behind their debt.  The New Zealand taxpayer helped to fund their education and they have an obligation to repay it so the scheme can continue to support future generations of students. “

Said the man who had a near-free, tax-payer funded tertiary education – Steven Joyce.

The result of National’s crack-down? Predictable, as Fairfax’s Adele  Redmond reported in May this year;

Five years of arrests and court proceedings have recovered less than $230,000 in overdue student loan debt.

Arrest warrants and Australian court cases pursued by Inland Revenue in the last five years have recovered a fraction of student debt, figures released under the Official Information Act show.

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Three completed court cases recovered $79,610 from two borrowers – the third person’s debt was wiped due to hardship – and $150,221 was repaid following eight arrest warrants to prevent debtors leaving New Zealand.

Twelve more cases covering $621,955 of debt were still under way, an Inland Revenue spokesman said.

The $229,831 recovered so far represented 0.02 per cent of all overdue debt.

The amount of loan debt owed worldwide topped $1.07 billion last year.

User-pays in tertiary education has failed. Like our antiquated marijuana laws, it criminalises those who refuse (or cannot) repay their debt. Others are left with a debt hanging over them as they try to save to buy a house; raise a family; or set up business. The mill-stone of a student debt handicaps young New Zealanders before they have set foot outside of learning institutions and into the workforce.

The innate unfairness and fiscal failure of user-pays is apparent. What is not so apparent is that the majority of political parties have policies that are counter to the user-pays concensus that has existed up till now;

Greens

Loan Repayment

  • Support keeping the current zero interest scheme
  • Ensure that repayment rates reflect borrowers’ ability to repay by adjusting the repayment thresholds to start at a higher income level, and introduce a progressive repayment scheme

Student Support

  • Review levels of student support to ensure they are at an equitable and liveable level
  • Work towards a universal student allowance by progressively reducing the age at which students cease to be means tested on their parents’ income and continue to raise the parental income threshold
  • Reinstate access to the Student Allowance for those studying postgraduate courses

Fees

  • Work towards a public ‘fee-free’ tertiary education system by capping and then progressively reducing student fees
  • Review funding mechanisms to explore alternatives to EFTS funding
  • Ensure Tertiary Institutions are adequately funded

Labour

  • Increasing living costs support with both a $50 a week boost to student allowances and a $50 a week lift to the maximum that can be borrowed for living costs
  • Restoring post-graduate students’ eligibility for student allowances
  • Restoring the eligibility of students in long courses, such as medicine, to access student allowances or loans beyond seven years FTE study
  • Accelerating the three years’ free policy, starting with one year fees free full-time equivalent for everyone starting tertiary education or training for the first time from 1 January 2018, and extending this to three years’ free by 2024.

Mana Movement (not currently in Parliament)

  • Improve access to free tertiary education for all students
  • Abolish all tertiary fees and cancel interest on student loans
  • Provide students with jobs to help them pay off debt
  • Develop a plan to write off student debt
  • Provide students with a living allowance while studying

Maori Party

  • Increase the accommodation supplement by half for all tertiary students.
  • Introduce a universal student allowance with cost of living adjustment to guarantee a livable income during study, for all tertiary students, including post-graduate students.
  • Write off the living cost component of all student loans and explore the viability of writing off the total student loan for those who work in a job equivalent to their qualification in Aotearoa for a period of five years
  • Provide free public transport to primary and secondary school children as well as tertiary students
  • Develop a four year zero fee scholarship to target the ‘First in Whānau’ to engage in a Bachelor level qualification programme.
  • Retain interest-free loans.
  • Reduce the repayment levels on a student loan starting at 4% ($40,000), 6% ($50,000) and 8% (for $60,000 and over)

NZ First

  • Introduce a universal living allowance which is not subject to parent means testing as a priority for all full-time students.
  • Immediately introduce a dollar-for-dollar debt write-off scheme so that graduates in identified areas of workforce demand may trade a year’s worth of debt for each year of paid full-time work in New Zealand in that area
  • Work with NZUSA and the sector to establish an expert reference group with a view to implement two thousand ‘First in Family’ scholarships per year. These will create a step-change in educational aspiration by promoting fee-free education with wrap-around support from secondary, through transition and to completion for those who would be the first in their immediate family to achieve a degree. ($68m over first 3 years 2015 to 2017).

United Future (now defunct)

Fees

[United Future will] Remove tuition fees for tertiary education in New Zealand, accompanied by a push to increase the quality of tertiary education and protect the value of New Zealand degrees. The zero fees policy would mean that students would only borrow living costs, rather than the crippling loans which are currently being incurred to cover fees as well. A zero fees policy also addresses one of the illusions of the current policy, where it is assumed that tuition fees cover all or most of the costs of study, when in fact the taxpayer already covers the majority of tuition costs.

Student Allowance

Abolish the Student Allowance, as a way to help fund the zero fees policy. The student allowance system has become patently unfair, relying on means testing of parental income until a student turns 24, and enabling the wealthy to receive allowances where their parents are able to reduce their taxable income.

National and ACT appear to be the only two parties that stubbornly adhere to the notion of user-pays in tertiary education.

The times, they are-a-changin’, as user-pays in tertiary education becomes less and less popular. We may expect in the coming years to see that deeply unpopular policy slowly wound back and a gradual, inexorable return to free, state-funded tertiary education.

Like the billboard sez;

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Though perhaps the slogan should have read “Return to free education“. If only to remind New Zealanders what we once had – and then lost – in the mania that was neo-liberalism.

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ACT’s Billboard – Blissful Obliviousness to Ironic Hypocrisy

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Seen throughout the country is  David Seymour’s grinning face on ACT’s canary-yellow billboard;

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Note the campaign slogan ACT has adopted; “Own your future“.

Deeply ironic considering that ACT is the party that has at it’s core policy to sell off all state assets to the highest bidders, whether local or off-shore corporates.

Own your  future“? Yeah, nah. Only if you can afford to bid for it.

 

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References

Te Ara Encyclopaedia of New Zealand:  Hospital funding and patient entitlement – Funding public hospitals

Fairfax media:  Prescription price rise hits vulnerable

Wikipedia:  Timeline of New Zealand history – 1990s

Ruth Richardson NZ Ltd: Ruth Richardson CV

Sunday Star Times: Politics – John Key – A snapshot

NBR: Bennett cutting a benefit that helped her – Labour

Fairfax media:  Student loan debt ‘balloons’ by 37 per cent, with average student owing $21,000

Fairfax media:  Joyce defends student loan crackdown

Fairfax media:  Five years of legal action by Inland Revenue recovers fraction of student loan debt

Green Party:  Tertiary Education Policy

Labour Party: Tertiary Education

Mana Movement: Education

Maori Party: Education Policy

NZ First: Education

United Future: Tertiary Education

Additional

Radio NZ:  As it happened – Jacinda Ardern takes charge as Labour leader

Horizon Poll:  New Zealand First voters equally split over coalition options

Radio NZ:  Labour sweeps into lead in latest poll

Previous related blogposts

Steven Joyce – Hypocrite of the Week

Cutting taxes toward more user-pays – the Great Kiwi Con

 

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Note: Replace US references to  Social Security with Superannuation and Medicare with State-funded healthcare for local relevance.

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This blogpost was first published on The Daily Blog on 1 September 2017.

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