A new information sharing agreement between Inland Revenue and the Australian Tax Office has led to the contact details of almost 57,000 student loan borrowers being located across the Tasman, two thirds of whom are in default.
The agreement came into force in October and the details of around 10,000 New Zealanders were found in the first data match. The process has since been refined and a total of 56,897 people have now been located.
“These borrowers have a combined loan balance of $1.2 billion and $430 million of that is in default. Inland Revenue will now start chasing up these borrowers and taking action to get their student loan repayments back on track,” says Mr Joyce says.
Mr Woodhouse says “The data shows that more than half of these borrowers left New Zealand over five years ago, with nearly a quarter having been away for more than 10 years. A third of them have not returned to New Zealand in the past four years. One third of the group has had no contact with Inland Revenue, and 43% have not made a payment since they left New Zealand.
“It’s time these people did the right thing and met the obligations they signed up to when they took out their student loan,” Mr Woodhouse says.
There will be further data matches in the coming months.
Inland Revenue has also revealed than more than 500,000 borrowers have now repaid their student loan in full since the scheme began in 1992. Over that period just over a million people have taken out a student loan.
The Student Loan Scheme Annual Report also shows that annual level of student loan repayments is increasing significantly.
“The loan payments through PAYE were 6.1 per cent higher than in 2014/15 and the amount repaid directly by borrowers increased by 14.6 percent on the previous year. Since 1992 Inland Revenue has collected $11.5 billion in repayments. In the last quarter total loan repayments were 7.3 per cent higher than the same time last year,” Mr Woodhouse says.
“Since the overseas-based borrower programme was established in 2010, it has prompted an estimated $348 million in additional repayments in the period to October, including an increase of more than $100 million in the past financial year. This has contributed to total repayments of more than $1.2 billion in the last financial year, an 8.5 per cent increase in 12 months,” says Mr Joyce.
“Borrowers that stay in New Zealand after their study are the best at paying off their loans, with the latest projections showing half of these borrowers will complete repayment in less than six and a half years.”
A copy of the Student Loan Scheme Annual Report can be found at http://www.educationcounts.govt.nz/publications/tertiary_education/annua...