My cohort was one of the last who had their university tuition fees paid for in full. If you did well in your final exams you got an A or B Bursary which was a nod towards excellence but you could still go on to tertiary study with a bursary grant if you passed Year 13. The bursary allowance covered living expenses, books, and course fees, regardless of your parents' income. Everyone got the same deal. It didn’t matter who you were or where you came from.
I was a Panel Beater’s daughter from West Auckland, so there was no way I would have gone on to tertiary study without the incentive of financial support. Going to university wasn’t even on my radar because I didn’t know how it all worked, nor did I think I was smart enough. I am forever thankful for the opportunity I received, and I didn't waste the gift of education. I loved learning and the smell of fresh stationery and books, so didn’t miss one lecture or tutorial in all the time I was studying.
Once I completed my degree, I started work and some of it was rather gruelling, but have paid taxes ever since and am proud of my achievements to date. I have not needed additional financial support from my government since and being independent and self-sufficient is a freedom I relish. In this stage of my life, I also like to contribute to my country and give back where I can.
Thinking about the wonderful start I had, I am extremely disappointed with my generation and the one previous. We should have fought to keep the cost of education in check for our young people. Instead, we allowed the system to be dismantled, lumbering our youth with a decade or more of debt.
The selfishness of the Boomers and the Gen X’ers (that’s me) hovers over Aotearoa New Zealand like a long black cloud because we took everything without making provision for future generations, and now we wonder why they are anxious, a tad angry and disillusioned.
Today, education and upskilling always seem to incur costs, and individuals often rely on a Student Loan to cover these expenses. It is a small mercy that these are interest free, although there are some who would even like to strip our people of this small allowance.
Talking to young people today, their major concern is getting a job that pays a lot of money so they can pay off their Student Loan debt. Sure, receiving a good salary is great, but there is also a thing called job satisfaction. If people believe their bank balance is the only thing that can provide them with a sense of fulfilment, they will eventually discover that they were mistaken. I am also a firm believer that money comes in when you are in the flow of life and enjoying it, not battling against it. A job that makes you miserable does nothing for prosperity.
Only being concerned about a job that pays well in order to pay off a debt is a barrier to entrepreneurial initiative. People play it too safe in life because they’re scared to fail; even though failure is often the best way to learn. Debt hobbles aspiration and dreams, so these end up in the ‘if only’ drawer. Youthful blue sky thinking is replaced with ‘What’s the point?’ or ‘Why bother at all?’
It is no wonder our universities and tertiary institutions are struggling to attract students. Who wants a lifetime of debt for a course that confines you to one life path? We all know in today’s climate, careers are not linear. The best skills to have are critical thinking, basic math and communication. Your degree teaches you the basics, but real learning starts on the job.
My career path was certainly not a straight line, but my degree gave me the confidence I needed to pursue a few options before I knew what I wanted to do. Eventually, I started my own business from the seed of a creative idea born from years of work experience, and I have never looked back. I doubt I would have had such an outcome without my Bachelor of Arts.
What could we do?
What I propose is treating Student Loans like an investment in our country’s future and not dumping the full responsibility on our youth. It’s time to step up and share the load.
If businesses can claim general expenses, including research, reference and upskilling employees, then why can’t students do the same? Why can’t students carry forward losses from the expense of their courses and offset these against their taxable income when they start working?
This is how it would work:
1. Each year, students do a tax return. They total up the 100% cost of their course fees, books, study equipment, stationery and IT supplies. They will need to keep receipts.
2. They can also claim an agreed percentage of accommodation, travel and utility expenses similar to home office expenses. They would set this percentage at around 25%.
3. Each year, the student accumulates study expenses until they complete the course or withdraw. Then, a person offsets these expenses against their taxable income until they receive the full rebate.
4. The expenses that are not offset against a person’s future income becomes the amount of the Student Loan. Students can repay this amount over time, as it is currently done.
This would do several things:
1. People would consider the costs associated with education, upskilling, and training as an investment in their future, not a financial noose.
2. More people would study and take courses, confident that they wouldn't have to put their life on hold while they pay off an enormous debt once they finish.
3. People would have the time and space they need to think about career options and choose a path they are enthusiastic about, instead of choosing a job solely to pay off a debt.
4. We would show our youth that we have their backs and that we care about their futures; not just our own.
5. We would give people a chance to dream and be aspirational at any stage of life. People would know that their country would share the burden if they spent money on education and upskilling.
6. Arguably, individuals who engage in meaningful work and do not constantly stress about debt experience better health outcomes.
Wouldn’t we feel better as a nation if we stopped treating our students like serfs with half their lives in bondage to the state?
It would be good if our young people understood their pure potential instead of being treated like cash cows.
About the author: Jan Hellriegel has worked in small business accounts and finance for over 30 years in order to supplement an artistic career. Her passion is music, philosophy and writing, and trying not to moan. She is the owner-operator of a few music businesses and enjoys making something from nothing. She is a pragmatic optimist who is solution driven and really likes people and wants the best for them. To find out more about Jan Hellriegel, here is a link to her online profiles and work.