22 Nov 2017

Govt reveals costings for student allowances boost

8:46 pm on 22 November 2017

The government has buckled under pressure and released the total cost of its plan to boost student allowances and loans to cover living costs.

Students at a university workshop.

Some university students are expected to receive another $50 per week with their allowances. Photo: 123RF

The Labour Party confirmed yesterday it would press ahead with a $50 per week boost for students from next year.

It has now released the preliminary costs taken to Cabinet when it made the decision.

The policy is estimated to cost $94 million this financial year and then roughly $200m a year from then on.

Labour had forecast before the election that the policy would cost about $273m a year.

Earlier in the day, Prime Minister Jacinda Ardern declined to reveal its updated costings, saying they would be released in several weeks.

"We want to make sure when we release those figures, they're as robust as possible."

She said Labour would reveal the cost at the same time it announced more details about its first year fee-free policy because they were linked.

National had criticised the scant detail after yesterday's announcement, saying taxpayers were entitled to know what the new government was spending.

Finance spokesperson Steven Joyce said it was highly unusual for such a big policy to be announced with no substantive costings whatsoever.

"This is actually almost unheard of - the idea that you'd release a large policy officially and not actually provide the costings.

"It's a legitimate question... What is the actual cost to taxpayers of this change?"

Further details about Labour's flagship policy to grant three years of free tertiary education by 2024 are expected in the next few weeks.

Universities New Zealand's executive director Chris Whelan said he was still in the dark over exactly how the policy would be implemented.

"We know it's coming ... but we've yet to receive a lot of clarity around exactly who will and won't be eligible for it."

He said the Government had a lot of fishhooks to consider within a very short time frame.

"It's putting a lot of pressure on the system... we've got a lot of students uncertain about what they will or won't be doing next year.

"We're looking at what's going to be a very busy period over Christmas."

Ms Ardern acknowledged that the time frame was "tight," but said the policy was on track.

"We've given that strong message to students - it is going to happen."

Labour has also confirmed that Australians will have to have lived in New Zealand for three years if they're to qualify for the free year of study.

Roughly 4600 Australian students currently study at universities here.

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