See what happens when you enforce the rules…compliance increases

No surprises here that after the arrest of student loan defaulter has resulted in increased compliance.

The border arrest of a man over his student-loan debt has contributed to a surge in repayments, Inland Revenue says – with emails and phone calls from borrowers up by more than 50 per cent.

About 20 people who have defaulted on their student loans are being monitored for possible arrest if they return to New Zealand.

In January, Cook Islands man Ngatokotoru Puna, 40, was arrested as he tried to leave New Zealand.

Student unions criticised the border arrest policy as draconian and likely to make overseas Kiwis “student-loan refugees” – unable to return home for weddings, funerals or other important events.

Over the first two months of this year there was a 31 per cent increase in repayments by overseas-based borrowers, compared to the same period last year, with $7 million more received.

Emails to IRD were up 62 per cent, and phone calls increased by 55 per cent.


Mr Puna, who said his uncle was Cook Islands Prime Minister Henry Puna, was arrested at Auckland Airport on January 18. The Herald revealed the arrest on January 22.

“Inland Revenue believe that the publicity around the first arrest at the border has contributed to the increased activity,” Tertiary Education, Skills and Employment Minister Steven Joyce said.

“It’s likely that a number of people were spurred into action. It’s just a pity that it takes these sorts of steps to encourage some people to meet their obligations to taxpayers.

“There was definitely a much higher level of activity at the start of this year, with Inland Revenue receiving over 20,000 additional repayments compared with last year.”

There are 112,390 overseas-based student-loan borrowers, and 70 per cent of them are in default.

Sounds like they need to arrest another loan dodger to get even more compliance.


– NZ Herald