You can run but you can’t hide

Student loan defaulters skulking in Australia are in for a rude awakening.

New laws making it easier for the IRD to track Kiwi student loan defaulters living in Australia could help claw back as much as $100 million extra a year.

About 70 per cent of overseas-based borrowers are in default, and about 60 per cent are thought to be in Australia.

Thousands of them now face Australian debt collectors, courts or arrest at the border after a data-sharing swap with the Australian Tax Office gives the IRD access to the contact details of any defaulters who have paid tax in Australia.

Until the latest measures were passed into law earlier this week, it was considered too hard for the IRD to track down defaulters living overseas.  

“This is just going to provide a far larger group of people who have gone to ground,” Tertiary Education Minister Steven Joyce said on Friday.

“It’s important for the sustainability of the [student loan] scheme, and to make sure it’s fair.”

By being able to cast its net wider, IRD would be able to start initial discussions with more defaulters and, if people still aggressively ignored IRD, they could face Australian debt collectors and courts, or arrest if they returned to New Zealand.

The latest measures comes just months after the first arrest of a student loan defaulter, when Ngatokotoru Puna was collared at Auckland Airport in January when he tried to leave.

The 40-year-old nephew of Cook Islands Prime Minister Henry Puna had avoided paying back his loan for 20 years and had racked up $130,000 in student debt after moving to Rarotonga.

Student loan debts remain interest-free while borrowers are in New Zealand. When they leave for more than six months, their loans accrue interest from the day they leave, which can then be compounded by penalty rates if they do not pay.

One gobby bludger reckons he shouldn’t have to pay.

An expat Kiwi defaulter living in Australia, who borrowed $15,000 in the mid-1990s, said penalty interest rates had inflated his loan to about $80,000.

IRD already had his details, but he had told them he had no intention of paying, he said.

“I’m in good company, though. There’s at least of 60,000 of us – at two arrests a year it will take 30,000 years to get everyone. It doesn’t seem like a well thought-out plan … f…ing muppets.”

He said he would return to New Zealand for occasions such as funerals, but “as for holidays, forget about it”.

Last time he was here, he said he spent thousands of dollars on tourism, and he suspected a crackdown on defaulters would cost the tourism industry.

“They are probably losing more money through lost tourism than what they are allegedly recouping in loans.”

He described the student loan scheme, introduced in the early 1990s as “predatory lending” and the IRD as “loan sharks”. “For me it’s political, I’m simply not paying a 20-year-old debt.”

See how far those argument get you in front of a judge. The little coward is too afraid to name himself though. But there is enough information there to start a good search. He is blaming the scheme for his massive debt, but he only has himself to blame by skipping out and not meeting his responsibilities.

It does show though that the media are complicit in hiding a loan dodger. They found him and if they can find then so can IRD.

The arrogance is incredible.

Chris Hipkins thinks that student loans is getting out of hand.

“But the huge mountain of student debt is something we need to rethink. At $15 billion and still growing, it is clearly getting out of hand.”

Young people saddled with huge debt were putting off having children and struggling to buy a home. “A whole generation of Kiwis is getting a pretty rough deal compared to those that came before.”

And which government was it that made student loans interest free and let people skip the country without addressing loan repayments? Oh that’s right it was Helen Clark’s government, who were warned at the time that interest free student loans would balloon massively as people took advantage of free money. No one forced these people to get student loans, they chose to get them. Chris Hipkins just ignores the role his former government played in causing the debt mountain.

 

– Fairfax

 


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  • Jude

    That was the worst election bribe ever and so many young people fell for it.
    I remember being so incensed that people were claiming student loans then swanning off on overseas holidays.
    The rules have tightened up ,but there are a group of voters with a debt that no doubt is preventing them from home ownership.
    I hope they do remember what party brought that ill thought out policy come election time.
    John Keys ” show us the money” I hope reminds everyone of the futility of election bribes.

    • I’d say it comes first equal with WFF. The whole package of middle class bludging introduced by Labour and enabled and then INCREASED by National has brought as to our knees with foreign debt.

      There is no right of center party at the moment. Just a choice between communism or socialism.

  • PhantomsDoc

    They made the choice to commit to an obligation to repay a load to enable them to get a better education and be able to earn more.

    The fact they then went and defaulted on that obligation and went overseas to hide, without taking into account the fact that one day they should be held accountable, doesn’t move me one iota.

    Put a holding pen on Pitt Island to put them in until the come up with the money then allow them to return overseas…with all the paperwork intact to enable them to become citizens of their new country.

  • Usaywot

    I have zero sympathy for these defaulters. My children all did tertiary study, all worked in jobs to pay their fees and paid off their tiny loans quickly..THEN travelled and bought houses. They would have loved to have had overseas holidays like some of their friends but are now very happy they didn’t at the time. A couple of people they knew even went through faux marriages to get extra allowances as married couples, then got divorced after study finished. There seems to be so little in the way of checks and balances and the tax payer is constantly being ripped off. I was disgusted by that election bribe and disgusted with people who I had previously thought sensible who voted for it “For their children’s sake”.

  • Grizz30

    I remember paying off my Student loan. It was a liberating day. The attitude of the defaulters above annoys me. It shows what reckless ideas of entitlement some people have been brought up to believe . You expect the government to pay to educate you then bugger off to another country and give little back?

    • Tom

      When they run out of time on their passports , that could well be a time of reckoning. Who would want deportation on their record!

    • Andy111A

      My parents would not let me buy a car until I had paid mine off. Funnily that incentive saw me pay it off by working 30 different odd jobs over the three year degree and fully paid off six months after graduation.

  • Anthony

    Why has it taken so long to get this far? It’s long overdue. Defaulters should all be stopped at the border. Pay up.

  • ““But the huge mountain of student debt is something we need to rethink.
    At $15 billion and still growing, it is clearly getting out of hand.”

    Here’s an idea Chip. Let’s axe all the dopey courses these little bludgers can get loans for….woman’s studies, media studies,film, basket weaving….blah blah the list of idiot courses is endless because all it is is another gravy train for troughers to set up some dimwitted academy and get accredited.

    As my Dad used to say the best way to get ahead is to make your own job and this lot have perfected it aided by a compliant socialist government.

    • localnews

      My favourite is the current can’t Uni radio ad with the girl doing a degree in sports coaching. I think she will end up disappointed

      • jcpry

        You need to think about it. Professional sports is becoming a very large business and the demand for well trained coaching is surprisingly big. It is not as you imagine – teaching someone to kick or catch there are elements of psychology, physiology as well as the technical aspects of the sport.
        You know how they say children at school will be working in jobs not yet invented? This is one you didn’t imagine when you were at school.

    • jcpry

      Media studies maybe but film is an industry and a highly technical one at that.

      • There are very few long term career opportunities in NZ film with the exception of the highly technical ones and even then not so many.

        Yet every kid I talk too wants to be a film director or movie star and these muppets encourage this moronic behavior along with the dimwitted parents that make statements along the lines of “Follow your dreams” and other moronic platitudes.

        Fine…follow them but why the hell should I fund them?
        There are many pointless and wasteful course out there and its high time they were culled out.

        • jcpry

          I think you need to widen your views somewhat. The statement ‘every kid I talk to’ shows that really you are talking a lot of rubbish. My son has a masters in film, is a published author and a highly motivated and talented young man. Do you suggest that is ability would be best suited to your narrow view of the world?
          We are not all the same. Vive la difference!

          • I think you are typical of the so called art set. Easy to offend and quick to insult.

            You should probably try and get some context from my comment instead of focusing solely on the film aspect. There are any number of taxpayer funded (me) film course’s that have no value.

          • jcpry

            So the centuries of rich cultural heritage we have of music, literature, and theatre means nothing to you? You must lead a very narrow existence if you cannot appreciate the arts of which film is one.
            BTW I don’t have an artistic bone in me and even though I am a business professional and owner I do appreciate it immensely. For what it is worth I wouldn’t know what the art set was unless you mean my talented wife’s watercolours.
            Clearly you have little understanding of the creative process and it appears that unless someone conforms to your narrow view of the world you discount what they have to offer.
            My son is a published author, has written, funded and produced a feature length movie. He works full-time to fund his passion to write and uses the film production skills he acquired as part of his degree every day. He is close to purchasing his own house in Auckland and pays a heap of tax just like you and I.
            In the past authors, composers, and playwrights relied on the patronage of the wealthy to allow them to give us the wonderful art we enjoy. By the sound of it if you had your way none of this would exist. Now wouldn’t that be a sad world to live in?
            BTW one of my daughters is a journalist. That must really upset your sensibilities.

          • So what? I’m not wealthy and your family is bludging off me!

            And there was a time sunshine when I was brilliant artist and a worthy musician but needs must. And I had to earn a real living not bleed one off someone else.

            I have no objection to the arts or those that want to pursue them. I heartily object to paying for it.
            Grow up ya sook. And tell ya kids to pay their loans back. And their mates.

          • jcpry

            So clearly you had neither the talent or the drive to succeed. I feel sorry for you it must hurt seeing others succeed where you have failed.

          • Time to go troll someone else. Bye.

          • jcpry

            Hey your welcome. Insult two members of my family and I’ll not let anyone get away scot free. It must be the Jewish / Irish / Scots lineage.

  • one for the road

    Hunting season is open, the gobby bludgers are going to get blasts from both barrels – they deserve it with attitudes like that

  • Keanne Lawrence

    Hipkins thinks? A Tui moment right there. What’s the bet he thinks they should get a free pass if they pledge to vote Labour? He is definitely on the right side of the house sitting in the opposition benches. The only time he got something right.

  • Sailor Sam

    Another way to get these loan defaulters overseas is not to allow them to renew their passports overseas, they must do it here in NZ, then do not give them a new pasport until after they pay up.
    The prospect of losing their highly paid jobs overseas would be an incentive.
    And letting their passport lapse will result in deportation home sooner or later.

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