O'Keeffe warned of 'loan scheme disaster'

EDUCATION Minister Batt O'Keeffe was warned yesterday that an Australian-style student loans scheme would be a 'disaster' for Ireland.

The advice came from the Education Officer with the Australian Union of Students Stefie Hinchy, and from the President of the National Union of Students in New Zealand Sophia Blair.

A spokesperson for the minister said Mr O'Keeffe would bring his preferred option to Cabinet after the Lisbon referendum.

The Union of Students in Ireland (USI) is campaigning strongly against the end of the free fees regime and has arranged for the visiting union leaders to meet public representatives in Ireland.

"We heard the same arguments in favour of loans that were heard in Australia 20 years ago," said Ms Hinchy, who added that the Australian Higher Education Contribution Scheme had had a number of unintended consequences. She claimed the scheme:

• left graduates with huge debts.
• was linked to falling birth rates as women delayed having babies in order to pay off their debts.
• led to skills shortages in areas like nursing and teaching as students studied courses that would lead to higher pay.
• did not lead to increased access by lower socio-economic groups.
• made graduates more self-centred -- "I've paid for my degree".

She said that there were significant start-up costs and that it would be at least a decade before significant sums were paid back by graduates.

Contribution

Over the past two decades, state investment in higher education in Australia had gone down while the contribution by students had gone up.

She said that Ireland's participation rate in college at 57pc was much higher than Australia's, which was half that.

Ms Blair said the amount of money owed by New Zealand graduates was staggering.

Many left for Australia to escape their debts but they still had to face them if they came home to work.

The New Zealand students union argued successfully on human rights grounds that the scheme discriminated against women.

It took women longer to pay back their loans as many took time out to have babies.

There was also evidence from the banks that they were reluctant to give mortgages to graduates who had huge loans to clear.