Rent increase will soak up most of allowance boost - students

Rent increase will soak up most of allowance boost - students
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Rent increases will soak up most of the $50 increase to student loans and allowances, kicking in from January 1, student organisations say.

Education Minister Chris Hipkins announced the increase on Tuesday, saying 130,000 students will be better off.

The allowance will increase from $177 to $227 a week.

The Union of Students' Associations welcomed the increase but said it didn't mean students would have more disposable income.

Its latest income and expenditure report found median student spending was $300 a week.

"The $50 increase means that students will have a bit more left for food after paying their rent," said national president Jonathan Gee.

"All we've been asking for is enough to live on."

Mr Gee said only a third of students were eligible for the allowance and the majority were expected to borrow to live.

The association wants further steps, including raising the parental income threshold for student allowance eligibility.

Sandra Gray, of the Tertiary Education Union, also said the supply of accommodation is an issue.

"The answer isn't just money sometimes," she said. "It does come hand in hand with accommodation. Anywhere there are universities the accommodation can be quite expensive itself."

But she said there are huge issues of student poverty and the increase is "absolutely crucial".

"We have students at the moment who are living in their car or living on campus when they are not supposed to because they just don't have money to live week by week.

"We have staff contributing to student food bags because students just can't afford to buy food and they can't actually teach students who aren't able to eat and get some sleep," she said.

Dr Gray said the biggest squeeze on students is work, with students working more than 20 hours a week as well as studying full time.

"You can't study full time and work 20 hours or more a week. If we can have students working a few less hours, concentrating on their studies more and putting food on the table, that's a really good thing."