'Band-aid' Budget won't encourage jobless into education - students

Student leaders say the Government can't expect people to take advantage of the free training announced in Thursday's Budget if they can't afford to pay the bills.

Finance Minister Grant Robertson's 'Rebuilding Budget' included a $1.6 billion investment into free training for trades and apprenticeships, which the Government expects up to 60,000 people to take advantage of. 

"[These are] areas where we've previously relied on migrant workforces who won't necessarily be able to come into the country," said Education Minister Chris Hipkins.

But people coming off decent incomes, prior to losing their jobs in the pandemic, are in for a shock. While they won't have to fork out or borrow to pay for the course fees, there's still the matter of day-to-day costs, says NZ Union of Students Associations president Isabella Lenihan-Ikin.

At present, students can get up to $239.76 a week through the loans scheme - which has to be paid back. 

"With the average rents in Wellington being $215 for a room in a three-bedroom flat, that leaves students with $24 at the end of the week to pay for all of the other essential weekly costs they face," said Lenihan-Ikin.

"Unless people are provided with the opportunity to retrain - which will be so necessary given that jobs in certain areas will completely dry up - it's really important people are supported into a pathway of retraining. Unless they're provided with that money each week to keep them going and pay for their bills, children's food and expenses each week, they're simply not going to move into education." 

Those on the Jobseeker Support benefit get a similar amount, depending on their specific circumstances, but it doesn't have to be paid back. 

"A person who's faced with unemployment as a result of COVID-19 will ultimately look at the unemployment benefit providing a better deal for them week-to-week, as opposed to moving into study." 

Some students are eligible for an allowance which doesn't have to be paid back, but it's means-tested - and for younger students, relies on their parents' income, whether they are being financially supported by their parents or not. It's also paltry compared with what ex-workers might be used to - a single person under 24 without kids can get a maximum of $237.90. 

Grant Robertson with the Budget.
Grant Robertson with the Budget. Photo credit: Getty

Lenihan-Ikin says the Government should have implemented something like Canada's Emergency Student Benefit, which will give about NZ$1500 per month to most students from May until August, and $2380 per month for eligible students with dependents or disabilities.

The Budget included a $20 million hardship fund, but that wouldn't go far, said Lenihan-Ikin.

"When students have lost their part-time jobs and are facing additional costs - they're trying to move to other places, or navigate the costs of buying devices and internet, all those things they need just to continue studying, students are facing a dilemma - whether to continue studying or not. 

"Although the $20 million hardship fund will provide some financial relief to alleviate those really acute costs, it doesn't go very far when you think that there are 300,000 learners across the country who will be wanting some of this $20 million." 

Even then, the hardship fund comes "eight weeks too late", she said, with many students already out of work with retail and hospo shut down for nearly two months.

"This is a band-aid budget. It only addresses the immediate wounds we have seen as a result of COVID-19, and failed to address the underlying reasons for the poverty tertiary students are currently experiencing, and have been exacerbated by COVID-19."

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