Labour MP Duncan Webb has challenged a request to wipe student loan debt of healthcare workers as a token of gratitude for their work during the COVID-19 pandemic.
Healthcare worker Nicola Millar submitted a petition in May last year requesting MPs to "acknowledge the work of our health professionals by wiping their student loan debt", which she described as "crushing".
"They are saving lives and protecting our communities while risking their own lives and health," she said in the petition. "I believe wiping their student loan debt would not only relieve their financial burdens, it would show our country's appreciation for the selfless work that they do."
Appearing before the Finance and Expenditure Committee on Wednesday, Millar said as a healthcare worker during lockdown, she was "very aware" that she and her colleagues were putting themselves at risk every day.
"I know that we were still able to earn, but some of us had large student loans and I was very aware that there were lots of people with a lot higher student loans than I, and I just thought as some sort of acknowledgement and appreciation for the work that we do - even though we chose the career - wiping off our student loans would be a nice way to acknowledge the efforts that we put in."
But committee chair Webb pushed back on the suggestion.
"We've got all kinds of people working in managed isolation who may not be medical workers but nevertheless may have student loans, and we've got all kinds of medical people working on the fringes whether they be social workers or counsellors or whatever," he said.
"So how would we draw the line as to who qualifies for what would be a very significant benefit, and who doesn't?"
Millar replied: "Medical professionals, full-stop, is what I was envisaging... It is big; I know it is big."
Webb asked if that means podiatrists would be included, as well as surgeons earning $200,000 a year. Qualified general practitioners (GPs) can earn between $95,000 and $180,000, while senior GPs can earn up to $250,000 a year.
"Oh well yeah, no," Millar laughed. "And not the doctors that are on call for $200,000 a day on the weekend and are out paddle-boarding and enjoying life and not necessarily being called in.
"You know, within reason."
Millar said it would be up to MPs to decide.
"I guess it would be up to you to look at it and look at the earnings of people and potentially over time how quickly they could pay off their student loan. Those who are on a much lower wage are not going to be able to pay off their student loan very fast."
Webb said her petition would be considered by the committee.
The total value of student loans in 2018-2019 was $16 billion, according to the Ministry of Education's Student Loan Scheme Annual Report 2019. It found that $27.4 billion had been borrowed by students since 1992.
Currently, borrowers must make loan repayments if they earn more than $19,760 a year before tax. Borrowers can only apply for a repayment holiday for up to 12 months.
In 2018, overdue student loan debt was $1.5 billion, with overseas-based borrowers owing 91 percent of that. In January last year a woman became the ninth person to be arrested at the airport over a student loan.
Legislation introduced in 2014 gave Inland Revenue the power to apply for arrest warrants for student loan defaulters trying to leave the country. Arrests are warranted under the Student Loan Scheme Act 2011, section 162a.
