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March 15, 2010 | by  | in News |
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Performance-based student loans!

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Tertiary Education Minister Steven Joyce has outlined potential changes to the student loan scheme, indicating there will be more emphasis placed on students to raise their pass rates, or face difficulties gaining future student loans.

The proposed changes were announced in a speech to the Wellington Chamber of Commerce last week.

The proposal will “link funding [of individual loans and allowances] directly to academic performance”.

These changes will also put added emphasis on tertiary institutions to increase student achievement and may force reductions in funding to, or elimination of, papers with low pass rates.

Joyce has stated that “there are a large number of tertiary programmes, particularly below degree-level, that have course pass rates as low as 30 per cent. Some of these programmes fail to properly equip students for the jobs they seek.”

Tertiary institutions have already been forced to reduce the scope of departments with poor enrolment numbers since the enactment of the Performance-Based Research Fund (PBRF) in 2006.

President of the Tertiary Education Union (TEU) Tom Ryan has raised concerns over the potential risks of basing funding on students’ performance, instead of overall quality of output.

“These changes may incentivise the wrong behaviour by rewarding higher pass rates with more funding.”

Potential restrictions on student loans will affect students who fail or drop out of more than 50 per cent of their classes, as well as the ability of first-time students aged over 20 who enter tertiary study through the current open-entry system.

NZUSA Co-Presidents David Do and Pene Delaney have spoken in defence of open entry for mature students. “We are concerned that moves to restrict entry for over-20s will limit access to those who missed their first opportunities for tertiary education. This would disproportionately affect Maori, Pasifika, and second-chance learners.”

While the substance of these changes have not been fully articulated by the ministry, Joyce has confirmed that “between 5 and 10 per cent of government funding for tertiary providers would be linked to student performance and dropout rates”.

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