Study Wage for All

We urge the New Zealand Government to implement a Study Wage for All.

By introducing a universal study wage for all tertiary students, at a decent rate, we can ensure all students can live with dignity and focus on their studies. (1) We envision the Study Wage for All would initially be set at $385* a week (after tax), and annually re-calculated to ensure students can make ends meet. We are proposing that all tertiary students will be eligible for a Universal Study Wage. This would abolish the current Student Allowance Scheme means-testing and other eligibility requirements.

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A Summary: Why do we need a Study Wage for All?

Learning is an inherently valuable contribution to society. To genuinely acknowledge education as a public good, we must value not only our educators, but also the students.
The current means-testing of the student allowance scheme exacerbates student poverty and is too flawed to truly ensure equity and fairness to marginalised groups.
We want to stop a downwards trend of students dropping out because they can’t afford to keep studying. We need more students, including those who otherwise could not afford to study, in tertiary education so we have citizens prepared for an increasingly complex world.
Tertiary education is not just an investment into the individual, but to their whānau, community and Aotearoa.
Pre-1990, Aotearoa had relatively universal student allowances and free tuition. Overseas, since 1996, Denmark has provided a universal student allowance too (which was 860 euros per month in 2022). Our own history and Denmark prove that a Study Wage for All is entirely possible.
Barrier-free education is a public good which benefits our collective future.

THE CASE FOR A STUDY WAGE FOR ALL

The current student allowance schemes fails to adequately address widespread student poverty and fails the collective future of Aotearoa. Normalised student poverty is not inevitable, it is a political choice. A Study Wage for All is critical to recognising the essential role of education as a public good.

Why does the current student allowance scheme fail to meet the needs of students?

The current means-testing of the student allowance scheme enables student poverty. Only 12% of students receive a student allowance(2), with most other students having to withdraw student loans and go into debt to survive. Students are twice as likely to ‘not have enough money’ to meet everyday needs compared to the total adult population, and two thirds of students still cannot regularly afford necessities.(3) Many students can no longer afford to study.

The student allowance scheme fails to meet the needs of students because of its inequitable, bureaucratic and overly stringent means-testing. The factors used to determine entitlements are out-of-step with the realities of many students and their families:

Parental income testing relies on an outdated assumption that families can support their children in tertiary study. Many families above the threshold still struggle financially. 60% of students do not receive financial support from their families, in particular, 75% of Pasifika students and 70% of Māori students do not.(4)
Parental income testing also allows the system to be gamed by the rich who can hide their wealth in trusts or assets.(5)
Partner income testing is outdated, unfair, and places unnecessary pressure on relationships. (6)
Age eligibility limits prevent life-long learning and do not recognise that adult poverty can continue to prevent access to tertiary education. (7)
Preventing postgraduate student access to student allowances when their financial situations are often akin to undergraduate students is downright exploitative. (8)

It is impossible for equity to be properly addressed in such a flawed system. We need a Study Wage for All to ensure fairness and equity. Moreover, learning is an inherently valuable contribution to society. All students should be provided enough to support their living costs, regardless of level of study, age, and parental or partner income.

Why does the current system fail the collective future of Aotearoa?

The current tertiary underfunding crisis goes hand in hand with the crisis of student poverty. The underfunding of tertiary education and student poverty are symptomatic of a privatised, competitive funding model that places the cost of tertiary education on individual students.(9) However, this fails to acknowledge that tertiary education is not just an investment into the individual, but to their whānau, community and Aotearoa. A Study Wage for All is critical to recognising the essential role of education as a public good.

The status quo of student poverty will set tertiary institutions on a path to becoming for the wealthy few. Domestic student enrolments have decreased by almost 20% from 2005-2015, because fewer people, particularly marginalised people, can afford to study and take the risk of going into debt.

Despite enrolments dropping, national student debt has escalated to a staggering $16 billion. However, before the 1984-1990 reforms, Aotearoa treated education as a public good and we had free university tuition and relatively universal student allowances. Our own history proves that a Study Wage for All, that recognises studying is just as meaningful as working and thus enables students to live with dignity, is entirely practical. Since 1996, Denmark has offered a universal student allowance (alongside free tuition), which amounted to 860 euros ($1516.41 NZD) per month in 2022. As a result, they have happier, healthier, and more productive citizens and communities. Normalised student poverty is not inevitable, it is a political choice.

How will a Study Wage for All benefit Aotearoa?

Aotearoa can have a brighter future with a Study Wage for All. It would stop students from having to choose between an education and dropping out to earn money and survive.

We will see more students from marginalised backgrounds bring their lived experiences and different ways of knowing to academia, research, innovation and leadership. This is essential to a society that values diversity and stands to benefit from approaching problems from different perspectives. Research that reflects different ways of knowledge and evidence-based solutions are crucial to healing our society as we navigate national and global crises.

A Study Wage for All will generate more students in tertiary education, which will lead to more critically-thinking, empathetic, creative citizens that are necessary for an increasingly complex world. We need our next generations to have the skills to lead Aotearoa through the challenges we face - climate change, geopolitical risk, the existential threat of artificial intelligence, how we share resources equitably to look after our people.

The graduated student benefits from social mobility, but so does their community. There are intergenerational benefits to more financially accessible tertiary education. Aotearoa will have more social cohesion and less wealth inequality.

NO MORE EXCUSES

In this election year, we call on our alumni Chris Hipkins and Grant Robertson to stay true to their roots and not forsake a whakapapa of ongoing student resistance against privatised tertiary education and student poverty. In 1996, Robertson advocated for the need to overhaul the allowances scheme and phase out tuition fees and to return to universal living allowances. Hipkins has also said, “We’ve had enough of broken promises by politicians, it’s time for the government to put their money where their mouth was before the election.” We agree.

There are no more excuses to keep putting student poverty on the backburner. A Study Wage for All is critical to recognising that everyone deserves to live with dignity and the essential role of education as a public good.

References and more information:

(1) - Calculations for a Universal Student Allowance prepared by the Parliamentary Library using HYEFU 2022 (at p148), the Ministry of Social Development’s Monthly Benefits Update – March 2023, current minimum wage rates, and StudyLink Statistics (2022).

(2) - Student Allowance January to June 2022: Students enrolled at New Zealand’s tertiary institutions (2022): https://www.educationcounts.govt.nz/statistics/tertiary-participation

(3) - Peoples’ Inquiry into Student Wellbeing 2022, pg 26 & 7.

(4) - Peoples’ Inquiry into Student Wellbeing 2022, pg 30.

(5) - Struggle Street: Unpacking StudyLink’s Biggest Flaws

(6) - Welfare Expert Advisory Group Report, pg 10; Peoples’ Inquiry into Student Wellbeing 2022, pg 9 & 28.

(7) - Peoples’ Inquiry into Student Wellbeing 2022 pg 9, 27 & 28.

(8) - Sweat Equity: Student Scholarships in Aotearoa New Zealand’s Universities; Peoples’ Inquiry into Student Wellbeing 2022, pg 6.

(9) - The financialisation of tertiary education in Aotearoa/New Zealand; A New Patriotism? Neoliberalism, citizenship and tertiary education in New Zealand

(10) - The financialisation of tertiary education in Aotearoa/New Zealand pg 46.

(11) - How we racked up $16 billion in student debt in NZ

(12) - Tertiary Education Policy in NZ

(13) - In Denmark, a universal grant helps all students