Student Allowances

Overview

The Student Allowances Scheme was introduced in 1989 to provide living support for New Zealand students studying full-time toward recognised tertiary qualifications and for adults studying full-time at secondary school. The aim of the scheme is to ensure that the need to meet day-to-day living expenses doesn't act as a barrier to full-time education for students from low and middle socio-economic groups.


Eligibility for a Student Allowance

A Student Allowance is available to people who are:

  • aged 18 years or over, or aged 16–17 if they meet criteria based on their circumstances
  • enrolled as a full-time student
  • on a recognised programme at an approved education provider
  • either:
    • a New Zealand citizen, or
    • a permanent resident of New Zealand who has lived in New Zealand for at least two years and has held "permanent residency status" for at least two years.

Income tests are applied to the Student Allowance. These tests consider the income of the student's spouse (if any), as well as the income of the parents of most childless students aged under 25 years. Tests of academic achievement (to secure continued access to a Student Allowance) also apply.

Students who are not studying full-time may be eligible for a Student Allowance if their education provider supports their application to study less than full-time for any one of the following reasons:

  • the student has an illness, disability or some other sufficient cause beyond their control that stops them studying full time
  • it is considered in their best interests, or
  • the student is studying more than half of a full-time course and the study will complete a recognised programme.

From 1 January 2007, PhD and professional doctorates were added to the list of Recognised Long Programmes. This provided students undertaking these qualifications with 156 weeks' Student Allowances in addition to the standard 200 weeks available to eligible students over a lifetime.

From 1 April 2007 clients in same sex de facto relationships were treated the same as married, civil union and opposite sex de facto couples who receive assistance from StudyLink.

Students who are eligible for a Student Allowance and who live away from home are entitled to an Accommodation Benefit payable under the Student Allowances Scheme. This is a contribution towards accommodation costs, up to a maximum of $40 per week or $60 per week for single students with a child or children.


Payment rates for Student Allowance

A Student Allowance is available at different rates depending on the circumstances of the student and on their assumed living costs. For students who are living with one or both parents, or with an earning partner in a recognised relationship, a Student Allowance is paid at a discounted rate to reflect the lower living costs these students are likely to experience compared with students living away from home.

Table 6.1 shows the maximum net rate at which Student Allowances were paid between 1 April 2007 and 31 March 2008. The annual general adjustment of Student Allowance rates took effect on 1 April 2007. In addition, the parental income threshold applicable to Student Allowances paid to 16-24 year olds was adjusted by the Consumers Price Index.

Table 6.1 Maximum payment rates for Student Allowances (effective from 1 April 2007)

Type of Student Allowance Status Amount
Single 16-24 years Away from home $148.73
  At home $118.98
Single 25+ years Away from home $178.49
  At home $142.78
Couple allowance - both students, no children One eligible $178.49
  Both eligible (each) $148.73
Couple allowance - dependent spouse, no children   $297.46
Single student with dependent children   $255.65
Couples - both students with dependent children One eligible $255.65
  Both eligible (each) $148.73
Couples - dependent spouses with dependent children   $297.46
Students in independent circumstances   $148.73
Earning spouse Away from home $96.06
  At home $64.48

Trends in the number of students receiving a Student Allowance

The number of Student Allowance recipients increased over 2006 and 2007, following decreases between 2003 and 2005 (see table 6.2). The main reason for this decline in the earlier period was that the strength of the economy and the labour market meant that fewer students met the targeting provisions of the allowances scheme. This situation has now stabilised. An increase over the last year in the number of students aged under 25 years receiving Student Allowances may also reflect an increase in the threshold for the parental income test, which must be met for those students to receive a Student Allowance.

Table 6.2 Trends in the type of Student Allowances received

Type of Student Allowance received Students receiving Student Allowances1
2003 Number 2004 Number 2005 Number 2006 Number 2007 Number
Single 16-24 years - targeted away from home 16,349 14,742 17,585 18,842 21,143
Single 16-24 years - targeted at home 10,407 9,555 10,295 11,404 12,703
Single 25+ years - targeted away from home 16,822 16,260 15,011 14,875 14,460
Single 25+ years - targeted at home 2,129 1,977 1,873 1,959 1,987
Couple allowance - both students, no children 876 1,054 149 119 105
Couple allowance - both students2 0 0 1,328 1,560 1,516
Couple allowance - dependent spouse, no children 1,728 1,722 137 3 5,354
Couple allowance - dependent spouse2 0 0 4,890 5,449 3
Single student with dependent children 1,846 1,756 1,522 1,541 1,572
Couples - both students with dependent children 748 836 65 1 1
Couples - one student with dependent children2 0 0 153 176 162
Couples - dependent spouses with dependent children 4,176 4,028 232 9 4
Students in independent circumstances 7,685 7,594 2,437 2,186 2,119
Earning spouse - at home 1,153 1,193 1,045 1,228 1,251
Earning spouse - away from home 117 109 84 79 99
Total 64,036 60,826 56,806 59,431 62,479

Notes

  1. Numbers of students recorded as receiving Student Allowances during years ended 31 December.
  2. New types of Student Allowances introduced in the year ended 31 December 2005.

Trends in expenditure on Student Allowances

Changes in expenditure on Student Allowances (see table 6.3) largely reflect changes in the number of students receiving Student Allowances.

Table 6.3 Trends in annual expenditure on Student Allowances

Expenditure on Student Allowances1
2003 Amount 2004 Number 2005 Number 2006 Number 2007 Number
Total expenditure ($m) 351 341 318 341 358

Note

  1. Expenditure on Student Allowances (excluding Accommodation Benefit) during years ended 31 December.

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