Beneficiaries studying certain professions will be eligible for a $500 loan in a move that softens earlier restrictions on tertiary study.
Social Development Minister Paula Bennett says the loan will only be available to those who are studying to be nurses, doctors, midwives, veterinarians and teachers.
The move comes after the Government earlier this year cut back training incentive allowances to solo parents and those on invalids' benefits - restricting them to sub-degree study.
The Labour Party's associate Social Development spokesperson, Carmel Sepuloni, says the $500 loan is woefully inadequate compared to the $3800 grant beneficiaries were eligible for originally.
Ms Bennett says many people have written to her and made compelling cases for increasing the amount of money beneficiaries can borrow to study over and above their existing $1000 student loans.
She says the new loan will be limited to one year initially, to see if it is meeting beneficiaries' needs.
[audio:http://www.radionz.co.nz/audio/national/ckpt/2009/12/02/new_$500_study_loans_for_some_beneficiaries]Listen to Checkpoint interview with Carmel Sepuloni