Student unions say arresting student loan defaulters at the border is unreasonable, and more needs to be done to make repayments easier for people overseas.
The Government announced its new stance towards loan defaulters in Thursday's budget.
People living overseas with overdue student loans face arrest at the border, and Tertiary Education Minister Steven Joyce says the Government will use a debt collection agency to track down about 10,000 student loan borrowers living in Australia who have made little or no effort to repay their loans.
Borrowers based overseas will have to make fixed annual repayments and the arrest system currently used for people who owe child support payments will be extended to the most non-compliant overseas-based borrowers.
The New Zealand Union for Student Associations says the Government needs to be doing more to make repayments from overseas bank accounts cheaper and easier.
The president of the National Maori Tertiary Students Association, Ivy Harper, says she understands student loans must be paid but arresting people at the border seems a bit too drastic.
"At the end of the day," she says, "is that what we want? To be seen as a border control? Our people struggle enough to come home."
Revenue Minister Peter Dunne says only the worst defaulters will be arrested at the border. He says borrowers overseas now have a variety of options for getting around high overseas bank transfer fees.
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