KEY POINTS:
The Government says its policy of a gradual move to a student allowance hasn't changed.
The comments followed a Press newspaper report today which revealed the Government had been looking at how much it would cost to pay all tertiary students an allowance.
The Education Ministry said it would be $728 million.
Tertiary Education Minister Pete Hodgson issued a statement saying Labour's policy had not changed.
"This is the situation, that Labour's oft stated policy remains one of moving progressively towards a universal student allowance rather than directly to one."
He confirmed he had earlier this year asked officials to cost a universal student allowance as he knew students would ask for this in the lead up to the budget.
About 57 per cent of students get an allowance and about 47,000 full-time students miss out because they earn too much or, for students aged under 25, their parents' income was too high to qualify.
Mr Hodgson asked the ministry in January to prepare a paper on how much it would cost to offer a universal allowance - something student groups have long pushed for. It is NZ First and Green Party policy.
The Press said the $728m net extra cost of such a plan was based on removing existing costs of the scheme and factoring in an expected reduction in student loans.
Labour has also considered increasing the allowance to as much as $350 a week, the Press reported, but the idea was dropped as too expensive.
The student allowance is $122 a week for those under 25 and living at home, $153 a week for those living away from home, and $184 for those aged over 25.
May's budget gave a 10 per cent increase in the parental income threshold, lowered the age for parental income testing to 24 and increased the amount students can borrow for living costs from the student loans scheme by $5 to $155 a week.
Ministry documents showed since 2001 there was a 32 per cent fall in the number of students eligible for allowances as parents' incomes rose.
A study by market researcher TNS Conversa revealed average student debt has risen by 54 per cent since 2004 to $28,838.
During the 2005 election campaign Labour scored significant points with students and their parents by offering interest-free student loans.
- NZPA
