2020 ELECTIONS/Han's idea of low-interest student loans stirs heated debate

11/03/2019 07:15 PM
KMT legislative caucus whip Tseng Ming-chung (曾銘宗, second left) speaks at a new conference.
KMT legislative caucus whip Tseng Ming-chung (曾銘宗, second left) speaks at a new conference.

Taipei, Nov. 3 (CNA) The debate over opposition Kuomintang presidential candidate Han Kuo-yu's (韓國瑜) idea of lowering rates or eliminating interest on student loans continued to percolate Sunday, with responses following party lines.

Han said Thursday that if elected, his government would help bring down interest rates on student loans to their lowest level possible or even have some banks offer interest-free student loans, with the interest subsidized by the government.

Premier Su Tseng-chang (蘇貞昌) responded Sunday that the government has already done a lot for economically disadvantaged students, while the KMT legislative caucus held a news conference to express support for Han's political views.

Su contended that Han's proposal could lead more people to take out student loans, including those who had no need for them, and invest the money elsewhere to exploit the low interest rates.

President Tsai Ing-wen (蔡英文) has rolled out several policies since taking office in 2016 to help poorer students, he said, including relaxing eligibility criteria for taking out student loans, extending grace periods on repayment and even offering zero-interest loans, and providing rental and child care subsidies for young people.

DPP Legislator Lee Chun-yi (李俊俋) noted that several new student loan relief programs took effect on Sept. 1, 2018, including a preferential student loan policy for students whose families earn less than NT$1.14 million annually.

Borrowers in that program do not have to pay interest on the loan in the first year after graduation, and then repay the loans at a fixed annual rate ranging from 1.15 percent to 1.62 percent a year, Lee said.

But the KMT argued that those policies have not done enough. KMT legislative caucus whip Tseng Ming-chung (曾銘宗) said Sunday that as of 2018, 840,000 people had taken out student loans averaging $212,000, and 398,000 of them were unable to repay them.

Tseng also said that since April 18, the Executive Yuan has rolled out 21 policies costing NT$322.3 billion, which have been criticized as attempts to buy votes.

In comparison, Han's cheap loan idea would only require about NT$4 billion a year, Tseng said, and he called on Su and Tsai to fully support the proposal.

KMT Youth League head Hsiao Ching-yan (蕭敬嚴) said he pays about NT$7,000 a year in interest on his student loans, an amount equal to a half month or full month of rent for people just starting out in the job market in Taipei.

He hailed Han's proposal as a good policy that should be backed by politicians across the party lines.

(By Ku Chuan, Wang Yang-yu and Evelyn Kao)


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