Woman ninth person arrested at border over student loan debt

AUCKLAND: A woman has been stopped and arrested at Auckland Airport over student loan debt.

The New Zealand Herald has been told the woman had been in New Zealand visiting her unwell mother, and was arrested on Friday as she attempted to fly out of Auckland Airport to the United States.

She spent a night in jail, it is understood, before staying in a hotel over the weekend and appearing in court on Monday.

The arrest continues a policy introduced under the previous National government.

Student unions have criticised the border arrest policy as draconian and likely to make New Zealanders overseas ‘‘studentloan refugees’’ — unable to return home for weddings, funerals or other important events.

The Inland Revenue spokesman confirmed an arrest happened in the past week, but said further details could not be released because of tax secrecy provisions.

‘‘While Inland Revenue has the authority to apply for arrest warrants for student loan defaulters leaving the country, this is very much an action of last resort after all other avenues have been exhausted,’’ the spokesman said in a statement.

‘‘The best advice we can give overseasbased borrowers is to pay any outstanding amounts. If that is not possible, we encourage borrowers to talk with us about their situation.’’ Nine arrest warrants have been executed since a 2014 law change allowed student loan defaulters to be arrested at the border. That number includes five arrests since the Labourled coalition came to power.

Those arrested have now repaid more than $30,000 between them, but that is believed to be only part of the amount they owe.

Last year, Education Minister Chris Hipkins said the arrest policy would not have been something he would have introduced, but it would stay in place because repealing it was not a legislative priority for the Government.

All student loan borrowers had interest added to their loans each year until April 2006. Since then the loans have been interestfree for borrowers who stay in New Zealand, but interest is still charged for those living overseas — about oneseventh of the more than 700,000 people with outstanding loans.

About 70% of overseas borrowers with overdue payments are in Australia, and the Government now has an informationsharing arrangement with the Australian Taxation Office to identify them.

The first border arrest happened in January 2016. Cook Islands man Ngatokotoru Puna (40) was arrested as he tried to leave New Zealand. Mr Puna claimed the IRD had sent reminder letters to the wrong address. He borrowed $5000 from his parents to pay the IRD before it was satisfied he could leave the country.