IRD scoops up $32m in student loan debt

RICHARD MEADOWS
Last updated 05:00 22/09/2012

Relevant offers

Money

Owner pleased after historic yacht with $1 reserve sells for $480,000 Businessman tied to ACC bribery in 'dire financial position' Rob Stock: You have a secret cash source Karen Scott-Howman: Customers drive banking innovation Budget Buster: How to nail your 2017 money goals How to survive a mid-life career crisis Left your cash at the ATM? You're paying the Vague Tax Young Kiwis put money on house deposit should they win $100,000 Young millionaire travels the world but hasn't spent a cent of his fortune Kiwis warned about email competitions offering prizes from NZ businesses

The Inland Revenue Department (IRD) has clawed back $32 million of overseas student loan debt in less than two years.

The department is also on the brink of ramping up its debt collection efforts. Borrowers living overseas have collective loans of $2.67 billion, of which $411.5m is overdue.

In October 2010, the IRD began a small-scale project to chase overseas debtors, which had returned over $32m to July 31.

“This amount is money we otherwise would not have collected if we didn't have the campaign in place,” IRD collections manager Richard Owen said. The initiative used a mix of direct contact and debt collection and tracking through private collection agencies to focus on 1000 Australian-based borrowers.

Every dollar spent on the pilot scheme has returned $11.40 of taxpayers' money.

In the next 2 years, the IRD will extend the campaign to about 57,000 other borrowers, with the focus mainly on Australia and the United Kingdom.

The IRD would shortly put out a formal tender for the services of private debt collection and tracing agencies.

Revenue Minister Peter Dunne said the scheme had received “extremely strong” support from the public. “People have obligations and you can't just shirk your obligations by leaving the country.”

Everyone needed to play ball, and it was unfair that overseas borrowers took three to four times longer to repay their debt, he said.

Ad Feedback

- BusinessDay.co.nz

Special offers

Featured Promotions

Sponsored Content