The Government is blaming big rises in the number of people in tertiary education for spiralling student loan debt.
Student leaders estimate student loan scheme debt will hit $9 billion today -- up from $5 billion in 2002. Rallies to mark the milestone are being held around thecountry.
Otago Polytech Students Association president Richard Mitchell today said debt was making graduates delay having children and was making it increasingly difficult for them to buy a home.
His comments follow new research showing a big rise in the price of houses compared to wages, and another report to be released tomorrow showing affordability is at its worst level since records began in 1989.
Mr Mitchell said the solution to student debt was to provide a universal student allowance and axe course fees.
But Dr Cullen today said one of the main reasons for the rapidly growing debt was the record number of New Zealanders in tertiary education.
The number of students had doubled from 254,000 in 1994 to 504,000 in 2005.
That was good for students and good for the economy, he said.
"Tertiary education is a good investment. People who have a bachelors degree or higher qualification earn two-and-a-half times what people with no qualifications earn," he said.
Dr Cullen said students were also better off than in previous years due to Labour's interest-free loans policy, which was collectively saving them about $500 million dollars a year.
This represented a saving of about $1000 for every student.
He said the Government had also stabilised fees, expanded scholarships, raised living allowances and widened eligibility.
