Ombudsman 'right' to order student loan release

The Chief Ombudsman was correct both in law and in the public interest in forcing Labour to release Treasury costings of its student loan policy, an Official Information Act expert says.

Steven Price at Victoria University said the two provisions in the act that Finance Minister Michael Cullen used to withhold the costings were not applicable and the outcome was the right one.

Labour is understood to be furious with the ruling as it is left scrambling to limit the damage from John Belgrave's direction to release costings of two scenarios done in late June.

One scenario - rejected by Labour - shows the policy's cost rising to $924 million in 2019-20 while the second scenario ordered showed the cost would be $527 million.

Dr Cullen's office asked that the second scenario be based on lower assumptions about take-up rates of loans by students, as it did not think Treasury's assumptions were realistic given experience with its 1999 policy to axe interest while students were studying.

Although Dr Cullen complied with Mr Belgrave's ruling he has serious concerns and has said he intends taking the issue up after the election.

Mr Belgrave refused to comment yesterday.

His recommendation that the costings be released to National, the Herald and another unnamed complainant was accompanied by an expectation that it be done by 5pm on Wednesday, as the election was imminent.

Mr Price, a fellow in law and journalism, said Dr Cullen could have delayed releasing the costings until after the election using a 21-day period available to him, but to his credit chose not to. During that time a Cabinet can overturn the recommendation through an Order-in-Council but the Herald has been told no Cabinet has ever done so.

However, Mr Price said Mr Belgrave's decision was consistent with his impressions about the way governments overuse the two provisions Dr Cullen cited in withholding the papers.

The provisions are the protection of the effective conduct of public affairs through free and frank advice from officials, and the protection of conventions about confidential of advice.

In overturning Dr Cullen, Mr Belgrave cited "strong public interest" in the full papers being made public, and said there was no good reason under the act to withhold the information.

Mr Price said the public interest was in part because a significant policy had been questioned so much during the election campaign by opposition parties.

Information that went into developing and costing the policy was of interest to the public, particularly in the context of an election.