Professor Sir Paul Callaghan's appeal to Kiwi expats starts a national debate

Professor Sir Paul Callaghan's appeal to expat Kiwi graduates to make a significant contribution to the Christchurch earthquake recovery mission by paying back their student loans has begun a national debate about the student loan system.

Since the appeal was launched last week media outlets and social media sites have been debating the merits of Professor Callaghan's HEKE (Heroic Educated Kiwi Expatriates) project, prompting a wider debate about the student loan system.

Sir Paul launched the campaign with a letter to graduates living overseas. In it, he noted the massive financial aid needed to recover from the Christchurch earthquake, and asked the more than 85,000 New Zealanders with student loans living abroad to provide a huge financial boost to the recovery. He particularly appealed to the 35,000 Kiwis abroad who are behind in their repayments.

New Zealand graduates living abroad have a median debt of $17,900—a total debt of over $2 billion.

"That represents nearly 30% of the $7 billion that New Zealand taxpayers will have to contribute through the Government's contribution to the rebuilding… If we were to get everyone to contribute even a little, then the effect would be hugely helpful," says the distinguished physicist, who was knighted in 2009, and named the 2011 New Zealander of the Year in February.

Since the launch Professor Callaghan has taken to social media sites, primarily the HEKE Facebook page (www.facebook.com/hekeproject) to argue the merits of the campaign.

He says such repayments would not only help New Zealand recover from the disaster, they would make good financial sense to the students. Graduates who live overseas do not qualify for the Government’s zero-interest student loan policy.

"What is remarkable about all of you is that you are earning an income in foreign currency, and if you were to start repaying or to accelerate your loan repayment rate, you would not only save yourself interest, but you would be acting heroically to help save your country," says Professor Callaghan in the open letter.

Unlike New Zealand residents, whose loans are repaid automatically through the taxation system, overseas New Zealanders only repay if they volunteer to do so.

"Many have given up any thought of paying, and for them, a compounding interest bill will cause a debt burden that makes it harder to return to work in their homeland, only to be called upon by IRD to service and repay that debt. Thus, New Zealand loses twice over,” says Professor Callaghan, whose title of New Zealander of the Year recognised his outstanding contribution to science, business and reversing New Zealand's 'brain drain'.

Professor Callaghan has rejected criticism that he is unfairly targeting expat graduates.

"I have tried to make clear that I am really only pitching this at graduates not repaying and that I don't want them to feel any guilt or obligation but purely to see this as an opportunity if they actually can afford to start repaying. February 22 is a game changer for all of us. We all have to think anew now," he says.

Last week Sir Paul also opened the Salvation Army’s Red Shield Appeal, making a challenge to New Zealanders with discretionary income, and to the Corporate sector, to dig deep to support the voluntary social service sector.

"The rebuild of Christchurch, once the Insurance Companies and EQC have made their contribution, will fall on all of us, all New Zealand taxpayers and indeed all our citizens."

He asks graduates to consider the value of their New Zealand education to their present employment abroad.

"If, like so many Kiwis abroad you feel frustrated in not being able to help Christchurch enough, then I would ask you to consider what I am proposing. If only a few respond, the effect will be significant, but if most of you do, then you will make history and your contribution will be the stuff of legend."

Named the HEKE (Heroic Educated Kiwi Expatriates) project, a website has been set up (www.heke.ac.nz), as well as a Facebook Page (www.facebook.com/hekeproject).

In Te Reo, heke means "to reduce".

"By reducing their student debts these heroes and heroines help New Zealand rebuild Christchurch. They also remove a barrier which prevents them returning to live and work in their homeland. We, their families, must welcome that."