Interest increase on study loans violates international treaty, student organizations say
Increasing the interest on student loans is contrary to an international treaty that the Netherlands signed, according to student organizations ISO and LSR. They call on Minister Ingrid van Engelshoven of Education to withdraw the legislative proposal that regulates this interest increase. If she does not, the organizations will call on the Senate to stop it or take "legal action", NOS reports.
The legislative proposal, which has already been accepted by Dutch parliament, links the interest on student loans to the interest paid by the government on government loans with a 10 year term. Now that interest is linked to government loans with a 5 year term. Interest on 10 year terms is higher due to the longer term. This is expected to result in 5,500 euros more debt for the average student, according to the broadcaster.
According to ISO and LSR, this is contrary to the International Covenant on Economic, Social and Cultural Rights. This treaty states that higher education "must gradually be made free of charge". An interest rate increase violates that, the organizations say.
When the Netherlands scrapped the basic study grant and introduced the student loan system in 2015, the government made sure to adhere to this treaty by investing the proceeds from the loan system into the quality of education. This is not the case with the interest rate increase, according to ISO and LSR.
The money raised with the interest rate increase will go into the state treasury and the government does not plan to invest it in higher education, the organizations said. "Neither the quality of education nor the student benefits from the interest rate hike. Filling the state treasury with student money is therefore illegal", LSR chairman Brechje Keukens said to the broadcaster.