Med Students like debt relief bonding

Both the NZMA and the NZMSA are applauding the concept of giving debt relief to medical graduates in return for them working in rural areas.

New Zealand Medical Association (NZMA) chairman Dr Peter Foley said he supported the idea, adding that debt relief for graduates would be a powerful tool for retaining a junior doctor workforce being tempted by pay conditions in Australia.

The New Zealand Medical Students Association (NZMSA) also applauded Key’s bid to address the loss of young New Zealand doctors overseas.

I’m glad the policy seems to be using the carrot of debt relief rather than some sort of stick which would try and stop doctors from leaving against their will.

The challenge will be how fast to write off any debt. Do it too fast and then you may just delay the departure. Do it too slow and you mat not have enough of an incentive.

It is worth remembering that writing off $10,000 debt is equal to giving someone $16,400 before tax due to the high 39% marginal tax rate on income for doctors.