I saw in a article from the NMIT that a 50 year old guy got fully trained on the student loan scheeme. If he has 80K of debt and we get another 12 years befor he fails a medical. He would have to pay $128 per week without a inflation calculation and CPI. If the IRD do the normal calculations he will never pay it back complettely. The system is flawed in the respect that many will never pay it all back. At least the Key government are prepared to look at repayments and recovery.
I used to work in a Student Loans office at a University 12 years ago prior to WINZ taking over the operation, and there were plenty of people in their senior years, and in one case, someone who was terminally ill taking out reasonably large student loans for study who probably will never pay them back. This 50 year old guy you mention is definitely not an isolated case. This loophole would be particularly difficult to close without overt discrimination that would almost certainly be challenged by lobby groups.