Media Release 10 September 2008

OECD Report Highlights Need To Invest In Universities

The OECD publication Education at a Glance 2008 released today contains content which highlights the need for increased investment in the New Zealand university system, according to New Zealand Vice-Chancellors’ Committee chair Professor Roger Field.

The publication contains an editorial by the OECD’s Director for Education Barbara Ischinger which notes that in the decade to 2005 spending per tertiary student shrank in some countries as expenditure failed to keep up with expanding student numbers.

Professor Field says research carried out by the NZVCC confirms that New Zealand was among those countries. Government funding per university full-time equivalent student in this country fell by $1834 during the 15-year period to 2006 when adjusted for inflation and measured in constant dollars.

Ministry of Education commentary on the OECD report points out that a comparison of annual expenditure per student on tertiary institutions shows that New Zealand ranks 19th out of 27 OECD countries. That puts New Zealand below the United States, Australia and the United Kingdom.

The editorial in the OECD report notes that the Nordic countries have achieved expansion by providing massive public spending on tertiary education, including both institutional and student support, “as an investment that pays high dividends to individuals and society”.

New Zealand is used as an example where “loans on advantageous terms are available to all students” with means tested income support for living expenses and scholarships that target students from lower socio-economic backgrounds.

NZVCC research shows that student financial support in the form of allowances is almost 50 per cent higher in this country than the OECD average in terms of expenditure as a proportion of GDP. Furthermore, student financial support in the form of loans is four times higher than the OECD average.

Professor Field says this situation suggests an imbalance between public investment in tertiary institutions and the students who attend them. “For New Zealand universities, the underlying issue is the balance between quality and affordability. If the pendulum swings too far one way, university education will be affordable for students but the quality of that education will be compromised.”

The editorial in Education at a Glance 2008 notes that strengthening public subsidies and achieving a good balance between financial aid in the form of student loans and scholarships can be a way to improve equity in access to tertiary education.

“For New Zealand universities that means increased levels of public investment are the key to unlocking the institutions’ full potential to deliver economic, social and cultural gains. It seems clear from the OECD data that the provision of student financial support in this country is more than adequate in terms of both tertiary education participation and equity of access.

“As the trainers of our professional workforce, New Zealand universities play a crucial role in society. Investment in them must be at a level that allows universities to continue to produce high quality graduates, pay competitive salaries to academic staff, invest in infrastructure, develop research and teaching capability and provide services and facilities for students,” Professor Field says.

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