Government Briefings Recognise University Funding Issues

Universities’ case for increased public investment has been recognised in education agency briefing documents to the incoming government.

Professor Roger Field, chair of the universities’ representative body, the New Zealand Vice-Chancellors’ Committee, says the briefings acknowledge there is an issue around the level of public support for universities in comparison with the amount allocated for student financial support.

“The NZVCC has consistently pointed to the fact that this country devotes far less of its tertiary education budget to institutions than other OECD countries. On an average basis, the OECD community devotes 82 per cent of government funding to institutions and 18 per cent to student financial support. Yet in New Zealand only 58 per cent goes to institutions while 42 per cent goes to students.”

The NZVCC is pleased that the Ministry of Education’s briefing acknowledges that “direct government subsidies … in New Zealand are relatively low by international standards, and the proportion of tertiary funding through student support is relatively high”. The Ministry recommends that “… any marginal increases in government funding in the next few years should take into account the current balance between institutional funding and funding to students”.

The Ministry briefing adds that allowing providers greater flexibility in setting student fees is one option available to government. “Easing fee maxima settings to give providers greater flexibility to charge higher fees to students is one way of supporting quality enhancements in institutions. While this would have a cost impact for students, the effect would be subsidised in part by the government through the fees component of student loans,” the ministry briefing says.

The Tertiary Education Commission briefing also touches on institutional funding, noting that universities have been “framing what they describe as an under-funding issue in terms of striking a better balance between investment in student support and direct investment in institutions”.

TEC’s briefing goes on to refer to university advocacy on how cost pressures are met through the tertiary education funding system. This is a reference to a forecast CPI being used to adjust per student funding rates on an annual basis when universities actually face annual cost increases at a rate 1.6 times the CPI.

Professor Field says while government agency acknowledgment of tertiary education funding issues is welcome it is only the first step to having the problem addressed by the New Zealand government. “The release of the briefings comes at a time when the Australian government is injecting $1 billion into their universities through new teaching and learning infrastructure initiatives and fast-tracking research fund allocations,” he noted.

ENDS