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A Nation-Building Role in A Knowledge Society

Hon. Steve Maharey
Monday, 10 July 2000
Speech Notes

Tertiary Education: A Nation-Building Role in A Knowledge Society

Address to the Association for Tertiary Education Management (ATEM) 2000 Conference, "Around the Mark: Navigating Challenges and Opportunities in Tertiary Education", held at the University of Auckland.


Thank you for inviting me to address this plenary session of the Association of Tertiary Education Management’s 2000 Conference. My job is very much about confronting the challenges that the new century poses for New Zealand’s tertiary education system, so it is always welcome to meet with others who are also focussing themselves on this task.

Of course, it is not only New Zealand that faces such challenges. There is a growing recognition throughout the world that for tertiary education the coming period will be one of great change on the one hand, and vital importance on the other.

As you may know, I have recently arrived back in New Zealand from overseas. I spent time at a UN conference in Geneva, in the Netherlands and in the UK. I’ve been speaking to people from a wide range of smaller countries. All are facing the same challenges. The global economy is forcing tertiary sectors in all of their countries to change in order to succeed in the new environment. The predominant concern is a need to lift their people’s ability to be able to respond to the changing world.

While in Britain, I met with David Blunkett who as Secretary of both Education and Employment is my closest counterpart in the Labour Government over there. In February this year he set out his assessment of the situation facing tertiary education:

"Across the world, its shape, structure and purposes are undergoing transformation because of globalisation. At the same time, it provides research and innovation, scholarship and teaching which equip individuals and businesses to respond to global change."

I also had the opportunity to meet with Anthony Giddens, the eminent sociologist and one of the leading theorists of Third Way politics. Giddens, too, sees a period of challenge and change for tertiary education. He wrote recently:

"Education needs to be redefined to focus on capabilities that individuals will be able to develop throughout life. Orthodox schools and other educational institutions are likely to be surrounded, and to some extent subverted, by a diversity of other learning frameworks."

All in all, it is quite a daunting time to be a tertiary education manager – but also an incredibly exciting one. I intend today to set out what I see as the three key factors for a success in a global knowledge society:
 Strategic focus;
 Quality; and
 Affordability

I want to outline what Government is doing to provide a framework in which tertiary institutions can focus effectively on those factors. I also want to indicate what I think tertiary managers need to start doing themselves.

Those three factors – strategic focus, quality and accessibility -- add up to what Tony Blair has called 'diversity with excellence'. This is what we're aiming for in tertiary education in this country. This is what we will need to achieve to lift the capacity of individuals, communities and business to respond to challenge and change. A tertiary education system characterised by diversity with excellence will be crucial to our ability to secure our future as a prosperous and inclusive nation.


First however, let me set the context for this endeavour by setting out what I see as the key characteristics of the global changes facing us, which give us both the opportunity and necessity to operate as a knowledge society.

I want to emphasise my use of the term 'knowledge society.' The more common term around the world has been 'knowledge economy' or 'knowledge-based economy'. That is beginning to change, and rightly so -- the term is too narrow. Our whole society is affected and the risks must be managed and the opportunities secured for the whole of society.

At the heart of the changes is the so-called Information Revolution, with its globalisation of the world economy by the use of new technology. The impact has been likened to the Industrial Revolution's early stage when the steam engine was just being put on rails.

The early decades of the 21st century will see accelerating change as the Internet and a host of inventions, unknown at present, impact upon our culture, society, economy and lifestyle.

In a globalised world there are different drivers of growth, and there are accordingly different imperatives at work on economies, and on institutions of learning. There are a number of implications for institutional leaders like you:

 Information communication technology offers new and challenging ways of delivery.

 Education will increasingly be delivered without regard for national borders, creating threats for domestic providers but also export opportunities.

 Stakeholders increasingly want to be more involved in the decision-making.

 "Second-chance" and life-long learning moves from important to imperative, and upskilling will become so routine that it will be taken for granted.

 High quality, relevant tertiary provision will be a key factor in attracting and anchoring business operations in our country.

 Our research base will be the foundation not only for new knowledge, understanding and ideas, and also engagement with the international research community.

Increasingly the mission of tertiary education comes down to one overriding requirement -- developing capacity. But there are many dimensions to this task:

 the capacity of individuals to participate in every facet of society from the workforce to democratic decisionmaking;

 the capacity of communities, including critically whanau, hapu, iwi and Maori to effectively manage their own development;

 the capacity of businesses to assimilate and utilise relevant technological innovations;

 the capacity of Government to develop and deliver strong evidence-based policy solutions;

 the capacity of the research community to foster a strong and responsive national innovation system; and

 the capacity of the community as a whole to debate and engage democratically on matters of public concern.


Facing up to these challenges will mean changes in our tertiary institutions. They will have to become more connected and involved in the society and economy. So much more will be expected of them and they will need to deliver on those expectations by working closely with a variety of constituencies.

This will require a strong strategic focus for each tertiary institution, which in turn will need to be located within a strong strategic focus for the sector as a whole.

I am talking about a step change that lifts our tertiary education system onto a new development path. We need to move beyond a situation in which institutions and other providers simply engage in fragmented, low-level competition. We cannot afford the win/lose dynamic that that produces. We cannot have tertiary providers who fail because we cannot afford to have students who are failed by them. We need to make success and the delivery of excellent education at every level a constant across the board -- the only constant in a diverse array of tertiary education provision.

Excellence does not mean homogeneity. Indeed, the danger over the past few years was that tertiary institutions were being forced by market pressures into increasing homogeneity in order to attract enrolment-driven dollars. This was not a good recipe for creativity and innovation.

In order to provide a foundation for diversity with excellence and to develop a strategic direction for tertiary education that has the commitment of institutions and providers, the Government has established the Tertiary Education Advisory Commission.

The Commission will act as a 'rolling thinktank', generating a series of reports on different aspects of the tertiary education system. Its work will take us back to heart of the Fourth Labour Government’s Learning for Life reforms which were based on clear institutional types – universities, polytechnics, colleges of education and wananga. We will ensure that each of these institutional types has a role and clearly understands what it is.

The Commission's first, initial report is before me at the moment and I expect to be in a position to release it publicly this month. The report will give an indication of the approach the commission intends to bring to bear on developing an indepth strategic direction. Over the next eighteen months the Commission's work will provide the basis for establishing:

 A funding system that encourages institutions to work actively together;

 A way of funding research that advances excellence in a complementary way across the sector, avoiding unnecessary duplication; and

 A system where institutions identify what they do best in order to serve New Zealand’s social, economic and regional needs.

That is what Government is doing to develop a strategic focus across the tertiary system as a whole, which extends from universities and polytechnics to industry training, workplace learning and second-chance education.

However, at the level of individual institutions, the successful development of strategic focus depends crucially on the efforts of managers such as yourselves. Strategic focus for the knowledge society will require innovation. Institutions will be faced with a range of areas in which capacity needs to be lifted, many of which will require them to extend their expertise to others in different ways than they have used before.

Tertiary managers will have a critical role in identifying areas for innovation, developing staff commitment to innovation, and addressing the logistical challenges that will often be involved. Perhaps even more importantly, they will need to build into their institutions an ability and willingness to continue to innovate, as stakeholder needs will change rapidly and so will the opportunities and challenges created by changing technology.

You will need to look beyond your own institutions. Institutions must see themselves as each providing an essential element within an overall system, not simply as competitors whose status comes solely from gaining the greatest number of students.

In order to accomplish this, institutions need to work in a cooperative and collaborative way with each other, with other providers, with Crown Research Institutes and with business. By 'cooperative' I mean your institution and your neighbours working together to arrange provision in a win/win situation, rather than a win/lose one. By 'collaborative' I mean working with others inside and outside the sector to promote the cost-effective delivery of quality education throughout our regions, and the development and dissemination of world class research.

This is not something that you need to be waiting to do. The move to a cooperative and collaborative sector is already underway. We are going to legislate to support and enhance development in this direction, and funding policies will be increasingly oriented to this over time. However, not everything needs to be or can be achieved by centralised policy measures. The initiative and enthusiasm of tertiary managers will be vital ingredients.

As will effective leadership from institutional Councils -- and governance reforms to foster that are on the way. I am committed to a representative model of governance but I am equally committed to ensuring that Council members, and especially ministerial appointees, are accountable for quality decision-making.

There is another policy measure which I believe will provide a strong foundation for your endeavours. We need to return to the original Learning for Life concept of each institution having a clear and unambiguous mission agreed with Government.

This will give managers a clear foundation for building their institution's strategic focus. Government's involvement will ensure the mutual compatibility of each institution's mission, which will foster cooperation and collaboration. Furthermore, a mission that has Government backing means institutions will be funded to succeed in this mission, which will give staff and students a significant degree of security, something they do not have at present.

I want to set, therefore, this challenge to you and to your colleagues. I want you all to begin defining your institution's unique mission. How does your contribution to the national tertiary education system mesh and interconnect with other providers? How could those connections be improved? How does each of your course offerings contribute to and reinforce your institutional mission? What community or communities do you serve, and how?

This is something that will obviously require dialogue with your staff and students, and with business and the community.

I set this for you today as a challenge. I expect to come back to your institutions before long and ask the same questions more formally.


I have already indicated that I do not see the function of tertiary institutions as being to strengthen their own financial position vis a vis their fellow institutions. Rather, I see the task of our institutions and other providers as a whole to develop the capacity of New Zealand's individuals, communities and businesses vis a vis other nations. The prerequisite for that is high quality provision.

Having spoken of 'diversity' I now come to 'excellence'. I see excellence as the condition placed upon the drive for diversity - we will not support diversification into areas where we cannot be assured of excellence.

We will require a commitment to strong quality assurance processes at the institutional level, and commitment to ensure those processes are consistent and well articulated at the level of the tertiary education system as a whole.

This Government has been clear that we see the New Zealand Qualifications Authority as the sole guardian of the national qualifications framework and the registration body that enables tertiary providers to gain access to public funding. We see NZQA as having the key role to play in developing a seamless national system of qualifications as the guardian of the national qualifications framework.

The overall responsibility of the Qualifications Authority is however absolutely compatible with bodies such as the Committee on University Academic Programmes and the New Zealand Polytechnic Programmes Committee operating with a delegated authority that makes these sectors in essence self-assuring.

Two key principles will inform our approach to quality.

The first, and over-riding one, is that the interests of students come first. This has been a fundamental paradigm shift that we mandated within the New Zealand Qualification Authority since the election. The priority is no longer to work with private providers to ensure their continued survival, regardless of any realistic prospect of their meeting quality standards. Instead, the question has become how can the interests of the students best be secured? This involves the development of strategies around 'provider exit' to minimise the negative impact of students. The same approach will apply to programmes at public institutions that do not adequately meet students' needs.

The second principle is that intervention will be in inverse proportion to success. Providers in all parts of the tertiary education system with a track record of strong performance and demonstrated capacity in their fields can expect a very light-handed approach to quality assurance with low compliance costs. Those with patchy track records or unproven capacity can expect a much more active relationship with the quality assurance system.

However, all providers will be expected to have some engagement to ensure appropriate transferability of qualifications. Students must be able to move easily between institutions and providers and must be able to cross credit courses between them.
We aim to move to a situation in which all institutions and providers will be required to demonstrate that their courses can be appropriately cross credited, are part of the national qualifications system, and are registered and accredited, in order to qualify for public funding.
Fundamental to the quality of a tertiary education system is the professional development of its teaching staff. We will be looking to develop a fund to support programmes on good teaching and innovation in tertiary education. This initiative will be accompanied by an indication to institutions that, over the medium term, it should become a normal requirement that all new academic staff with teaching responsibilities are involved in appropriate training.
We will also work with an independent body, most likely the New Zealand Qualifications Authority, to establish annual awards to an outstanding teacher and researcher. The awards will include financial support for the individuals involved to further develop their interests in teaching or research.


A system of diversity with excellence must mean diversity with excellence for all. Practically no job today goes unaffected by the need to respond with ever-greater initiative and flexibility. With increasingly sophisticated technologies, workers are no longer "cogs in the machine" but increasingly process supervisors, ensuring the smooth flow of operations and responding quickly to changing demands.

Our tertiary education system has to respond to this reality, both by equipping school-leavers and by updating older workers' skills. We must have a system that is genuinely focused on lifelong learning for everyone throughout their lives.

Once again, this puts responsibilities both on us as a Government and on you as managers.

For our part, we have already moved to address the affordability of tertiary education. One of our first actions as a government was to address the most iniquitous elements of the Student Loan Scheme, most notably by ending interest charges while studying for full-time and other low-income students, at considerable cost. We have also asked the Education and Science Select Committee to carry out a comprehensive inquiry into the Loan Scheme and its social impacts, and this is now underway.

We also made a number of changes to the Training Incentive Allowance in recognition of the additional barriers to paid employment that are faced by domestic purposes, widows and invalids beneficiaries.

We addressed the highest tuition fees in the tertiary system by additional funding that has ensured that Dentistry tuition fees have been brought down to the same level as for Medicine.

Most recently, we have announced an across-the-board offer to all EFTS-funded tertiary providers. We have put aside $30.5 million for next year to give a 2.3% top-up on tuition subsidies to all providers who are willing to end the fee spiral and hold all fees and programme costs at 2000 levels.

It was vital that we move swiftly to address the fee spiral. From 1990 when a standard fee of $1,250 was charged, average fees have increased to approximately $3,500. This rapid rise was a concern for, as well as individual students, many parents have been hit hard by these increases.

This rising cost compounded a growing win/lose education system at all levels. This competitive process was part of a wider creation of a win/lose nation. New Zealand's increase in inequality was relatively large in comparison with other countries and we now have one of the most unequal income distributions in the world.

That is why we were determined to make progress on this in our first Budget rather than lose ground further as fees continued to rise. That is why we acted on this ahead of being able to make the systemic changes to a cooperative and collaborative framework that will be the prerequisite for investment into the tertiary education system itself. We are not willing to inject more money in to fund competitive practices.

2001 is only a first step of course. And we have clearly signalled that the particular approach of an across-the-board freeze at 2000 levels has been clearly signalled as an interim measure. We will be developing an approach for 2002 that will allow ongoing fee stabilisation, and reductions over time, in a way that is treats institutions equitably.

The second, and in many ways more important, area in which this Government has been active to promote accessibility has been in Closing the Gaps. We are developing a range of initiatives to enable Maori, Pacific Islanders, and other under-represented groups to overcome barriers to education participation and achievement at all levels. Our attainment of a successful knowledge society will depend to a considerable extent on how much we can close the gap of Maori educational under-achievement. 'Closing the Gaps' is a major priority for this Government and the Prime Minister has taken personal leadership of our efforts.

My officials are currently immersed in a major work programme developing initiatives to close the gaps for Maori and Pacific Island peoples in tertiary participation and achievement. I believe you can look forward to some significant measures in this area.

However, it is not only Government that has an obligation to close the gaps, nor to restrain fee increases, nor to reach out to widen tertiary participation in all respects. As public institutions our universities and polytechnics, colleges of education and wananga need to be active in developing their own initiatives, both to reach out to under-represented sections of our community and to ensure that the environment is responsive to their needs once they enrol.

Many exciting initiatives to widen participation are already underway, and I see forums like this one as an important channel to disseminate best practise in this regard.


Today I've set out the policy environment this Government is developing to allow the tertiary education system to meet the challenges of the new era.

New Zealand has to become a knowledge society if we are to survive and prosper in the new century. This means that the tertiary education system will need to adapt, in response to new technologies but also to the incredible demands that will be placed on tertiary providers as central capacity-building institutions in the knowledge society.

In order to do that, institutions and other providers will need work together in an overall system. They will each need a strong strategic focus. Education will need to be of very high quality at all levels and for all the purposes for which it will be required. And the system must be accessible. Nobody must be prevented from meeting their potential by an inability to access or afford education that meets their specific needs. Paramount in this is an absolute drive to close the gaps in tertiary participation and achievement for Maori and for Pacific peoples.

That will require institutions to innovate and to have a strong ongoing innovative culture. Tertiary managers have a crucial role in this.

The competitive model of the 1990s was not always characterised by management success. Much of that was due to the fundamental flaws in the model itself. Nonetheless, it provides a salutary lesson that we need to continue to develop management capacity in the system, as well as strong and effective governance.

We need to focus on what it takes to be a successful tertiary manager. That involves specific skills as well as generic skills and I know the Association for Tertiary Education Management is aware of that and committed to fostering that. Forums like this one today are a vital opportunity to share best practice and to forge networks between institutions. They are vital to both innovation and a culture of cooperation and collaboration. I welcome the opportunity to contribute to that.


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