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Vocational Learning in a Knowledge Economy

Hon. Steve Maharey
16 October 2001 Speech Notes

Catching the Skill Wave
The Importance of Vocational Learning in a Knowledge Economy

Address at event to launch the Association of Polytechnics in New Zealand Skilling the Nation conference. New Zealand Portrait Gallery, Wellington.


I am very pleased to be here today, and to have a chance to say how important and timely I believe the Skilling the Nation conference is. I’d like to thank the Association of Polytechnics in New Zealand (APNZ) and particularly APNZ president Paul McElroy and executive director Jim Doyle for the work that they have put into organising what promises to be a fascinating and constructive event.

The recent Knowledge Wave conference set a high-level direction for New Zealand’s efforts in the information age.

That conference was about identifying the developmental needs of a knowledge economy and society. Time and time again the discussion – both formal and informal – at that Conference turned to the importance of education as a driver of economic and social development.

It is now time for action, and it is now time for polytechnics to position themselves as being, not just part of the action, but at the center of that action.

It is now time for us to focus on the links between education and the real economy. And that means focusing on points of engagement, and areas of delivery where polytechnics will have a comparative advantage vis a vis other players in the tertiary education and training domain.

Polytechnics need to be better connected to their regional economies and should be a source of drive and leadership.

The Skilling the Nation Conference will bring together business and education experts and commentators to review the findings of the Knowledge Wave conference and to propose concrete strategies for going forward.
Already, in advance of the conference, APNZ has put forward a series of propositions to help focus debate. These include such ideas as:
- Defining skill requirements jointly with the business sector
- Networking with business clusters
- Partnering with other tertiary providers and research organisations
- Setting standards that are globally competitive
- Building learning communities where skill and knowledge is prized
- Encouraging entrepreneurship

It is for the polytechnic sector, in partnership with your key stakeholders – learners, industry, ITOs, other research and education providers, central and local government – to work through these propositions.

It is for the sector to lead the process, and provide leadership to the debate.

And I am confident that these propositions will provide a focus for that debate, and ground it in the needs of the real economy.


Polytechnics have the opportunity to stamp their mark on New Zealand’s economic and social development over the next few years. Small and medium-sized enterprises emerging in the economy are going to give us the lift we need to move forward. To do this they require skilled and capable staff.

I have often warned against a narrow conception of the ‘knowledge nation’ focused excessively on the very high skill levels of a very few. We need world-class researchers and innovators, training to the highest levels of postgraduate study, but by itself this can only take us so far. It needs to be complemented by a broad diffusion of skill throughout the workforce and the community at large.

A key to the success of other similar-sized countries such as Ireland, Singapore and Finland has been a well-educated and skilled workforce that can turn its hand to modern technology and industry practice. We need to move quickly to catch the knowledge wave with a matching skill wave.

It is in this context that polytechnics can properly be seen as the ‘engine-room’ of the knowledge economy.


This ‘engine-room’ as not always been well-stoked in recent years. The failures of the 1990s have been well-documented. Real funding per student fell by 29% - by almost a third. Competitive pressures undermined many institutions, particularly regional polytechnics, and drove their strategic direction onto uncharted, often rocky, terrain.

Perhaps the most fundamental blow, however, was to the sense of mission that polytechnics felt as a sector. The Education Amendment Act 1990 had been very clear:

"A polytechnic is characterised by a wide diversity of continuing education, including vocational training, that contributes to the maintenance, advancement, and dissemination of knowledge and expertise and promotes community learning, and by research, particularly applied and technological research, that aids development".

However, in practice, this was undermined in the 1990s as tertiary education institutions were increasingly treated as generic Tertiary Education Institutions or TEIs. These TEIs were then expected to focus exclusively on their balance sheet, not their Charter, as their guiding document.

Of course, polytechnics (and other institutions) must be well-managed -- but well-managed in pursuit of what?

The tertiary education reforms that this Government has embarked are, more than anything else, about reintroducing a strategic focus on the tertiary education system, and reawakening a sense of mission.

In order to do this we will, before the end of the year, be introducing a Tertiary Education Reform Bill before Parliament. This Bill will in fact amend two existing pieces of legislation. Amendments to the Education Act will set up the Tertiary Education Commission and bring all post compulsory education and training under a single umbrella. Charters will be strengthened, and supplemented with institutional profiles.

The second set of amendments will be to the Industry Training Act reflecting Government decisions arising out of the Industry Training Review. That review identified a number of initiatives building on the actions that the Government has already taken to lift investment and performance in vocational education and training - ensuring that we really do have the kind of Skills Wave this economy and society requires.

Also before the end of the year, we will release a draft Tertiary Education Strategy, which will set out clearly the Government’s priorities for skills and knowledge development for the nation as a whole.


We are doing our bit, but in order for New Zealand to really catch the skill wave, it will require the polytechnics themselves to take ownership of the strategy as well.

I am looking to this conference for the polytechnic sector to achieve a common direction and sense of purpose on the contribution they plan to make to the development of our knowledge economy and society.

This is no small challenge, but I have faith in the polytechnic sector. That faith is one that that is underpinned by the contribution that this part of the tertiary education and training sector has traditionally always been able to make – quality contributions in education and training for the real economy. I wish you well – and I’ll see you there.


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