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Targeting quality and relevance in tertiary ed.

5 April 2005 Media Statement

Targeting quality and relevance in tertiary education

Improving the quality and relevance of tertiary education is the focus of the new Statement of Tertiary Education Priorities (STEP) that will guide funding of the sector in the future, Education Minister Trevor Mallard announced today.

Every one to three years the government releases a STEP under the Education Act. The STEP released today sets out the priorities for New Zealand’s tertiary education system from now until December 2007, in line with the government’s overall Tertiary Education Strategy.

“In this STEP the focus is turning to tertiary education provision that is of high quality and relevant to our needs as a country. In earlier STEPs the focus was on building system capability," Trevor Mallard said.

“We are committed to a tertiary education system that will help New Zealanders and New Zealand become more innovative, more skilled, more productive and more prosperous.

“Funding priority will go on the high quality tertiary education provision that is relevant. Low quality courses and providers have no place in a publicly funded system. Funding will shift away from this sort of provision.

"For instance, vocational programmes with relatively poor employment outcomes will not be a funding priority and neither will programmes that only relate to personal interests or hobbies and have no other benefit.

"Instead, our targets for funding will include programmes that match our skill development needs. Programmes will also be targeted for funding that equip people with the basic skills necessary for them to get jobs, for further education and training, or to function effectively in society,” Trevor Mallard said.

Under the STEP, government agencies and tertiary education organisations will work together to focus on:
- taking responsibility for, and actively working to improve, the quality of their teaching to ensure that all students and learners gain the best value possible from their participation in tertiary education;
- ensuring access to excellent education and training that is relevant to students' needs and the needs and goals of employers, communities and New Zealand; and
- enabling knowledge, teaching, and research activities to better support innovation and the social, economic, environmental and intellectual development of New Zealand.

The latest STEP will guide tertiary education organisations in preparing their profiles for 2006-08, which the Tertiary Education Commission will then approve for funding purposes.

These profiles will also reflect the outcomes of the Tertiary Education Commission’s reviews which will shift funding away from provision that does not contribute to New Zealand’s broad national goals (see for more information).

As well as these reviews, the STEP’s emphasis on quality and relevance of tertiary education provision is further supported by other work that is underway such as the implementation of the Student Component Performance Measure.

The performance measure will link a proportion of funding to providers’ performance in relation to course retention rates, successful course completion rates and the results of a survey of learner opinion.

This STEP, which will be formally gazetted on Thursday, replaces the STEP published in August 2003 which informed the early stages of the tertiary education sector reforms.

The STEP 2005/07, along with previous STEPs, can be viewed at

Questions and answers are attached.

STEP 2005-07: Questions and Answers

What is the STEP and the Tertiary Education Strategy?

The Tertiary Education Strategy (TES) and Statement of Tertiary Education Priorities (STEP) dovetail together – the TES is a longer-term high-level document outlining the government’s strategic vision for tertiary education, while the STEP focuses on shorter-term deliverables.

The TES comprises six broad strategies: foundation skills, skills for a knowledge society, high quality research, Mâori and Pasifika development and capability and quality. The TES requires a culture shift in the tertiary education system – so that tertiary education organisations (TEOs) actively and continually contribute to a system of high quality teaching, learning and research that meets the needs of New Zealanders in a changing, and increasingly complex world.

The STEP reflects the strategies in the TES but with a shorter-term focus. It maps out the government’s priorities for the performance of the entire tertiary education system, in line with the overall strategy for the sector.

What are the differences between this STEP and the last two?

The previous two STEPs focused on building the infrastructure of the reforms and the capability of TEOs. This new STEP shifts the emphasis from system capability to the themes of quality and relevance.

Both the latest STEP and previous versions are available from

The new STEP is much more specific about the actions needed now. For example, it sets out the government’s definition as to the characteristics of tertiary education provision that is strategically relevant. It also specifies the particular roles that the various TEOs play in providing tertiary education, and the need for greater differentiation.

Unlike previous STEPs which were structured around specific objectives in the TES, the new STEP follows four key themes:
- investing in excellence in teaching, learning and research;
- increasing the relevance of skills and knowledge to meet national goals;
- enabling students and learners to access excellent and relevant tertiary education, and progress to higher levels of study and achievement; and
- enhancing capability and information quality in the tertiary system to support learning, teaching and research.

This changed format is in order to give greater clarity and specificity.

How will the work outlined in the STEP be carried out?
- In general, the Tertiary Education Commission gives effect to the STEP through:
- negotiating charters with tertiary education organisations;
- negotiating and approving profiles – or parts of profiles – for funding purposes (see below for more information on profiles);
- allocating funds to organisations; and
- building the capability of organisations.
- Through the series of reviews announced in February by the Tertiary Education Commission

These are a review of private training establishment (PTE) provision, a review of sub-degree programmes in the A1/J1 funding categories, a review of dive provision and a review of overlapping provision between Industry Training Organisations and polytechnics.

The review on sub-degree provision is focussing on courses that
- have large EFTS volumes and/or have experienced rapid growth;
- have limited assessment content;
- have limited connection to labour market needs, or are largely formalising learning that was previously happening in an informal and unfunded setting; and
- appear to be subsidised at a level that well exceeds the cost of provision.

In the reviews, the general criteria that will apply are:
- the need for the qualification (e.g. skill and economic development needs, contribution to Mâori development and advancement goals, meeting the development aspirations of Pacific peoples, contribution to social and community goals);
- linkages and outcomes (e.g. staircasing, graduate destinations, linkages with employers);
- performance (e.g. participation, retention, completion); and
- distinct contributions according to institution type (e.g. a PTE’s particular niche provision).

Criteria may differ slightly depending on the review.

The results of the reviews will be reflected in the final profiles.
- Through the implementation of the Student Component Performance Measure.

The performance measure will link a proportion of funding to providers’ performance in relation to course retention rates, successful course completion rates and the outcome of a survey of learner opinion.

What does the STEP mean for tertiary education organisations?

The STEP identifies the focus for different types of tertiary education organisations (TEOs) given their different roles, and sets out the need for greater differentiation between TEOs in providing quality and relevant tertiary education.

For instance, it defines the different roles of universities, polytechnics, wananga and private training establishments (PTEs) (page 8).

Each TEO must compile its profile and shift provision in line with the priorities in the STEP.

When will funding shifts take place?

From 2006. Funding shifts will take place after TEOs assess the quality and relevance of their activity and take decisions to shift away from courses of low quality and/or low relevance. These decisions will be reflected in their profiles for 2006-08.

In addition, the TEC has the ability to limit enrolments – or remove or reduce funding – in particular areas, once it has conducted a review. That's where the reviews outlined above fit in.

What is the definition of "highly relevant" and "high quality"?

The STEP sets out on pages 15 and 16 the government’s high-level definition of relevance. In terms of quality, criteria for this will be determined through the reviews and for wider Profile approval, the Profile criteria and guidelines will reflect the key factors that lead to good learning outcomes for students, such as the quality of the learning environment, the level of pastoral support and the quality of teaching staff.

What are profiles?

A profile is prepared annually and demonstrates how a tertiary education organisation gives effect to its Charter and what its contribution in terms of the Tertiary Education Strategy (TES) and Statement of Tertiary Education Priorities (STEP) will be.

A profile sets out a tertiary education organisation's:
- operating plans, key policies and proposed activities for the next three years;
- objectives, performance measures and targets;
- short to medium-term strategic direction; and
- activities for which it seeks or receives funding from the TEC.

All tertiary education organisations receiving funding from the TEC are required to have an approved profile, unless they meet certain exemptions. The main exemptions are:
- organisations that receive up to $50,000 of funding from the TEC in any one year;
- organisations with which the TEC is contracting only pilot initiatives; and/or
- employers involved only in workplace literacy training.


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