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National Tertiary Policy and Fact Sheet


Good quality accessible tertiary education and training is vital to New Zealand’s economy and citizenship. National will work for a dynamic high-quality tertiary education system that ensures that students get value for their investment. We favour autonomous providers who work to clear, simple rules with minimal but effective oversight from government

Participation in tertiary education has risen sharply in the past five years. Growth has been arbitrary and uncontrolled. Expenditure has grown by almost $1 billion since 1999 and most of the growth has occurred in informal and lower-level certificate and diploma courses. While degree courses have grown by 6% in six years, community education courses have grown by 545% and certificate and diploma courses by 116%.

In 2005, Labour is spending $65 million on community education courses provided by polytechnics and wananga with no assessment, no qualification, and no requirement for evidence that students are doing the courses.

Last year, Labour spent more than $600 million on low-level certificate and diploma courses with large student numbers and low retention and completion rates.

In the period 2000/04, Labour spent at least $3.3 billion on sub-degree courses. Only one third of students ever completed the courses, so $2.2 billion was spent on unfinished courses.

During the same period $424 million was spent on trades and skills training. Funding was capped, and so the number of people able to do these courses was restricted.

The best time to give our young people skills is when the economy is growing and employees are willing to take on trainees – employers are willing to take on people with fewer skills and train them.

National believes we should seize this opportunity by removing the cap on apprenticeship funding and by paying more for trades and skills courses.

We want to ensure that providers of education and training are encouraged to offer the courses the economy needs and that students want, not the cheapest courses that attract the most government funding.

National also wants to ensure students know that all publicly funded courses are high quality. In recent years quality control systems have not worked, and providers have approved low-quality courses for the sake of the revenue those courses earn. Students and taxpayers must be able to rely on the quality of government-accredited courses.

National will cut back the complex Wellington education bureaucracy because it has failed spectacularly to ensure value for taxpayers’ investment in tertiary education.

A recent damning report by Treasury, the State Services Commission and Prime Minister’s Department shows that the Tertiary Education Commission, the Ministry of Education, and NZQA all failed to control the funding and quality in the tertiary sector because of vague policy, faulty legislation and infighting.

National supports further growth and development of high-quality blue skies and strategic research in tertiary institutions. We will continue with the existing rules and funding for the PBRF and ensure all institutions offering degrees can meet the statutory requirement for related research capacity.

National will:

Abolish Community Education courses run by tertiary institutions
Informal courses with no assessment, no qualification and no teaching time are not tertiary education. These courses have been the worst example of institutions recruiting students for purely financial reasons, regardless of the academic merit of the content.

Boost trades, skills and workplace training
National will remove funding restrictions on trades and apprenticeship funding and encourage more trade training and apprenticeships by paying more for high-quality, high skills qualifications. National will announce a trades and skills policy later.

Freeze government spending on student enrolment in sub-degree certificate and diploma courses
Taxpayers are investing more than $600 million in lower-level courses where there has been explosive and uncontrolled growth. The freeze on growth will allow us to review the value of that investment and work with providers to knock out unsuitable courses and give providers time to adjust.

Introduce spending controls across all tertiary funding
National wants to ensure that the government can control the spending on tertiary education. We will end the pattern of unpredictable uncontrolled public spending growth over the past five years by introducing tight annual spending caps for tertiary enrolments.

Strengthen quality control
Institutions who do not have adequate quality control systems or who have approved dubious courses will lose the ability to approve their own new courses. Independent and consistent oversight of course approval and EFTS values is vital for students who rely on the government to guarantee the quality of publicly funded courses and qualifications.

Pay for study and learning, not enrolment
National will pay institutions for students when there is evidence that students are genuinely engaged and learning. The current system pays institutions when students enrol, regardless of whether the students actually start or stay in a course. Institutions should have a financial incentive to ensure students are successfully learning, not an incentive to let them drop out.

Set student retention and completion requirements for the continued funding of courses
National will cut funding for any course where the drop-out rate exceeds 50% two years running.

Ensure students have choice of courses and providers
National supports student choice of courses and providers. We will require better pathways between polytechnics and universities, and between different learning levels so students can make better choices about progressing their learning.

Better information for students
National will make available to students the information that the government uses to assess the quality of courses. This will include employment rates, research ratings and completion and retention rates.

Reduce central bureaucracy
The report “Review of the Education Sector” demonstrates the need to simplify government monitoring of tertiary education and apply effective and consistent rules. National will simplify tertiary policy and cut back the bureaucracy.

Bring back accountability
National will instruct central agencies to apply funding and quality sanctions consistently to all providers without fear or favour. National will reform polytechnic councils to ensure better accountability for academic and financial decisions.

Work for sustainable training provision in the regions
Strong local providers of training and education are important to every region. They need clear consistent and predictable policy and funding rules. National will work with providers to ensure they are responsive to local needs and are financially sustainable.

Support growth in adult education night classes
National supports low-cost courses that meet a range of community aspirations and needs. The current system of night classes through schools and some other providers works well. National will support growth in adult education

Focus on high-value research
National supports further growth and development of high-quality blue skies and strategic research in tertiary institutions. We will continue with the existing rules and funding for the PBRF and ensure all institutions offering degrees can meet the statutory requirement for related research capacity.

Tertiary Education Fact Sheet

Uncontrolled and Arbitrary Growth

- Between 1999 and 2005 Labour has increased annual tertiary education expenditure by $1.1 billion.

- During that time the number of people completing degrees has increased by only 5%.

- Most of the growth in enrolments and spending has occurred in sub-degree certificate and diploma courses, with the number of people enrolled in these courses more than doubling between 2000 and 2004.

- Between 2000 and 2004 Labour spent at least $3.3 billion on sub-degree courses.

- Completion rates for sub-degree courses are low. Less than a third of people enrolled in sub-degree qualifications ever complete them.

Capped Funding for Skills Training

- In each of the past five years Industry Training Organisations have made bids to train more industry trainees than the government was prepared to fund them for.

- Between 2000 and 2004 the Industry Training Fund grew by just $39 million while funding for modern apprentices grew by less than $20 million.

- By contrast, between 2000 and 2003 alone, annual spending on sub-degree community education, certificate and diploma courses increased by $441 million.


- The Tertiary Education Commission (TEC) has an annual operating budget of $42.5 million a year and employs 324 staff.

- According to Cabinet Papers, Labour awarded an additional $10 million to the NZQA, TEC and Ministry of Education following the recent review of the tertiary education sector.


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