The Government is considering merging all of the country’s Polytechnics.
This is in response to growing financial concerns about a number of them which have raised questions about the on going viability of some.
The institutions’ chief executives met Education Minister Chris Hipkins last December and told him their sector was under strain.
Charles Finny, independent chairperson of NZITP (New Zealand Institutes of Technology and Polytechnics), which represents the 16 institutes of technology and polytechnics, said the institutions were facing a downturn in enrolments and a funding system that was not fit for purpose.
“A number of institutions have got challenges, and without the international students, for some institutions, it would be extremely challenging indeed, so we do need a new approach,” he said.
“The sector is under pressure; no-one is denying that.”
Education Minister Chris Hipkins says part of the problem is the size of the sector. All 16 institutions are about the same size as the University of Auckland.
“Clearly you’ve got an issue of scale,” he told POLITIK.
“These are pretty small organisations.
“And if you look at the smallest of them, Ta Poutini on the West Coast, it’s broke and heavily in debt.”
Ta Poutini has only just over 300 students and last year the Government had to inject $3.6 million into it to keep it going.
To compound its problems, last November it received a category four designation from the New Zealand Qualification Authority in its 2013-17 external evaluation review – the lowest designation NZQA can assign.
“It’s pretty much insolvent.
“We’re basically pouring cash into it to keep the lights on.
“We can do a quick fix there; wipe off their debt, pour some more money in, but we’ll be back in a year’s time looking at it again because the model is just not sustainable.
“The Western Institute of Technology in the Taranaki is well on the way to being a similar situation; you’ve got others who are trending towards that and then some of the bigger ones, if you wait long enough they will get to that point too.”
Hipkins says that with 16 institutions there is a massive duplication of back office systems.
“There are built-in administrative inefficiencies that we can look at, but more importantly you’ve got a lot of programme development cost that you don’t need,”
He asks why it is necessary for each polytech to have separate programmes.
“Surely you could have one programme that was delivered at the different sites round the country.
“So you start to look at how you can use get those greater efficiencies, so less money on the programme administration and development side and more money on the programme delivery side and then the whole economics of this situation change.”
He says that New South Wales had similar problems and their solution was a one TAFE (Technical and Further Education) model.
“They put it all into one but with a devolved structure within that one.”
He also sees scope to link the Polytechs into the Government’s job creation and future of work proposals.
Perhaps surprisingly, given the controversy he is in over charter schools, he believes that private training establishments often do a better job than the Polytechs.
“Before I went into politics I worked in the oil and gas industry.
“I was contracting to Shell Todd, and my job was to manage all their apprenticeships and training.
“If I went to WIT, the polytech in Taranaki, and I said I want these programmes, they would say they could do something in six months time.
“But if I went to the local private training establishment, Marine offshore, they would say when do you want it by.
“I’d say a couple of weeks, and they’d say that’s fine.
“The institutional settings for the polytechs are so intricate that they are so slow to respond to industry demand.
“And the result is that the PTEs have hovered up all the privatessector funding for education because they can do it quicker.
“If we can get the Polytech sector more nimble I reckon there’s a huge amount of additional investment we can attract from the private sector.”
This is not quite what Hipkins’s National Party critics would expect to hear from him.
And they may end up finding hard to oppose his moves to join the Polytechs together and make them more customer focussed.
It almost sounds like what they would do.