Education Minister Chris Hipkins announced an end to competitive funding models for non-degree tertiary study from New Zealand Qualification Framework levels 1 to 4.

Hipkins made the comments at a Vocational Education and Training Forum in Auckland yesterday, describing the competitive model as a “failed ideological experiment”.

“It forced tertiary education providers to bid against each other for a share of funding across two competitive processes and created needless instability in the sector.”

“We don’t do competitive funding for schools or university degrees, so why would we do it for non-degree tertiary study?”

Hipkins says ending competitive funding will give providers greater funding certainty.

Executive Director of Universities New Zealand, Chris Whelan has welcomed the decision saying the competitive funding process make it hard for education providers of foundation and bridging programmes to commit to any sort of long-term cost, leading to underinvestment in teaching facilities and difficulty recruiting and retaining talented teachers.

However, National’s Tertiary Education spokesperson Paul Goldsmith disagrees, saying the collective impact of this decision combined with fees-free and international policies will only serve to stifle innovation for polytechnic institutes.

“Mr Hipkins is giving $2.8 billion to the tertiary education sector but not a dollar of that is going into helping our polytechnics with funding pressures.

“Spending all of this extra investment on free tertiary education for students will do nothing to improve the situation for polytechnics. In fact, with no money left to spend on supporting polytechnics, it will actually make things worse,” says Goldsmith.

Mark Flowers, chief executive of Wintec, thinks a broader view needs to be taken of what polytechs are ultimately trying to achieve, before decisions can be made on funding arrangements.

“When we’re clear about where we’re trying to get to, then we can have a discussion on how we are funded.”

Flowers says there needs to be sufficient funding for their sector.

“There’s no doubt ITPs have been damaged by funding freeze for a number of years,” he says.

The new arrangements will kick in next year, when up to $135 million of funding will return to being on the basis of student enrolments. Funding from 2019 will now be allocated by the Tertiary Education Commission (TEC) through the 2018 Investment Plan process.

The change affects all Student Achievement Component (SAC) funding at levels 1 and 2, as well as funding at levels 3 and 4 for courses focusing on agriculture, horticulture and viticulture.

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