By: Simon Collins

Kiwi tertiary students, pictured here parading at Victoria University in May, pay the seventh-highest fees in the OECD. Photo / File

New Zealand tertiary students are paying the seventh-highest fees in the developed world, a new report says.

The latest annual education update by the 35-nation Organisation for Economic Cooperation and Development (OECD) shows that Kiwi bachelor’s degree students in public institutions paid average fees of US$4295 a year in 2015-16, or NZ$5927 at today’s exchange rate.

In NZ dollars, that was less than in the United States ($11,319), Australia ($6573) and four other countries.

But New Zealanders paid more than students in the other 20 countries for which data was available, including nine where students pay no fees at all.

The report comes as Labour campaigns for next week’s election on a platform of scrapping fees for a lifetime entitlement of three years of tertiary education by 2024, starting with one year free next year.

The data shows that taxpayers provided only 51 per cent of tertiary institutions’ income in 2014 in New Zealand – higher than in the United States (35 per cent) and Australia (39 per cent), but well below the average of 70 per cent across all 35 OECD nations.

Universities NZ director Chris Whelan said this was partly because New Zealand had the second-highest proportion of international students – 21 per cent of all tertiary students, compared with 16 per cent in Australia and an OECD average of just 6 per cent.

Only tiny Luxembourg had proportionately more international students (46 per cent).

But NZ domestic students also paid a relatively high share of the costs of their tertiary education.

“We might think tertiary education is free if there are no fees, rather than the actual cost of $6000 paid by the student and $11,500 by the taxpayer,” Whelan said. “It’s not actually free.”

On other measures in the report, New Zealand’s performance is mixed.


Public spending on education through taxes, at 4.7 per cent of the national income, is the 10th-highest among the 35 nations.

Private spending, at 1.7 per cent of national income, is the fifth-highest, and the combined total of 6.4 per cent is higher than all other countries except Britain (6.6 per cent) and Denmark (6.5 per cent). The high private spending is partly because of our high numbers of fee-paying international students.

Our public spending is about the same as the OECD average on primary schooling (1.5 per cent of national income), and slightly above-average on secondary schooling (2.4 per cent), but slightly below-average on tertiary education (0.9 per cent).

Early childhood

Almost twice as many 2-year-olds are in preschool education in New Zealand (65 per cent) than across the OECD (39 per cent), although the numbers range widely from none in Ireland to 95 per cent in Iceland partly because of definitional differences.

NZ preschool enrolments are also above-average for 3-year-olds (89 per cent) and 4-year-olds (94 per cent), and are substantially above Australia at all ages.

NZ taxpayers fund 81 per cent of the cost of early childhood education, about the same as the OECD average (82 per cent) and much more than in Australia (67 per cent).

Teacher ratios

Ratios of teachers to students in New Zealand are almost identical to both Australia and the OECD averages in both primary schools (1:16) and secondary schools (1:14).

Teacher pay

Primary teachers after 15 years’ service earned almost exactly the same in 2015 (NZ$59,259 at today’s exchange rate) as the OECD average ($59,152), but much less than in Australia ($81,918). Australian teachers are the fifth-highest-paid in the OECD.

The trans-Tasman pay gap is due to much higher incomes in Australia generally. Primary teachers’ actual incomes averaged 86 per cent of the average income of all tertiary-educated full-time workers in New Zealand, virtually the same as in Australia (87 per cent) and the OECD average (85 per cent).

Teacher demographics

NZ teachers are the third-oldest in the OECD with 36 per cent aged 50 or over compared with the OECD average of 30 per cent.

The proportions of female teachers are about the same as the OECD average across all sectors: 98 per cent female in preschool education, 84 per cent in primary schools, 66 per cent in lower secondary school, 60 per cent in upper secondary and 49 per cent in tertiary education.

Tertiary subjects

The most popular subjects for tertiary graduates are business, administration and law, a group which accounts for 25 per cent of NZ graduates and 24 per cent across the OECD.

New Zealand is first-equal with Finland in our share of graduates in information and communication technologies (7 per cent), but third-lowest in engineering, manufacturing and construction (8 per cent) – a pattern that Whelan attributes to our relatively “agrarian and service-oriented” economy.

NZ students’ choices across other subjects are similar to the OECD average.

Educated workforce

Last year 43 per cent of New Zealanders aged 25 to 34 had tertiary qualifications, exactly the same as the OECD average but below Australia (49 per cent).

Kiwis aged 25 to 34 with every level of education were more likely to be employed in New Zealand than in either Australia or across the OECD, but the income advantage from completing tertiary education was only 40 per cent above high-school graduates in both Australia and New Zealand compared with the OECD average premium of 56 per cent.


One in eight (12.6 per cent) of New Zealanders aged 18 to 24 last year was not in employment, education or training (NEET) – worse than Australia (10.9 per cent), but better than the OECD average (15.3 per cent).

Source: NZ Herald


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