Te Pūkenga annual report shows $50m in cost savings

Tuesday, 6 August 2024

Megapolytechnic Te Pūkenga’s annual report has detailed more than $50 million in cost savings in the year leading up to the coalition Government’s announcement to disestablish the institute.

Te Pūkenga – New Zealand Institute of Skills and Technology was formed four years ago to run the country’s 16 polytechs and nine ITOs (industry training organisations). The 2023 annual report, released on Tuesday, was the first year of reporting with all its polytechnics and work-based training organisations under the one entity.

The report showed an operating deficit of $37.9m at the end of 2023 which was a significant reduction on the forecast deficit of $93.4m for the year.

Te Pūkenga had been beset with financial problems‒ reporting an $80m deficit in 2022 ‒ and high profile senior resignations, with five executive members leaving less than two years into their roles.

But Te Pūkenga chief executive Gus Gilmore acknowledged the hard work of staff in achieving the results found in the report.

'The financial result is the outcome of focusing on addressing financial performance through an intensive cost savings exercise, which included consolidation to reduce duplication, structural changes, vacancy management, lease reduction, property sales and programme rationalisation,“ Gilmore said.

'The shortfall in income was primarily due to falling domestic enrolments, which affected the whole tertiary education sector.“

He was pleased with the 86% growth of international students on the previous year’s numbers – 5315 full-time students. It currently had a total of 236,819 students including 105,103 trainees and apprentices.

Meanwhile, course completion rates increased from 77.2% in 2022 to 79.3% and learner satisfaction increased to over 90% in 2023.

The institute had focussed on improving learner support services, Gilmore said.

“For example, a partnership with Te Whatu Ora to provide new and improved mental health and addiction services for ākonga resulted in over 6500 ākonga accessing 14,959 enhanced mental health services sessions.”

In December, staff at Te Pūkenga were officially informed of the Government’s plan to break up the organisation.

A “letter of expectations” from Minister for Tertiary Education and Skills, Penny Simmonds, had confirmed plans to disestablish the centralised organisation, but noted it would require legislative change and more work would be required before determining the future configuration of the network.

As a result, all transformation work had ceased. While work continued to disestablish, its focus remained on ensuring learners, employers and staff were supported to continue delivering vocational education and training, Gilmore said.

'Looking back on the year 2023, our kaimahi can be proud that we have delivered exceptional vocational education with good outcomes for our learners and employers, and significantly improved our financial performance, during a time of immense change and ongoing uncertainty.

“We thank kaimahi for their continued commitment, hard work and manaakitanga in a period of further change for the sector.”