Some polytechs could face closure as Te Pūkenga dismantle confirmed

Friday, 20 December 2024

The Tertiary Education Minister is expecting 10 polytechs to be able to stand alone, while new legislation for the disestablishment of megapolytechnic Te Pūkenga means others could be merged or shut down.

The Government confirmed its plans to dismantle Te Pūkenga – New Zealand Institute of Skills and Technology on Friday, more than a year after the initial plan to disestablish it was announced.

The Government had decided to amend the Education and Training Act 2020 to disestablish Te Pūkenga and allow institutes of technology and polytechnics (ITPs) to be established as autonomous entities, Tertiary Education Minister Penny Simmonds said.

But decisions on which polytechnics would be established, and in what form, would be taken in the first half of next year. She expected the first standalone polytechs to be in place on January 1, 2026.

They could be re-established as regional standalone polytechnics, or as part of a federation, likely under Open Polytechnic.

The new legislation meant mergers and closures of polytechs could be possible. Simmonds expected 10 polytechs to be able to stand alone.

Despite massive cost savings resulting in Te Pūkenga bringing its deficit down to less than a million dollars this month from an operating deficit of $37.9 million at the end of 2023 (a significant reduction on the forecast deficit of $93.4m for the year), that was largely due to pulling out of centralisation costs, Simmonds said.

Te Pūkenga would remain in place until the end of 2026 in case some took longer to get into a financially viable position.

“Our hope is that we can get institutions into a place where they will be financially sustainable for the long-term.”

No additional funding would be injected into the sector for disestablishment.

As the different business divisions went through consultation, reviewing its finances, Simmonds said any cut costs should be on a “no regret basis”.

However, how realistic that was given the financial debt of some of the former polytechnics, would become more obvious as it was continued to work through next year, she said.

Simmonds acknowledged it was a tight time frame and that it may be unsettling for staff working in the sector.

Some business divisions, including Otago Polytechnic, had already made cuts to its programmes.

“All of those affected by the changes will be kept informed and supported through this process.”

Learners should continue to enrol and study for qualifications, and employers keep taking and supporting apprentices and trainees, she said.

“Although there may be some changes to how ITPs are organised, and to how and where programmes are delivered, learners can continue to have confidence in their courses and qualifications.”

Labour’s tertiary education spokesperson Deborah Russell criticised the move to return to individual businesses. “Te Pūkenga was set up because it was increasingly difficult for polytechnics and Institutes of Technology to survive alone,” she said.

“All the feedback I’ve heard from the sector was that Te Pūkenga had turned a corner and was starting to deliver. It took longer than it should, we acknowledge that – but it is the right approach.

Just two weeks ago the Education and Workforce Select Committee was told that only two former Institutes of Technology and Polytechs could stand on their own, while others had no pathway back to financial viability.

“What she is doing is taking the sector apart again and creating more disruption. This is tough on students and tough on staff, and will ultimately take the sector backwards,” Russell said.

The legislation was expected to be introduced in the House next April and completed with a select committee process by October.

As part of the Government’s vocational education and training reform, decisions were yet to be made about the design of the work-based learning systems, Simmonds said.

Standard setting currently delivered by Workforce Development Councils (WDCs) would be taken over by Industry Skills Boards, but further input was sought from industry on how work-based learning should be structured.

WDCs would continue to operate in the interim, she said.

“I intend to hold a targeted consultation on two work-based learning options very early in 2025.”

She planned to take decisions to Cabinet in the first half of 2025.