Donnelly Brian: Education (Tertiary Reforms) Amendment Bill — First Reading 
Donnelly Brian: Education (Tertiary Reforms) Amendment Bill — First Reading 
[Volume:639;Page:9072] 
Hon BRIAN DONNELLY (NZ First) 
: 
 New Zealand First will be supporting this bill through its first reading although we will be scrutinising closely one or two of its elements during the select committee process. We are supporting it because we believe it does simplify the processes currently in use to steer the system. It streamlines the processes for planning funding and monitoring the system. At the same time these reforms will better align the tertiary education sector and its outcomes with the needs of our society—economic social and environmental. 
New Zealand First sees this bill as an evolutionary step in a process of reform that extends back to the early 1990s. At that time New Zealand had the second-lowest tertiary participation rate in the OECD which really hampered our economic development at that time. The only country we in fact bettered was Turkey. So the equivalent full-time student funding—the bums on seats approach—was set in place. It was the market philosophy as it were and the effect of this was to create dramatic increases in participation rates. That has to be recognised. But there was very poor alignment with society’s needs particularly labour-market needs and the situation was exacerbated by the uncapping of the equivalent full-time student funding. Institutions looked after their own interests first and foremost rather than met the interests of the students or society as a whole. 
The Labour-Alliance Government when it came into power in 1999 had a Minister of Tertiary Education Steve Maharey who was certainly able to identify flaws in the system as it was but he did not necessarily have the solutions. He put the responsibility for finding those solutions to a review panel the Tertiary Education Advisory Commission. The key elements of the commission’s proposals were the bringing of all tertiary education funding under one set of policy and funding parameters and the establishment of the Tertiary Education Commission which was to be a funding agency to exercise a light-handed authority over the funding of courses in line with separate tertiary education strategy and statement of tertiary education priorities documents. There was no doubt the new system improved alignment but the system with its charter and profiles etc. proved to be cumbersome and bureaucratic and the commission needed to take an increasingly heavy-handed approach to achieve its ends particularly to reign in expenditure. 
The tertiary reform legislation in 2002 in fact specified that the Tertiary Education Commission would be only a secondary source of policy advice to the Minister; the legislation spelt out clearly that the primary policy advice provider would be the Ministry of Education. But it is worthwhile noting that recent accountability tools for the Tertiary Education Commission specify that it is required to be a primary policy adviser to the Minister a situation that has shades of Fitzgerald associated with it. This legislation makes such policy primary-explicit. 
As the Minister has pointed out the bill moves away from an annually funded demand-led input-based tertiary system to a 3-year controlled output-based system. The triennial base as a funding regime in itself will cut compliance costs and provide greater security for institutions as well as for their staff. Such a change will be of particular benefit to smaller regional institutions and many private training establishments which thus far have been very vulnerable to vagaries in the system. 
The Government will periodically issue a tertiary education strategy setting out the long-term strategy and current and medium-term priorities—in other words doing away with two documents and bringing them into one. The Government through the Minister will also set out the design of funding mechanisms and establish funding levels. We all know about blow-outs for example in equivalent full-time student funding through private training establishments and also 5.1 funding largely through polytechs and technical institutions. So the process will be achieved by the responsible Minister in issuing funding mechanisms that the Tertiary Education Commission will implement. 
The Tertiary Education Commission will issue guidance on how different tertiary education organisations can contribute towards achieving the tertiary education strategy in relation to content requirements of plans and the criteria under which plans will be assessed etc. The bill sets out the general requirements for plans and the Tertiary Education Commission will specify detailed content requirements in the investment guidance documents. The commission will monitor the performance of tertiary education organisations and work with them to address performance issues and build the capability of the organisations. The important point is that the model is meant to be a collaborative one in which the Tertiary Education Commission will work constructively with tertiary education organisations. The commission will have some flexibility to amend review and replace their plans. The commission will be able to propose amendments or request that a tertiary education organisation review its plan with a view to amending or replacing it. If required the commission itself can amend plans—and I want to make that point: the commission is being given the powers to amend the plans of individual institutions. 
This is the source of New Zealand First’s concerns. The legislation makes it quite clear that in the event of a disagreement between the Tertiary Education Commission and a tertiary education organisation over a plan the commission will be the final arbiter—no questions asked. This is potentially problematic where there is the possibility that this part of the legislation may run up against two principles associated in particular with university education and those are the principles mentioned before of academic freedom and institutional autonomy. 
The complexities of applying those principles to a largely taxpayer-funded system was exquisitely delineated by former MP and university lecturer Liz Gordon. The Education and Science Committee—I think it was in about 2002—was carrying out a financial review of the Southern Institute of Technology and the institute was asked upon what criteria it determined whether to run a course. The institute responded by saying that it would run a course if it had employment outcomes. Liz then posed a question that had the institute gasping. It was this: “In other words if Tim Barnett’s bill gets through you would run courses on prostitution?”. 
I think in that question she encapsulated that fundamental conundrum that exists as a result of institutional autonomy academic freedom and in fact the responsibility of Government to taxpayers in terms of what they will fund and what they will not fund. As far as New Zealand First is concerned tertiary institutions do not have untrammelled institutional autonomy in which they can demand taxpayer funding for any programme they wish to offer. The idea of academic freedom is more full of fish-hooks. Universities have an important role as society’s conscience and critic. They have an obligation in this respect and this role is fundamental to the protection of our democratic freedoms. Without them as I say we could be in serious trouble. The question is whether the Government should have the power to shut down the teaching within certain courses of holocaust denial or claims of the intellectual inferiority of certain races. However uncomfortable we might be with the assertion New Zealand First strongly opposes any suggestion that a Government should have such power. 
The question that has to be asked is whether this legislation is giving such power to an institution or to one of its agencies such as the Tertiary Education Commission. That is a question I think we will need to tease out through the select committee process because if it is allowing those powers to be exercised then New Zealand First would certainly oppose that part of the bill. We will certainly be looking carefully to see that the absolute powers being established for the commission cannot be used as a means of unacceptable control by Government over what is taught in our tertiary institutions. I thought Marian Hobbs explained it quite well by saying that in fact what we are talking about concerns the ideas that are taught within courses. We have no truck with the idea that institutions should be able to demand that taxpayers fund whatever courses they wish to run. However we also would oppose any mechanisms that could be used to shut down the explorations of ideas simply because they are uncomfortable to the Government. 
I just want to make one little point before I finish which is that it is notable that within this legislation there is no reference at all to the principles of the Treaty of Waitangi. If members have a look at the wording that is used they will see that it is about meeting the development needs of Maori people which was put in the last bill by Nanaia Mahuta but it also goes on to mention the needs of other population groups. I take credit for putting in that other part. It seems to me that the issues that need to be addressed through the so-called principles of Treaty of Waitangi clause are very much meant by the clause used within this legislation. Therefore I reiterate that New Zealand First will support the bill going to the select committee. We will look very carefully at those certain elements of the bill during the select committee process.