Donnelly Brian: Education (Tertiary Reforms) Amendment Bill — Second Reading 
Donnelly Brian: Education (Tertiary Reforms) Amendment Bill — Second Reading 
[Volume:643;Page:13040] 
Hon BRIAN DONNELLY (NZ First) 
: 
 The select committee process that has seen this legislation the Education (Tertiary Reforms) Amendment Bill returned to the House—significantly amended I might add—has provided me as chair with a great deal of satisfaction. I thank the officials who advised the committee. They came from the Tertiary Education Commission the Ministry of Education and the New Zealand Qualifications Authority. They worked collaboratively. I believe and I think the rest of the Education and Science Committee would agree that they provided the committee with very clear advice. 
Also I thank members of the committee. They had to get their heads around some complex issues and they certainly took their task with responsibility and acted in a way that befits responsible members of Parliament. I have to say that that includes the National members of that committee even though at the end they wrote a minority report expressing concern about the excessive complexity and increased bureaucracy that they suggest lies behind this bill. In terms of the actual treatment of the bill they acted extremely responsibly asked all the right questions and made the right suggestions to make sure that it was as good as possible. 
There is one question I would really like to ask and I hope that one of the National members who is yet to take a call will answer it. I ask whether National members if by any chance they should gain the Treasury benches next year would repeal this bill and overturn these reforms. I would love to hear one of the National members tell the House one way or the other what the case would be in those circumstances. 
There are a couple of parties in this House who constantly bemoan the good old days of tertiary education when students were required to make very little financial contribution to their tertiary qualifications. Not only was that the case but also on reaching the age of 21 anyone in New Zealand could access university education on those favourable terms. The only trouble with those so-called good old days was that New Zealand had the lowest tertiary participation rate of any country in the OECD with the exception of Turkey. That was in the late 1980s. 
When the National administration came to power in 1990 it put in place policies aimed at addressing that situation which was a dead weight around the neck of the New Zealand economy—the “bums on seats” policies. Participation rates increased dramatically over the 1990s so that by the end of the 1990s New Zealand was in fact fifth on the OECD list. Unfortunately there was not a good alignment between many of the courses offered by institutions and undertaken by students and the economic and social needs of the nation. 
This legislation marks the second attempt by the Labour administration to create a better alignment. The first was made by the former Minister for Tertiary Education Steve Maharey but he left the old funding mechanisms in place and inevitably the institutions made full use of those. As a result we had situations such as the 5.1 funding debacle and the uncontrolled growth of wananga and Te Wananga o Aotearoa. 
This legislation certainly provides for more heavy-handed control by the Tertiary Education Commission as to what it will and will not fund. At the same time it seeks to simplify the processes by replacing the 3-year profile with a plan. It also gets rid of the requirement for institutions to have 10-year charters signed off by the Minister which gives us a good place to start a discussion on the specific issues the select committee had to address. 
A number of submitters—most noticeably representatives of the university sector—argued that ministerially approved charters were an essential tool for long-term planning and investment. The argument however seemed to contradict another strongly held position of the university sector that the bill did not adequately protect academic freedom and institutional autonomy. It is hard to understand how the requirement of ministerial approval for long-term planning documents sits comfortably with the joint concepts of academic freedom and institutional autonomy. The select committee agreed that long-term planning is an essential tool of institutional governance and therefore that it includes the requirement that tertiary institutions carry out such planning but not in any prescribed fashion. In doing so I believe that the committee upheld the concept of institutional autonomy. 
A concern was also expressed not just by the university sector but also by others in the submitter group that the bill did not directly mention the requirements for academic freedom and institutional autonomy. However the bill amends the Education Act which most assuredly states these requirements. In order to allay any unnecessary fears over this issue the committee made an amendment to make it explicit that the functions conferred on the Minister and the Tertiary Education Commission by this legislation are to be exercised in accordance with the principal Act. So it has to take into consideration those twin concepts. 
One of the committee’s challenges was to ensure the consistency of language. To this extent it was affirmed that a plan drawn up by an institution in order to initiate discussion with the Tertiary Education Commission will be consistently referred to as a “proposed plan”. Only when a plan has been ticked off for funding will it be referred to as a “plan”. 
Considerable concern was expressed that the Tertiary Education Commission would be able to control the non-Government resources of an institution. The legislation was amended to make it clear that the commission’s power of approval applies only to those aspects of a plan for which Government funding is being sought. We believe that this amendment will allay fears that the Tertiary Education Commission will be able to control non - Government-funded programmes and activities. 
However the Tertiary Education Commission will have the power to seek information in order to access whether an organisation may be at risk. Clause 14 requires the chief executive to monitor and report to the Minister on institutional risk. When we think about it we see that if there is to be prudence around the investment of taxpayers’ money in tertiary education then there has to be a level of monitoring. Why would a responsible Government invest tens of millions of dollars into programmes in an institution that was about to go belly up? In the bill that was initially prepared and sent to the select committee section 159KBA in clause 14 required the chief executive of the Tertiary Education Commission to assess whether the operation of any institution represented a risk to “the financial or proprietary interests of the Crown;”. Anyone with any understanding of tertiary education would know that the use of the term “proprietary rights’’ would be a red rag to the bulls of the university sector. It was agreed that the wording went further than was necessary and the section was rewritten. 
There was an issue as to which stakeholders the institutions should be required to consult. A number of submitters recommended certain groups of stakeholders that they believe should be written into the legislation and they recommended that institutions should be required to consult them. The problem with that approach was about how long we should make the list and whom we should leave off. A more fundamental difficulty was the question of whether select committees or Parliament itself should prescribe such a list. In the end the committee believed that it should be left up to the institutions themselves to decide which groups are their significant stakeholders. However as a check against possibly irresponsible behaviour the Tertiary Education Commission will have the power to recommend any further groups to an institution if it believes that the institution has been remiss in the identification of its key stakeholder groups. 
John Hayes 
: 6 weeks to go and all’s well? 
Hon BRIAN DONNELLY 
: The member did not hear me start this speech with “kia orana” did he? 
 A number of concerns about the bill were expressed such as that it provides the Tertiary Education Commission with unbridled powers. Certainly the way the bill was originally written up left the Tertiary Education Commission with the ability to have almost arbitrary powers. Amendments were made by the select committee which have certainly reduced the possibly of the perception of arbitrary usage of powers conferred by this legislation. No longer will the Tertiary Education Commission just purely and simply be able to come along and do it; it will have to pass over to the institution the reason why it is doing it. However we did not go as far as to provide equal powers between the institutions and the Tertiary Education Commission for one simple reason: the Tertiary Education Commission will be operating in an environment of capped funding. Therefore it must have the final say if the system is not to be logjammed. 
I just note a minor change that was made at the suggestion of the engineering industry training organisation Competenz. Its submission pointed out that students of industry training organisations do not attend the industry training organisations themselves and the legislation refers to students attending the institutions and industry training organisations. However those students are enrolled at the industry training organisations. The select committee recommended that the legislation be amended in such a way as to reflect that accurate and common-sense suggestion. 
I reiterate once again that all of those involved during this particular select committee process acted commendably. They got the bill back in a form that I think is much much better shaped and they have removed some of the rough edges from the bill that came to us originally. That is what a select committee should be about. With that I commend the bill to the House.