Education (Tertiary Reforms) Amendment Bill — In Committee 
Education (Tertiary Reforms) Amendment Bill — In Committee 
[Volume:643;Page:13213] 
Education (Tertiary Reforms) Amendment Bill 
In Committee 
Debate resumed from 15 November. 
Clauses 1 to 3 ( 
continued 
)  
Dr PAUL HUTCHISON (National—Port Waikato) 
: 
 I am grateful for the opportunity to speak once again on the title of this tertiary education bill. The Education (Tertiary Reforms) Amendment Bill has been called a reform bill and undoubtedly in many respects that is an enormous misnomer. I suggested that perhaps a far more appropriate title would be “The Labour Government (Let Us Reform the Tertiary System Again) Bill” because the last reforms were so bad. 
The whole essence of the Labour Government’s bringing in this bill came about through the enormous excesses of waste we have seen under Labour in tertiary education over the last 7 years. National has calculated that in the order of $419 million has been spent just on paper-shuffling for no purpose whatsoever. The OECD pointed out that on average there has been a change or a reform every 2 years. So here we are after Minister Maharey brought in the first reforms back in 2001 and we have had reform after reform and after this amazing $419 million being spent who else would bring in a reform? It was none other than Dr Cullen. 
During 2003-04 the real excesses occurred. Those were the years when a course on homeopathy for pets was broadcast over the radios and TV sets of the nation and when “pendulism” for beginners and other such vitally important and extraordinary courses were perpetrated by this Labour Government amounting to probably a massive half a billion dollars of extra expense. Something like $1 billion of good education money has been wasted over this last 7 years. 
Here is the absolute irony: now that we have had Dr Cullen as the Minister for Tertiary Education suddenly Helen Clark has come along and decided to rearrange the deckchairs. And who should come in as the new Minister for Tertiary Education but none other than the former Minister of Health whom Tony Ryall described the other day as having joined the graveyard of Ministers of Health. His task is a considerably difficult one in that he is going to have to face a bureaucracy that has mounted from 16 bureaucrats at the beginning of this millennium to 340 and is rapidly increasing by another 28 or so as 13 or 14 investment managers and 13 stakeholder engagement managers are brought in. 
One of the other possible names for this bill would be the “Let’s Add More Bureaucracy to the Tertiary Education System Bill”. That is because the Minister when he first brought in the legislation said it was going to be a high trust - low compliance bill. We know that it happens to be the very opposite. Right around the country we are getting complaints from tertiary institutions that are saying they are literally being threatened by these investment managers. They are being told that if they do not play ball with the managers their investment plans will not be sorted out. We are finding that some of the universities are in deep difficulties because the Government has even before the legislation has been put in place demanded that the investment plans must be in. Therefore though the universities have not been able to know the details of the plans they have had to go ahead. So we have places like Victoria University being millions of dollars out of pocket. We have places like Auckland University estimating that it is something like $8 million out of pocket. This bill is indeed a travesty. 
Hon BILL ENGLISH (Deputy Leader—National) 
: 
 I think this bill should be called the “Worst Example of Government Reform Bill” because as my colleague has pointed out this bill is one more stupid attempt to achieve the impossible vision of one of the previous Ministers which was I think that of Mr Steve Maharey. We are now 8 years on since Labour promised to reform the tertiary education system and its main achievement under the title of “Education Tertiary Reforms” has been to try to reform the legislation it put in before. For instance this bill abolishes charters and profiles. I can remember the Minister for Tertiary Education telling everyone how vital it was that we had charters and profiles on whose development millions of dollars were spent only to have them junked. 
There is a stack of documents—I think it is about this high; others would estimate it is that high—that are full of sociological gobbledegook about how the Minister can sit in his office and govern the educational aspirations of New Zealanders in the tertiary education system. It does not matter how often bureaucrats set out to write pages and pages stitching together contradictory objectives in pursuit of utopia; they keep failing and this bill will fail. 
It turns out now that 29-year-olds with PhDs who are called investment managers have a total stranglehold over the direction of the tertiary education system in New Zealand. I tell the Minister that I think the 20-year-olds who are spending tens of thousands of dollars getting their education should have more say than one of their peers who happens to land an overpaid job in the Tertiary Education Commission. I looked at the purpose clause clause 3 which states the purpose of the Education (Tertiary Reforms) Amendment Bill and there is no mention of students—none. One would think we are running a whole system with no people in it. The bill is about organisations plans stakeholders and bureaucrats. They do use up about half the resources but not all of them. There are still these people called students I say to the Minister and this bill should be called the “Fulfilling the Aspirations of Young New Zealanders Bill”. It should be but it cannot be because they are not mentioned in the bill. 
I have asked some of those 19-year-olds whether they have read the statement of tertiary education priorities. 
Moana Mackey 
: Since when did the National Party talk to students? 
Hon BILL ENGLISH 
: Well that is the problem—the sheer arrogance of Labour believing that it knows what 19-year-olds want. I asked one just yesterday actually: “Have you read the statement of tertiary education priorities and are you aware of the stakeholder consultation plan?”. I got a vigorous response in language that I will not repeat here but it was essentially: “I haven’t read them. I’m not going to. I don’t care who wrote it and it makes no difference to me anyway.” 
So the people who are meant to be complying with all the nonsense in this bill do not know about it and even if they did they would say it was rubbish. They do not care what it is and they will do what they like. This bill should be called the “Total Waste of Time Tertiary Reforms Bill”. As my colleague Mr Hutchison has pointed out many times the people who designed it are all going. Steve Maharey Michael Cullen Janice Shiner and Russell Marshall will all be gone—all gone—when this bill comes into effect. There is no accountability. They do not have to follow through but they do have to answer to the public for this. They have spent $400 million thinking about it. This little skinny bill here is the product of $400 million of analysis over 8 years and nothing sums up better the total incompetence of this Government. 
KATHERINE RICH (National) 
: 
 I will follow on from some of the comments made by my colleague Bill English. Here we are some 8 years after Labour campaigned on the issue of tertiary education reform. All through 1998 and 1999 Labour talked about tertiary education reforms and what they would do for universities polytechnics and the wider tertiary education sector. Now 8 years down the track this is the bill that will fix everything. This is the bill that somehow will make a miraculous difference out there in tertiary land and ensure that the investment we make as a country will go to the right places and meet the needs of students. Well for all those students out there listening to the debate and thinking about this bill we can say one thing and that is that this bill will not deliver utopia out in the tertiary education sector. This bill is so full of jargon bumph and statements that nobody can understand that it will not have any chance of engaging students or the wider public. 
The phrase of the moment is “stakeholder engagement”. It is a very interesting phrase. It gets used around Wellington a lot but when we ask anybody what exactly it means in terms of the day-to-day workings of an organisation we find that it can mean everything and nothing depending on who uses it. We asked the Tertiary Education Commission what these stakeholder engagement managers will actually do. We were told that they will go up and down the country meet with community members and seek out the needs of local communities. We kept saying: “Yes but how will that be done?” and they said: “Well they are going to have cups of tea with local people and they’re going to hold meetings and hui and talk about tertiary education.” I go back to the 19-year-old students Bill English mentioned. Will they turn up and want to take part in these meetings? Will they want to get publicly involved? 
Moana Mackey 
: Some will. 
KATHERINE RICH 
: Get real! They are more interested in other aspects. They will not be involved in this kind of consultation process. 
What will the investment managers do? Some little upstart who might have a tertiary qualification and be quite bright is currently travelling up and down the country at huge expense ringing up vice-chancellors and saying to them things like: “I’m going to visit you every Tuesday to talk about what’s going on in the university.” and of course vice-chancellors are saying: “What? I’m busy running a university. Why do I want to talk to some little upstart about what’s going on every single week?”. It is just added bureaucracy. It is bureaucracy that is symbolised by this bill. 
It has taken $420 million to get to this point. The sum of $420 million has been spent on an organisation that went from a handful of staff to well over 300 and now it has an extended network of offices up and down the country. We had one in Dunedin. It opened its doors and got involved in engagement worked with universities and polytechs to develop charters and plans at huge expense to the community only for the Tertiary Education Commission to turn round and tell communities and the Education and Science Committee that what it had set up was not quite “fit for purpose”. So they shut it all down shut down the leases—and who knows what that cost?—and did an about-face. I feel sorry for the tertiary education sector. It has got involved in this process in good faith. It got involved in writing all its charters and plans and it spent huge amounts of money to get this far only for the Government to change its strategy and say: “No guys and girls this is not what we’re going to do. We are going to go in a totally different direction.” 
The upshot here though is that a bill that says it will reduce bureaucracy and make it easier for tertiary providers now introduces more planning than we have seen in the tertiary education sector before. Tertiary education providers will have to do more planning—medium-term plans short-term plans and long-term plans—and if they want to keep their charters they can do that as well. This bill does not deliver something that will be less bureaucratic or have less red tape. It will mean more and more planning and it will mean that the focus is taken off the teaching and education of our students and put more on the management and planning. 
This bill would be better off being referred to as the “Let’s Put as Much Jargon into One Bill as We Possibly Can Bill”. It could be the “Let’s Spend a Lot of Money and Get Nowhere Bill”. I think those members over there should be ashamed that after $420 million worth of thinking and 8 years into this Government this is as far as this Government has got. It has taken 8 years to get this far and at huge expense. There are glossy documents but nothing else. 
COLIN KING (National—Kaikoura) 
: 
 When we listen to Labour members talking about their goals and aspirations around tertiary education we know that we cannot have any confidence in them. Basically we have the old adage that a leopard will not change its spots and once something has been made crooked it cannot be made straight. Those could be quite good lines to use in addressing the title of this bill the Education (Tertiary Reforms) Amendment Bill. 
It is quite rich when we hear Labour members trying to blame previous Governments for the model that they have carried on with for 8 long years in funding tertiary education. When we check out Labour’s policy on its website we find it quite interesting to see that Labour members have been the ones who have perpetuated this low-quality visionless numbers game. Labour talks about building up to some 250000 people in industry training. At the moment we have something like 140000 in industry training and we are having great difficulty in maintaining quality tertiary education at our institutions. Today we heard Labour’s boasting about getting close to 14000 Modern Apprentices. We have to remind people that there are 140000 people in industry training. The Government has spent over $200 million on trying to get a completion rate of just under 4000. Again we would be wise to consider this bill as amounting to 7 years of going sideways—7 years of wastage. 
It is interesting when we consider the performance of the Labour Government around tertiary education especially in industry training that the Building and Construction Industry Training Organisation in Auckland last year had a 9 percent completion rate of its Modern Apprentices. The parallel apprenticeship programme run out of the Manukau Institute of Technology had a 90 percent completion rate. So today we are seeing the abysmal performance of a Government flagship policy whereas the parallel programme that has been produced and developed by the Manukau Institute of Technology and all the other institutes of technology around New Zealand is outperforming this sham that the Labour Party calls the Modern Apprenticeships programme. [ 
Interruption 
] I am sure that the member who represents the electorate of Waimakariri would be very interested to know that when we look at the conduct of the Minister—and he has a big part to play in this Education (Tertiary Reforms) Amendment Bill—we see that when he talked this year about setting the fee maxima he failed to gazette it. It was part of our job on the select committee to ensure that we inserted another clause in the bill so that we could enact this year’s fee maxima. The Minister had overlooked it and he failed to gazette the fee maxima. 
When we look at the purpose of the bill we see that quite iconic line that states: “… without affecting the academic freedom and autonomy of institutions preserved and enhanced by the principal Act”. We know that that was stated previously in section 161 of the Act but the reason why it was put back in was that the committee felt that the Minister had too much authority. When we go over to new section 159AC “Revocation and replacement or amendment of tertiary education strategy” inserted by clause 8 we see it all laid out there that the Minister has an enormous amount of control. All the way through this bill we see that the Minister has quite unshackled authority. That scared the institutions and they recognised that there was a risk there. 
When we look at it all we see that we have had a capped funding arrangement at the industry training end and we have had universities providing high-quality education. We have had this industry training section in the middle that has been coming to Wellington about every 5 days on its knees and begging for money. The Education (Tertiary Reforms) Amendment Bill should be sorting out the industry training section. 
MOANA MACKEY (Labour) 
: 
 I move  
That the question be now put 
. 
PANSY WONG (National) 
: 
 I am not surprised that the Labour member is very anxious to close the debate. I want to question one of the purpose statements of the bill. Apparently the bill will enable the Tertiary Education Commission effectively to monitor the performance of organisations. Just now I have been told by my diligent National colleague that this exercise so far has cost the public $420 million for nothing. Another $100 million can be added to this bill. 
Let me share this with the public. Two years ago I brought it to the attention of the Minister for Tertiary Education Dr Michael Cullen that there was a cash-back scam of senior students signing up to learn English and getting a kickback and that this scam covered about $100 million of student loans. There was not much prospect of the Government recovering that. When this was brought to the attention of the Minister Dr Janice Shiner the Chief Executive Officer of the Tertiary Education Commission said that an inquiry would be carried out. Twelve months later I asked what the result was. She said that the competent staff at the Tertiary Education Commission had politely written a letter to the 13 institutions that were suspected of being part of this scam. That letter said: “Have you been good? Did you really take part in those scams? We will come out and visit you and we will give you plenty of notice before we do so.” Those remarks were followed by this statement: “Please sign on the dotted line that you did not take part in this scam.” The commission got all those signatures and closed the inquiry. 
So it took this backbench MP with no additional resources such as the 340 staff working in the department to go to Television New Zealand’s  
Close Up 
 programme. Only then did we manage to get the Tertiary Education Commission to take another look into the scam. Files have been sent to the Serious Fraud Office so that it can consider whether to prosecute those institutions. 
It did not stop there. This is not even funny because then the chief executive officer of the Tertiary Education Commission went on television and said that a new policy had been introduced and that the scam had stopped. Well we brought the latest scam to her attention only about a month ago this year. Three institutions were still advertising for students. I was told that the commission sent a letter to one of the institutions and asked it to stop doing this. So a scam was brought to the commission’s attention 24 months ago and 24 months later a poorly resourced backbench National MP is still doing the job for an organisation of 340 people— 
Colin King 
: And growing. 
PANSY WONG 
: —and growing. 
I want the next Labour speaker who is so proud to support this bill to take a call and explain to the public why the passage of this legislation would make this organisation more effective. What would change? All we know is that it has wasted $420 million and as I have just said another $100 million can be added to that bill. I am really looking forward to the Minister in the chair the Hon Parekura Horomia who used to be very good at taking calls explaining to the public why he is so enthusiastic about backing this organisation and believing that it will be effective. We are really looking forward to the Minister taking a call and saying what the public is getting for this $420 million. There is silence. I am sure that the Minister will oblige and take a call. 
JILL PETTIS (Labour) 
: 
 I move  
That the question be now put 
. 
A party vote was called for on the question  
That the question be now put. 
Ayes 68 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 2; United Future 2; Progressive 1; Independent: Field. 
Noes 49 
New Zealand National 48; Independent: Copeland. 
Motion agreed to. 
A party vote was called for on the question  
That clause 1 be agreed to. 
Ayes 68 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 2; United Future 2; Progressive 1; Independent: Field. 
Noes 49 
New Zealand National 48; Independent: Copeland. 
Clause 1 agreed to. 
A party vote was called for on the question  
That clause 2 be agreed to. 
Ayes 68 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 2; United Future 2; Progressive 1; Independent: Field. 
Noes 49 
New Zealand National 48; Independent: Copeland. 
Clause 2 agreed to. 
A party vote was called for on the question  
That clause 3 be agreed to. 
Ayes 68 
New Zealand Labour 49; New Zealand First 7; Green Party 6; Maori Party 2; United Future 2; Progressive 1; Independent: Field. 
Noes 49 
New Zealand National 48; Independent: Copeland. 
Clause 3 agreed to.