Urgent Debates — Te Wananga o Aotearoa—Dissolution of Council 
Urgent Debates — Te Wananga o Aotearoa—Dissolution of Council 
[Volume:625;Page:20371] 
Urgent Debates 
Te Wananga o Aotearoa—Dissolution of Council 
Hon KEN SHIRLEY (ACT) 
: 
 I move  
That the House take note of a matter of urgent public importance 
. The issue is the Government’s decision yesterday to move procedures towards the dissolution of Te Wananga o Aotearoa’s council and the appointment of a commissioner and the decision to approve a short-term loan of $20 million of taxpayers’ money to meet an immediate cash-flow requirement. 
The Prime Minister in her interviewed comments associated with this spending of a further $20 million of taxpayers’ money was quoted as saying that she resents the payment of that $20 million. Well those are hollow words. I put it to the House that what she actually resents is being caught out and being exposed for the inadequacy of this Government’s tertiary education policies. 
If we go back in history—and we do not have to go back too far; we have only to go back to the start of this Government’s tenure—we learn very quickly that the wananga monster was created by this Labour Government. It created the monster. Back in earlier years there was actually an application for a Treaty of Waitangi settlement from Rongo Wetere the chief executive of Te Wananga o Aotearoa. The previous National Government declined that. Rongo Wetere was saying essentially that based on equivalent full-time students he should enjoy the same rate of funding for low-quality mass courses as universities. He was saying that to run a course in twilight golf or hip hop incurs the same cost per student as a chemistry or physics course at Auckland University Otago University or wherever else. 
The National Government to its credit said that that was nonsense. It dismissed the Waitangi Tribunal’s recommendation. Michael Bassett who served as a member of the tribunal at the time said that it was one of the most foolish applications to have come before the tribunal and that he was stunned that the tribunal recommended it be approved. 
I might add that initially the incoming Labour Government also declined to approve funding for the wananga at that rate. Then what happened? Do members remember the state of the nation address when everything was to be about closing the gaps? Everything was to be about closing the gaps and just throwing money at things Maori irrespective of quality or targeting. That is what we can trace this back to. At that point the Labour Government changed its mind and said that it would meet Rongo Wetere’s request—it would give him almost unlimited funding on an equivalent full-time student basis; he would get funding at that rate for as many people as he wanted to enrol in those courses. 
Look at the figures! Can members guess what the budget for Te Wananga o Aotearoa was in 2000? How much do members reckon it was? [ 
Interruption 
] No it was $5 million in 2000. How much do members reckon that had grown to by last year the 2004 calendar year? The answer is $239 million of taxpayers’ money. That is the thick end of a quarter of a billion dollars. 
Dr Wayne Mapp 
: What happened to the money? 
Hon KEN SHIRLEY 
: That is a very good question. Under this Labour Government there was no scrutiny. I have been told by people in the New Zealand Qualifications Authority and the Tertiary Education Commission that whenever they raised questions they were told that the direction had come from on high—from the Labour Cabinet—just to keep throwing money at the wananga and not to scrutinise the course content or look at the outcomes. The Government was not interested in outcomes—just in shovelling over the money. That is what the Labour Government did. 
The Government claimed that it did not know. Do members remember when the ACT party exposed this story in February this year? The Government members said: “Horror shock! We’ve got to do something.” But Bill English just made the point in question time that the Government actually had Mr McNally its own appointee to whom it has paid hundreds of thousands of dollars to be its stooge and mouthpiece at the wananga. It was getting regular reports from him. In fact when I broke this story in February an internal email from Mr McNally was the damning point that exposed the culture of extravagance. 
The Labour Ministers knew about it. [ 
Interruption 
] Mr Maharey of course. He was the real culprit. We know about Minister Mallard’s shortcomings. We all know those. But who was the Minister who oversaw this all through last year? It was Minister Steve “Smarmy” Maharey and he did it— 
Jill Pettis 
: I raise a point of order Madam Speaker. All members are honourable members and the Minister’s name is the Hon Steve Maharey. 
Madam DEPUTY SPEAKER 
: The member knows that he must refer to members— 
Hon KEN SHIRLEY 
: I withdraw the reference to “smarmy”. 
Madam DEPUTY SPEAKER 
: The member knows quite well when he is called on a point of order to withdraw or to withdraw and apologise. He does not repeat the message. 
Hon KEN SHIRLEY 
: I withdraw and apologise. The point is that as the whole House knows the Hon Steve Maharey was the Minister dishing out that money. He was receiving the reports from his own stooge Mr McNally about the wananga. 
And who else did the Government have there? Obviously it was getting concerned—it set up an audit and review committee at the wananga. And who did it put on that committee? It appointed Shane Jones—who is way up on Labour’s list its new star. So was he not telling the Government either perhaps? I think that he probably was. The Government knew all about it. And what did it do? It did nothing. It tried to hide what was happening. It tried to disguise it. 
Actually one cannot say that the Government did nothing because—knowing that things were so bad—it kept shovelling the money out. It kept dishing out the taxpayers’ money. 
Stephen Franks 
: Buying Tainui loyalty. 
Hon KEN SHIRLEY 
: Buying Tainui loyalty—and is that not the issue? We know that this particular fiefdom Te Wananga o Aotearoa is actually immersed in the chieftainship of Tainui. One has only to look at the governing council. Is it not obvious what the Labour Government was doing? It was getting concerned about the emerging Maori Party—and so it should—and it thought that it had better shore up Tainui at least. I do not think that that has worked for the Government because Tainui are now so angry that they were led along by the Labour Government which signed a deed of settlement back in 2001 and promised them money. And now Minister Mallard is saying that he will give them another $20 million loan! 
But hang on—let us go to the back page of the deed of settlement signed by this Labour Government in 2001. It outlines a schedule for a $40 million payment. That payment was part of accepting the treaty claim that the previous Government had initially refused and said was a load of nonsense—as it was—but that this Government under its “closing the gaps” policy said was the vehicle and that it would sign. Not only did the Government give the wananga the equivalent full-time student funding—which as we know amounted to $239 million of taxpayers’ money last year alone—but on top of that it gave the institution $40 million in loans. 
I have here the loan schedule. On 7 November 2001 $25 million was handed out. Another $15 million was to be given but the Government actually withheld it. The Government signed a deed of settlement and then withheld the money. How honourable is that? Even if one thinks a deed of settlement is nuts and disagrees with it—as I do and as I think this side of the House does—one honours it after one has signed it. But Minister Mallard and others have been withholding that money. I put it to members that the $20 million the Government is giving to the wananga now will really just be payment of the $15 million that was promised— 
Stephen Franks 
: Plus five! 
Hon KEN SHIRLEY 
:—plus $5 million—back in 2001. 
I have a wonderful cartoon here from a month or so back drawn by Tremain who is a great cartoonist. For those who have not seen it I will walk them through it. Minister Mallard is at the rostrum—a big public rostrum with a microphone—and the caption states: “If the wananga has been ripping off taxpayers we will endeavour to get the money paid back”. 
The little bubble to the side states: “Yeah right!”. There are two little pigs down the bottom and they are saying: “And we’re prepared to take off”. 
So I think that that $20 million loan will be written off. Who else thinks that the Government will write off the money? Members should put their hands up. The Government will certainly be writing that money off. It is gone—“outski”! 
I hope that Minister Mallard will take a call in this debate. I hope that he will explain this situation to the House. I put it to him that surely it is time that he exposed his predecessor Minister Maharey who members may recall is the same Minister who got us into so much trouble with the community education grants. Everything that Minister Maharey touches turns to custard. Of course he is the champion of this Labour Government’s third way. He is the Government’s think tank in a single person! He is its visionary and everything he touches turns to custard. 
Again the ACT party exposed just yesterday that the Community Employment Group which ran the hip-hop tour and blew that incredible amount of money did one final thing before it went out of existence—it organised a big bash for itself at Rotorua. It ran up $32000 worth of debts on airplane tickets hotel accommodation meals and all the rest of it. That was its departing gesture to the taxpayers of this country. Who was responsible for that? 
Stephen Franks 
: Christine Rankin. 
Hon KEN SHIRLEY 
: No it was not Christine Rankin it was Minister Steve Maharey. 
The “Gumboot Minister” Mr Mallard has now been brought in to try to clean up the mess at the wananga. He is doing his best but as we all know that is not good enough. In many respects he is just digging a deeper hole. 
I do not want to see the wananga close. I want it to provide quality courses that are targeted at what is a desperate need in this country—to address the failures of our education system for those who have slipped through the net of the compulsory sector and who lack basic literacy and numeracy skills. The failure of our State education system is a scandal. But who believes that a State wananga is the answer to that? I certainly do not believe that. But that is where we are heading because this Government will end up with a State wananga. 
Sure there were serious shortcomings with the Rongo Wetere fiefdom at Te Awamutu but what the wananga actually did using taxpayers’ money was destroy private tertiary education providers in this country. It has destroyed them up and down this country. No one can compete with the State. When those providers were providing the best courses they could in a competitive environment and providing innovation in the tertiary sector the wananga came in with bucket loads of taxpayers’ money offering free courses. 
Anyone who knows the Auckland market knows that schools teaching English as a second language schools have been closed one after the other and that Te Wananga o Aotearoa has taken them over. It has sacked those good teachers and put in second-rate teachers and has trebled the class sizes. It has destroyed what was a very valuable provision by the private sector to tertiary education. We know of the Labour Government’s philosophical hatred of private providers in tertiary education. In a way it has used the wananga firstly to destroy those providers—by unfair competition using taxpayers’ money—and now it will use that bad example as an excuse to close them down. That is a dreadful outcome. 
In conclusion I make the point that I have no confidence in the Auditor-General’s inquiry. That is principally because the terms of reference specifically exclude any examination of the integrity of the enrolments and any examination of the course content. Surely that is the basic problem. No one was examining the quality—the outputs—of those courses so we had a proliferation of very low-quality courses and no one was taking responsibility to ensure that the outcomes were to a standard that we should expect. Coupled with that the wananga was driven by a “bums on seats” philosophy. People were being enrolled while waiting in queues for a hamburger as we know—that was happening all around the country on a massive scale. This Government has failed. The wananga monster is its creation. 
Hon TREVOR MALLARD (Minister of Education) 
: 
 Some of us can remember—some time ago I think—that member describing Donna Awatere Huata as the best thing that had happened to education in New Zealand. I think his judgment has not changed much since that time. 
Hon Bill English 
: It was you! 
Hon TREVOR MALLARD 
: I am the best thing? Thank you! That is the first time Bill English has admitted that. 
Tariana Turia 
: I raise a point of order Madam Speaker. I do not think this Minister has any right to cast aspersions on anyone else in this House. [ 
Interruption 
] She may not be in this House but this debate is about Te Wananga o Aotearoa not anyone else. 
Madam DEPUTY SPEAKER 
: I will rule on that but before I do I just warn members and the chief Government whip that that was a point of order and there will be silence during points of order. The point the member raised is a debatable point. 
Hon TREVOR MALLARD 
: I am not at all surprised— 
Stephen Franks 
: I raise a point of order Madam Speaker. It is a point of clarification. The first point of order was raised on the basis that aspersions were being cast on another member of this House. I do not know whether you accepted it or did not accept it but I wonder which person in this House was having aspersions cast on him or her. 
Madam DEPUTY SPEAKER 
: I have dealt with the point of order. 
Hon TREVOR MALLARD 
: Without wanting to refer to the point of order and I will not go back to it I am certainly commenting on the judgment of the Hon Ken Shirley. He has been consistently wrong over a number of years. Even today he talked about the possibility of the wananga becoming a State wananga. Well it is a Crown entity—it is a Crown entity now. It has been a Crown entity ever since National funded it—when it started it. It has been a Crown entity all the time. 
Hon Dr Nick Smith 
: What’s the difference? 
Hon TREVOR MALLARD 
: The member is right. What is the difference between a Crown entity and a State wananga? I say it is nothing. 
Hon Jim Sutton 
: You could call it the “Don Brash Memorial Wananga”. 
Hon TREVOR MALLARD 
: In fact I think it is the “Nick Smith Memorial Wananga” in this case or maybe he was only a junior Minister at the time the funding flowed into it. 
Hon Brian Donnelly 
: It’s the “Lockwood Smith Memorial”. 
Hon TREVOR MALLARD 
: Lockwood Smith was certainly the senior Minister but he had a number of little assistants over the years. I thought Nick Smith was one of them but maybe he was not one of Lockwood Smith’s little assistants who worked closely with him over a number of years. 
Hon Dr Nick Smith 
: Keep to the issue. Where’s the accountability? 
Hon TREVOR MALLARD 
: The member does not like it. Nick Smith is tweeting again like a little sparrow—away he goes. 
This wananga is being treated as any other Crown entity institution would be treated. Any other institution in the same circumstances unable to—[ 
Interruption 
] Tariana Turia on one side says I am discriminating and other people on the other side say I am being soft. I think maybe there is a point of balance and we are taking a reasonable approach. 
I want to acknowledge that this wananga over a period of time has made an enormous difference to a lot of people. There was an enormous backlog of people who through the 1990s and probably the 1980s and in some cases back to the 1970s never got jobs. They had been on the scrap heap for years and years and this wananga made a big difference to the lives of many of them. What has happened? Those people have jobs. They are employed. They are working. They are paying taxes. Some of what was the role of the wananga has now disappeared. Given the fact that that has happened a certain discussion is to be had going forward as part of a charter and profile exercise as to the shape of this organisation. 
I want to make it clear as I have on previous occasions that we will not support any inappropriate use of taxpayers’ funds and investigations are going on in that area as members are aware. Until we get the results of those investigations I think it is better to wait and not show the prejudice we have seen about things Maori from the ACT party over recent months. 
The Government wants the future focus of the wananga to be on Maori students and on the quality of programmes offered rather than on straight volume growth. This wananga received a Treaty of Waitangi settlement. After there was acceptance from National that there would be a settlement the wananga received a settlement on the basis of the need of the Maori students. To shift the whole emphasis to Pakeha students and immigrant students is I think in breach of the terms of that settlement. It certainly means that the wananga does not meet the conditions for the suspensory loan and that has been discussed with it. There is a difference in points of view but that is certainly my view. 
As I indicated the Tertiary Education Commission is renegotiating the charter to make sure it is focused on its core role. The Auditor-General is investigating allegations of the inappropriate use of public funds. I think there is a two-tranche investigation. We have not yet had the results of tranche one. The Government has appointed Mr Roche to be a Crown observer and with the agreement of the council that observer has assumed the role of Crown manager and has taken over the finances of the wananga. It has become clear as part of that process that the finances are not in good shape. We knew they were in bad shape but it is clear that they are in worse shape than we previously contemplated especially around short to medium term cash flow. 
Like many organisations income does not always match expenditure and there have been periods right through this year when an overdraft has been required—especially because of the high levels of need through to 31 July and to avoid the sort of fire sale that members opposite would complain about. This organisation has over $100 million worth of assets. If it went to a fire sale and if there were any question of selling to its mates or of quick deals then members opposite would complain. I want to see an orderly set of arrangements and the Crown manager is the person who is able to focus on that. 
I thank the Crown appointees to the council of the wananga. I make it clear that any contemplation of the appointment of a commissioner is not a reflection on them— 
Hon Bill English 
: What is it then? 
Hon Dr Nick Smith 
: Why did you fire them? 
Hon TREVOR MALLARD 
: I think it is fair to say with Wira Gardiner having been there for only about a month or maybe 6 weeks that it is a bit hard to blame him for everything. I know that National Party members like attacking their own former members and their own former vice-president. They do not like Wira Gardiner very much and I understand that but Wira Gardiner is a straightforward person. I want to indicate that this appointment is not a reflection on some of the people who have been working very very hard to recover the situation. It has become clear that it is unlikely that that can occur. I want to make it clear that although there is an authority for a Crown loan it is not yet done and dusted. I have to be satisfied that the arrangements are in place before that loan occurs. I am not yet satisfied that we are in a positive situation in that I can give assurances to Cabinet Ministers around the security of the loan—[ 
Interruption 
]—notwithstanding cartoons. I think Tremain is a very good cartoonist. I have not seen that one but no doubt I will try to have a look at it. 
I want to make clear to people that there are two ways of the Government securing the loan. One is against the assets of the wananga. They are very large assets and they are relatively unencumbered. The other way is against the income stream to the wananga—the majority of which of course still comes from the Government. So I tell members not to panic around security for the loan. We will get the best shape of wananga going forward— 
Hon Dr Nick Smith 
: It’s done great over the last 5 years! Done a great job! 
Hon TREVOR MALLARD 
: I want to thank Nick Smith. He has admitted that I have done a great job. On that note I think I should end. If he says that I do not need to speak any more. 
Hon BILL ENGLISH (National—Clutha-Southland) 
: 
 Well that speech fizzled out with a whimper as it should from a guilty man. What does that Minister think the public make of the Government coughing up $20 million more for the wananga when last year it gave it $234 million? Trevor Mallard is the man who is mainly responsible for the problems that the wananga has. I think all parties agree that the wananga is an institution that has done some real good in a community. It is an institution that has had some issues and some problems but Trevor Mallard is the Minister who has been too lazy and too complacent to do anything about the vast amount of information that he has been given over the last 2 years whereby he could have avoided spending $20 million this week to keep the wananga afloat. Twenty million dollars is a lot of money. Twenty million dollars would solve a whole lot of problems for special-needs children. It would double the increase that schools received in their operations grant last year. Any member could think of any other priority and this House needs to know that there is only one reason that the Government has to cough up this $20 million and that is Trevor Mallard. 
I have asked the Government for the official information about just what interaction it has had with the wananga over the last 2 years. Well I got about 2 inches of paper from the Government setting out an enormous range of interactions between the Government and the wananga and Trevor Mallard and his smarmy mate the hopeless Steve Maharey were there at just about every one of them. Their fingerprints are on dozens and dozens of documents and briefings over the last 2 years about the wananga. The ACT member is right—the only reason that anything happened about the wananga this year is that it is an election year and Labour was caught out having done nothing when it knew everything. The other reason of course is that it wanted Pakeha voters to see that Labour could kick something Maori and it is just going to keep kicking till it goes down. Rongo Wetere got a bit too big for his boots in Maori politics and the Government is going to nail him no matter what. Even if it has to jack it up it is going to nail him. So this is a combination of mismanagement from Trevor Mallard and the problems the Maori Party is causing the Labour Party. That is why Mr Mallard’s response was so pathetic. So what has been happening? Well star Maori candidate Shane Jones was on the audit and risk subcommittee of the wananga committee for the last 2 years. 
Hon Parekura Horomia 
: What’s wrong with Shane Jones? 
Hon BILL ENGLISH 
: Let us say there is nothing wrong with him and that he is as competent as Labour thinks he is; that means he would have been telling Trevor Mallard and his good mate Helen Clark about every second week how big the problems were. So if he was competent Trevor Mallard must have known about all the problems in the wananga and if he was incompetent well that must be how he got so high on the Labour list. 
Mr Graeme McNally is one of the most experienced tertiary consultants in New Zealand. He has overseen the financial unviability of many institutions. Wherever there is trouble he is there. He is up in Taranaki now. That institution has gone broke. He has been there for a year; it has gone broke. He was at Te Wananga o Aotearoa for 2 years; it has gone broke. The Government spent $120000 paying Graeme McNally to watch the wananga go broke. He knew what was going on. He was telling Trevor Mallard all the time what was happening. But Trevor Mallard did nothing. Maybe the Government is going to use the National Certificate of Educational Achievement (NCEA) excuse. Maybe it is going to say: “Well yes there was information around but it wasn’t flagged; it didn’t have a red alert on it. They didn’t tell us precisely what was wrong.” Well they did. For a period of about 6 months Trevor Mallard and Steve Maharey were briefed weekly—weekly. I can tell the House that Ministers get briefed weekly only about things that really really matter. 
The chief executives of the New Zealand Qualifications Authority the Ministry of Education and the Tertiary Education Commission met fortnightly for 2 years to discuss the wananga—and the wananga only. But nothing happened. Nothing was done. I shall quote the comment of one official: “I am tired of going to large meetings which are drawn out and everyone agrees but no action comes at all.” That sums it up. Here is the question that the House needs an answer to: why did two of the most competent amazing Ministers the New Zealand Parliament has ever seen—Trevor Mallard and Steve Maharey—knowing everything they knew about the wananga do nothing? The reason is that they were scared to do anything and they lack the competence to do it. It is in the Official Information Act paper; they state that officials were telling Ministers that if they did anything relationships with iwi would be affected and that they should not shut down outpost enrolments because that would affect relationships with iwi. They knew that Te Wananga o Aotearoa was popular among Maori. They knew that the Maori Party was getting up and going and getting some traction. They knew that if they laid a finger on the wananga it would give the Maori Party just the kind of rocket boost it needed. 
Well what happened was that the ACT party laid a finger on the wananga and then the Minister decided to do something and then the Maori Party did get the rocket boost it deserved. So this is a Labour nightmare because now it is seen by the Pakeha voters to be pouring good money in after bad and it is seen by Maori voters as having kicked the institution that drove Labour’s unemployment figures down—by putting 30000 of them on the roll. It is lose lose lose. The man who has overseen it all the man they call “Runner” because he does Helen Clark’s errands is Trevor Mallard. He has made a political botch of this that will cost Labour the Maori vote and he has made a financial botch of it that has cost the taxpayer millions and millions of dollars. 
The problem lies with the Minister—Trevor Mallard. He knew everything that was going on. He knew for instance that the retention and completion rates quoted were wrong. The Ministry of Education has these retention and completion rates. The only way one can show that one has not completed a course—in any tertiary institution actually—is by lodging a formal withdrawal. If someone just drifts off and never finishes a course then the person is counted as “completing”. Unless those people officially withdraw they are still in the course. We know that tens of thousands of students just walk and not just from wananga courses but from a whole lot of other courses. That is just one little example of the mess in tertiary education. 
I think the wananga is to some extent the author of its own problems. But to a significant extent it is the victim of a lazy incompetent Government that has left a trial of wreckage through tertiary education. The snooty smarmy Steve Maharey who had the nice word for everyone blew hundreds of millions of taxpayers’ dollars—that he never expected to be spending—on a tertiary system churning out qualifications for students who were sucked in by what they thought was a State guarantee of quality. But it was no guarantee of quality while this Government was in charge. This is yet another example in education alongside NCEA where this Labour Government with its arrogance has trashed the aspirations of thousands of New Zealanders and it is Trevor Mallard’s fault. 
Hon BRIAN DONNELLY (NZ First) 
: 
 I start by saying that there is a really delicious irony in this whole issue over Te Wananga o Aotearoa in that the wananga actually represents everything that the ACT party believes is good in tertiary education. It is a model of ACT’s philosophy of education. It is a model of the market model. It is a most successful institution based upon ACT’s philosophy of education. All we have to do is ask about ACT’s philosophy of education; it is about the market model meeting clients’ needs getting enrolments and getting bums on seats. It was the model that was established through the 1990s and now here in 2005 a successful institution which started off in a garage next to a dump in Te Awamutu is the largest tertiary institution. By the way there is no minority report from ACT in there at all which points out that everything was hunky-dory. 
We have to recognise the fact that this institution has grown rapidly and it has grown rapidly as far as we know at this point in time within the rules that have been established under the market model—as far as we know at this particular point in time. No one has come along from the Audit Office or anywhere else and said that it has not been working within the rules and the rules have been established for all institutions. We will have to wait—and the Minister was correct to say so—and see just exactly what comes out of the audit report. There may be some shortcomings in the terms of reference. But as far as we know this is the most audited tertiary institution in New Zealand and we have not got one hanging offence so let us wait and see whether the accusations made by Ken Shirley are well-founded. 
What we do have to recognise is that that institution grew within the rules as far as we know. It started off in a shed in Te Awamutu and grew all the way to being the largest tertiary institution in New Zealand under as I said those particular things—under the elements of entrepreneurialism innovation penetrating market research and the efficient delivery of systems. We know well that one of the reasons why it was able to cream so much money was that it was able to have very very high levels of student-teacher ratios—much higher obviously than the funding architects had ever considered because they packaged up all those programmes. So it is very efficient in terms of efficiency as measured by the ACT party and its economists and the people who believe that our whole society can be organised upon the Adam Smith model. Nevertheless we still think that it moved too fast. 
Ken Shirley has fingered one of the key issues and it is not the rubbish he has been talking about; it is the issue around the Treaty of Waitangi money. That is one of the keys to the financial problem the institution has got into and I want to give a little bit of background to that. During our time in coalition Government an application was made to us—for $10 million I might add—along those particular lines. We had all the Maori members and we were fairly keen on looking at that. But when we actually analysed it this is what we came to a conclusion about: in 1993 when the private training establishment became the wananga under Locksmith Smith under National and became a State institution it agreed to accept equivalent full-time student funding like other tertiary institutions and the policy was that the capital funding would be in equivalent full-time student funding. So if we were to give it a Treaty of Waitangi claim because it claimed a capital shortfall—it was not about operations it was about capital funding—in fact it was already getting the capital funding and all that funding it was getting from the time it was a wananga. 
New Zealand First said that that was double-dipping and that it was not fair. Why should other institutions not get the same sort of double-dipping? Northland Polytechnic started off with terrible buildings so why should it not get the same sort of capital injection that a Treaty of Waitangi claim was able to give to this particular institution? So we did not allow it. But the moment the coalition broke down the National Party immediately started working on giving that money to the wananga. When Labour came into Government it just could not wait to throw the money at it and say: “Here’s a gift from the Labour Party. Go and close the gaps.” So an agreement was made for $15 million. The wananga then started to purchase buildings on the expectation that this money would flow through to it. That was quite a reasonable expectation—a deed of settlement had been signed. 
Then the Government reneged on that settlement deed and therein lies the problem. Suddenly the wananga did not have the money to be able to continue along with other things that were going on for example the capping of the funding that went through—the 5.1 funding—and the other funding there. That cap was put on and that put pressure on the wananga. Other factors—and I think the Minister is right; some of the unemployment factors etc. meant that its enrolments reduced at the very time that the Government was reneging on the issue over the Treaty of Waitangi money which it should not have been given in the first place. Then of course it said: “Look we can trade ourselves out of this.” but the way to trade out of it would have been to sell off those properties and they would have been at fire-sale cost. Quite rightly the Government has said: “Hang on a second. We don’t want this. We don’t want that pub on the road just out of Hamilton sold at fire-sale cost. If it has to be sold it should be sold at a decent level so that the money can be returned to the State institution.” which the wananga is and as I say for that both National and Labour have to take some blame. 
The member from ACT Ken Shirley mentioned that the Education and Science Committee did a financial review. I have to tell Mr Ken Shirley that unfortunately that review was of the year prior to the year we are looking at now when the wananga got itself into financial problems. I also have to mention—and this is an excuse for the member—that ACT did not put in any minority report to suggest that there was any financial mismanagement or financial problem in the wananga up to that particular point in time. 
Hon Ken Shirley 
: And you were the chairperson. 
Hon BRIAN DONNELLY 
: I was the chairperson and that is why I will stand by the fact that we did not get any evidence of financial mismanagement during that financial review. I want to make that public and people can read it in the report we made to the Parliament itself. But I have to make mention of one particular interaction during that review. I refer to the occasion when we went up to the wananga and interviewed and all the programmes that were going on were explained to us. Let us face it—there has been real innovation in the delivery of programmes there. There has been very real penetration of a part of the educational market that has been very very resistant to penetration by any of our other institutions. Those things have to be recognised and whatever is occurring here in the decisions the Government is making those things cannot be lost. As a Parliament we have to ensure that they are maintained. 
Rongo Wetere made this particular comment to a question asked of him when they were putting out some of the problems that were occurring with the funding flow etc. Someone asked him: “What could be done to help you out?” and his comment was: “Get rid of this Labour Government.” Am I correct! Maybe that piece of information went back to the Minister of Education and maybe that has created some of the turn of events since then. There has been a lot of talk about the $239 million but that $239 million has come from the funding streams from the policies that were set in place during the National Government. If National—[ 
Interruption 
] Oh yes certainly. But the funding policies were put in place at that particular time and endorsed by ACT I might add. If Labour can be criticised it would be because it has done nothing about it. In fact the Associate Minister Steve Maharey whilst recognising that there was a problem with the “bums on seats” policy did not do anything about it. He put in place the levers but never pulled any of them. Therefore this Labour Government does have to take responsibility for the financial problems that occurred. 
In the last Parliament we put through a tertiary education reform bill. The reason we put it through and changed the way in which things were done was so that there would be early signals when there were financial problems. So much for the early signals! This is not the first institution that has had to be bailed out by National or Labour. There is one in New Plymouth that is still in that particular process so it is not unique in itself. But the tertiary education reform legislation was supposed to give more timely information to be able to act. This particular situation has not been acted on in a timely fashion. In fact it has been frustrated by some of the deliberate measures made by the Government itself around Treaty of Waitangi money and about capping funding. 
METIRIA TUREI (Green) 
: 
 Typically Te Wananga o Aotearoa is suffering a much greater level of scrutiny that any other similar institution would in similar circumstances. It is absolutely no surprise that the ACT members have attached themselves to this issue. Te Wananaga o Aotearoa is after all a Maori institution that provides a critical and an enormously successful service to Maori communities and Maori students across the country—a service that all other providers have effectively failed to provide with anywhere near the success that this one has. 
We do not have requests from ACT for urgent debates about the millions of dollars that universities spend on advertising for example. Although student fees are still increasing and tertiary staff are finding it more and more difficult to get the pay rises they need to do their work the universities are spending millions of dollars every year on advertising to attract people in our small country. We do not have urgent debates about what is happening with regard to the Taranaki Polytechnic which has had a $7.5 million bail-out. Te Wananga o Aotearoa is a huge institution worth hundreds of millions of dollars; in comparison with its size $20 million is a reasonable amount of money in the circumstances. Yet we do not have the same claims of mismanagement and terrible foul play against Taranaki Polytechnic that we are hearing from ACT about Te Wananga o Aotearoa. Nor do we hear the same complaints against the Modern Age Institute of Learning a private provider that also received assistance from the Government. This is clearly a race-based attack in my view. 
It is really important that we do not lose sight of the purpose of Te Wananga o Aotearoa which is to provide education services to Maori communities—communities that have missed out and been failed by the State system of tertiary education provision and indeed by the State system of compulsory education. Te Wananga o Aotearoa has massively increased Maori involvement in tertiary education—much more successfully than anyone else has been able to do. One of its real successes has been the establishment of small outposts in far-flung parts of our country so that small communities of Maori and other people who live there as well can get access to tertiary services they would otherwise never have had access to. The institution has been committed to providing and supporting whanau into tertiary education. That is an enormous success and it must not be underplayed. The institution has made tertiary education accessible where other providers have failed to do so. 
In fact the real scandal here is actually that Maori adults are now having to get student loans and go into debt in order to obtain the education they should have got for free when they were young. Part of the increase in Maori student numbers is the increase in adult students: people returning for second-chance learning for basic literacy and numeracy education and to do the training they should have had when they were still in school. The State system completely failed to meet their needs at that time and now they are going back to tertiary institutions to get that education and having to pay fees—and sometimes enormous fees. One of the real successes of the wananga is that it has provided a number of courses for free making sure Maori are not doubly penalised in their desire to obtain the education they were entitled to in the first place. 
There is no doubt that the wananga has made some mistakes. Part of that was due to massive expansion; it is always difficult for a provider like that to expand so quickly. But the Hon Brian Donnelly is completely right: the wananga has done all that within the rules and the frameworks provided for it by the Government. If there is a problem here it is with the Government policy that has not done anything about the equivalent full-time student system that allowed this situation to happen from the beginning—partly I guess because the Government wanted the wananga to be a little flagship for its education policies. Now that the Government is losing support in the Maori community perhaps it is letting the wananga go. Maybe it is quite justified to make that accusation against the Government. But either way it is the Government’s responsibility to have in place policies and frameworks to ensure these problems do not happen to State-funded institutions. 
But that said a $20 million blowout is comparatively speaking not as bad as the $800 million blowout by Air New Zealand all those years ago. That was a huge amount of money going to what was effectively a private institution that provided services for a very limited number of New Zealanders. Yet here we have quibbling over $20 million for an institution that provides services to people and to communities that otherwise miss out completely. 
In terms of the wananga the Greens believe that it should be supported and assisted to provide the services it is designed to provide that it does a fantastic job of providing those services to Maori communities and that the scrutiny it is suffering is a race-based scrutiny. We do not shy away from the fact that mistakes have been made. It is not a particular surprise that there are financial difficulties in an organisation of the wananga’s size and with the level of expansion it is undergoing. We urge the Government to continue to support this institution not to let it flag and to remember it provides a critical service that this Government’s other institutions have not been able to provide. We should not let Maori communities suffer for this Government’s failed policies. 
BERNIE OGILVY (United Future) 
: 
 Yesterday the Minister of Education the Hon Trevor Mallard gave us a message that I do not think any of us are pleased about and that is why we are here today debating this wananga. This particular institution is on the brink of insolvency. There is no great joy in talking about this. Some of us in talking about it today have indicated some of the concerns that exist. Those concerns are not being swept undercover as they have been over the last couple of years. 
I want to talk about just two or three things that have struck me. I was on a visit to the institution in Te Awamutu with the Education and Science Committee some months ago and what impressed me—and had already impressed me over the years that I have understood this institution in its short existence—was that it has played a huge and significant role in encouraging Maori in particular and those who are at the wrong end of the socio-economic club as it were to get back into education and to learn to read and write. That is so fundamental to all of us sitting in this institution called Parliament that we take it for granted but as has been pointed out those people need a second chance because the education system as it was in their time failed to deliver educational outcomes for them. This institution—this wananga—has proved beyond peer and beyond doubt in my mind and in the mind of United Future that it has done amazing things. We will not forget that. 
However the cost of quality assurance and accountability procedures is the nub of the matter. As a policy United Future has no problem whatsoever with funding being focused on students but it does have an issue about funding being for a particular provider. That of course has allowed a variety of options to exist. That is why this wananga has existed and has done such a wonderful job in terms of providing education and in making available what we call second-chance education for those who missed out through failure or from not being interested in the mechanisms of education when they were going through either primary or secondary schooling many years ago. 
Yesterday the Minister announced that he will dissolve the council and appoint a commissioner. That is a very unusual step and as a result I think that this debate has great significance. 
I want to touch on something that others have alluded to but did not emphasise—that is the spectacular growth in any organisation requires scrutiny and other things to be put into place no matter what the institution. I think that that is why we are in this predicament today. Quality assurance and accountability over a wide range of issues has not been managed correctly. We have been very much alerted to the fact that financial management problems exist. Originally there were governance problems as was previously discussed by the select committee. Low-quality courses have been produced and the quality of education has not been assessed correctly. All those things add up to there having been a lack of scrutiny while the organisation grew out of all proportion to anything else with so many tens of thousands of students coming on board for the first time to learn and to contribute to our society. And they are contributing—they can now read write and do the things they want to do. They are studying as well as being in the workplace and I think that they are part of the success story of this country. I would like that never to be forgotten. 
But I want to address the associated issue of who is really to blame for all this. Is it the institution which we have heard one or two people berate? It is partly the institution. Is it the Minister and those around him? Or is it the system that has been inherited as others have indicated? Those issues are all part of the problem and I would like to focus on one or two of them. 
The New Zealand Qualifications Authority and certainly the Tertiary Education Commission have really failed. In the last few weeks in this House there has been no end of concern about the New Zealand Qualifications Authority. It has failed to come up to scratch in respect of the exam system that replaced School Certificate university entrance and scholarship exams. We have heard time after time that the National Certificate of Educational Achievement has not come up to scratch. Who is to blame? It is the New Zealand Qualifications Authority. The Tertiary Education Commission was put in place by an Act of Parliament in my time. It was set aside purely and simply to monitor and bring quality assurance to all tertiary education institutions in New Zealand including this sort of organisation and it has not done so. 
I put on record today that we in United Future and many of us sitting in Parliament have concluded that the real blame goes beyond the noise of what has been printed in the media. The New Zealand Qualifications Authority and the Tertiary Education Commission have not performed correctly. They should have brought their signals to the Minister. Some people have said that the Minister was informed but that he did not take on the advice. I am not sure about that; I do not have that evidence. But I do know that as an auditing body the Tertiary Education Commission has been ineffective. That charge is writ large all over this case. 
The commission and the authority failed to identify problems that emerged with some private training establishments—I note that those problems came as a result of very very quick expansion. A lot of private training establishments have gone under because of the same issues. All we have here is a State sector mirror image of the whole thing. United Future is not happy that we have to debate this in the House when the lesson should have been learnt by the Tertiary Education Commission and the New Zealand Qualifications Authority when they dealt with the private training establishments and the growth they underwent in this country. 
It is a shame that this is before us but at the same time if we as a Parliament and as a country learn from this we will be ever so much stronger and more able to go forward to help the education of all students—young and old—in this nation. 
Hon PAREKURA HOROMIA (Associate Minister of Education) 
: 
 Te Wananga o Aotearoa is being treated the same as any other tertiary education institution in the same situation would be treated. As members know other tertiary institutions have been treated the same. We acknowledge that the wananga has made huge gains for Maori in education. Thousands of learners who were previously marginalised by the education system are now engaged in learning. The Government wants to look into the institution’s positive gains while also addressing the pressures that have been created by rapid growth. We are committed to addressing any inappropriate use of taxpayers’ money and there is certainly tension around in relation to allocating this loan to the tertiary institution. 
The wananga has a very important place in the tertiary sector. In the sense of its roll and its rapid expansion the wananga lends itself to a whole lot of issues that arise 200 years on from our being a settled society. It is important that the member who was blabbing on about this being a special deal for Maori looks at it in the context that pervades. It is important to understand the intergenerational adjustment that is going on for Maori at the moment. 
If he wants to huff and puff about what this Government does not want to do for Maoridom I will tell him that 91 percent of all Maori who want to work are in work. Is that bad for Maori? No. There are 18000 Maori on the unemployment benefit and that figure is tracking down. It is the lowest unemployment rate for Maoridom in 29 years. Is that bad? Is that indicative of a Government that has not done enough for them? People pretend that this Government is on a different mission. Forty thousand more Maori have gone into work in the last 2 years. Is that negative? No. There are 23500 Maori in Modern Apprenticeships. We know that a lot of the modern leaders who are 60 or 70 years old did two things. They either went to Maori trade training or they went into the armed forces. That means they were in a skilling framework that set them up for the rest of their lives. That is the better part of what the wananga has done—it has re-entered our people into education. 
A lot of institutions never saw the market in doing that. They never saw the different demographic compared with Pakeha and non-Maori demographics in this country. The average age of Maori students enrolled in the wananga is 22 which means that it has played a principal role in the development of those students. Twenty percent of all qualifications in this country albeit there are wobbly bits in the system are gained by Maori. I tell my colleague Mr Shirley that in 1968 only 16 Maori came out of university. 
Hon Ken Shirley 
: How many went there? 
Hon PAREKURA HOROMIA 
: Not many because neither the institutions nor the Governments in those days made an effort to put them in there. I remind my friends in Opposition that the baby-boomer Maori—and although I never went to university I understand that the baby-boomers are from 40 to 60 years of age and that that is different from the Pakeha baby-boomer— 
Jill Pettis 
: No we’re 50 I hate to tell you. 
Hon PAREKURA HOROMIA 
: I do not know but at the end of the day for the last 150 years when Pakeha children have sat down at the dinner table—whether they be 5 11 12 13 14 or 15—they have heard good talk from their parents and their uncles and aunties. Because those adults have been to university have been managing businesses and have been telling their kids about the Maoris who work for them. Being a 50-year-old-plus Maori I tell the House that my generation is the last generation of children of manual labourers—that is true of 99 percent of us. If one of our parents was a teacher or a nurse that was a rarity. That is who we are—99 percent of the parents now are children of manual labourers. It was a great life and Maori were loyal workers. 
The wananga found a market and picked up a people who were not used to going into tertiary education. That is what the wananga did. I believe and I will say this even though some people in Opposition and some of my own colleagues may disagree that the wananga has a role now and it has a role in the future. If we want to huff and puff about being good to all New Zealanders then we should make sure that the education journey has relevance and that the continuum of it is not just a snapshot in time where people choose or narrow their view on a people who are still developing. 
Hon Ken Shirley 
: There has to be quality. 
Hon PAREKURA HOROMIA 
: There has to be quality. But quality is certainly aligned with demographic experience and that is what is happening in Maoridom. It is no deep science that due to the intergenerational adjustment we do not have many old people on the marae because in the 1950s 1960s and 1970s a lot of our people moved from their rural and traditional roots to cater for the labour-market need. That member in the ACT party knows about that—about generating wealth and about corporate nuances. 
Who were the manual labourers? Who were the people who had one of the quickest transitions in the world in 10 years from being a traditional-based—a marae-based—people to being city-based? It was Maoridom. I can tell members that whether or not they like it this is not about wasting funding. It is about a Government having the courage to address the situation. We know that the labour market and everybody else needs those Maori people. We also know that there is a shortage of skills. 
I remember standing in Taumarunui 20-odd years ago when Buck Nin was there and I remember people talking about starting the wananga. I certainly know what journey Maori people or indigenous people need to take in the economic climate that we have at the moment. I say that Te Wananga o Aotearoa has played a critical role. But there have been mistakes. Again the differentiation between governance management and tutorage to the pupils is something that we have to differentiate. At the end of the day it is political fodder for people with blinkered views to say how bad it is but to not take into account the situation. 
I ask members to imagine it: 99 percent of the parents of the people are children of manual labourers. When one talks about quality education or better quantities in education how can one achieve that suddenly? Pakeha parents and Chinese parents are generally well ahead. So in that sense I defend the wananga. I defend the need to keep it in this country and to keep it alive. I defend it from the perspective of a treaty right. I defend it from the perspective of the right of doing the right thing for the people—for the young kids in this country and their parents. I do understand intergenerational adjustment. I do understand a minority population against a majority population. Of most Maori parents now—50 60 or 70-year-olds—99 percent never went to university. They never had the privilege of going to a tertiary establishment. That is what we are trying to do. If there is nonsense in there we will sort it out. If there is nonsense and misuse in the management we will sort it out— 
Hon Ken Shirley 
: We’ll do it properly—hip hop! 
Hon PAREKURA HOROMIA 
: That is right and that is what we have done. Hip hop is a nonsense in that sense but by Jove the people in that member’s party have made a lot of money out of the hip-hop business because it is a big business in this country. 
Hon Ken Shirley 
: Name one. 
Hon PAREKURA HOROMIA 
: The music industry has exploded. The member understands that. We can huff and puff about the negatives. We can beat the poor old Maori up again. We can make believe. But we should be honest about what we want to be and give Maori a chance. Maoris do want to be on an equal footing. I can tell members a deep secret about Maori. Maoridom is going forward. Maori are doing better. 
Jim Peters 
: How are you going to change it? 
Hon PAREKURA HOROMIA 
: We are going to change it by due process. We are going to make sure that Maori compete. We are going to make sure that their assets and their enterprise are utilised better. We are going to make sure that they understand that the days of the Pakeha managing it for the sake of it may be past that 99 percent of them never went to university that they can manage their own business that they can be there and that they can be better leaders. 
The debate having concluded the motion lapsed.