NEW ZEALAND: Universities face growth restrictions

New Zealand’s eight universities face the prospect of carrying unsubsidised students for the first time in nearly a decade as the government’s tertiary education reforms begin to bite.

The country of 4.2 million people subsidises New Zealander’s tertiary education and in recent years the government has allowed universities to grow by 15% or 1,000 full-time equivalent students per year. But the government is now introducing a new-capped funding system requiring growth in subsidised student numbers to be pre-approved by the Tertiary Education Commission.

That approval process has had a rocky start for the 2008 academic year with a miscalculation of this year’s growth in student numbers and complaints from vice-chancellors about last-minute changes to funding levels.

Government spending on universities next year of NZ$1.18 billion (US$880 million) was expected to cover forecast growth of 3% spread over 2007 and 2008. But three universities – Auckland University of Technology, Victoria University of Wellington, and the University of Auckland – grew so much this year that the budgeted money was not enough.

The Tertiary Education Commission was forced to ask Cabinet for more and received an additional NZ$34 million. But even that proved insufficient with Otago, Victoria and Auckland universities indicating they would receive less money than they needed to cover increased student numbers next year, let alone cover this year’s growth.

Victoria vice-chancellor Professor Pat Walsh said the commission had reneged on a previous commitment to fund the ongoing pipeline impact of this year’s growth at his university and would not fund it for further increases next year.

A University of Auckland spokesman said the university would not receive sufficient tuition subsidies to cover all the students it expected to enrol in 2008.

Meanwhile, Otago vice-chancellor Professor David Skegg has refused to clarify allegations that funding for his university’s expected growth would be diverted to three other un-named universities. Other universities have also refused to comment but it is expected that all institutions will have a mix of two main options for dealing with growth that exceeds agreed levels.

The first is to simply ‘carry’ students above the agreed growth levels, receiving their tuition fees but no government subsidy. Such an approach can be used to prove demand and press the Tertiary Education Commission to agree to growth the following academic year.

The second is to impose enrolment limits on courses to ensure universities do not enrol more students than they are subsidised for. New Zealand universities range in size from 29,451 full-time equivalent students at the University of Auckland to just 3,094 at Lincoln University, the only one with fewer than 10,000 students. International students account for about 17 per cent of enrolments.