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Steven Joyce - Source: Q+A -
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STEVEN JOYCE interviewed by GUYON ESPINER
GUYON Thank you Minister for joining us this
morning on the programme we really appreciate your time. One of
your top priorities in the portfolio is course completion rates,
but when you look across the sector amongst all providers all
students, the rate of course completion is close to 75%, so is this
really such a big problem?
STEVEN JOYCE - Tertiary Education Minister
Oh it's a significant problem in some areas, and I would start at
the outside by saying there's huge amounts of good things going on
in our tertiary education sector, and you've gotta be careful not
to tar all with the same brush, but there are some courses where we
have very low completion rates, sort of as low as 30%.
GUYON Which ones are they?
STEVEN A lot of them in the foundation area, level
1 to 3.
GUYON What sort of courses are we talking about
though, what sort of subjects?
STEVEN These are courses in many areas where
they're involving catch-up for those that haven't don't quite so
well in secondary, and also across a number of the sort of lower
level type, hairdressing and tourism type courses. But I think it's
important again not to be too prescriptive because you get some
that are doing really well, some institutions doing really well
with exactly those courses and some that aren't. So it's really
saying here's an expectation we have across a set of courses with a
certain type of student body, we expect you to reach that, and the
signal is to institutions that aren't getting anywhere near that,
to actually do some work and change.
GUYON And so what you're doing is linking
performance and course completion, [they] will be part of that to
the funding of an institution, having something approaching 10% of
an institution's funding linked to pass rates.
STEVEN Be more like 5% to start with, we said 5 to
10% and it's probably going to be at the lower end of that. But it
is important - at the moment what we do is we say you enrol a bunch
of people to a course and we will pay based on those enrolments,
and if you get an attrition rate, a sizeable attrition rate through
the period of the course there's no comeback against the
institution.
GUYON So what will those rates be though Minister,
so what will you have to have as pass rate in order to hang on to
that 5 to 10%.
STEVEN It will differ according to the type of
students that you're dealing with. For example, under graduate
students going into universities, the pass rate now of those that
come out of school and go through university is about 70 - 75%, so
as you say that's not the problem area. But can I just say that the
whole of the exercise is to get those institutions that aren't
focused on, if you like, pastoral care and support of students
during the courses, in other words checking to see that they're
still turning up, checking to see that they're still engaged.
GUYON Sure, everyone would agree that that was
commonsense. But could we just get from you some sort of level of
which that you would expect pass rates to be? Would you expect them
to be at that sort of 70% rate across the board?
STEVEN No, no you wouldn't. What you would expect
is to have a different pass rate that you're seeking for foundation
courses, from vocational courses, from academic courses, and you'd
have a different pass rate for full time versus part time. The
thing a lot of people don't understand of course is the tertiary
sector is a hugely wide of effectively different sectors, you have
universities, you have polytechs, you have private training
institutions, you have foundation courses, you have adult literacy
and numeracy, all these fit into what's called the box which is
tertiary, and they are all different, so you actually do have to
treat them all a little bit differently.
GUYON When you're talking about funding obviously
fees is a big part of that, there's currently a fee maxima in place
which actually caps the amount that institutions are allowed to
charge students, are you looking at changing that so institutions
can charge more?
STEVEN There's a sort of hidden Labour Party price
freeze for the tertiary sector which has been there for some years,
and the trouble is that it has actually created some real
distortions. Actually there's two fee controls, there's a fee
control as to how much you can increase the price of your courses
just generally, and then once you're at the expensive end you
actually can't go any further, and what that means is that some of
our more expensive courses have had their fees capped sometimes for
as much as seven or eight, nine years and then the other courses
have been allowed to continue to increase. And that creates
distortions for the institutions, because it's costing them a lot
more to provide them...
GUYON So what changes - are you gonna look at
lifting that, are you going to abolish the maxima?
STEVEN No what we're looking at is saying - there
will always be fee regulation. As long as the government is
providing on behalf of taxpayers a significant percentage of the
cost of the course there has to be fee regulation, otherwise the
institutions will simply go out there and keep putting their prices
up for what the market can stand ....
GUYON So what changes are you looking at there
then?
STEVEN I'm looking at whether we should retain the
maxima for those expensive courses, or whether there perhaps should
be a percentage increase that's similar right across all courses
regardless of whether they're expensive or inexpensive.
GUYON So let's just drill down there a little bit,
because that's interesting. So you're talking about courses such as
medicine, where you're looking at ten thousand odd dollars a year -
you're looking at allowing that to rise considerably?
STEVEN Well you wouldn't allow it to rise
considerably. I think that would be inappropriate in these current
economic times. But the question you have to ask yourself is are
you actually really sending a signal to institutions currently that
they shouldn't be supplying these expensive courses, because
they're losing more and more money on them as they're not allowed
to put the prices up at all in many case, and yet they are allowed
to for their lower costs courses. So if I was an institution I'd be
tempted to say, well there's our lower cost courses they're some of
these ones that don't involve labs or flying for example, aviation
courses. I might just do the lower cost ones that cost me less to
provide and do more of those, and of course you get necessarily
then not necessarily the ones that the economy are looking
for.
GUYON So we can expect some fee increases at those
higher end courses?
STEVEN We are getting fee increases now.
GUYON Well it rose 1.9% last year, what are we
looking at?
STEVEN Oh well I think just wait till the Budget,
that's a Budget decision.
GUYON But roughly what are we looking at?
STEVEN Oh it won't be dramatic.
GUYON But it will be a rise?
STEVEN There will be the potential for some of the
more expensive courses to increase in cost yeah, but we're not
talking a dramatic change. What we are going to do once we've made
some initial steps is actually go and have a really good look at
university course pricing and tertiary institution pricing, because
they were last looked at in the mid 90s and some of them are
getting highly distortionary relative to the actual cost of
providing the course.
GUYON So you're looking at a wider review on
that?
STEVEN Yes.
GUYON Let's move to qualifications, the actual
qualification that people end up with when they go to these
institutions. You've highlighted the fact that there are 6000
qualifications.
STEVEN It seems quite a lot doesn't it?
GUYON It does seem quite a lot, and a report
released to me by Qualification Authority under the Official
Information Act, shows that your target is to reduce the number of
qualifications by 40 to 45%. Now what sort of timeframe are you
looking at for that goal?
STEVEN Well by July this year there'll be first of
all a real weeding out of those that actually aren't being used,
and a fair number of the 6000 are if you like just sitting there
dormant at this point. We've gotta cull those out and say well
these ones aren't gonna be used in the future, and then actually
interestingly the Qualifications Authority will acknowledge it's
sort of been it's own worst enemy over the year by allowing a lack
of flexibility to adapt national courses for local environments,
and effectively everybody's kept popping up with their own local
course. So one of the things that they will look at doing is
allowing more flexibility to amend a national certificate for
example so that it reflects the realities of a local environment
while retaining it as a national certificate. I think there's quite
a lot that can be done there, and it's good because at the end of
the day you want a student to walk out with a qualification that if
they go down to the other end of the country or up to the other end
of the country that the employer will understand and go yep
actually I can see where that one is and I know what this person's
been trained for. At the moment in some areas that's quite
difficult.
GUYON If you're gonna roughly halve the number of
qualifications, then surely that necessitates reducing the amount
of institutions. Do we need 20 polytechs?
STEVEN No, you wouldn't assume that at all,
because the two are actually unrelated. Because for a polytechnic
in one part of the country to adopt a national course instead of
their own branded course is quite a simple exercise and doesn't
affect necessarily the provision. But your wider question is, do we
need 20 polytechnics? I don't have a strong view on that. I think
we need the polytechnic provision roughly where we have it now, but
in terms of how the institution should be shaped, I think that's
over to the institutions and we're encouraging further cooperation
with the appointments we've just made to polytechnics.
GUYON That means mergers doesn't it?
STEVEN No it doesn't necessarily. You've got a
continuum, a one end is cooperation of calling each other up every
now and again and seeing how you're going, at the other end there's
mergers and there's a whole range in between. I think in my view of
it is regional provision of vocational courses is very important,
it's very important to those regions, I think the best way to
organise it is up to the individual polytechnics to discuss, but I
think the really important thing that must be top of mind is the
quality of education for the students, and as long as everybody
keeps that at the absolute forefront of their mind then the
structures if any should change or not, will actually follow.
GUYON One of the big issues for students
themselves is student loans; it's been a big political issue as
well. You are looking at tightening up on the scheme to some
degree. I understand that that also includes a plan to limit the
amount of time you're allowed to spend on having access to interest
free student loans. What are your plans in that area?
STEVEN Well there's a number of things we're
looking at, and we've all bought into the interest free student
loan policy. It's been fought over a couple of elections now and
everybody's bought into it, but the reality is that it does create
some interesting incentives for people, which once you take out the
interest says to people well perhaps you don't have to think as
much as you used to have to think about how long you actually spent
in courses and things, because you're not accumulating interest. So
given that I think, and given the amount that taxpayers pay, they
roughly write off about 47% in the dollar of every student loan at
the moment, then there is some boundary issues that we look
at.
GUYON Let's talk about those boundaries, are you
looking at limiting the amount of time someone is allowed to spend
...
STEVEN We are looking at potentially a lifetime
limit in terms of the amount of time you can borrow for student
loans, that's one of the things that's on the table.
GUYON Roughly what sort of limit are you looking
at?
STEVEN Well it wouldn't be a particularly
draconian limit, even somebody with my not necessarily esteemed
academic record wouldn't have had any trouble with it.
GUYON How many years Minister?
STEVEN Well, it was six or seven years for an
undergraduate degree of normal length, and so we're not talking at
the, you know, you must finish your degree within three years if
that's what's been set down, we're not talking about that at
all.
GUYON So roughly you get six or seven years of
access to interest free student loans.
STEVEN At an undergraduate level.
GUYON How much would that save, have you worked
that out?
STEVEN Well of course it's not massive in the
overall scheme of things for the year, you know given that student
loans is a very expensive policy. These are all things in the
margin, but with all the things we're looking at you're sort of
looking at between the 10 and 20 million a year, because it's that
sort of numbers. Another thing we're looking at is the issue of
people that come to New Zealand and when they should be able to
access student loans.
GUYON What change are you looking at there from
the current situation?
STEVEN Well currently if you come to the country
as a new permanent resident, or Australians of course as they come
across, you are not allowed to get a student allowance for two
years, and you are not allowed to have a social welfare benefit for
two years. But interestingly you are allowed to borrow for a
student loan the moment you arrive, and that creates some
interesting incentives for people to sign up to tertiary
institutions where perhaps they're not as committed to the country,
or not committed to tertiary education as perhaps others would
be.
GUYON Interesting, so are you hinting there that
there would be a two year window before they would be able to
...
STEVEN It's one of the things we're looking at,
whether we should line that up with the student allowances.
GUYON So international students may have to wait
for two years before they could access?
STEVEN Well not international students. They're
defined as people that come in and they're fee paying students, but
new residents to the country who come into the country might have
to wait for a period of time before they qualify for student loans,
that's something we're looking at.
GUYON When you look at the budget you spend about
1.5 billion on student loans.
STEVEN Yeah, it's big.
GUYON Have you got a target to reduce that
to?
STEVEN No I haven't. What I have got though is a
commitment to have the best possible outcome from what is a very
sizeable spend in tertiary education in this country. We're well
ahead of the OECD average, we're ahead of the Australians in terms
of how much we spend overall. My friends at the universities and
polytechs would all love us to spend more, but the chances of me
getting to do that in the current fiscal environment and given how
much of our economy that already is spent in this area is not
great, so I have to actually move things around to get a better
result, and one of the things we want to do is maximise the number
of places in universities and polytechs.
GUYON So that money will come out of student loans
and it will be filled back in...
STEVEN &To the tertiary sector yes, and this
year we actually - many people don't know this - we are actually
putting more places into our tertiary sector this year than we ever
have before. Now unfortunately that was scheduled to drop off a bit
next year for two reasons. One, there was a demographic change
which the Labour Party endorsed before they left, and then also
we've been going higher than expected because of the current
economic environment. So the challenge for me is to find the money
to keep those places in place in 2011, that's my immediate
challenge.
GUYON Just final question cos I'm running out of
time, student allowances, any change planned there?
STEVEN No nothing planned at this point.
GUYON Nothing changed there. Look that's all I've
got time for but thank you Minister for joining us this morning, we
really appreciate your time.
