NEW ZEALAND: Election brings research funding increase

Universities in New Zealand are looking forward to a $50 million (US$29 million) boost to their main research income as a result of the country's change of government. But other education impacts of the country's swing to the right were less clear as University World News went live.

Last week's election result gave the centre-right National Party sufficient seats in Parliament to form a government with support of the right-wing ACT Party. The Nationals are also expected to develop agreements with the United Future and Maori parties although what impact those agreements might have on higher education were unknown last week.

The National Party went into the election with just a few clear points of difference with the then-ruling Labour Party in terms of tertiary education policy. Chief among these was opposition to introduction of a universal student allowance - instead the Nationals promised to introduce a bonding scheme that would write off student loan debt for health and education sector graduates who worked in areas hard to staff.

The party had also pledged to abolish Labour's 15% tax credit on private sector research and development, with one-third of the resulting savings split between the government's research institutes and three research funds dominated by universities. That should see more than $50 million a year split between funds that currently distribute about $311 million a year.

Another key policy was to cut bureaucracy, including the NZ Tertiary Education Commission which negotiates annual funding with tertiary education providers and administers a range of contestable funds.

The party was expected to act on all three of the above pledges but was expected to leave fundamental aspects of the tertiary education system, including the funding system, well alone.

National tertiary education spokesman Paul Hutchison had reassuring words for universities, stressing that National would not seek to impose more controls on them. But Hutchison also indicated that much depended on the government's finances.

The new government had pledged to make modest tax cuts but, with deficits forecast for several years to come, it will find it difficult to pay for many new initiatives. That will be of particular concern to universities which are lobbying for significant funding increases to catch up with international competitors, particularly Australia.

Under Labour, they enjoyed three consecutive funding boosts specifically for staff salaries. Similar increases in future now appear unlikely.

In addition, the Nationals pledged to retain the current system of caps on student tuition fees which will mean universities have few avenues to increase their incomes.

The New Zealand Vice-Chancellors Committee maintained diplomatic silence in the immediate aftermath of the election but the Association of University Staff was more outspoken.

AUS President Maureen Montgomery urged the government to stick with its predecessor's Tertiary Education Strategy. This had stressed quality, relevance and value for money in a climate of collaboration between institutions rather than competition.

Montgomery noted the financial pressures faced by the incoming government but said that if the government made savings in bureaucracy and other areas, it might be able to redirect some of that money directly to tertiary education providers.

She said further university funding increases were needed because those made to date had merely maintained New Zealand's level of disparity compared with other nations.

* John Gerritsen is editor of NZ Education Review.

john.gerritsen@uw-news.com