West Coast polytech gets $33m bailout
The Government has bailed out a troubled West Coast polytechnic with $33 million to keep it going until next year.
The Tai Poutini Polytechnic (TPP) in Greymouth has been given $8.5m in extra funding and the $24.9m it already owes the Government has been written off.
Education Minister Chris Hipkins said in his cabinet paper on the decision that TPP was effectively in receivership, but needed support.
‘‘The Crown is continuing to provide support because it is critical for tertiary education provision on the West Coast,’’ he said.
‘‘People living on the West Coast have particular challenges accessing tertiary education due to the small population spread over a large geographic area.’’
TPP would never be in a position to repay the $24.9m owed due to its ongoing deficit position and small size, Hipkins said.
In 2015, after concerns were raised about TPP’s courses, an investigation discovered the Government was paying for far more teaching hours than were being delivered by the polytechnic.
The under delivery covered seven years and meant TPP owed $24.9m.
The investigation, conducted by accounting firm Deloitte, also discovered ‘‘irregular human resources practices and a lack of control of expenditure’’, the cabinet paper states.
Tertiary Education Commission (TEC) monitoring and Crown ownership manager Dean Winter said the under delivery was significant.
‘‘In some of the scaffolding programmes, students were receiving as little as 10 per cent of the teaching hours they were meant to,’’ he said.
‘‘That means that in a course where students were expected to receive nearly 200 hours of training, they only did 20.’’
TPP chief executive Alex Cabrera said the ‘‘investigation findings are historical and do not reflect the current practice at TPP’’.
‘‘The Government has shown a commitment to ensuring the continued delivery of quality, sustainable tertiary education on the West Coast,’’ he said.
‘‘Over the past 18 months we’ve carried out a range of measures to create business efficiencies and cut costs across the business, along with our efforts to improve quality and monitoring.’’
TPP deserved to stay open, Winter said. It had a ‘‘significant role’’ to play in the West Coast economy and a large regional employer, with 124 staff.
‘‘We deliver the training needed to get local students into real jobs and we work closely with regional employers to make sure we’re training people they need to fill jobs – this is particularly important across the West Coast’s growing tourism and hospitality sector where we know local businesses are keen to secure workers with relevant skills.’’
Tertiary Education Union national president Sandra Grey said the situation was ‘‘pretty grim’’ for staff at TPP. The union has 30 members there.
‘‘It is a very stressful time for people who work there. It means their future is in the balance and the future of their students and their community, and they find that very difficult to deal with.’’
Hipkins said reform plans for polytechnic funding across New Zealand could go to cabinet in March. The cabinet paper for the TPP decision claims that 50 per cent of New Zealand polytechnics will be in deficit by 2020 and 80 per cent in deficit by 2022.
‘‘It is critical we address these challenges across the whole network, rather than just one organisation at a time. We need a lasting solution to this long-standing challenge,’’ he said.