The scrapping of final-year fees-free has seen the Government Budget freed up of over $1 billion – or $300 million a year.
Finance Minister Nicola Willis highlighted the saving as one of the main sources of savings and revenue in the Budget.
Instead, a portion of the funding will fund vocational training opportunities for secondary school students – as previously indicated – doubling the number of Trades Academy places to 20,000 for year 11 to 13 students, and by 2030 with operating funding of $69m over four years. It will also provide 1000 more Youth Guarantees places that provide wraparound support and training for 5500 school leavers, aged 16 to 24, with little or no qualifications at a cost of $87m.
Minister for Regional Development Shane Jones said almost $2b had been spent on fees-free over the past eight years with no real impact.
“Fees-free did not increase enrolments or completion rates, especially for those from low-income backgrounds,” he said.
The new spending comes as Stats NZ data revealed a growing rate of youth who are unemployed, not in education or training at 14.4 percent, despite a slight decrease in overall unemployment from its decade-high 5.4 percent to 5.3 percent.
Following the earlier “Budget leak” to scrap fees-free, educators called for increases in funding for trades training, given that only 30 percent of school leavers chose to go to university.
However, alongside the scrapping of fees-free will be another hit to tertiary students with the Budget including an operating funding of $35.5m to enable tertiary providers to increase tuition fees by up to 6 percent in 2027.
Willis said the Budget initiatives would lead to the creation of 220,00 jobs. “Those university students can look forward to a good future in this country,” she said.
Education Minister Erica Stanford indicated that this year, secondary schools would feel the love in the Budget.
“This Budget provides substantive investment into the development of our national secondary curriculum, providing resources for students and essential professional learning for teachers,” Stanford said.
An investment of $2.1b was allocated to secondary achievement, including $61m to develop resources for the refreshed NZ curriculum and $20m to provide professional learning and development for 32,000 secondary school teachers to implement the new curriculum and national qualifications.
An additional $15m will go to Industry Skills Boards to develop at least eight new industry-led secondary subjects as part of the reforms.
Meanwhile, the NCEA reform will result in $90m in funding for the New Zealand Qualifications Authority, including the delivery and implementation of the new qualifications, modernising digital systems, and a pilot programme for the use of AI for marking and exam development.
Last year’s Budget was labelled the learning support Budget, but some additional funding has been put into supporting learners with additional needs.
It includes $22m for students with high health needs, $3m for deaf education services, and $10m to meet the increased demand for English for Speakers of Other Languages.
A substantial infrastructure boost will see $470m of capital funding go towards redeveloping up to 10 schools, delivering up to 232 additional classrooms and purchasing land for new school sites in high-growth areas, including Queenstown.
Schools will also receive an increase to their operating grants by 2 percent, totaling $160m over four years. However, it falls short of the 12 percent needed to address the gap while funding did not keep up with inflation over the past five years, identified by a recent report by the Post Primary Teachers’ Association.
The association called for an urgent adjustment to this year’s operational grant of at least 5 to 12 percent – but ideally more – to tackle some of the shortfall. In the meantime, schools have increasingly highlighted the significant costs they are covering through initiatives like fundraisers just to ensure they have enough support in the classroom.
Early childhood education
The early childhood education sector is receiving a 1.5 percent increase to its funding rate, totalling an additional $40m each year. It will also be available from July, brought forward from January next year, to address cost pressures facing the sector.
However, it will not meet the expectations of parts of the sector, predominantly representing for-profit centres, which have campaigned for a 5 percent funding increase to address a sector at “crisis point”, nor does it address the call for a 15 percent subsidy increase to address funding which has fallen behind since 2020, according to analysis by NZEI Te Riu Roa.
Other new spending
A new initiative will see $12m of operating funding go towards supporting young people in care to attend and engage at school, addressing the cohort’s likelihood of experiencing more enrolment problems and a lower rate of gaining secondary qualifications.
Recent changes to the function of the Teaching Council, coming into effect in July, will see $18m go to the Ministry of Education over four years to take over its professional standards setting function.
Along with the already announced $212.4m funding for the Healthy School Lunches and early childhood programmes until 2027, the Budget includes $1.5m of funding to continue support for the KickStart Breakfast programme for schools.
In a pre-Budget announcement, Stanford said $131m was going to support literacy and maths achievement for students in years 0 to 10.
