The governments zero budget approach has been applied to the tertiary sector – there will be no new funding overall in the coming year. However, there will be a significant amount of tinkering with the way funding is allocated within the sector.

As the media have pointed there are some increases within ‘Vote Tertiary Education’ (the part of the budget allocating money to universities, polytechnics, wananga, and other providers).

There is an extra $365 million for research over the next four years ($166 million of which goes to a new government agency called the Advanced Technical Institute, which is still under design). There is also an increase in funding to institutions providing engineering and science degrees. But, before we all get too excited about this ‘new money’, it has come at the cost of increasing the repayments for all of us who have student loans, and by capping student allowances to 200 weeks (if you study for more than 200 weeks you’ll have to pay your living costs through borrowing or savings).

What is more, the increase in funding for teaching in engineering and science doesn’t look so spectacular when set against inflationary pressuring in tertiary education and the fact that other areas of teaching have not been given any increase in funding. For each engineering student doing a degree institutions will get an 8.8 percent increase, and science funding will go up 2 percent. Tertiary education prices were up 3.6 percent on the March 2011 quarter, making a very small net gain for teaching engineering students but not in any other area of teaching and learning.

So perhaps our sector gains though the increase in PBRF funding. This competitive fund gets a boost of $100 million over the next four years. In the coming year, however, only an extra $6 million will be put into PBRF, a funding increase of 2.5% (and let’s just remind ourselves again the cost of running the sector has increased since last year by 3.6%).

The next gem is that 5,000 more students are expected to enter the tertiary education sector in the coming year. This is good news. We want more New Zealanders getting an opportunity to study. However, it would help if we had some new money to pay for their education rather than shaving money off the funding allocated for existing students.

Added to this, private training establishments (including companies making a profit out of education) will be able to compete with public institutions for level one and two funding; and, the government is giving them an extra $29.5 million over four years to close the funding gap that exists between them and our publicly-owned and governed polytechnics, wānanga, and universities.

By now you will be thinking the calculations overall look fairly grim. The big picture equation goes like this: no new money, inflation running at 3.6 percent in the sector, 5,000 additional students, and more competitive funding.

This means the sector must again do more with less, the formula that the National-led government has imposed upon tertiary education employees for the last four years.

So are there any ideas on how can we make up the shortfall in the cost of running the sector and what the government is prepared to invest?

Steven Joyce, Minister of Tertiary Education, Skills and Employment, says that our institutions must do more to capitalise on the international student market. He wants us to move towards the Australian levels of international students (around 30 percent of all students in Australia are fee-paying international students compared with 10 percent in New Zealand) if we are to ensure the tertiary education sector flourishes.

So the equation for managing a zero budget in the tertiary education sector:

Stagnant government funding (despite rising costs) + increased competition + more fee paying international students = more well-trained and economically productive New Zealand citizens.

It seems a fairly ill-thought out equation to us. But what do you think of the Minister’s education investment equation?

Students at the universities of Auckland and Victoria are planning to protest today’s budget and impending to cuts to student allowances.

The student action group ‘We are the University’ at both universities are holding student association and TEU endorsed protests.

At Auckland University, over a thousand students have said that they will attend a ‘student strike‘ outside the library at 1.00pm.

At Victoria University of Wellington students are planning to march to Parliament from their Kelburn campus at 12 noon.

We Are the University Auckland says the government is planning to attack students with this year’s budget:

“It will affect current students, ex-students and potential future students by limiting allowances to the first four years of study or 200 weeks (with no exceptions for longer degrees or postgrad study), by freezing the parental income threshold to get the allowance (so even fewer students can get it), and increasing the repayment rate from 10 percent to 12 percent. We have had enough of the short sighted, mindless politics of austerity that limit who gets access to tertiary education and that see us paying rent to a generation that had everything they are taking from us.”

TEU will have analysis and comment on Budget 2012, as well as links to coverage of tertiary education-related and employment-related Budget news on its website.

Also in Tertiary Update this week:

1. TEU rejects performance pay in education
2. Good employment law crucial to good vocational training
3. Time to reinvest universities’ million dollar surpluses back in staff
4. Insecure work rife in Australian universities

Other news

Campaigners are calling for a “living wage” in New Zealand, inspired by policies in United States cities and London. The Living Wage Aotearoa NZ campaign is drawing support from unions, churches, Pacific, women’s and community groups. Organiser Annie Newman of the Service and Food Workers Union said it was inspired by “living wage” policies governing council contracts in more than 140 US cities and in London, where the rate of £8.30 ($17.35) an hour is 37 percent above the legal minimum wage - The Herald

Tertiary Education Minister Stephen Joyce is defending the decision to decline loans to students failing their papers as “absolutely” the right one to make, despite targeting less than five per cent of the students it was expected to -Stuff

Tensions have escalated further in Montreal as Quebec’s legislature voted in favour of an emergency law, Bill 78, to end the 100 days of student strikes. The Bill pauses the current academic year at institutions affected by strikes; imposes steep fines for anyone who tries blocking access to an institution; and limits where, how, and for how long people can protest in Quebec. Critics blasted the bill as an affront to civil rights, an overreaction or ill-considered improvisation. Thousands stormed the streets of Montreal and Quebec City late Friday night to protest the bill’s passage -CBC/Radio-Canada

Millions of youth around the world have essentially given up looking for a job, warned the International Labour Organization (ILO) in a new report. The global youth unemployment rate (at 12.6 per cent in 2011) would be a full percentage point higher if it included the number of young people who have dropped out of the labour market, said the ILO in its “Global Employment Trends for Youth 2012″ report.  Of particular concern are young people who are neither in employment nor in education or training – known by the acronym NEET. If youth are economically inactive because they are in education or training, they invest in skills that may improve their future employability, but NEETs risk both labour market and social exclusion - ILO

“Most of the credible evidence shows that performance pay in any sector, but especially in education, is demotivating. The main benefit for employers is simply that, over time, it lowers the total amount they need to spend on salaries or wages.”

US motivation expert Dan Pink recently noted that reward systems often backfire. In fact, compensation based upon performance may actually lead to worse academic results for students.

“The research shows that money matters. It just matters in a slightly different way than we suspect. Paying people unfairly — say, when Jane makes less than June for the same work — is extremely demotivating. And, of course, low salaries can deter some people from pursuing certain professions. Therefore, the best use of money as a motivator, at least for complex work, is to compensate people fairly and to try to take the issue of money off the table.  That means paying healthy base salaries…”

Dr Grey said performance pay for education would be a harmful idea for education in New Zealand, including for academic, general/allied staff and for students in tertiary education.

Management researcher Alfie Kohn says performance pay makes employees feel that they are being punished, it is manipulative, it ruptures good workplace relations and it deters risk-taking. Mr Kohn notes

“Not a single controlled study has shown a long-term improvement in the quality of work as a result of any reward system. That would be an astonishing fact were it not for the existence of scores of studies – conducted with adults as well as children, in real workplaces among other venues – that have demonstrated how rewards tend to be not merely ineffective but powerfully counterproductive.”

TEU’s national secretary Sharn Riggs says this bodes well for collective agreement negotiations, which start soon at seven of New Zealand’s eight universities.

Victoria University reported a $14.5 million surplus (4.3 percent of revenue). AUT had a $9 million surplus (3.1 percent of revenue). The University of Auckland posted a $32 million surplus (3.5 percent of revenue) and the University of Otago had surplus of s $26 million, (4.5 percent of revenue). All except the University of Auckland are due to begin negotiations soon.

The University of Canterbury reported an overall loss of $115m (39 percent of revenue) once costs relating to the earthquakes were accounted for. Lincoln, Waikato and Massey have not published their annual reports yet.

AUT, Otago and Victoria all reported surpluses that are higher than the three percent target that the Tertiary Education Commission requires them generate.

“University vice-chancellors consistently say that New Zealand needs to invest it its university employees, and that their pay and employment conditions need to be internationally competitive,” said Ms Riggs. “Now that they are in a stronger financial position than the government requires of them, they are in the ideal position to invest in solving the problem they themselves have identified and decried.”

Overpressure in education – an inevitable consequence of payment by results. A protest and a warning to parents.

A Victoria University TEU member sent this to us a few weeks ago – it seems particularly pertinent today given Minister Hekia Parata’s recent call for performance pay for teachers!

It seems Mr Taylor may have been ahead of his time – or perhaps Ms Parata a few years late?

Labour Minister Kate Wilkinson is proposing extensivechanges to employment law, which include allowing employers to walk away from collective agreement negotiations. Cabinet approved the changes this week and they will likely go before Parliament this year.

TEU national secretary Sharn Riggs says the changes will have a huge impact upon people working in tertiary education.

“Removing the employer’s duty to conclude bargaining is among the worst of the changes – it would mean that we would probably not now have collective agreements in place at the ex ITP-MECA branches – Wintec, NorthTec, Unitec, Whitireia, and Bay of Plenty Polytechnic. It may also have prevented us resolving the long-running dispute at Auckland University last year. Under these changes the employers would have simply been able to say that they had tried their best but could not reach agreement. The effect of that would be that all our members would be sitting on individual agreements with no ability to collectively negotiate a pay increase or changes to their conditions.”

The government also intends to remove a provision that guarantees all new employees will be employed on the terms and conditions of the collective agreement for the first 30 days of their employment.

Ms Riggs says this will mean that new workers (who may not know or be told that there is a collective agreement in place at their institution) could be offered any employment conditions at all.

“We know now that employees usually stay on the conditions to which they are first appointed. If those are no longer the union negotiated conditions then new employees could be appointed on conditions that undermine the union conditions. This will enable the employer by default to introduce new conditions into the workplace – for example they could slowly erode timetabled teaching hours.”

The minister, Ms Wilkinson says that the changes are modest and pragmatic, and will increase productivity, and help create higher paying jobs.

However, the Council of Trade Unions says the changes being considered are the worst attack on workers’ rights since the 1990s and will give employees few options. The CTU says the changes would have enabled Ports of Auckland employer to walk away from collective agreement negotiations and proceed with redundancy plans.

Ms Riggs agrees.

“These law changes threaten to de-unionise tertiary education employees, and drive down pay and employment conditions. They are bad for productivity and worse for any vision New Zealand has of being a high-wage economy.”

Also in Tertiary Update this week:

1. Petition to keep university councils democratic
2. MIT nixes fundraising BBQ
3. Budget 2012 preview
4. Commission agrees with TEU’s PBRF advice

Other news

Tomorrow is Pink Shirt Day, an international campaign aimed to raise awareness about the power to prevent bullying. Pink Shirt Day aims to reduce bullying by celebrating diversity and promoting the development of positive social relationships.

Canterbury University students are plan to hand a petition against the proposed closure of three arts courses to vice-chancellor Rod Carr tomorrow and say they will not leave his office until he receives the document. You Are UC student group spokesperson Morgan Hodgson said that on Friday the group would hold a “petition crawl” at the university, ending up at Carr’s office - The Press

Australian National University management has backed away from its plans to ”spill” the positions of 32 of its tenured and permanent academic and administrative staff at the School of Music, bowing to union pressure to use formal redundancy provisions instead. The decision came as 1000 music-lovers crowded into ANU’s Union Court yesterday to protest against the proposed cuts in one of the biggest and loudest rallies in the university’s history -Canberra Times

Contrary to the Heraldeditorial, the biggest factor in the University of Auckland’s slip in world rankings is not student numbers. From 2006 to 2012, Auckland’s THE ranking fell from 46th to 82nd, yet student numbers increased only nine percent. At the same time, Government funding slowed to below the rate of inflation. Without proper investment, New Zealand academics will continue to move overseas for higher wages, research cannot be adequately carried out and students cannot receive the best tuition - Arena Williams and Sam Bookman

The University of Canterbury’s school of music is in crisis and needs to rapidly reverse a student decline to survive, a new report says. To fund a wages’ bill of $1.4 million, the school needed more than 180 fulltime-equivalent students. It had 85 this year. The university said yesterday there was no possibility the music school would close. “This city lives and breathes music and we know the school of music is a critical part of the music community,” pro-vice-chancellor Ed Adelson said -The Press

So instead, TEU members at MIT will use their lunchtime to travel to see the locked-out union members and their families to ‘shout’ them lunch directly.

The Talleys’-owned AFFCO meatworks company has locked out over 1000 of its workers after  bargaining with union members for only 10 hours. Most have been locked out now for nearly three months. The workers have been without pay since the lockout started and their union, MWU, estimates that 5000 children are affected by the lockout.

TEU organiser Chan Dixon says MIT’s TEU members are simply trying to support workers in their local community.

“The on-going lockout of AFFCO workers by Talleys is one of the most brutal attacks on working people. We just want to give the workers a chance to feed their families and protect their jobs,” said Ms Dixon.

The zero, budget (meaning there will be no overall increase in spending, even to account for inflation) is being preceded by several pre-budget announcements highlighting  some areas that will see increased spending as well as preparing voters for some of the less popular cuts.

Within tertiary education, Treasury forecasts from December indicated that tertiary education funding for 2013 will fall to be nearly $400 million below 2009 levels and will continue to fall until 2015. It also shows that numbers of funded full-time equivalent students will reach a record level this year (244,000) and will remain significantly above 2009 levels until at least 2016.

Within the confines of a ‘zero’ budget, the minister of tertiary education has already signalled that funding for degree-level science, maths, technology and engineering will be up but that funding for humanities and commerce may be down. Funding for PBRF research will be up, but funding for level and 1 and 2 courses may be down.

The budget’s big news story within tertiary education is likely to be restrictions on student allowances to four years of study, and the requirements to pay back loans more quickly. TEU views both these changes as an attack on equity and accessibility. There is no doubt that limiting people’s access to allowances, and increasing the financial burden that loans place on some people (especially low income earners, or those from low income families) will prevent some people from studying.

However, the other important equity issue is the gradual shift in funding from level 1 and 2 courses to degree and postgraduate study and research. All levels of study are important but the government is choosing to sacrifice the opportunities of first-time learners who are trying to get basic skills so that it can fund high-end research and study.

The other issue of note is that the Mr English appears only to be looking at the expenses side of the ledger in an attempt to balance future budgets (with the exception being he is not re-examining the 2009 tax cuts for New Zealand’s wealthiest earners, which took an estimated $2 billion out of our economy). He is not looking at investing in areas that can create more jobs, more skills and more opportunities – all of which would lead to more tax revenue and less expense for the government. Tertiary education has a critical role to play in solving New Zealand’s financial problems, but it needs support and resources to do it.

A part time student at the University of Canterbury says the university’s plan to close its theatre program will cost her $4000 of fees for a degree she can no longer complete. Sarah has told the student campaign You are UC:

“If I was a single teen or in my early 20s, I could move to Wellington, Auckland, or Otago to complete my Theatre degree. But this is not my situation. I am married, I have 3 children, I own a home in Christchurch, moving to suit the degree I want to achieve is not in the realm of possibility for me. The only reason I started a degree at Canterbury was so I could become a High School Drama teacher. If this closure goes ahead, I will have spent $4000 towards a degree which I will be unable… to complete at Canterbury University.”

Meanwhile the Christchurch Press reports that corporate culture at the university may be choking creativity. Reporting on the change proposal to close theatre and film studies The Press notes:

“[T]he issue at the moment, the document goes on to say, is not that Arts courses are weak or unsustainable, but that the College of Arts offers more courses than it can support on current and projected income.”

“In short: there is nothing wrong with the affected courses but someone or something has to go. It also becomes clear that this thinking actually pre-dates the earthquakes, as the proposal says [Pro-Vice-Chancellor of the College of Arts, Prof] Adelson has been engaged in his strategic process for 18 months.”

The Press reports that that TEU has filed papers with the Employment Authority seeking a compliance order. Essentially, the filed papers charge the university with not following its own rules around academic process.

Also in Tertiary Update this week:

1. Will there be jobs for science graduates?
2. Joyce wants less representation on university councils
3. Massive student protests shake Quebec
4. Massachusetts replaces teacher educators with video highlights

Other news

Instead of rethinking whether performance measures work in the tertiary sector, the government has set up a performance exercise looking at student retention and completion. For tertiary institutions the quickest route to achieving in this exercise is making sure students pass their courses. The simplest way to ensure students pass is to put pressure on academics to elevate grades (and in a few isolated cases this is already beginning to happen in a range of institutions across New Zealand) – Dr Sandra Grey on Kiwiblog

What we’re saying, though, is that once you’ve used your 200 weeks [of student allowance], that’s the end of it. Currently, you can get exemptions for long programmes, as they call them, or for master’s or PhDs. But when somebody’s getting to the point when they’re doing a master’s or a PhD or a long programmes where they’ve perhaps done one degree and they’re going to do another degree, they are going to have a good income when they leave, and therefore they should be able to pay off a student loan - Steven Joyce on TVNZ Q&A

Universities NZ welcomes the Minister of Tertiary Education, Skills & Employment’s indication over the weekend that there will be a modest increase to the Performance-Based Research Fund (PBRF) in this year’s Budget as it is an effective system for supporting the wide-ranging contributions made by university research - Universities NZ

39 percent of fraud in both tertiary and local government sectors went un-investigated by police. Some 38 percent of respondents in councils and 37 percent in polytechnics and universities said they were aware of a case of fraud in their institution within the past two years – compared to a public sector average of less than a quarter - Radio NZ

Saudi Arabian students have been banned from studying in Christchurch because of earthquake fears. Students sponsored by the Saudi Ministry of Higher Education cannot get government-funded scholarships in Christchurch this year -Stuff

Confronted with the biggest crisis since the 30s, the trade body for British sociologists proudly displayed its engagement by enumerating articles in the Journal of Niche Studies. All this is a long way from that letter of 1981, let alone Keynes. Perhaps it shows how far academics have been forced to conform to their research assessment exercises and turn out measurable output - The Guardian

TV3′s new Sunday morning offering, Three60, is sponsored by Massey University in a deal some sources say could be worth around $50,000. Professor Malcolm Wright, Massey University’s head of journalism, appeared onThree60 to discuss the Rupert Murdoch saga. The sponsor became the commentator. In doing so, the tertiary institution got more buck for their endorsement dollar than if they had flashed a logo on screen at the commencement of the show – which they did. Is this part of the deal? - The New Zealand Herald

”They’re potentially a bit large and unwieldy,” Mr Joyce said.

”I want to see the universities take a more entrepreneurial approach.”

The government pushed through similar changes for polytechnic councils in 2009.  Those changes reduced councils down to eight members, four of whom are directly appointed by the minister and the remaining four are chosen by the first four.  The minister appoints the chairperson and gives her or him the casting vote. Council members may also sit on multiple councils. Staff representatives, student representatives, union representatives and iwi representatives all lost their seats on the new councils.

At the time public law expert Mae Chen said the dominance of Ministerial appointees may also undermine institutional autonomy, contrary to the object of the Education Act and Parliament’s clear intentions for academic freedom and independence.

TEU national president Sandra Grey has warned that Mr Joyce should take a look at what has happened under the new polytechnic council structure before he makes moves on university councils.

“The size of the polytechnic councils might have dropped but the costs of running them have not.”

At Wintec for instance fourteen people sat on Wintec’s council before the reforms and collected $93,000 in council fees. Since the reforms eight councillors, appointed by either the Minister of Tertiary Education or the council itself, have had pay rises of between 17 and 131 percent, and collected just under $109,000,despite being half the size and less representative of their local community. At Unitec the 15 councillors in 2009 received a total of $99,000 (an average of $6,600 each). The eight councillors in 2010, who were appointed by either the minister or the council itself, received $116,000 (an average of $14,500 each).

Dr Grey says the global financial collapse of 2008 showed that small unaccountable governing boards don’t always get it right, and that a transparent, democratic model, such as used in universities,  is much more reliable and financially sound.