Minister of Tertiary Education Steven Joyce has confirmed to the Education and Science Select Committee that funding for tertiary education in 2011/12 will decrease 0.4 percent to $2,780.707 million from estimated actual expenditure of $2,790.522 million in 2010/11.

In his evidence to the select committee on the 2011/12 Estimates for Vote Tertiary Education the minister also noted that funding for the Industry Training Organisation (ITO) sector has fallen by more than $100 million over the last two years. He attributed this to the effects of the recession – but said he also expects ITO funding to fall further as officials review the sector and make it more accountable for the way it uses its funding. He said that withdrawing government funding from programmes for which students do not earn credits would reveal the actual level of demand for skills training by ITOs.

The minister told the committee that the number of ITOs would probably fall from its current 38. The government is not actively seeking to reduce the number; the minister believes it will happen because of discussions between the commission and ITOs.

Many in the trades and education sectors have been warning under-investment will add to future skills shortages both specific to the Christchurch earthquake and more generally across the whole country. However, the minister believes that industry training is only part of the solution to future skills shortages; and that any skills shortage will be mitigated by people returning to that part of the workforce, and by migration.