Treasury’s Pre-election Economic and Fiscal Update 2011 came out this week and it signalled even less money for the tertiary education sector in the coming years.

Treasury’s budget forecast in May showed that tertiary education spending is forecast to decline from nearly $4.5 billion in 2009 to $4.1 billion in 2014 (tables 6.6 and 6.8 p 109). That cut of $400 million dollars will come at the same time as inflation costs are likely to drive the actual cost of tertiary education up by about $1 billion over the same period.

Six months on from that forecast, Treasury’s latest news is even starker. It says that the actual tertiary education spend for this year was $200 million less than what it predicted in May and that the forecast government spend on tertiary education for 2013, 2014 and 2015 is likely to be about $20 million less each year than forecast in May.

Most of that cut in forecast spending is from a lower student loan bill than Treasury forecast in May.

TEU national president Dr Sandra Grey says New Zealand has a high-quality and cost-effective tertiary education system – but it cannot continue to be buffeted by drastic funding cuts such as Treasury is forecasting for the next five years.

“Everyone suffers if you don’t pay for the engine that drives higher education and research in this country. No matter how committed staff are to their jobs they will not be able to paper over $1 billion of cuts.”