Treasury tells govt to slash education spending

Posted By TEU on Nov 12, 2009 |

Tertiary Update Volume 12 Number 39

Treasury is advising that government’s investment in education may have to decline from its current 6.4 percent of GDP to less than 4 percent by 2050. It wants government to achieve that cut in funding by shifting more of the cost of education services from the government to individual students and families, and by targeting government support to those who will benefit most. It also wants to “improve the productivity of the education system” – using limited funding more efficiently to achieve the same or better results.

Treasury’s report Challenges and Choices, New Zealand’s Long-term Fiscal Statement calls for more flexible remuneration systems in the tertiary education system that allow providers to reward high-quality teaching and allow wages to reflect differences in the balance of supply and demand across different parts of the teaching workforce.”  It also recommends greater mobility of students and staff between high school and tertiary education providers.

Treasury said education spending had doubled to $11.5 billion since 1994. Spending had climbed about 6 per cent a year, but this had to be reduced to 2.8 per cent. It has advised the Government it had a wide range of options to cut spending.

Education Minister Anne Tolley told the Dominion Post she was still considering the report. “We haven’t taken any advice as a result of the Treasury report.” During the lead-up to the Budget, Mrs Tolley ignored advice from the Treasury against pouring more than $35 million into private schools.

Also in Tertiary Update this week:

  1. Fijian education leader reiterates call for democracy
  2. A little bit of interest
  3. TEU calls for close link between research and teaching
  4. Canterbury College of Education cuts secondary education programme
  5. Support for librarians’ professional development
  6. Pittsburgh proposes tax on higher education

TEU Tertiary Update is published weekly on Thursdays and distributed freely to members of the Tertiary Education Union and others. You can subscribe to Tertiary Update by email or feed reader. Back issues are available on the TEU website. Direct inquiries should be made to Stephen Day, email:

Thaks to Alex Dukal at Flickr for the image

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