Hon Heather Roy address to the New Zealand Association of Private Education Providers (NZAPEP) 2009 Annual Conference; Waipuna Conference Centre, Mt Wellington, Auckland; Wednesday, September 9 2009.

Mrs Edwige Fava, President NZAPEP; Andrew Smith, National Executive Officer; representatives of the Australian Council for Private Education and Training; Dr Peter Coolbear, AKO Aotearoa Director; NZAPEP Executive; members of the association, ladies and gentlemen.

Good morning.

Thank you for the invitation to open your conference this morning.  While I know that Minister Anne Tolley would have liked to have been here today in her capacity as Minister for Tertiary Education, I see my portfolio responsibility - as Associate Education Minister - for independent schools as being closely aligned with your organisation's aims and ethos.

Since 1991 you have been a strong voice for private providers of tertiary education.  Some of your members will have been involved in the industry from the very start of the legislative changes that brought about the New Zealand Qualifications Authority, and will remember those early pre-NZQA days of the National Education Qualifications Authority.  One colleague of mine was seeking to register a private training establishment at that time.  He referred tongue-in-cheek to the acquired condition of 'NEQA-philia.'

Since then both the NZQA and the private education sector have grown considerably and, as an industry, has become a significant element of New Zealand's post-compulsory education scene.  Just as your members' success is determined by the market so, too, is that of a professional body.  Having round 350 members demonstrates that NZAPEP has developed into a strong, credible and influential association.

In many ways, the challenges that you face are similar to those I have been wrestling with in regard to independent schools.  Few argue with any conviction that the State could do without private primary and secondary schools.  A similar minority would try to argue that New Zealand could do without private tertiary education and training providers.

What are some of the challenges that you face?  I see these as including a level playing field for public and private education and training providers, capped funding since 2002, compliance costs, the ability to enrol unfunded students above the 103 percent of contracted enrolments, and the relative roles of PTEs and Industry Training Organisations.  None of the solutions to these issues are, I believe, outside the scope of the Government's objectives.

What does this mean for you?  Budget 2009 was a starting point for this Government's education priorities, within which tertiary education is seen as critical to the economic and social wellbeing of New Zealand.  However we are also aware that, in this time of economic downturn, there are tough 'business' decisions that have to be made.  This is a market reality I know you all understand.

This Government's priorities in the sector are clear.  They are to:

* simplify the funding system

* lower compliance costs

* reduce central planning

* greater devolution of responsibility for organisations to manage the quality and delivery of their services, and
 
* increase the accessibility of provider achievement results.

It is vital that we get more people under 25 into education and training, and the Youth Guarantee scheme is designed to assist in achieving this goal.  Budget 2009 has, therefore, led to some changes to the funding environment for PTEs.  The student achievement component funding, and the fee maxima mechanism, will both receive an inflation adjustment of 1.95 percent for 2010.

In Budget 2009, the Government introduced equity funding for Maori and Pacific students from next year for PTEs.  PTEs have long, and rightly, argued that the equity funding that has been available to ITPs and wananga should also be available to their sector - after all, many PTEs have a particular strength in responding to the needs of Maori and Pacific students.

Funding for short courses on regulatory compliance, health and safety will be removed for all tertiary education providers, and $2 million in additional funding for international education promotion has also been provided.  These measures go some way toward unravelling the legacy of 'picking winners' that characterised the past nine years of ad hoc policy making and funding.  The Chief Executive of the Tertiary Education Commission, Dr Roy Sharp, will explain the operational aspects of these changes later today in more detail.

I know that many of you have concerns around the subject of a level playing field.  I am a strong advocate for the establishment of a single set of principle-based rules for the market.  These must be enforced fairly, and with the lightest possible touch by the hand of Government.  Price signals must be clear for all providers and consumers.  In my role as Minister of Consumer Affairs I am working on a project called 'One Law - One Door', which seeks to achieve this across the board for consumer transactions.  I believe a similar approach could be considered for post-compulsory education and training.

The ACT Party has long campaigned for a reduction in red tape and compliance costs for business.  It is, therefore, pleasing to be part of a Government that has committed to these outcomes and - in the case of your industry - this includes simplification of the funding process.  I see a reduction in the number of different funds as a good start towards reducing compliance costs for you, and ensuring that PTEs can concentrate on the core business of providing high quality teaching and learning for students.  I understand that the TEC and NZQA have also been working together to reduce compliance through reducing duplication of processes.

I can understand your concern with the market as it currently stands with PTEs, Government Training Establishments (GTEs), Institutes of Technology and Polytechnics (ITPNZ), Independent Tertiary Institutions (ITI) and wananga all providing similar offerings but with significant differences in the degree of transparency and accountability for costs and outcomes.  I'm pleased to see Ministry officials here today to understand, firsthand, the significant challenges you face and to carry that message back to Wellington.

Minister Tolley's forthcoming Tertiary Education Strategy will set the direction for tertiary education in New Zealand over the next five-10 years.  It will be more concise than the previous strategy and reflect broad policy directions.

These will include improving fiscal management, simplifying the funding system and government administration to increase provider flexibility, enhancing quality, improving transitions into tertiary, and improving system performance for Maori.

Ultimately, the Government seeks to ensure that more New Zealanders are achieving at higher levels of tertiary education and will consult later this year on the draft strategy.  I encourage you all to provide feedback.  Your suggestions are valuable and will be carefully considered.

I'm aware that many of you have an interest in the Government's Youth Guarantee scheme.  Unfortunately, the school system is not a good fit for some young Kiwis.  The Youth Guarantee initiative is designed to ensure that these young people have opportunities to participate in tertiary education regardless of their personal or family circumstances.

While most 16 and 17-year-olds stay at school, Youth Guarantee recognises that others will be more motivated to achieve qualifications in a tertiary education setting and is a recognition that 'one size fits all' and education do not sit easily together.  It will provide them with this opportunity now, rather than leaving them in the more challenging scenario of attempting to re-enter the education system at the tertiary level after disengaging from schooling.

Youth Guarantee will focus on a range of vocationally-focused courses linked to Levels 1-3 on the National Qualifications Framework.  Building on the ability to read, write and do maths will also be part of the course.  There will be up to 2,000 full-time equivalent student places for the Youth Guarantee in 2010 and 2011, at a cost of $52.7 million.  The scheme will focus on areas with high youth unemployment rates and look at access to suitable vocational training programmes.

The ultimate aim is to make the scheme available to all 16 and 17-year-olds as funding permits.  The decision to fast-forward the Youth Guarantee delivers on the Prime Minister's commitment at the February Jobs Summit.

I know that a number of PTEs submitted proposals on Youth Guarantee.  I understand that the TEC will be providing indicative allocations in the coming weeks. Over time, the Government intends to implement more of these programmes.  Your sector should prepare itself for this.
What does the future hold?  You will be aware that the Government is keen to see a greater focus on performance measures in the coming years.  This is crucial in ensuring that we achieve value for money for the taxpayers' investment in tertiary education and also to incentivise and reward higher performance.

The intent is for funding to follow performance - not attendance.  High performing providers will be funded, with the best receiving increased funding.  It is a market reality that - in some cases - poor performing providers may not receive any funding, or will receive less.  However, before this can occur, the right measures have to be agreed to by all parties.  It will be necessary to produce information which students, and others, can use to compare institutions and make informed choices.

I understand that your members are keen to move course offerings towards the higher value end of the market and I think that this is the right move for the times.  Combined with this enhanced emphasis on performance, the time is right for PTEs to show the country what they are capable of in a fairly regulated and funded education and training market.

You will be holding your awards ceremony - showcasing the achievements of the private tertiary sector - at this conference.  The National/ACT/Maori Party Government is a strong advocate of celebrating success and, while I cannot be here for the ceremony itself, I wish to congratulate the nominees and especially the winners in each category.

The awards ceremony is an opportunity to focus attention on outstanding people and achievements in the private tertiary sector and showcases excellence in teaching, learning, leadership and management.  These elements, together, make up a strong tertiary education market.  In offering the awards, your association has itself shown leadership.

I wish you the very best for your conference and for your ongoing contribution to the learning opportunities available to all Kiwis.

Thank you.