Government says it may soften loans abolition plan; affected institutions ask - when?

Plans to stop students getting student loans while taking tertiary courses that do not receive government subsidies may be softened, says the government, but affected private institutions say they have heard nothing about it.

At an education and science select committee hearing on 14 June, Tertiary Education Minister Michael Cullen said the government would be talking to some affected institutions to see if they were offering courses that were appropriate for funding.

Dr Cullen said some institutions did not have access to government subsidies (known as Student Component Funding) not because they had not applied but because the Tertiary Education Commission (TEC) did not consider them relevant.

The proposal, as announced in last month's Budget, is expected to affect thousands of students at about 140 institutions. About 50 private training providers say they may have to close because the plan means they will lose students.

Brijesh Sethi, a director of an affected private training establishment (PTE) in West Auckland, and coordinator of a group fighting the policy, said at the end of June that he was unaware of any new approaches by TEC to affected institutions.

He said there had been no update on Dr. Cullen’s statement to the select committee, and as far as he was aware "TEC has received no instructions whatsoever in this regard".

He said that when the policy was first announced there was no consultation about whether the courses offered by affected PTEs were strategically relevant or of good quality.

His institution, the New Zealand School of Education, was the only private or public provider in West Auckland that offered high-level IT training aligned to international certifications and the only PTE in the whole of New Zealand approved by NZQA for the whole ICT field up to level 6. He could not see how the TEC could say his institution was not relevant.

"The IT sector has one of this country's biggest skills shortages. Our graduates get jobs with all sorts of firms. And, in our part of the country, no-one else is doing quite what we do. New Zealand School of Education is so strategically relevant it is not funny."

TEC policy and advice group manager James Turner said TEC had offered to discuss the implications of the policy change with affected PTEs.

The New Zealand Herald reported last month that Mr Turner said the commission had to accept that some providers would possibly close.

An article from Brijesh Sethi criticising the policy is online as a PDF document.

A Subtext story on the Budget announcement is at this web page.