Government Measure Knocks Export Industry - Why?

A “surprise” Government move to levy tuition fees for international students makes no sense in a country trying to build up a successful export-led economy.

Commenting on the Tertiary Education Reform Bill proposal to impose an export education levy, Michael Barnett, chief executive of the Auckland Regional Chamber of Commerce, said the measure puts at risk a flourishing international industry which injected $450 million into the Auckland economy in 2001.

“Here is a classic case of an industry successfully responding to Government encouragement to get into exporting in a big way, and it now finds itself being hit by a tax whose only use seems to be to fund an organisation to be set up to further regulate the industry.”

Mr Barnett described the levy proposal as an “export disincentive.”

Rather than Government levy the industry to pay for its regulation, the market-led response should be to encourage the industry to do as many other industries do - establish a self-regulatory framework and industry code of conduct.

He predicted that if the measure goes ahead, it will be self-defeating to the Government’s strategy to build an export-led economy.

Foreign investors seek an environment in which certainty and a profitable return can be established. Having a government change the rules without any announcement or consultation is not only dictatorial, it raises the question of, “if it can be done to this industry, what about others?”.

The education export sector was growing into a golden goose earner of foreign exchange for New Zealand, including many households who home-stay students. “The industry overall seems to be conducting and regulating itself to acceptable standards - if it isn’t broken why set up a costly bureaucracy to fix it.”

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