10 October 2001 Media Statement

Legislation improves tertiary governance

Important new measures strengthening the effective governance of tertiary education institutions were agreed in Parliament last night.

Associate Education (Tertiary Education) Minister Steve Maharey said the Education Standards Bill allows for a staged method of intervention by the Government to help at-risk public tertiary institutions before bad turns to worse.

“The Government needs to have the ability to take timely action when the ability of an institution to continue to perform its functions is at serious risk.

“The new provisions are designed for institutions that are facing significant financial difficulties and will not affect the vast majority of institutions that are well run:
- the first stage of intervention requires more in-depth provision of information from the institution;
- the second stage, if needed, is the appointment of a Crown observer to the institution’s Council;
- the dissolution of an institution’s Council and the appointment of a commissioner to replace it are steps of last resort when an institution is facing complete financial failure. The Minister must consult with interested parties before appointing a commissioner.

“The power to appoint a commissioner has caused a degree of controversy. The Government has listened to submitters and to concerns raised with us by the Greens and has made changes to the Bill during its Committee Stage.

“The new provisions incorporated into the Bill tighten the definition of serious risk necessary to trigger the appointment of a commissioner, require the Minister to appoint an advisory committee to support the commissioner and provide for a review of the new powers after five years.

“The Government is convinced that the additional measures contained in the Bill will not affect the important principles of institutional autonomy and academic freedom. A commissioner would inherit the duties of an institution’s council in this regard.

“The Government is continuing discussions with the New Zealand Vice-Chancellors’ Committee on improved accountability arrangements which may be able to be introduced with the new funding framework that will be in place from 2003. However it is clear that these changes are some way off and it is sensible to provide for the additional provisions in the Bill in the meantime.

“The public of New Zealand have invested over $4b in the assets held by public tertiary institutions and they will receive $1.4b this year in tuition subsidies. This bill ensures this investment is properly safeguarded,” said Mr Maharey.

ENDS

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