Monday, October 13, 2008

Moving on...

For years and years I, and many many other students besides, argued strenulously for universal allowances and lower fees.

We railed first against Marshall and Goff and then against Lockwood and Creech. We pointed out the apalling inequity that while we were missing out, people who were unemployed were supported. We argued that poorer kids were put off and that education was a right. That your parents couldn't be expected to support you until you were twenty five. Sometimes, things got weird such as when the marriage loop-hole was championed by Shortland Street's Nick and Rachel.

My view then as now is that investing in higher education is vital to our future prosperity.

The left have always been the most amenable to this argument. The right have said its simple self-interest; that farmers don't get tax-payer funded training nor do pilots. Farmers do by the way, see here and here. Progressively however, Labour have modified and improved funding for students and for higher education to the point now where the annual cost of borrowing can be converted into universal allowances. Of course there's a impact on the Crown accounts - future debts will neither be incurred nor repaid but the Crown will still have to meet the costs of allowances. Of course there's some inequity between cohorts; I repaid my loan and I don't imagine I'll get a refund. These are not the main objections however, at least not the ones being trotted out by the likes of Farrar and Hooton.

Farrar and Hooton have discovered fiscal responsibility just in time to pronounce Clark and Cullen unfit. Universal tax cuts might be fine, but universal allowances; Labour's scuttling the boat. Predictable faux-outrage.

I'd have my reservations about this policy absent others but the fact is that Labour's track-record on education is extremely good. Critically for me, they have consistently invested in industry training and have now announced plans to further expand participation. Whereas the tertiary sector risked becoming faddish and irrelevant under Creech's funding system - a system that encouraged all providers to offer degrees and vandalised trade training - changes over the last ten years have created specialisation, refocused providers on local labour markets and promoted research.

I've said elsewhere this wouldn't be my number one priority - that'd be early childhood and special education - but when you examine the overall mix and balance of education policy, Labour's record is unrivalled and soon Generation Debt, a generation created by National, will be a thing of the past.


Anonymous said...

"My view then as now is that investing in higher education is vital to our future prosperity."

Utter bollocks. What is vital is digging in to disadvantage at early years. The Treasury has got it bang on:

"Some of the most important long-term gains will come through improving outcomes for very young children, and effective public policy programmes in areas such as early childhood education and parenting support have greater benefits for children from disadvantaged backgrounds."


subsidies for existing students and/or graduates are unlikely to
contribute to productivity growth."

Universal allowances do nothing for equity, nothing for growth and nothing for the future. They are nothing more than a deeply cynical bribe - exactly as in 2005.

And who's going to pay for all this glorious new spending...?

backin15 said...

The two aren't mutually exclusive however. Despite what I understand are some limitations, Labour's 20 free hours of ECE has/will continue to lift participation and achievement. Similarly, international comparative tests confirm our schools are doing exceptionally well. As I said, my top priorities in education might differ slightly, but across the entire spectrum of education, Labour's consistently made policy improvements and better and more investments. There's some risks associated with this policy, however it was inevitable we'd get to the point where the annual costs of debt financing could be spent on allowances.

If there's any truth to National's hysteria about the brain-drain, and I think it's overstated, then this might also slow the trend.

Anonymous said...

They are mutually exclusive when the country has run out of money. That's the problem - the Government is used to high-spending, high-rolling times, and they are over.

Actually, the international tests show that our schools do well on average, but that we have one of the widest ranges of achievement - so don't get too complacent. 20 Free Hours was badly-targeted, expensive and unlikely to make a dent in disadvantage, because the money will be sucked up - yet again - by the sharp-elbowed middle class.

Oh, and it's not "investment" -- it's spending.

backin15 said...

1. It's phased in so that the full costs won't occur until there's forecast growth.

2. Fair point. I wasn't suggesting that nothing more needed doing, I agree the tail is too long, way too long and specifically linked to a comment at PAS where I'd noted my concerns about disparate performance in schools and the need for more investment in ECE and special education.

3. I'm aware that there's problems with the 20 free hours policy, some might be policy-related, some are bound to be the implementation. The point is that Labour's got solid policy across the spectrum and the results suggest that they're working.

I'm not a pollyanna, but some credits due. I believe, and you may disagree, Labour inherited a god-awful mess in the education sector.

Anonymous said...

Labour has got solid policy - it's called middle class welfare. There is, as yet, no evidence that 20 Free is working to assist the disadvantaged, and I'd want to look at the opportunity cost of how that money could have otherwise been used.

The costs of the allowance kick in while we are still running deficits.

Labour talked up a major crisis in the education system and then created a real god-awful mess of its own. What has zoning done for student results? What has the TEC done for student outcomes? What has massive teacher salary payments - unrelated to performance - done for student outcomes?

Oh yes, and who was in charge when the CPIT ripped off the taxpayer? Or when the tertiary budget massively blew out, so much so that the Treasury Secretary was publicly expressing concern? National? No - Labour.

backin15 said...

I'll have another look, but I thought that the full costs coincide with projected surpluses. I don't think it's fatal to the policy if there's some cross-over.

Re ECE, I'll defer to your better knowledge. Increasing across the board ECE would be my number one priority were I Minister for Education.

I don't agree with you about extent to which the system was in crisis under National. Our performance wasn't good by international measures, PPTA/NZEI were at the government's throats, industry training was languishing and the tertiary system was heading in the wrong direction.

You've cited some examples of rougue providers. I agree, CPIT was under Labour's watch, but the failure was of the CEO and the Board. I'd not for one moment suggest that they should have significantly less autonomy within agreed constraints, but I'd've sacked the board. Remember it was CoolIT that was the final straw - that funding was intended to increase the participation of people who'd not traditionally engaged in tertiary education. It was being rorted, IMHO, by a unscrupulous twat and sadly the government reacted by capping the kind of fund that should have been uncapped.

No government's perfect, none that I'm aware of anyway, but I stick by my earlier comment, this one's performed consistently better than the last and the alternative is a hodge-podge of cobbled together policies that entirely lack coherence.

Anonymous said...

Teachers' unions are always at the government's throat - that's no reason to cave in to them without extracting something in return.

Industry Training wasn't languishing - it was still bedding in. I think you overestimate the role of the government in the ITO system's emergence - I reckon they just got their act together on their own.

So did Labour sack the CPIT board? No.

Capping the fund was quite sensible, given all the other policies the Government has in place - e.g. fee caps, interest-free student loans

And why was the tertiary system "heading in the wrong direction" under the Nats? What gives you confidence that it is now on the right track?

backin15 said...

Teachers unions are mostly disgruntled I agree, but even Napoleon regreted having to many battles. The implementation of NCEA, remember that was set up by National, was hopelessly compromised.

Industry training was languishing. We might simply have to agree to disagree though I'll point out that in 1998, ITOs handed back money whereas within a few years of policy reforms participation outstripped funding. I was involved in some of the policy reforms so I'm biased but the numbers speak for themselves.

CPIT, no they didn't and perhaps they should have but you'll note the CEO left. My point is that the failure of CPIT was primarily management/governance failure, not really policy failure.

University and polytechnic funding had been uncapped, National's policies established demand funding. It led to lots of faddish programs, low completions and inefficient duplication and competition in urban centres and stripped back capability in trades and regions.

I understand that the TEC hasn't made the progress people hoped for, but it at least refocused providers on labour market demand...

National's Green and White Papers at the end of their last term, IMO, would have fractured the system beyond recognition. For instance, voucher funding would have seen institutions like Lincoln disappear (again I might be baised by having worked there). If a agri-business economy like NZ can't afford a specialist university like Lincoln, who can? Research funding was disappated and spread way too thinly, polytechnics were abandoning sub-degree training and, as I said earlier, industry trianing had stagnated.

You have a different perspective on these issues clearly but I think the numbers still favour Labour.

Anonymous said...

ITOs handed back money because they were only really 5-6 years old and a bit immature/lacking in market presence. I don't think the "policy reforms" enacted under Labour did much of any substance.

TEC hasn't focused providers on labour market demand - it's focused them on the centre; chasing funding pools and lobbying for more/less regulation.

CPIT was exactly a policy failure - the Government should never have allowed community education funding to have been demand-driven. The Nats certainly never intended that it would be.

Would it be the end of the world if Lincoln collapsed? Massey also have agribusiness areas of specialisation. And you do have to question the ability of such a small country to sustain so many small institutions.

There was a lot of talk - led primarily by Steve Maharey - about demand driven funding leading to faddish courses and poor completion, but very little in the way of hard evidence to back these claims up. Have you got any evidence?

backin15 said...

No, ITOs handed back money primarily because (a) the focus was on enrolments not progress or completions and companies were reluctant to sign-up more trainees until they'd seen real progress (b) there was a cap on funding for training only between levels 1 - 4 (c) you could only sign-up into full qualifications not smaller bite-sized units of training and (d) there were perverse incentives to study the same training at a polytechnic with far more generous funding.

With respect, I was running the peak-body for ITOs at the time and while I am sure there are other perspectives on this, it's pretty clear that National had lost interest. When Bradford was the Minister he foolishly told polytecyhnics they should aspire to be universities such was his disdane for trade-based training.

TEC might not be performing as well as was hoped, I don't know. The persistence of skill/labour shortages suggests it might be but it's a complicated matter. I'd be interested to know if the PBRF has concentrated research dollars however?

Re capping/uncapping funding, it's complex again. I think uncapping community education can be justified if it leads to more people completing qualifications that wouldn't and improve labour market participation - that was what it was intended to do but was rorted by providers. That's clearly a failure of governance and management and TEC had/has the tools to address this; if they haven't used them, they should.

If Lincoln had failed because it couldn't deliver support to industy, sure. But that wasn't the problem, the problem was that funding followed faddish courses and big population centres. Lincoln should have been encouraged into cluster with the CRIs that surrounded it and been given five years secure funding to make it work.

I agree there's too many unis, remind me who it was that approved AUT?

Anonymous said...

I'm happy to agree that AUT was a bad decision.

ITO funding is still based on enrolments; most of the funding is still directed by policy towards levels 1-4; the qualification requirement remains, as do the perverse incentives to work through polytechnics. What's changed?

There will always be labour and skills shortages - that's the nature of how labour markets work. Equilibria are fleeting or shifting. The TEC has had no impact, and won't.

I repeat: do you have evidence to back up your faddish courses claims? And why shouldn't funding follow big population centres - that's where most of the students are, and presumably you agree that the whole point of having education institutions is to, uh, educate people?

backin15 said...

Anon, enrolments have only been part of the funding formula since 2000, achievement is a key factor - there's 17 others (or at least there was). Lifting the cap on level 4 was small but significant. It was opposed by the officials and despite this Labour agreed to limited funding above 4 - it was a critical signal to industry that there concerns were respected by government. I don't know the percentage that now attracts funding above this level and I actually hope it doesn't grow too much (if it did, I'd be looking for a higher industry contribution as the public benefits abate).

Re teh perverse incentives - yes I understand this is still a problem. It's a tricky one too but at least now TEC has mechanisms to limit funding to polytechnics where there's overlapping provision. Again, I don't know if they're using them as I'd want them too, but they should be. The deadweight is high.

I agree with you about labour and akill shortages; it's dynamic and training isn't the only solution. The point is that local institutions must, through the development of their charters, focus on forecast demand and at least do their bit not flood the Auckland market with teaching and design quals.

Examples of faddish/duplication of courses, I'll give you three. First, polytechnic fashion and design students who were unemployable in the fashion industry since they didn't learn the basics of garment construction. Second, Unitec offering building, boating and plumbing courses in Auckland at three times the cost to the tax payer in competition to the ITOs. Thirdly, the obscenity of the private provider in Taranaki (don't remember its name) which offered a IT course entirely online but stating that a computer was required course materials which led to students borrowing from the loan scheme - enrolments increased something like 6 or 7-fold and there were no completions.

Anonymous said...

Actually, achievement isn't the key factor in the ITO funding system. And the Labour Govt wimped out of making student completions part of the provider funding system.

TEC doesn't actually have the levers to "fix" overlapping provision, because there is so much disagreement about whether it exists and whether the TEC can stop selected courses.

Charters don't exist anymore, and your comments assume that someone at the TEC is actively monitoring and comparing info from "Investment Plans". They aren't.

Unitec is still offering those courses at three times the cost.

I'm happy to see dodgy PTEs and design provider whacked - but that's a quality assurance issue....which noone has done anything substantive on for years.

backin15 said...

Anon, clearly you're informed and clearly we disagree. When I was still involved in industry training, progression/completion of qualifications was a key factor informing future funding. Perhaps you can say what's happened since?

Regarding overlapping provision, there's a history to the split between ITPs and ITOs that ages-old however in the newer markets, it shouldn't be difficult to work out what the optimal investment is and manage accordingly. I know that there's an ownership risk with ITPs, but that alone's not enough to dissaude government.

I know that Charters have become part of investing in the plan - about which I have always had my reservations - but the point is that there's still levers to be used whereas for a while there were none; once the course was approved, you could get funded. IMO that's risky and I've already noted the examples that form part of my concerns.

Unitec's management have long resisted guidance. That's partly their perogrative, but partly inaction. As above, I'd hoped that the parties could have made use of the opportunities to come to sensible market separation and competition.