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Training providers face closure as Government fund falls short - ITENZ

Fuseworks Media
Fuseworks Media

Private training establishments (PTEs) across the country have been left high and dry as a $9.9 million fund designed to support them falls drastically short of expectations.

The Ministry of Education’s PTE Targeted Assistance Fund (TAF) was allocated on September 30, part of a $51.6 million investment designed to prop up New Zealand’s international education sector. But many were not eligible to apply for support - and of the 51 out of 150 international private training providers who did apply, only six were accepted for full funding, and two for part funding. The TEC (Tertiary Education Commission) has asked a further six providers for additional information before a decision on their funding will be made.

According to the country’s largest PTE association, Independent Tertiary Education New Zealand (ITENZ), if private tertiary providers can’t access the fund, many will not survive the loss of international students.

"The Targeted Assistance Fund looks like it’s trying to close PTEs as part of a continued government effort to tidy up the sector - not save jobs," says Paul Chalmers, ITENZ Board Member and Founder of Newton College of Business and Technology.

"Allocation was extremely unfair. The government says they want to save jobs but the funds cut-off for Category 3 providers has meant a number of quality PTEs have missed out. Some of them have pending External Evaluation Reviews scheduled and will be back to Category 1 or 2 shortly, but it will be too late for them to access the fund.

"These same providers will be needed in a few months to provide domestic or international education, but instead they’ll be closed and their staff will be taking an unemployment benefit. What a waste."

ITENZ believes the government should fund providers at the same level as the unemployment benefit to keep jobs open until international students return. This would help ensure that the $4.5 billion per year sector, of which PTEs contribute approximately $1.3 billion, continues to play a leading role in New Zealand’s economy.

Aspire2 International is the country’s largest provider of private education and training to international students, and for the past three years alone has contributed over $30 million pa to the New Zealand economy. Despite being a lynchpin in New Zealand’s export education sector, the PTE’s application for the Targeted Assistance Fund was rejected, although Clare Bradley, Chief Executive of Aspire2 International and ITENZ Deputy Chair, says they will be asking for a reconsideration.

"Aspire2 International is a group of three registered education providers but the criteria meant TEC would only consider the plight of one. We will re-submit on behalf of that sole provider and hope for success this time round."

Although they’ve had reassurance from government that they want the sector to survive, Bradley says PTEs may need to seek additional support and quickly, given the wage subsidy periods have now all ended.

"We hope once the election period is behind us, we’ll have greater certainty regarding when students can come and what further support will be provided."

Although the government announced earlier this week they would allow 250 international PhD and postgraduate students to enter New Zealand, PTEs are unlikely to benefit. ITENZ says it is however a glimpse of light at the end of the tunnel and a pathway to further opportunities for the rest of the sector.

For staff at Aspire2 International, financial support and the safe return of international students can’t come soon enough. More than 150 people (over half the team) have lost their jobs since March, and remaining employees have sacrificed 20% of their salaries. "Dwindling student numbers have had an unimaginable impact on our staff. Receiving the Targeted Assistance Fund will enable us to retain much needed personnel and invest in new programmes of study to align with what New Zealand needs right now."

At top cookery school Le Cordon Bleu, things are also looking bleak, according to General Manager Jenny Jenkins.

"For those PTEs that have rolling enrolments rather than one big intake per year, the real hardship will not occur until 2021. We weren’t eligible to apply for the fund because students who started at Le Cordon Bleu in 2019 are still with us for 2020," says Jenkins.

"It’s only now, in our October intake, that our business is really starting to flounder."

With 98% of enrolments coming from overseas, Jenkins anticipates just a handful of students per intake until borders properly reopen.

"Our numbers will drop drastically from now on -2021 will be absolute crunch time for us and that’s when we will need financial assistance. The government needs to take this into consideration for PTEs such as ours who have several yearly intakes."

The National Trade Academy (NTA) is another PTE staring down the barrel of redundancies and potential hibernation. According to NTA Director and ITENZ Chair Craig Musson, the Targeted Assistance Fund would have been a lifeline to the NTA English Academy and NTA’s commercial pilot school partner the NZ Airline Academy, both of which cater solely to international students. But because of the way funding criteria was structured, NTA was not eligible to apply.

"Both these schools operate as separate businesses, but under the umbrella of NTA. Unfortunately, the TAF rules state that each entity has to be a PTE under the Education Act. This doesn’t take into account the changes in education business delivery models that operate in the education sector."

For a sector already disenchanted by the meagre $9.9 million PTE Targeted Assistance Fund, the difficulty in accessing it has come as yet another blow.

Says Musson, "We received $9.9 million between potentially 150 international providers who bring in $1.3 billion to the economy - yet in the same week the Christchurch City Council received $125 million for six cycleways."

Add to that the recent $11 million funding of Taranaki’s Green School and it’s not hard to understand why New Zealand PTEs are feeling so disparaged.

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