National's Shane Reti blasts fees-free funding reallocation

National's tertiary education spokesperson has blasted the Government's fees-free policy after its funding was reallocated due to not meeting initial forecasts.

On Tuesday, in a pre-Budget speech to the Wellington Chamber of Commerce, Finance Minister Grant Robertson said the Government's fees-free policy hadn't led to the number of enrolments initially forecast.

As a consequence, Robertson said $197 million of funding would be reallocated to "the implementation of the reform of vocational education".

The Government wants to reform the vocational education industry by merging the country's 16 polytechnics into a single entity - the New Zealand Institute of Skills & Technology.  That decision came as the polytechnics struggled with low enrolment numbers.

National's tertiary education spokesperson Shane Reti said the reallocation of funds proved the Government had its priorities wrong and its policy was doing little to motivate people into study.

"This is another failed flagship policy. We've got KiwiBuild and now we have got the fees-free flop."

"A forecast of 80,000 learners under fees-free, in fact only 50,000 took it up," Reti claimed.

He noted a study by researchers at the University of Canterbury that found only 5.8 percent of students would not have enrolled at university if the policy had not been implemented. But the study also found roughly one in three students were influenced by the policy to enrol.

"It seems that fees-free has been a 'nice to have' rather than a 'need to have'," Reti told The AM Show.

Instead of spending money on the policy, Reti said the nearly $200 million now being reallocated could have been given to parts of the education sector in need.

"There is a lot of need across the education sector that might have benefited from the $200 million underspend.

"Imagine if every polytechnic, that each of the 16, had maybe got $5 million of that, maybe they wouldn't be in the precarious situation they are today."

Questioned on if National would scrap the entire fees-free policy and make students pay for education again, Reti said it wouldn't be continued in its "current form".

"We will not be implementing a failed policy, who would want to do that?

"We will support learners in a number of ways and we will reveal that in our education discussion document later in the year."

One of those ways may be to better target the subsidy to those who need it most, rather than it being available to anyone wanting to enter tertiary study. What attributes would be used to determine who needs it has yet to be fully developed by National.

"That has always been one of our arguments is that this has been a blanket policy, that maybe those who don't need it, like maybe the other 94 percent in the Canterbury study who said it wasn't critical to them, we will be looking to improve the access and affordability for those who most need it.

"There is a number of attributes we are working on at the moment. Clearly, there is age, there is marital status, we are looking at a number of attributes that might feed into a policy that will better target and support learners."

But despite the reallocation, Caitlin Barlow-Groome, the vice-president of the New Zealand Union of Student Associations, said the money would help people get into trades and apprenticeships.

"At the end of the day, as long as we are working towards a world where there's no barriers to getting into any form of education, then really it's a good thing," she told Newshub.

"We need more tradies and we need so many other skilled people rather than people going to university."

The vocational industry reform has been controversial, with Garry Fisseden, chief executive of The Skills Organisation, saying after the reform's announcement in February that students will be disadvantaged under the proposed vocational sector reforms.

"Through close relationships with thousands of employers and trainees, ITOs (Industry Training Organisations) have an essential part in bridging the communication gap between industry and learning institutions.

"Employer engagement in industry training is essential to its success - the proposed new model puts this relationship, the responsiveness of training programmes to business needs, and the employment opportunities of thousands of students in jeopardy."

But Robertson said on Tuesday that change was being called for.

"I know from conversations over many years with this Chamber that this is an area where you want reform, and so do we. Put at its most simple, we need to value apprenticeships, trades and workplace training more."

The Government had planned to expand the fees-free policy to two years free by 2021 and three free years by 2024 - but Robertson did not mention if this was still the case.