Another restructure is on the cards for the Bay of Plenty's polytechnic Toi Ohomai Institute of Technology, less than three years after the merger that created it.

Education Minister Chris Hipkins announced on Wednesday a proposal shake-up that would see a new national body take over all of New Zealand's 110,000 polytechnic students and 140,000 apprentices and industry trainees.

The proposed NZ Institute of Skills and Technology would take over programme design and administration for all campuses of what are now 16 separate polytechnics, including Toi Ohomai.

It will also take over enrolling and managing apprentices and industry trainees from what are now 11 industry training organisations.

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Those organisations will be replaced by a new "industry skills bodies" to be led by employers.

The shake-up was designed to prevent the remaining polytechnics sliding into deficits because of a slump in domestic enrolments between 2010 and 2017, as the buoyant job market lured young people straight into jobs instead of training.

Toi Ohomai chief executive Leon Fourie welcomed the proposal.

He said establishing a single national body was a bold decision with major implications for the vocational education sector.

He said there was a great deal of detail to consider concerning what it meant for Toi Ohomai but he looked forward to the consultation period over the coming weeks.

"We agree that Government and wider society should be increasing the emphasis on vocational training to reflect the needs of industry and the rapidly changing modern workplace."

Toi Ohomai student body president Emire Khan-Malik said she was in full support of whatever changes would happen to the polytechnic.

"What we need to do as a student body is support Toi Ohomai as much as we can.

"Having our polytechs here is very valuable and very precious to us because even students that never did well at school, they at least still have a chance to pick up the skills they didn't achieve, and continue their education."

Mayors of Tauranga and Rotorua said a focus on jobs and filling industry shortages was essential.

Tauranga's Greg Brownless said the Government needed to ensure local needs and trade skill shortages were met.

High economic growth meant that the Bay was producing more jobs than people to fill them, so skilled staff in a range of industries, from horticulture to healthcare, were in high demand.

Rotorua mayor Steve Chadwick said whatever shape the proposal took, it needed to "feature a real focus on career pathways and apprenticeships as being central to enabling our young people to achieve their training and work aspirations and get good employment outcomes".

"We also know that there is a need to bridge current skills gaps that exist in our own district and across New Zealand as a whole, and we've always said that there needs to be a very strong link between business sector needs and what's provided by our vocational training institutes."

Chief executive of economic development agency Priority one, Nigel Tutt, said he supported a review of the education sector to make it more efficient and better aligned with the services that the industry.

Master Builders Tauranga representative Mike Bell commended the work of Toi Ohomai and Building and Construction Industry Training Organisation and said he would prefer to keep things as they were.

He was apprehensive about what changes.

"By going forward and putting it under a central thing, we don't know what's going to happen there, really."

Toi Ohomai is one of New Zealand's largest institutes, created after a merger between Bay of Plenty Polytechnic and Waiariki Institute of Technology in May 2016.

It has eight campuses and centres in Tauranga, Rotorua, Taupō, Tokoroa and Whakatāne with 14,000 students and 1000 staff.

- Additional reporting Simon Collins