Budget 2020: Targeted fees-free retraining scheme tipped

Madeleine McCarthy was heading for a career in business until Covid-19 hit. Now she has switched into studying cyber-security. Photo / Michael Craig

A targeted fees-free tertiary training scheme for people who have lost their jobs due to Covid-19 is being tipped as a possible highlight of today'sBudget.

The current fees-free scheme, which gives people one year of free study fulltime or two years in an apprenticeship or industry training, was originally planned to extend to two years from 2022 and to three years from 2025.

But those extensions were in doubt before Covid hit because the free tuition failed to boost student numbers, and the Covid crisis means that the scheme is now likely to be redesigned to support retraining the thousands of Kiwis who are losing their jobs.

Universities and polytechnics expect the Budget's retraining package will also include streamlined processes to fund courses that are shorter than traditional degrees and diplomas, aimed at helping people add extra skills they need for new jobs on top of qualifications that they already have.

Ten former pilots, air traffic controllers, technicians and other people with strong technical backgrounds and at least three years of work experience jumped straight into the second year of an engineering honours degree at Canterbury University this week under a special "fast-track" programme seen as a model of what is needed nationally.

Canterbury engineering school academic dean Shayne Gooch said he started the course after he was approached by a pilot who had lost his job.

"Three-quarters of the interest we got was from the aviation industry," he said.

Canterbury University Engineering School academic dean associate professor Shayne Gooch started a fast-track course this week after a pilot approached him. Photo / Supplied

"These are people with the technical interest. A lot of them may not have done maths to the right level at school, but what we have set up is an introductory maths and then they go into first-year maths, so it's an easier pathway."

Manukau Institute of Technology (MIT) is also working with Air New Zealand and the E tū union to retrain former aircrew staff for roles such as construction project management and in healthcare.

However, the current settings make it difficult for mid-career people who lose their jobs to go back to study. An MIT nursing student faces fees of $6300 and a Canterbury engineering honours student $7798 a year, and the fees-free scheme is not available to anyone who has already done more than six months of fulltime tertiary study.

Students can take out student loans for course fees plus $239.76 a week for living costs and $1000 a year for course-related costs - an amount that has been temporarily doubled to $2000 this year to cover the extra costs of studying online from home.

Alternatively, adults over 24 can get income-tested student allowances at rates that are just above welfare benefits, but students can only get only up to $60 a week for accommodation compared with up to $165 for single people or $305 for families with children on welfare.

Cabinet papers released last week revealed that some students who had lost part-time jobs in the Covid crisis had withdrawn from their courses and moved on to welfare because they could no longer afford to study.

Education Minister Chris Hipkins said on April 14, when he announced the temporary student loans increase, that he was "also working on a second package of changes to prepare the system for significant growth in participation in key strategic areas as greater numbers of New Zealanders are expected to look to retrain and some industries need bigger workforces".

He told TVNZ's Q+A this week that the existing one-year fees-free scheme would continue and added: "You will see a bit more about the decisions that we have made in that direction in the Budget."

MIT chief executive Gus Gilmore told the Herald that the Government "really needs to look at opening up its fees-free programme more widely".

Gus Gilmore says Government "really needs to look at opening up its fees-free programme more widely". Photo / Supplied

"The Government could and should open that programme more widely to enable study for workers displaced as a result of the Covid situation," he said.

Universities NZ chief executive Chris Whelan said the original fees-free scheme failed to increase enrolments.

"If one of the objectives was to make it easier for people to get into higher education, a more targeted approach would make more sense," he said.

Chris Whelan: "A more targeted approach would make more sense." Photo / Supplied

He said about 60 per cent of students work part-time while studying in normal years, earning $6000 to $9000 a year. But many of those jobs have gone.

"For quite a small amount of money, $6000 to $9000 a year, it would be a tragedy to see them going on to the dole and giving up studies," he said.

On its own initiative, Canterbury University is offering grants of up to $7500 to cover course fees for 1000 workers whose jobs have been reduced or ended due to Covid-19. Workers must have ongoing employment and be nominated by their employers.

Wellington's Victoria University is offering free study in the second half of this year to people whose jobs or lives have been upset by the pandemic. It has had more than 1500 inquiries since announcing the offer on March 20.

Dairy NZ is also offering short "farm-ready" courses for people wanting to take up 1000 vacant jobs in dairy farming.

Career switch

Madeleine McCarthy has switched into studying cyber-security. Photo / Michael Craig

Madeleine McCarthy was heading for a career in business until Covid-19 hit. Now she has switched into studying cyber-security.

McCarthy, 26, worked in Australia for several years before returning to do a commerce degree at Auckland University, which she finished last year.

She then started a paid internship in logistics with a major company, which she hoped would turn into a permanent job.

"My contract was actually supposed to end in February, but they extended it out to May and I was hoping there would be more opportunities somewhere else in that business," she said.

But then the pandemic hit. The business kept operating through the lockdown, but its sales slumped and McCarthy's internship was the first job to go in late April.

"Work just slowed right down," she said. "The permanent staff were okay, just not me because I was not a fulltime employee."

She applied for five new jobs.

"I didn't hear back from anyone, except from one person who said we are not hiring due to Covid-19."

So she decided to go back to study.

"I always did want to do cyber-security, but I didn't want to go back to study, I wanted to keep working," she said. "Now that that's not really an option, I decided to head to Unitec."

She has applied for Unitec's new Diploma in Cyber-security that runs for one year from July, and already has a head start because she majored in information systems in her commerce degree.

She will take out a student loan to cover the $6700 fee and will have to go back to living on the student allowance of $275 a week plus an accommodation benefit which took it up to $320 when she was at university. She flats with three flatmates and pays $200 a week in rent, leaving about $120 to live on.

"That's why I did not want to go back to study," she said.

But she was attracted by the fact that the cyber-security course puts students in work placements one day a week.

"They said some of it might be unpaid or paid, depending on where you end up going," she said.

"I still want to work and get work experience in a relevant field, and I couldn't get a relevant job without relevant experience. If I end up in an unpaid one, I will look at getting part-time work as well."