Fran O'Sullivan: Nanny state may lose out in education battle

Michael Cullen's new tertiary education initiatives look more like the response of a Finance Minister with some major economic issues to resolve - than an education minister's traditional platform.

Cullen is attempting to paint his proposed changes as "evolutionary" rather than "revolutionary". But that won't wash.

What is under way is a major shift away from a demand driven tertiary education system - where the numbers of "bums on seats" dictates the amount of funds universities and polytechnics get from Government - to a "nanny state" approach.

Cullen - Finance Minister's hat clearly to the fore - wants to ensure the tertiary education system delivers enough trained graduates to drive forward the economic and social transformation of New Zealand.

The desires of prospective students will be pushed to one side as the Government begins a consultative process which will ultimately determine how many places it will fund, in which courses, and where.

The theme has been in the background since the Tertiary Education Commission was set up by this Government in July 2002.

Former TEC head Andy West set some University Vice-Chancellors into paroxysms of rage when he disclosed that he wanted to determine that major companies - like Fonterra - had a pool of the right graduates to draw from when filling their employment gaps. West thought there was unnecessary duplication in the sector and railed against some rather low-rent courses masquerading as serious education, and polytechs masquerading as universities.

Inevitably, universities saw his proposed top-down approach as an intrusion on their sovereignty and an attack on their right - and that of their students - to take a more purist approach to academic endeavour.

The rhetoric became rather hyperbolic with some key players muttering the commission - in effect the Government - was displaying Nazi tendencies.
The Government's centrist tendencies stayed relatively subterranean while Steve Maharey had responsibility for the tertiary education portfolio and hardcore players like Auckland University's John Hood were on the scene.

The commission did impose conditions on universities and polytechs requiring them to draw up charters and "profiles" of themselves to try to ensure there was no excessive duplication in the sector. But an outright power grab was essentially stifled.

Maharey's - at one-step removed - reign over the tertiary sector was marred when polytechs and the wananga became bogged down in controversy when it was revealed a substantial wad of the taxpayers' cash was being used to fund Maori "singalongs", twilight golf courses, Cool-IT programmes and even dog-grooming.

Cullen is made of sterner stuff. He clearly wants to clean up the show for political and possibly even electoral reasons.

But he has been careful not to throw mud in Maharey's face as he moves to exert more control over the Education budget.

Maharey's reputation is already damaged from the ill-judged attempt to require Television New Zealand to operate as both a commercial entity and public service broadcaster.

But while TVNZ appears to be moving back more strongly to being a commercial player with the appointment of Rick Ellis as its new CEO, on the education side free-market tendencies are being curbed.

Back in are the old nostrums of "national interest" and "outcomes rather than inputs" - the typical lexicon of state planners.

Free-market purists will be concerned - but the Finance Minister will have a ready response. Cullen has had the private sector on his back for months crying about major skills shortages which are hampering its ability to grow.

It is instructive that Business New Zealand was among the first to welcome the Government's commitment to "getting more value for money" and relevance from the tertiary sector.

Business New Zealand chief executive Phil O'Reilly notes that the decision to focus on outputs rather than inputs will be better aligned with the way "most businesses" work.

Already the Forest Industry Contractors Association is adding a welcoming note saying the proposed changes will enable regional polytechs to once again "offer courses in the national interest", such as forestry.

It said forestry education courses had been driven out of polytechs as they strived to offer more profitable courses - thus adding to the overall skills shortage.

O'Reilly also cautioned against the need to avoid central planning and more bureaucracy. But these changes will not work without a top-down approach.

The great irony is that Cullen is basically operating in shareholder mode - rather like any corporate topdog with a faltering business to sort out.

The talk in Wellington is about treating education as a major investment by the Government in New Zealand's economic future.

And the major shareholder wants to ensure he gets a return for Government's education dollar.

The key question facing Cullen and his bureaucrats is will the changes work, will they deliver the required bums on seats within our companies and institutions, or will the top-down approach stifle a student-led response to where the gaps will be in the economy some years out?

There is another side to the equation. Education funding is not a one-way street. There is no such thing as a free tertiary education any more.

Students will need to use their own market power to ensure they also get value for money for their hefty course fees.

If tertiary students are shuffled into new directions at the state education funders' behest - do they then come running if the jobs aren't there when they complete their degrees or course?

Cullen is unlikely to be around as either Finance Minister or Tertiary Education Minister to judge whether this new economic experiment did in fact produce the manpower to lead a transformation to a knowledge economy.

My belief is that the smart money - and smart students - will continue to make their own choices. If they can't get the education they want here - they'll go elsewhere.

Then nanny state will be the real loser.