The number of students eligible for the Government’s new fees-free policy in 2025 could be nearly 30,000 fewer than those who currently benefit, which would save the cash-strapped Government $170 million a year.
The estimates are revealed in Ministry of Education advice provided to the Act Party during coalition talks after the election with National, which was also in talks with New Zealand First.
The Public Service Commission has released all the requested advice during those six-week talks, which provides a glimpse into at least one issue where National was pushed, and where the party refused to yield any ground.
Advice was also sought about how much the prison population would swell by adding burglary to the list of Three Strike offences, and whether New Zealand could “withdraw” from the United Nations Declaration on the Rights of Indigenous Peoples (UNDRIP).
Act requested information about fees-free and the Three Strikes law, while National asked about UNDRIP. NZ First made no requests for information despite gaining coalition wins in the fees-free and UNDRIP spaces.
Act had wanted to scrap fees-free, and while National has been critical of it since it started, it had decided to keep it. The Coalition Government eventually adopted NZ First’s policy to switch it from a student’s first year of tertiary study to their third year.
In response to questions from Act, the Education Ministry said the current cost per year of the policy was about $320m.
Switching eligibility to full-time third-year students would effectively limit the policy to students undertaking degree-level study. Further limiting it to those who hadn’t failed a paper would reduce the cost to $97.4m a year.
There would also be an estimated $50m in additional student loan costs, due to the difference in the number of students who would no longer be eligible. Factoring this in means the policy would save the Government about $170m a year.
In 2022, the ministry estimated that just over 14,000 students would have been eligible for fees-free for their third year of study. This is about one-third of the 43,000-odd fees-free students in 2022.
Fees-free has been controversial since it was introduced by the Labour-led Government in 2018, with NZ First as its coalition partner.
One of its key aims was to open the door for those who would otherwise not have enrolled in tertiary study, but the share of decile 1 students in first-year tertiary study has halved since it started, while students from wealthier backgrounds make up an increasingly greater share.
The year before it started — in 2017 — 6.37 per cent of first-year tertiary students came from decile 1 schools. In 2022, it was only 3.24 per cent.
The Labour government moved the goalposts in 2020, changing the policy’s purpose to improving affordability and reducing student debt levels, which is essentially a self-fulfilling objective.
The new settings are expected to apply from 2025, and are hoped to be an incentive for students to complete their studying without failing any papers in their first two years.
Act has long advocated for burglary to be among the qualifying offences for the Three Strikes law.
The Ministry of Justice said this would see the average sentence for a third burglary conviction jump from 1.6 years in jail to 10 years - the maximum sentence for the offence. The 190-odd people a year with non-prison sentences for a third burglary conviction would all get 10 years.
Overall this policy change would increase the prison population by about 1300 prisoners in five years, 3200 prisoners after 10 years, and 4500 prisoners - or half the current prison population - after 20 years. This would require the construction of several new prisons to accommodate them.
Act then sought advice on the same policy but with more modest consequences: a minimum three-year sentence with no parole. The ministry estimated the increases to be 300 additional prisoners after five years, 800 after 10 years and 1200 after 20 years.
This failed to get over the line in coalition talks. The Act-National agreement reflects National’s policy and states: “Restore Three Strikes legislation, with amendments to tighten the definition of strike offences and ensure some benefit for pleading guilty.”
One of Justice Minister Paul Goldsmith’s priorities is to reduce court times, which is partly why he wants guilty pleas in Three Strikes cases to have some benefit; the law contributed to longer court times because there was no incentive to plead guilty, due to the lack of judicial discretion in sentencing.
Read more: How the judiciary used the words of Judith Collins to tame the Three Strikes law
The National Party asked a series of questions about UNDRIP, including its status in domestic and international law, its impact on domestic policy and law since New Zealand signed it in 2010, and whether New Zealand can “withdraw”.
Act campaigned on ignoring UNDRIP and stopping all work on He Puapua, which had already been shelved under the Labour government, while NZ First wanted to withdraw from it.
Crown Law told the National Party that UNDRIP was a non-binding statement of principle, not a treaty, which the National-led government supported in 2010.
UNDRIP could impact New Zealand common law because of its relevance to “the interpretation of existing international obligations”.
Courts are able to consider it, and indeed it has been referenced in several court rulings where it was qualified by reference to the Treaty of Waitangi. It can also be used in claims against the Government in the Waitangi Tribunal.
New Zealand’s free trade agreements with the UK and the EU also contain provisions about UNDRIP “and their respective positions made on that Declaration”.
Crown Law said there was “no formal process for withdrawing” from UNDRIP. ”Any change in New Zealand’s position could be made by public statement.”
That is indeed what happened in the National-NZ First coalition agreement, which states: “Confirm that the Coalition Government does not recognise [UNDRIP] as having any binding legal effect on New Zealand.”
National also asked Crown Law about a Court of Appeal case that could have made it easier for iwi and hapū to have customary titles recognised by the courts.
The Government will pass a law overturning that judgement, a commitment that was part of the NZ First-National agreement. It was sought in negotiations by NZ First, and it gained the support of National and Act.
Derek Cheng is a senior journalist who started at the Herald in 2004. He has worked several stints in the press gallery team and is a former deputy political editor.
The Prime Minister has met the Chinese leader in Beijing.