Penny Simmonds: Vocational Education Minister on Treasury warning government about Te Pukenga de-merger

The Vocational Education Minister assures its Te Pukenga de-merger is responsible, despite Treasury raising concerns.

Newstalk ZB can reveal it urged the Government to seek reassurance that allowing polytechs to go back to governing themselves would help their finances.

The mid-March paper warned the financial situation would be the same, if not worse, than before the merger.

Penny Simmonds told Ryan Bridge if they did nothing, Treasury would be right, but they haven't sat on their hands.

She says they've spent 18 months with financial advisors working with each polytechnic, getting rid of excessive staffing levels and non-viable programmes.

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Episode Transcript

Speaker 1 (00:00):
Turns out Treasury warned the government that breaking up to
Pukinger could leave polytechs worse off. Documents released to news
Talks would Be say the changes may not even fix
the financial problems that they had before the merger to
begin with. Penny Simmons as the Vocational Education Minister joins
us now Minister, good morning.

Speaker 2 (00:18):
Good morning, Ryan.

Speaker 1 (00:19):
Did you see these documents?

Speaker 2 (00:21):
Oh, yes, of course I saw them. Yes, But we
had a range of advice from Treasury over a number
of months, and more recent advice than what they gave
us in March as well.

Speaker 1 (00:32):
What did the more recent advice say, Look.

Speaker 2 (00:35):
Treasury Is concern, of course, is whether the sort of
work that we've been doing, the financial work we've been
doing over the last eighteen months with financial advisors, with
each polytechnic getting their pathway to viability, whether the polytechnics
would be able to undertake that. That's why we pushed
the decisions out right till July, to make sure that

(00:58):
we could see they were making progress on those pathways
to viability. So if we did nothing, Treasury would be
quite right, there'd be quite a high level of risk.
But we haven't done nothing. We've spent eighteen months, as
I said, with financial advisors working with each individual polytechnique,
getting rid of programs that aren't viable, getting rid of

(01:20):
access at staffing levels, reducing unnecessary expenditure, and bringing discipline
back to and a business like operation back to the polytechnic.
So that work that we've been doing, as well as
identifying over one hundred million dollars worth of unused or
underused assets that need to be sold as well and

(01:43):
sourcing the additional twenty million that we reprioritize from back
office TC to support some of the unviable strategic provision
that we need in certain geographic regions, but also that
we need for specific delivery and for exams, pul forestry
and the primary sector. So we've done a lot of

(02:04):
work to make sure that the polytechnics are and the
best possible financial state to stand up.

Speaker 1 (02:10):
So we won still got.

Speaker 2 (02:11):
A lot to do.

Speaker 1 (02:11):
We won't need to subsidize any of them.

Speaker 2 (02:15):
We've still got a lot of work to do on
how much that aren't stood up.

Speaker 1 (02:18):
How much well I look for because the contingency is
one hundred and sixty odd million.

Speaker 2 (02:21):
Right, one hundred and fifty seven. No, we're not anticipating
having to go beyond that. We're hoping we won't have
to use all of that.

Speaker 1 (02:30):
Okay, let's say we use one hundred and fifty seven
million of contingency. That's a lot of money. Will these
polytechs be in a better financial position after we've spent
that money than they would before we spent it.

Speaker 2 (02:42):
Yes, they will because we've done all this work. And
remember that Taipukingha had said they needed nearly another billion
dollars over the next ten years to be operational. So
what about.

Speaker 1 (02:55):
This thing the Greens are saying that they're disestablishing some
of them in person teaching, including cutting some programs. This
is a Northland around forestry and horticulture, is that true.

Speaker 2 (03:05):
That's the work that we're putting the twenty million into
areas that we need to keep face to face in
areas like the far North and the East Coast where
there are a high number of young people not in
educational employment.

Speaker 1 (03:19):
So you won't cut There'll be a guarantee you won't
cut in person teaching of horticulture and forestry in the
North and in.

Speaker 2 (03:27):
The East if the numbers are there to do it.
But we're not going to subsidize courses that have got
two or three people in them. That just doesn't make sense.
So if there are numbers, if there's demand for the courses,
and they're not viable because of the nature of the delivery,
then that's what the Strategic Fund is for.

Speaker 1 (03:47):
Penny. Appreciate your time, Penny Simmons, the Vocational Education Ministry.

Speaker 2 (03:51):
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