Education (Tertiary Reforms) Amendment Bill

This bill is very important because undoubtedly tertiary education is vital for the country in every way. It is important in terms of the economy, in terms of future productivity—something that has been lacking under the Labour Government over the last 7 or 8 years—and in terms of citizenship.

Part 1 is the machinery of the bill, and the Minister described it as bringing in a new era of high trust and of low compliance. He said it is about quality, relevance, and value for money. Sadly, the very opposite seems to have occurred. In fact, he talks about streamlining, yet we have already heard from right around the country, as the 13 investment managers and the 13 stakeholder engagement managers spread themselves out, that more and more hurdles are occurring. In fact, I heard from one of the tertiary education institutes just recently that an investment manager said to it: “Look, if you don’t play ball, we won’t sign off the plan with you.” Is that is an indication of the high trust? No, it is centrally controlled threats, and that is totally the opposite of the ethos that Dr Cullen started with when he began to plan for this bill.

I do want to say that the select committee members worked extremely well together. This bill was so bad when it was first introduced that it needed a whole lot of work. I also want to commend the officials for their wonderful report. It was beautifully set out. The bill is a very complex bill, but they set out their report magnificently and clearly and described the various contentious areas that are encompassed, particularly, in Part 1. These areas relate to charters, procedural fairness, treatment of sensitive information, and the adult community education amendments. Of course, the most controversial area—where we will go back to the purpose clause—is the issue of academic freedom and institutional autonomy, which the Labour Government has tried so hard to trample over.

Nevertheless, we are talking about Part 1 today, and I hope that the Government is appreciative that I have tried to help it all I can. Even though National is opposing this bill, we have brought in a very well-thought-out Supplementary Order Paper to try to see whether the Government can see some sense as to the error of its ways. Undoubtedly, it is important to have high trust in the tertiary education system, and it is extremely important to diminish the bureaucracy that has built up so logarithmically over the last 7 years under Labour. From a department, within the education department, of 16 or 17 people, there is now a steaming group of 340 in the Tertiary Education Commission—

Anne Tolley: How many?

Dr PAUL HUTCHISON: There are 340 staff, and, just recently appointed, as fast as the commission can get them, are those extra 13 investment managers and 13 stakeholder engagement managers I was talking about earlier on, who appear to be very variable in their ability to engage or invest. I have heard from some institutions that many of those managers are not very comfortable in dealing with financial investment, and when organisations are as complex as the tertiary education institutes, it is hugely important to have highly competent people. In fact, the OECD, in its report this year, said that one of the things about the tertiary education system in New Zealand is its complexity, and this bill adds even more to its complexity.

I rise to speak briefly to the Education (Tertiary Reforms) Amendment Bill, because it is a fantastic bill that is designed to reform the system for planning, funding, and monitoring the provision of the tertiary education system.

Clearly, this Government is committed to quality education. Under this bill, the Government is clearly moving from the “bums on seats” system to a quality education system, and we are committed to quality tertiary education that is relevant for today’s New Zealand economy and social well-being. This bill will provide a tertiary system that will better fulfil New Zealand’s needs, yet at the same time give better value for money for taxpayers and students. Clearly, this bill allows us to move away from the annually funded, demand-led system to a system funded 3-yearly, which will be a much better way of giving stability to our education system so that teachers, lecturers, and students can be surer of the courses they are following. The bill will also streamline the processes supporting the operation of the tertiary education system in New Zealand, thus strengthening the stakeholders involved.

I totally support this bill. We had a good discussion at the select committee, where we had a lot of input from the tertiary education sector and stakeholders, and the committee made quite a few changes to the bill that clearly made it much better. With those few words, I commend the bill to the Committee.

The bill we have in front of us was certainly a challenge to the Education and Science Committee, and we must acknowledge, during this Committee stage, the wisdom and advice we had from submitters. When we stop to think about tertiary education, we realise that it covers an enormous range of provision, right through from our Gateway programmes to university courses at the other end, of course, like PhDs and suchlike.

But in the middle we have such things as the Tertiary Advisory Monitoring Unit and the New Zealand Qualifications Authority, and it is on that basis that when we look at this Education (Tertiary Reforms) Amendment Bill, we start to understand that a bill of this particular nature will not change an awful lot. In actual fact, when we put it up and measure it against the performance of what we have had to endure in tertiary education over the last 8 years, we start to realise that it will take a lot of work to get the tertiary education programme back on track.

Part 1 of the bill deals with a whole range of situations. As the previous speaker, Ashraf Choudhary, alluded to, it is meant to change the efficiency and productivity of tertiary education, and increase the return to the Government and taxpayers of the money invested in it, which is some $3 billion. However, to put it bluntly, the Labour Government has completely butchered this sector, time and time again. In actual fact, when we come to look at the productivity gains inside New Zealand against those of OECD countries, we find that our productivity gains have been very, very poor.

The purpose of this bill to unravel the complexities, but unfortunately the opposite is the case. When we look at what the Education Review—which is quite a laudable publication that keeps us all up to date—says about the growth of tertiary education, we see, as my colleague Paul Hutchison has told us here in the debating chamber, that the Tertiary Education Commission has grown to comprise some 340 members. The Education Review gives reasons for this being the case, and states: “The Tertiary Education Commission Communications Manager, Andrew Bristol, said that the number of the staff paid more than $100,000”—which, incidentally, has increased from some 20 to over 50—“increased because the commission had a far different role to play compared to when it was first set up. The new method of investing in tertiary education requires the appointment of more senior people with specific skill levels.” Unfortunately, we have seen a proliferation in the number of those members. That has had another effect on the other side, when we look at the structure of it all, because the institutions themselves have become bogged down in it.

Inside all of this we have the New Zealand Qualifications Authority. That is dealt with in Part 1. The authority is to set up a quality assurance programme, yet we find it working at a snail’s pace. In actual fact, I was disappointed to learn today that after the debacle and fiasco around the Plumbers, Gasfitters, and Drainlayers Board and the industry training organisation stand-off in the Hazel Armstrong inquiry, the new qualifications have not been approved. It is hoped they will be approved in January 2008. That is an indication of what we are working with here, and I do not think that a bill of this nature, which came to us with very draconian wording in it, will address this issue whatsoever.

One of the major issues we really are confronted with in legislation of this nature, as laid out in Part 1, is that it will stifle quality. What we saw down in Christchurch with the Southern Institute of Technology—a very, very successful model of what a polytech should be doing and accomplishing—was that that institute lost $8 million worth of equivalent full-time student funding because of being more competitive, more efficient, and, in fact, having more people coming to it for quality education than the Christchurch Polytechnic Institute of Technology. What we are actually seeing, unfortunately, is that this bill is stifling initiative. It is stifling quality of education, and that is not good for the tertiary education sector.

I am pleased to have the opportunity to speak to Part 1 of the Education (Tertiary Reforms) Amendment Bill. Right at the very outset, I want to make the point that the Education and Science Committee really faced a massive challenge in working its way through this proposed legislation. I think the select committee was very, very fortunate on two counts, one being the quality of the advice and the guidance—and, I have to say, the forbearance and the patience—that the officials brought to the task. It could not have been easy for them, either. But finally we got through it.

The second acknowledgment I want to give in addressing Part 1 is to the leadership provided by National’s own tertiary education spokesperson, Dr Paul Hutchison. He brought a detached, thoughtful, and reflective approach to the debate—not helped, I have to say, by some of the members opposite—and this brought a bit more common sense and structure to what were, when the bill was first presented to the committee, some pretty loose, untidy assertions on the part of the Minister.

Life is interesting. It has a way of going round in circles, and I think that Part 1 clearly demonstrates that. The bill is trying to clean up a mess that was initially created by the Minister responsible for the Tertiary Education Commission at the time, a Mr Maharey. He left tertiary education more unsettled and more confused than he found it, and that is what tends to happen with the left in New Zealand politics. So they put in Dr Cullen, the man who had already lost control of financial policy, and the man who—it is increasingly obvious—does not know what to do about, for example, taxation, and they told him to get in there and fix tertiary education. This bill is the result.

If we look through Part 1, we realise just how bereft of sound, original thinking this Government is. What is in the minds of the members opposite that makes them think that the best way to get quality is to create massive bureaucracies? What was wrong with the New Zealand university system when a couple of people sat around a table in the old Department of Education? Now we are talking about—is it 380 people?

Colin King: 340.

ALLAN PEACHEY: I must get it right. I would not want to be accused of exaggeration. That is a hugely increased number of people. Why is this bill making it so expensive to administer the tertiary education system?

One of the other problems we get is that left-wing Governments bring with them a sort of massive crashing club in their approach to issues they are trying to deal with, and nothing illustrates that better than the tertiary education issue. When I look at Part 1, I have two thoughts. Firstly, where is the trust? Why does this Government not understand that one gets the best results from high-trust models?

Jill Pettis: Is this the National Party’s policy on tertiary education?

ALLAN PEACHEY: Goodness gracious me, is that the defeated member for Whanganui? I think it might be. Well, the people of Wanganui decided they had no interest in her views, and I certainly have no interest in her views on tertiary education reform. As I was saying, this is not a high-trust model. I looked at the vice-chancellors and the chancellors who came and presented, very well, before the committee, and I could not help but reflect that when they were asked the question: “Is this legislation so seriously flawed that it should be dumped and we should start again?”, their body language was interesting.

National members cannot have it both ways. Prior to the last election they had a field day over the excesses of 5.1 funding, the singalong courses, and the twilight golf courses, which actually came about as a result of the uncapping of the equivalent full-time student numbers in 1998. Who was it that uncapped the number of equivalent full-time students in 1998? The consequences of that were, first, the blowout in the number of equivalent full-time students used by the private training establishments, which Labour then put a totally artificial moratorium on. Then there was the blowout in the polytechs and institutes of technology. Then, National members had the gall to say: “What we want to do is get rid of any bureaucracy. Let’s go back to ‘bums on seats’ and the uncapped EFTs.” I am sorry but those members cannot have it both ways.

In this particular case it is the second tranche, I guess, of the reforms that Labour has attempted to put in. The first one failed somewhat because some of the funding mechanisms were left in place by the former Minister. When Maurice Williamson travelled to Finland and Ireland and studied their tertiary education systems he said that he met up with people who said: “If you plan you are almost certainly not going to get it right. But if you don’t plan you absolutely are not going to get it right.” That is what occurred with the “bums on seats” situation. There was a misalignment. This bill, the Education (Tertiary Reforms) Amendment Bill, is attempting to achieve some alignment.

I would be the first to agree that the bill is more heavy-handed in terms of bureaucracy than what existed in the past, but we have to look at what occurred as a result of the light-handed bureaucracy in the past. Mr Peachey asked what was wrong with two people sitting in the department running our universities. Well, there was only one university in New Zealand then. Members may recall that it was called the University of New Zealand and it was set up in 1876 at the request of Canterbury, much to the chagrin of Dunedin. Of course, there were a lot fewer students and it was a lot less complex sort of a world. If that is what National wants to take us back to, then it really does have a dinosaur policy on tertiary education. I continue to ask this question, which I cannot get an answer to: if National gains the Treasury benches, will it repeal this legislation? Would it reverse these reforms? National members cannot seem to tell me that. There has been speaker after speaker, but no one will address that simple yes or no question.

I would be the first to admit that the members of the Education and Science Committee worked constructively, although from time to time we did have to point out one or two of the basics to Dr Paul Hutchison. For example, even when this bill has gone through, academic freedom and institutional autonomy will still be protected because it was in the Act anyhow, in a different part. In fact, we went so far as to say “Let’s just confirm that this is in the other part of the Act as it has got to be considered in this part.”

What I mean when I say that National cannot have a bob each way is that Dr Hutchison has put up some amendments, one of which I would like to talk to because I think it has some merit, but the other amendments actually create more bureaucracy. They require even greater levels of consultation and they try to prescribe to the Minister all of the different groups he should be consulting with, when at the same time Dr Hutchison says that this measure is too bureaucratic. The North American native indigenous people used to call it talking with a forked tongue.

The area in which there is some merit—and I think it is a 50:50 call from New Zealand First’s point of view as to whether we will support it—is the amendment about commercially sensitive information. I would like to take a call later, if I could, to go through this in a bit more detail, because I believe it needs explanation. I think that in this particular case there is some merit in the amendment on that particular issue set out on Supplementary Order Paper 161, which is in Dr Hutchison’s name. I am not saying at this point in time that we are going to support it, but I can say that I think there is an issue around this one.

I move, That the question be now put.

I appreciate the opportunity to take this call, and I hope that we will have time to spend on Part 1, because it is very, very important. One of the basic aims of the Education (Tertiary Reforms) Amendment Bill was to make the planning of tertiary education institutions more streamlined by cutting down on charters and profiles and replacing them with a 3-year investment plan.

That sounds great in theory, but there are a few ironies about this aim, one of them being that the universities were anxious to hold on to their ability to retain a charter. They felt that a long-term plan that was signed off and given the tick of the Minister would be very useful to them in terms of having a link with the Minister. They felt that that association would give them an extra bit of security in terms of their direction.

I guess the other irony is what has turned out. The very good summary that the department has provided points out that plans are developed by the tertiary education organisations. Although the plans must satisfy the requirements set out in clause 17 of this bill, tertiary education organisations are not prohibited from including in their plans information to satisfy their own purpose—for example, long-term planning. However, the summary then goes on to state that in some instances tertiary education organisations may be required to provide the Tertiary Education Commission with evidence of long-term planning.

Under clause 17 of the bill, new section 159R states that the Tertiary Education Commission can require types, classes, individuals, or tertiary education organisations to provide supplementary information. In actual fact, that supplementary information may be short-term planning, medium-term planning, or long-term planning. So, in effect, the Tertiary Education Commission may require almost anything in the way of planning.

I am very sceptical about whether the basic idea of a simple 3-year plan replacing the charters and profile will work out under this Labour Government in actuality. I think there is a very, very slim chance. Because, as I have said, I have heard what is happening right around the country—about the threats by the investment managers to the tertiary education institutions that they will not sign off plans unless the institutions are prepared to reduce the number of equivalent full-time students, or whatever.

Let us look at the polytechs. “The polytech cuts start to bite” is one of the headlines in the Education Review of 14 September. We have heard, for instance, that the Southern Institute of Technology has been cruelly cut down on the number of equivalent full-time students for next year—something like 2,500. I say “cruelly” because the Southern Institute of Technology is one of the best-performing institutions in this country. Quality, relevance, and value for money is what it has aimed for, yet the centrally controlled Tertiary Education Commission, under the Labour Government, says that it will penalise the successful institutions and that the institutions cannot provide education in Christchurch because they are actually making it too hard for the incumbent to be able to survive, so they have to move away from there.

This is grossly unfair, particularly when it is inconsistent with what the universities are doing. I would defy Dr Cullen or the Tertiary Education Commission to start doing the same sort of thing to the universities. Can members imagine if the Massey University campus up in Auckland was told that it was out of region and to go down to Palmerston North, or, likewise, if the Otago University campus up here in Wellington was told that it was out of region and to go down to Dunedin.

The commission has started with the weakest institutions. What it should be doing is concentrating on who can provide quality provision at the best price. It is doing the very opposite.

I move, That the question be now put.

The CHAIRPERSON (Ann Hartley): No, we have a couple more speakers.

It is an honour to speak to Part 1 of the Education (Tertiary Reforms) Amendment Bill.

First of all, I think it is worthwhile asking the Minister in the chair, Maryan Street, why, after 8 years and over half a billion dollars of expenditure, we are looking at tertiary reform only now. If one looks at Labour’s history back in the 1998-99 campaign one sees that it said it was going to make changes to the tertiary sector. Up until this point there has just been talk, expenditure, and change, and many people do not agree that this measure is going to make a skerrick of difference to students up and down the country.

My colleague Paul Hutchison and I went to a presentation put on by the Tertiary Education Commission. We said that our Education and Science Committee was looking at the tertiary reforms, and we asked for a blow-by-blow account of exactly what this piece of law would do in terms of its impact on universities. We heard the presentation, which tended to go along the lines of blah-blah, stakeholder engagement, blah-blah, charters and profiles, blah-blah, investment reducing duplication. We have all heard the discussions that occur when we talk about tertiary reform. But in the end we said: “Well, if you can give us an example, what exactly will be the difference for Auckland University?”. There was a long pause before someone said: “Oh, actually, there’ll be very little change as a result of this reform. It’ll be business as usual.” So we thought that it was probably not a bad thing for universities, because nobody has had much of an issue with them.

But when we started to look at the nuts and bolts of this bill and the proposed changes, we started to have deep concerns about some of the changes. The Minister for Tertiary Education at the time said that this bill was designed to reduce bureaucracy, increase transparency, and look at better investment in tertiary funding. A lot of the universities and a lot of other tertiary providers said it was good to reduce red tape, reduce the amount of reporting, and reduce the thousands of dollars they spend on useless red tape and bureaucracy. When we looked at this bill, we found that the bill gets rid of charters and profiles, but then it suddenly brings in a whole new layer of accountability and a whole new section on planning. The tertiary provider not only has to put in place planning in the short term, which of course we all expect, but also is asked to do a medium plan, and perhaps a long-term plan as well. So rather than just preparing a charter and profile—which cost some universities hundreds of thousands of dollars to produce, and will now be parked—the tertiary providers are going to have to start again, and put out a long-term plan for up to 10 years. Well, I challenge the Government—any Government—to have a plan for 10 years, because things change so dramatically. We cannot expect our tertiary providers to have a crystal ball so that they can plan exactly what they will do vis-à-vis courses, etc. in 10 years’ time. So the National Party has some concerns that this bill seeks to take away some bureaucracy, only to bring back a whole new set of changes that will be equally burdensome, if not more so.

The other issue that I think is addressed in relation to Part 1 is academic freedom. Most of us were shocked at the second reading the other night to hear a member from Labour say that when universities receive 60 percent of their funding from the State it is a bit rich to expect full academic freedom. Well, I think that will be a huge shock to many in academia, and I think the Minister should explain some of the changes that have been made in relation to that. I would also like to hear how the changes make it easier for universities. How do they make universities and other tertiary providers’ jobs easier, or are they just introducing another layer of bureaucracy, which will be equally costly?

I think there is a lot of discussion about plans. In fact, “plan” is the most overused word in this bill. In an attempt to reduce the amount of resources attached to planning and strategising, it actually introduces far more planning and strategising than anybody ever envisaged when the tertiary reforms began.

I rise to take a short call on Part 1 in response to some of the points raised by the National Opposition in respect of the Education (Tertiary Reforms) Amendment Bill.

The bill does use the word “plan” a lot, as the member who has just resumed her seat said, and we make absolutely no apology for that. Tertiary education ought to be planned, it ought to be considered carefully, and it ought to be engaged with by stakeholders. That is the framework and the upshot of this bill. As a result of this bill, we will have a new system for planning, funding, and monitoring the provision of tertiary education.

There are some significant changes. It will be a system that is no longer demand-led, it will be a system that is no longer based on inputs, and it will no longer be a system with a 1-year planning and funding cycle. Spreading the plan, the funding, and the organisation across 3 years provides a level of security and continuity, and that allows tertiary education organisations to proceed with their business. So the new system is built on a plan, and it lasts for up to 3 years. The plans are developed, owned, and maintained by each of the tertiary education organisations. The people who have an interest in the offerings of those tertiary education organisations will be encouraged. In fact, there will be a requirement that they are consulted and talked to in the course of the development of programmes and in the implementation of the plan.

A key feature of this process is its flexibility. The contributions we have had from the Opposition have implied that a layer of stultifying bureaucracy will be applied across the top of these organisations. In fact, the opposite is true. The bill does establish plans but it contains a number of provisions for those plans to be reviewed, amended, and replaced as needed through a collaborative process. There is some flexibility built in.

I would like to make a couple of comments especially about clause 3, which has been amended to make clear that the principle of academic freedom is completely unfettered by the amendment bill. I welcome the reassurance that this will provide to academics in tertiary institutions. Although that provision was already present in the legislation, this provides additional reassurance and demonstrates that academic freedom is in no way jeopardised by these reforms.

The part currently under consideration does the bulk of the work in this reform bill. It sets out the legal mechanisms that allow for the plans, which I have already referred to, to be developed and approved, then changed if need be. It sets out the mechanisms that the Tertiary Education Commission might use to monitor the performance of tertiary education organisations. That is right and proper. It is also important to note that there is no prohibition or control. The repeated notion that the Government represents some sort of commissariat that dictates what is taught completely misrepresents and distorts the function of the Government. Of course, if a programme offered in a tertiary education organisation is funded by the Government, the Government, through the Tertiary Education Commission, is responsible for ensuring that the courses are delivered as they are meant to be. The commission has no reach over programmes that are not funded by the Government.

I refer to Supplementary Order Paper 161 in the name of Dr Paul Hutchison, and respond to some of the points he made earlier. As much as I admire Dr Hutchison and take no exception to him as a person in any way, the Supplementary Order Paper is completely redundant. It is a second bite of the cherry, it seems. The very points that the member raises have already been disposed of by the Education and Science Committee. The National Party is having another go at what did not make it through the process of the select committee. The issues around the shape of consultation requirements on tertiary education organisation plans, the publication of the tertiary education strategy, the reasonableness of Tertiary Education Commission decision-making, and the potential exposure of commercially sensitive information have all already been addressed. Dr Hutchison’s amendments are considered to be unnecessary, repetitious, and altogether unhelpful, which is why the Supplementary Order Paper should fail, despite the niceness of the member who puts it forward.

It was good to hear the Associate Minister for Tertiary Education explain some of the details that the Education and Science Committee spent months and months working our way through. It is good to know that the Minister has some understanding of the challenges that the committee had to face.

But for just a moment or two I would like to talk about Dr Paul Hutchison’s Supplementary Order Paper 161. I point out to the Minister that the reinforcement of academic freedom was put in clause 3 only at the very last moment. It is a bit like the requirement that information be supplied to the Tertiary Education Commission before funding is granted. Listening earlier to the chairman of the select committee gave me some confidence that he, too, is aware that, under closer examination, there are some problems with that ability of the Tertiary Education Commission to demand information before funding is given. I see the risk emanating from the point of view of how it appears to a person on the outside—a partner or a joint-venture client who may be entering into a research programme. Such people will look at the requirement and decide on balance to go with a university that can guarantee them categorically that there is no spectre of confidential information being disclosed. It is on that basis that the National Party is particularly concerned about that requirement.

As I mentioned in the second reading debate, our eminent member Dr Paul Hutchison is ever, ever aware of—and is probably the most well-informed person in this Committee about—the alignment that is necessary between universities and the science fraternity. It is something that we really have not done very well. That probably highlights the attitude of the Tertiary Education Commission and the angle at which it is approaching this whole thing. It is approaching, effectively, to put it in simple terms, an issue around delivering skills and trade training at institutes of technology and polytechnics—low-level diplomas, certificates, and some degree-level qualifications—that is about managing quality, yet we have actually roped in the universities, and have done it under the view that they will do as we say. They will not be able to be heard around any sensitivities. With this particular provision in Part 1, I believe we are putting at risk a lot of the commercial science arms of universities. I want to make that particular point.

I now want to move on to a point about quality. Clause 14 includes section 159KBA, “Monitoring and reporting function of chief executive in relation to institutions”. I draw the Committee’s attention to a review that was done recently and resulted in Review of the Operation of the Tertiary Education Institutions at Risk Legislation. It deals with sections 195A to 195F of the Education Act. I think it is necessary for the Committee to be aware that, from my working through this bill, it will go nowhere near tidying up this problem. The report talks about the Tertiary Advisory Monitoring Unit and its responsibility, but in terms of the auditing process that happens every 5 years it states: “… TEIs should also be measured in terms of the quality of education provision. … In the longer term, it may be appropriate to review the current criteria …”. Then we go to section 46 of the report, which states: “It is likely, for example, that as part of the Investing in a Plan process, the TEC will have more tools to support TEIs to respond to the difficulties they are facing, by providing the right kinds of incentives to encourage good performance.”

That is quite an indicting statement. It is an indictment that after 8 years of Labour Government we have a comment from the auditing body of standards of education inside the tertiary education sector about providing “the right kinds of incentives to encourage good performance.” The right kinds of incentives are not in the bill. I think that is a point that is well worth being made.

I take a call just to stress three points. The first is the point about academic freedom. I have to say that the Opposition has this totally wrong. There is no change to the Act in terms of the protection of academic freedom and institutional autonomy.

Dr Paul Hutchison: I raise a point of order, Mr Chairperson. We are actually debating Part 1. The academic freedom part is dealt with in the purpose clause and is actually not relevant to Part 1.

Hon BRIAN DONNELLY: Speaking to the point of order, Mr Chairperson, I note that the Opposition speakers have been referring to academic freedom and institutional autonomy all the way through their speeches. I am responding to their speeches.

The CHAIRPERSON (Hon Clem Simich): Thank you.

Hon BRIAN DONNELLY: I wish to make the point, which is quite simple, that references to those two concepts are still in the Act. This bill makes no change to them except to strengthen their protection. That was explained to the members of the Education and Science Committee time and time again.

I also want to make a point about charters. There was a sector that wanted charters, but it flowed over into the polytech sector as well. Universities can still have their charters. There is nothing in this legislation that prevents them from having charters. The problem is that they came along and said they have to have institutional autonomy but that they also want to have those 10-year charters signed off by the Minister. The whole thing contradicts itself.

What the committee said was that long-term planning is good governance practice, and we would expect that all tertiary institutions would have in place some form of long-term planning, vision statements, etc. But we said we would leave it up to the institutions themselves to devise what works for them. So small private training establishments might have a totally different need from, say, a large institution like Auckland University, which may decide that it will stick with the charter that it has spent money on. I want to make clear that the select committee said that we will put in place something requiring long-term planning, but we did not prescribe what form it was to be in, and it certainly was not to be signed off by the Minister.

The third issue is around the notion of commercially sensitive information. Clearly, the Tertiary Education Commission has a responsibility—and it is spelt out in the Act—to continually monitor the financial risk of the institutions themselves. That is prudent. Why would we be putting literally tens of millions of dollars into an institution that was going to go belly up in the next week? We need to have some sort of guarantee that the institution is not engaged in some foolhardy scheme that will turn the whole thing to custard. So the Tertiary Education Commission requires information beyond just purely and simply the information around those programmes for which the institution is seeking money. But the question is whether the Tertiary Education Commission requires information that burrows down deep enough to be commercially sensitive information.

The problem brought to our attention—and I think it was a genuine problem—was that if universities, for example, had to reveal all their contracts, then they could not give that information, because they would have already signed contracts not to reveal it to anyone. Commercially, they would be breaking their deals right from day one. But, secondly, their concern was that the Tertiary Education Commission also comes under the Official Information Act, as do universities. The Tertiary Education Commission told us that it could refuse information that was commercially sensitive. The universities responded by saying: “But they might not know what is commercially sensitive. We do.”, and that was a very, very good point and a valid point.

We asked the officials to go away and look at this matter seriously, and it was confirmed to us that the level of detail of information that would be required by the commission in order to be able to do its monitoring function was at nowhere near the level that would require commercially sensitive information on research contracts, etc., and even if it was required—and the officials said it would not be—and the commission got an Official Information Act request on it, the commission would first go back to the institution and ask it what its opinion was under the protected disclosures provisions under the Official Information Act.

Therefore, I have to say to the Committee that I am not too certain about the tidiness of the language that is used in the bill, because it is really about that commercially sensitive information that is protected under the Official Information Act. That part is what really is relevant in terms of the amendment that Dr Paul Hutchison has put forward. I think it is a genuine attempt, and I will not lambaste him for it. It is still an issue that we are not 100 percent comfortable about, and it is a line call for us at this point in time.

I move, That the question be now put.

I raise a point of order, Mr Chairperson. Under Standing Order 137(3)—

Hon Member: What does that say?

NATHAN GUY: It talks about closure motions. If there is a lot of interest, as there is in this debate on Part 1, it is over to you to decline it, Mr Chairperson. I urge you to consider that there is a lot of interest in the debate and many members are seeking calls.

The member’s knowledge of the Standing Orders is impressive and delightful, but the most important arbiter on this is you alone, Mr Chairperson. The motion that I have put is not a debatable one, but that is what the member has now sought to do by—[Interruption] A member is now interjecting on my point of order, as well. So maybe, Mr Chairperson, you could also tell Mr Bennett some of the rules of Parliament. But this is not a debatable motion. The motion is put and you either accept it or do not accept it, and your decision should not be challenged by any member, in Government or in Opposition.

The CHAIRPERSON (Hon Clem Simich): I thank Mr Hughes for his assistance. I do not need any more assistance on this one, but I think that the Committee would like to hear from Te Ururoa Flavell.

I appreciate very much being given the opportunity to speak to Part 1 of the Education (Tertiary Reforms) Amendment Bill, particularly because the Māori Party has some proposed amendments. I thank you very much, Mr Chairperson, and I appreciate the opportunity to be able to speak to them—and I am sorry for being a little late to do it.

During the last big reshuffle of the tertiary education sector, which saw the establishment of the Tertiary Education Commission and the introduction of charters and profiles, the Ministry of Education released a document entitled the Report of the Working Party on Charters and Profiles. Arising out of that report, institutional charters were expected to outline and describe institutions’ approaches to fulfilling Treaty of Waitangi obligations towards Māori, by identifying how they would give effect to relationships with Māori. That directive was reiterated in the Tertiary Education Commission’s document Charter Guidelines. With regard to profiles, the situation was similar. The Report of the Working Party on Charters and Profiles stated that one of two fundamental expectations of profiles was that they would identify how an organisation planned to work with Māori. That report was significant, in that it underscored the need for a Treaty-based relationship between tertiary education providers and Māori, and, in relation to the issue at hand, it highlighted the need for the institutions to develop their charter profile system in consultation with Māori.

But with this bill before us the requirement to consult Māori, and the acknowledgment of consultation as central to the Treaty relationship, has, for some reason, been written out. So what has happened since that report was released in 2001? Just to take us back a little, I say Māori scholarships and references to the Treaty in policy documents have been scrapped in the face of accusations of race-based privilege made by the previous leader of the National Party, Don Brash—

Hon Darren Hughes: That’s right.

TE URUROA FLAVELL: —the Foreshore and Seabed Act, which denies Māori both land rights and legal rights, has been passed—that is right—Treaty settlement legislation has continued to be passed amidst criticism of poor process, including inadequate consultation; the Treaty of Waitangi Act 1975 has been amended by specifying a closing date for submitting historical claims to the Waitangi Tribunal, without prior discussion with or agreement from hapū and iwi Māori; a member’s bill to delete the principles of the Treaty of Waitangi from all legislation has been supported to go to a select committee; the Treaty of Waitangi was removed from the school curriculum, by deleting references to it in the Ministry of Education’s 2006 draft curriculum document; direct references to the Treaty of Waitangi and its principles have been deleted from the new health policy, action plans, and contracts; land subject to Treaty claims has continued to be put up for sale without any prior communication with claimant iwi; and the list could go on and on.

But to come back full circle to the field of tertiary education, we are now considering a bill that allows tertiary education providers to prepare a proposed plan in consultation with those who they consider ought to be consulted. The key words are “ought to be consulted”. We know from experience that unless a requirement to consult is spelt out in black and white, it does not happen, despite the planning and despite the good will. We also know from experience that those who do consult, who take the time to build the relationships from which robust consultation and productive decisions can emerge, come to value it a great deal. And that is not to mention the economic benefits that often follow as a result of consultation.

The Māori Party’s amendment to clause 10 of the bill is to rectify that omission by adding subsection 10(3)(e)(iii) to new section 159ABA, which would require tertiary organisations to consult with Māori—with hapū, iwi, and Māori staff and students—in preparing their proposed plans. It is important that the gains developed out of the tertiary reform process of the late 1990s and early 2000s are not cast aside.

In yesterday’s speech at the second reading of this bill, I talked of the Treaty being about relationships: a commitment to a constructive and mutually reached respectful relationship by both Māori and the Crown. I reiterate also from yesterday’s speech that the lack of commitment this bill makes to the Treaty, by failing to match up the ministerial requirements to set a long-term strategic direction for Māori development aspirations to a Treaty-based context, makes the Treaty meaningless, invisible, and invalid.

Although the issue of consultation with Māori has been the focus of the recent period of tertiary education reform, one issue that was not resolved was that the same care for the Treaty, in terms of constructive mutually respectful relationships, be asked of the Tertiary Education Commission in the performance of its functions as is asked of institutional councils in the performance of theirs. The idea shared in the select committee by Te Tauihu o Ngā Wānanga, which is basically the collective of the three whare wānanga, is that for a Treaty relationship to be meaningful, it needs to exist at all levels of the tertiary education system, whether at Government level or at the level of the tertiary institutions.

The amendments to the Education Act 1989 that established the Tertiary Education Commission failed to include an acknowledgment of the Treaty and its principles, and that was despite the presence of a tailor-made section for doing so—namely section 159G “Principles guiding how Commission operates”. The amendment that we are talking about today from the Māori Party to add a new clause 11A to the bill proposes that the statutory requirement of tertiary institutional councils to acknowledge the principles of the Treaty of Waitangi in their governance role be reciprocated and reflected also by the Tertiary Education Commission in its planning and monitoring role on behalf of the Government. That would mean that the Tertiary Education Commission would have a statutory requirement to make good on the Treaty and get past the frustrating, ad hoc, and absent processes that have been reported to us over the last couple of years.

In closing, I say the purpose of the amendments is to make the Treaty meaningful, real, and visible. We hope that members of the Committee will be able to give serious consideration to our proposed amendments and will vote accordingly. Kia ora tātou.

I move, That the question be now put.

The CHAIRPERSON (Hon Clem Simich): We have had 13 speakers, including three doubles. But you have nine amendments and you opened the debate, so I think you should close it, Dr Paul Hutchison.

Thank you very much, Mr Chair, for your generosity in allowing me to speak again on the Education (Tertiary Reforms) Amendment Bill. I must say that I was appalled that Labour, right from the beginning of Part 1, has tried to close the debate—firstly Moana Mackey, then Jill Pettis, then Sue Moroney, and then Maryan Street, more or less in that order—and that is of huge concern.

Sue Moroney: I raise a point of order, Mr Chairperson. The member said that I tried to move a closure motion, and I have not done that. It is wrong. The information is false.

The CHAIRPERSON (Hon Clem Simich): That is not a point of order, although it did relate to a procedural matter.

Dr PAUL HUTCHISON: Thank you, Mr Chair.

I would like to concentrate on this area of commercial sensitivity, which has been of great concern to the universities and to the polytechs, because in this last 15 years there has been a different era in terms of most of our academic institutions developing commercial arms. Prior to that, what they tended to do was altruistic, selfless, and for the good of mankind. But what has happened over these last 15 years—I think starting with UniServices in Auckland University in about 1992—is that those institutions have all formed commercial arms. This may or may not be a good thing, but it is certainly the reality of today’s world, and it is very important for New Zealand that we make sure that the commercialisation of research is enabled to the greatest extent possible.

The universities have said that being required in the summary plans to insert commercial information may ruin some of the deals that they could be planning. That is of great concern when members think, for instance, of the Pfizer deal with Auckland University. That was cancelled for other reasons, but it was a $65 million agreement with the university, and it was profoundly unfortunate that the company decided to withdraw the funding.

In Supplementary Order Paper 161 I have tried just to diminish or protect to a small extent the amount of information that an organisation is required to put in its summary plan. It states: “an organisation is not required to include details in any plan summary, of information that is confidential or commercially sensitive, or that may otherwise be withheld from disclosure under the Official Information Act” etc. I think that brings us just another edge closer to giving institutions a degree of comfort, and that is the reason why I have inserted it. I believe it was constructive, and I think it is realistic.

It is correct that at the end of the day one does have an Official Information Act process. However, as we all know, when an institution has something that is very sensitive, it is very easy to have that document leaked in this day and age of emails—and we know it around Parliament, around New Zealand, and around the world. So I think every possible mechanism that we can bring in to ensure that commercial sensitivity is protected, within the bounds of reason, is appropriate.

Clearly, organisations like Business New Zealand have said in their submissions “that the bill should reflect the principle that information regarding the use of public funds must be as freely available as possible”—I totally agree with that—“apart from the fact that exceptions to this principle should be made only when there are compelling reasons; for example, national security, privacy—natural persons—or commercial sensitivities.” As we know, New Zealand universities are very cash-strapped; there is a cap put on their funding

Hon Steve Maharey: Promise more money.

Dr PAUL HUTCHISON: Well, I say to Mr Maharey that he may need it in a few months’ time, down there at Massey. I think it is after some funding. But the very important thing is that this is potentially a crucial source of funds for universities. Hence we want to make every protection possible. Thank you for indulging me, Mr Chairman.

I move, That the question be now put.

Motion agreed to.

The question was put that the amendment set out on Supplementary Order Paper 161 in the name of Dr Paul Hutchison to section159AA in clause 6, to omit subsection (3)(a) and substitute new subsection (3)(a), be agreed to.