The Front Page: Could universities push up fees to make their businesses more sustainable?

2 min read

Victoria University of Wellington faced more than 200 job cuts. Photo / Mark Mitchell

The Government is forking out an extra $128 million over two years to support universities on the brink of making widespread job cuts.

Speaking to The Front Page podcast, Tertiary Education Union branch president and Victoria University of Wellington English lecturer Dougal McNeill said the sector was looking at as many as 1000 job cuts.

“What was at stake was hundreds of job losses around the country,” he said.

“Hundreds were signalled at Otago, 299 at Victoria University, also remember there were 400 jobs slated to go at Te Pūkenga [the nation’s polytechs], and there have also been attempts at redundancies at AUT that are supposed to come in later on.”


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While it’s still unclear whether the Government funding will be enough to stave off all of these job cuts, McNeill said it will buy the tertiary education sector time to work on what the future looks like.

“We need to have a wider conversation about funding,” said McNeill.

“The Prime Minister, when he was the Minister of Education, was quite open [when] campaigning in the last election that the funding model is broken. A country of 5 million people having its universities competing in a kind of zero-sum game is bad economics and leads to bad education.”

Universities have long faced the challenge of balancing the economic imperatives and government funding, given they are dependent on both for survival. With the ongoing impact of Covid, the economic challenges have piled up and led to deep funding holes that have not been sufficiently filled by Government. Add in the exodus of young Kiwis going on gap years, the staggered return of international students and the fact that low unemployment usually leads to fewer enrolments, and you have a complex situation that demands longer-term thinking.


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“You don’t have the same crisis emerging from Dunedin to Auckland without there being an underlying pattern going on – and that’s the issue. I think we’ve got a chance to really intervene now.”

If a clear long-term funding plan isn’t established, could this lead to universities hiking student fees to create a financial buffer for the future?

“I don’t want to see our young people go further into debt,” said McNeill.

“Education is a public good. Having a well-educated population is good for us. The skills that people develop at university are actually deployed in society more generally. And so even if raising fees might seem like a tempting short-term solution to individual institutions, I think it would not be part of an actual sustainable rebuilding of our sector.”

Increased fees would also exacerbate the debt burden of students who often graduate from university owing tens of thousands of dollars in student loans.

“Add to that the cost of living as a student, rent, food and all the other issues that everyone else is dealing with and it makes it very difficult for them to actually focus on their studies. Let’s not make that even harder for them.”

The point here is that both this and the subsequent Government will face tough decisions when it comes to ensuring the long-term sustainability of our education sector.

Listen to the full episode of The Front Page podcast to hear the full discussion on this issue.

The Front Page is a daily news podcast from the New Zealand Herald, available to listen to every weekday from 5am. It is presented by Damien Venuto, an Auckland-based journalist with a background in business reporting who joined the Herald in 2017.

You can follow the podcast at iHeartRadio, Apple Podcasts, Spotify, or wherever you get your podcasts.


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