Govt tightens education purse strings

The Government has tightened the purse strings on education with a Budget which leaves early childhood services and many tertiary institutions with no increases in their government subsidies next year.

Education Minister Hekia Parata Photo: RNZ / Alexander Robertson

New spending on schools and early childhood services totals $686 million during four years - about two-thirds the size of new spending in each of the previous two budgets - funded in part by $64.9 million in cuts at the Education Ministry. Tertiary education spending increases $113 million over four years.

Total spending on schools and early childhood education rises from $10.3 billion to $10.8 billion dollars in the next financial year. Tertiary education spending will increase from from $3.017 billion to $3.060 billion.

School operations grants will increase just 1 percent next year, half as much as in previous budgets, and there are no increases at all to early childhood subsidy rates or subsidies for most tertiary courses. Budget documents say inflation in the past 12 months is 0.1 percent.

Read more stories on Budget 2015

Schools

The biggest ticket item in education is the previously announced $243 million over four years in capital spending for seven new schools, expansion at four other schools, and 241 new classrooms at other schools. The Budget provides a further $88.2 million in operational spending for those projects.

Spending on the Ongoing Resourcing Scheme for the most disabled children increases by $39.5 million over four years, enabling about 500 more students to access the scheme. There is also $23 million in new spending for extra teacher aides to help children with disabilities under a previously announced policy.

The echoes of the Novopay school payroll debacle continue, with new spending of $53.3 million over four years on the education payroll.

John Key and Bill English doing bridge run before the Budget is announced.

John Key (left) and Bill English on their way to announce the 2015 Budget.

Winston Peters responding to Budget 2015 "I see red".

Winston Peters responding to Budget 2015.

Andrew Little giving his 2015 Budget speech.

John Key responds to the Labour Party's Budget reply speech.

Andrew Little grilling Bill English's 2015 Budget in parliament house.

John Key responds to the Labour Party's Budget reply speech.

Te Ururoa Flavell giving his Budget 2015 speech.

This budget will be the seventh for Finance Minister Bill English (right - pictured with Steven Joyce on the way to the lock-up at Parliament's Banquet Hall).

Peter Dunne giving his 2015 Budget speech.

Bill English (left) and Steven Joyce handing out the Budget to parliament members in the house.

Steven Joyce (left) and Bill English leaving the 2015 Budget lock-up at Banquet Hall, Parliament.

Bill English giving the 2015 Budget in Parliament house.

Metiria Turei giving her 2015 Budget Speech to the house, parliament.

Steven Joyce (left), Paula Bennett and Bill English arriving at the 2015 Budget lock-up at Banquet Hall, Parliament.

Steven Joyce (left) and Bill English arriving at the lock-up - where about 160 journalists and analysts are waiting.

Bill English giving his Post Budget 2015 speech.

Andrew Little delivering his Post Budget 2015 speech.

Radio New Zealand's economics correspondent Patrick O'Meara, host Susie Ferguson and political editor Brent Edwards in the studio.

Labour leader Andrew Little - at a post-Budget stand-up with reporters at Parliament..JPG

Maori Party MP Marama Fox (left) and ActionStation director Marianne Elliott hongi after the delivery of a petition calling for a Budget to end child poverty.

15,000 signature petition calling for a Budget to end child poverty in front of parliament.

Bill English picking up the 2015 budget at the printers in Petone, Lower Hutt.

Fiscal Strategy Report 2015

Budget 2015 report

Bill English pre-budget speech in Wellington 1 May 2015.

John Key after pre-budget speech to Business New Zealand.

Early Childhood Education

The Government expects to spend $75 million more on early childhood education during the next four years as more children attend from an earlier age and for more hours.

There is no provision for an inflation-linked increase to early childhood subsidies. In the previous two budgets these amounted to about 1 percent.

Tertiary

The Government is expecting fewer enrolments next year but will maintain its spending on tertiary education by increasing funding in some areas.

The Budget continues the Government's policy of limiting tertiary subsidy increases to high-priority courses in science and technology-related subjects. It targets $86 million over the next four years to increase subsidy rates for degree courses in science (7.5 percent), agriculture (20 percent), optometry, pharmacy and physiotherapy.

There is also $11.4 million over four years to increase the number of engineering graduates, half of it to provide more places on engineering courses.

Most other courses have now had no increase for four or five years.

There is $8.4 million over four years to allow growth of up to 500 new learners per year in Maori and Pasifika Trade Training.

The government also proposes allowing tertiary institutions to raise their fees for domestic students by 3 percent next year, down from the previous limit of 4 percent.