The Minister of Education has confirmed tertiary fee regulation settings for 2023
Following consultation, the Minister of Education has confirmed fee regulation settings for provider-based fees in the tertiary education system for 2023. This includes setting the Annual Maximum Fee Movement at 2.75 percent, along with changes to support Te Pūkenga to undertake fee unification for 2023 and to exclude work-based programmes from fee regulation requirements for 2023.
The Annual Maximum Fee Movement
The Government regulates how much tertiary providers can increase their fees for domestic students each year through the Annual Maximum Fee Movement (AMFM). This caps the percentage increase on fees for existing courses at level 3 and above on the New Zealand Qualifications and Credentials Framework (NZQCF).
Following consultation, the Minister of Education has confirmed that the AMFM rate will be set at 2.75 percent for the 2023 calendar year, which is in line with the Budget 2022 across-the-board increase for tertiary tuition and training subsidies for 2023. This permits a 2.75 percent increase on the fees (GST exclusive) charged in 2022 to domestic students. Micro-credentials remain subject to a $60 per-credit cap (GST inclusive).
An AMFM of 2.75 percent strikes a balance between protecting the affordability of tertiary education for students and their whānau, while also giving tertiary education providers some flexibility to help cover increases to costs in 2023.
Supporting Te Pūkenga to undertake fee unification for 2023
Across Te Pūkenga’s network of provision, there are many qualifications that currently have multiple programmes. Te Pūkenga is planning to undertake a process of programme unification from 2023 that will reduce complexity across the network, enable greater flexibility for learners and employers, and support seamless transition across learning contexts and geographic locations.
To support Te Pūkenga to undertake programme and fee unification, the Minister of Education has decided that, for 2023, where Te Pūkenga unifies a programme by rolling out an existing programme across its network, the fee setting limits for new courses (the 75th percentile rule) will apply to the courses in that programme. This change will ensure that Te Pūkenga can set a unified programme fee that reflects the weighted average of the existing course fees for a unified programme.
Continuing to exclude work-based learning from fee regulation
While fees for provider-based programmes at level 3 and above on the NZQCF have previously been regulated, this was not the case for fees for work-based programmes funded through the Industry Training Fund (ITF). Fees for work-based programmes are generally much lower than provider-based programmes and employers often pay, or contribute towards, the cost of these.
With the implementation of the Unified Funding System (UFS) for vocational education and training from 2023, the Minister has decided not to change the way fee regulation settings apply between provider-based and work-based programmes in 2023. This means work-based programmes will not face fee regulation in 2023, despite being funded alongside provider-based programmes through the UFS.
The Ministry of Education is also currently undertaking a review of learner and employer contributions towards the cost of vocational education and training (VET). This includes considering options on how fee regulation settings apply across VET, which may include regulating fees for work-based learning. Any future changes will be subject to public consultation and Cabinet approval and would not take effect before 2024.
A note about the amount of change in the sector
We recognize that it is an extremely busy time for providers given the amount of change occurring in the tertiary education sector and uncertainty related to the ongoing impacts of the COVID-19 pandemic. We needed to progress this work to give the sector clarity on fee settings for 2023 and to meet statutory requirements to consult on fee regulation settings. We thank those who provided those who provided a submission that informed the Minister’s decisions.
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