The Government proposes to merge all of New Zealand's Institutes of Technologies and Polytechnics into one. This includes the Southern Institute of Technology and if approved it will affect the whole Southland community.

Why we disagree with this proposal

SIT should not be included in the proposal for the merger because it doesn't fit into any of the major points that the Education Minister has outlined. Read More

  • Money Contributed

    The local community contributed over $7.25M to assist with the establishment of the Zero Fees Scheme.


    Only approximately 13 % of SIT2LRN students access loans and allowances therefore cost effective for the Government.

  • Sports Ball

    SIT makes financial contributions of approximately $300,000 every year to Southland community arts, cultural and sports events.

  • Teaching

    94% of SIT students and graduates are satisfied with SIT and their programme of study.

  • Graduate

    97% of SIT graduates surveyed (51% response rate) are in employment or further study.

  • International

    Southland has low unemployment, an older working population with identified skills shortages and has a real need for international students and their families.

    Southland needs to be able to do its own recruiting for international students to provide more graduates for industries and businesses.

We are concerned that:

  • Institutes will lose their autonomy and their ability to make decisions – this is at the heart of what has made SIT successful. The Minister has given no indication as to the proposed level of decision making, or it’s delegation on essential issues such as programme delivery, budgets and innovation;
  • There will be a loss of responsiveness to the needs of the local communities. SIT want to continue to serve the local needs of the people, industries and businesses of Southland;
  • The financial impact of the changes will be problematic. We don’t yet have full confirmation of what will happen to the assets we have accumulated, including money raised by you the Southland community. We don’t know if we will be penalised in the future for running a surplus with money leaving the community or by getting an unequal share from the start;
  • The Southland regional development strategy will be undermined as we need 10,000 new people living in Southland by 2025 with approximately half of these coming from SITs international students’ recruitment - a process we may no longer have any power over. Southland needs both domestic and international students and their families to come to Southland to help provide more graduates for local industries and businesses to grow.
  • There is not enough detail on how the proposals would work, and therefore there are significant risks for the whole sector and SIT in particular.






Reform of Vocational Education




Southern Institute of Technology


5 April 2019


Peter Heenan

SIT Council Chair


Penny Simmonds

SIT Chief Executive







Academic strength. 5

Financial strength. 5

Community engagement 5

SIT2LRN distance learning. 6

Zero Fees scheme. 7

SIT’s International programme. 8

SIT’s history of collaboration and financial leadership. 8

Telford Agricultural Training Campus. 9

MAINZ Auckland and Christchurch campuses. 9


Funding system is broken. 10

Tertiary Education Commission. 11

New Zealand Qualifications Authority. 11



Ring fencing of assets. 14

SIT2LRN distance learning programme. 15

Aspects of the Proposals which SIT Supports. 15

Proposal One – Redefine the roles of education providers and ITOs, and extend the leadership role of industry and employers across all vocational education. 15

Seamless transition between on–job and off–job training. 15

Common and consistent qualifications. 16

Proposal Two - Create the New Zealand Institute of Skills & Technology. 17

Centres of Vocational Excellence. 17

Single student management system.. 18

Proposal Three – Create a unified vocational education funding system.. 18





  1. The Government is currently consulting on the Proposal for Vocational Education System Reform. The three proposals for consultation are:
  1. Proposal One: Redefining the roles of education providers and Industry Training Organisations (“ITOs”), and extending industry and employers’ leadership role across all vocational education;
  2. Proposal Two: Creating the New Zealand Institute of Skills and Technology (“Institute”); and
  3. Proposal Three: A unified vocational education funding system.
  1. This submission is made by the Southern Institute of Technology (“SIT”).


  1. SIT recognises that there are viability challenges and consistency of delivery issues for ITPs in some parts of the country, and that the Minister of Education considers changes are necessary to address the problems identified in the vocational education system. However, we are concerned that various aspects of the proposed changes may not necessarily address the problems identified and will create other issues of inefficiency and disconnection with regional communities. 
  2. We support proposal 1 and 3.
  3. We oppose proposal 2 and set out our reasons below.
  4. The Southland Community and SIT have a strongly preferred option for SIT to be able to continue to operate as a legal entity under the Education Act independent of any centralised New Zealand Institute of Skills and Technology model should the Minister proceed with this proposal.


  1. Southland has a number of unique issues and features, noted below, which local industries, businesses and the community need and require SIT to respond to by competitively seeking to attract greater numbers of both domestic and international students:
  1. Consistently one of the lowest unemployment rates in New Zealand.
  2. Consistently one of the highest employment rates in New Zealand.
  3. Older average age of the Southland working population (38 years vs national average 35.9 years).
  4. Produces approximately 15% of New Zealand’s GDP with only 2.2% of New Zealand’s population.
  5. Very small population and the Southland Regional Development Strategy (SoRDS) seeks to add 10,000 people by 2025 and SIT is part of that solution.
  6. Identified skill shortages in the Primary Sector, Tourism, Manufacturing Industries and Trades.
  7. The Southland community is a significant financial contributor to SIT e.g. $7.25 million for Zero Fees but also over $100k pa ongoing to support students as well as industry in kind support, and the Southland community’s gift of a 300-seat theatre to SIT. Many of SIT’s assets are integrated with community use and vice versa e.g. SIT Zero Fees Velodrome.
  1. SIT has been identified as a key part of the Southland Regional Development Strategy (SoRDS) to address the above issues through attracting additional domestic and international students to Southland, who potentially become graduates progressing into the Southland workforce.
  2. Industry need and SIT’s ability to respond to it is captured in this quote from Karyna Young of Yunca heating reported in the Southland Times:
    One of the major difficulties for both our manufacturing and engineering divisions at this stage of operation is recruitment.   We are currently going through a growth stage and need the right people to drive our teams as we look to increase our skill set with specialised production out of the Invercargill factory.    In the preceding 12 months we have used Employment Agencies, Work and Income, Seek, Print Media and Digital Media to fill roles.  Some positions advertised at Work and Income have received no response at all, so yes there is a huge deficit in qualified tradespeople and skilled workers in Southland.  When seeking employees from Otago for the Dunedin factories we do not seem have quite the same problems.
    Our most successful avenue and a relationship that we absolutely rely on is the work we do with the team at SIT.  In the last 18 months the majority of the positions we have filled are by Immigrants who have settled in Invercargill whilst their spouse has been studying at SIT and have current work Visas.  Some have been offered permanent full-time positions, others fixed term contracts but all have been referred to us by the Employment Officer at SIT after advertising positions have proved to be unsuccessful.  
    We have had positions filled by immigrants that have excelled in their given roles and have swiftly been moved into management and supervisory roles.  We currently have employees from Germany, Brazil, Africa, Sri Lanka, China, India and the Philippines based out of our Invercargill branch.  The diversity alone gives the factory a true international feel and the eclectic range of experience the team offers has been amazing for us to work with, and learn from. [1]
  3. SIT and Otago Polytechnic are unique in the ITP sector in that both attract considerable numbers of students into the Otago and Southland regions in response to community and industry needs.
  4. The Southland community has developed several initiatives with SIT over the past two decades to ensure SIT continues to competitively attract students from outside Southland, including the Zero Tuition Fees Scheme, SIT2LRN distance delivery with staircasing onto campus programmes, International student recruitment.
  5. While competition in the ITP sector may not be viewed in a favourable light by some, it is a necessity for Southland and therefore SIT to meet the needs of industries that are so important to the Southland and New Zealand economies. That Southland produces around 15 % of New Zealand’s GDP reinforces this.
  6. For these reasons SIT submits that to include SIT in a centralised entity of one New Zealand Institute of Skills and Technology would put SIT in a juxtaposition with requirements which are at odds to the other regional providers within the entity. This would result in SIT either operating in conflict with the general objectives of the entity in order to meet the needs of its community, or alternatively being bound by the general objectives of the single entity and SIT failing to meet the needs of the Southland community.


  1. SIT is an ITP that offers programmes at campuses in Invercargill, Christchurch, Queenstown, Gore, Telford (Balclutha), Music and Audio Institute of New Zealand (“MAINZ”) Auckland and Christchurch; as well as offering distance and blended delivery learning through SIT2LRN.
  2. SIT provides quality vocational education which equips people with the knowledge, skills and competencies to be effective industry participants, in alignment with its Mission Statement and Statement of Purpose. 
  3. In 2018, SIT had a total of 5,132 Equivalent Full Time Students (“EFTS”), over 200 programmes and a total of 13,131 students. This number comprised 1,843 international students (964 EFTS).[2]
  4. We set out below some of the unique features of SIT developed in conjunction with our community to meet the needs of Southland.

Academic strength

  1. SIT delivers over 200 programmes from level 1 and 2 Foundation to level 9 Master’s degrees. SIT consistently receives positive feedback from degree monitors, industry bodies, employers and graduates. For example, B Nursing graduates regularly achieve 100 % pass rates for the Nursing Council external registration examination.
  2. In 2018 SIT student satisfaction continued to be high:
  1. 94 % of students were satisfied with their programme of study
  2. 93 % of students were satisfied with their teaching
  3. 95 % of students were satisfied with the Institute
  4. 94 % of students were satisfied with the learning environment
  1. In 18, 97% of graduates either working or in further study (79% were in employment or self-employment).

 Financial strength

  1. SIT has operated in surplus every year since 1990 when the Education Act changed, and direct funding occurred. This demonstrates that SIT is not, nor has ever been an institute at risk and therefore not part of the problem the Minister is trying to address.
  2. SIT has throughout this time operated with cash assets which have been used to continually reinvest in the institute’s capital assets for the betterment of students both academically, through programme development, equipment and facilities, and for their general wellbeing, such as student accommodation.
  3. SIT’s strong financial situation has also enabled a number of partnership developments which have benefitted the community for example Centrestage Theatre which was gifted to SIT by the community which SIT then substantially upgraded and made available for use by schools and arts festivals; the Southland High Performance Centre which SIT purchased advanced testing equipment for which is used by elite athletes and enables SIT interns access.

Community engagement

  1. SIT has 42 Advisory Committees which are made up of more than 250 industry, business and community representatives who work alongside SIT staff and student representatives to set direction for the content and delivery of programmes to ensure they are relevant to industry and create work-ready graduates
  2. SIT celebrates the work of Advisory committee members at an annual dinner. The guest speaker for 2018 was the Minister of Education the Honourable Chris Hipkins who in his speech noted “We know that SIT serves its community well and you should be proud of its success and confident about its future. You should also cherish the engagement and support you enjoy from businesses and local government”.
  3. Also attending the 2018 Advisory dinner was ILT and ILT Foundation President Alan Dennis who was equally complimentary saying “SIT is the mainstay of our city and has brought to the city a huge feeling of positivity and vibrancy, and added to the multicultural nature and substance of the region.”
  4. SIT staff and Council are members on many local business, industry and community committees, boards and groups in sports, arts, culture and business.
  5. More than 800 community people attended the recent RoVE consultation meeting with the Minister and a further 200 people met the Minister at the airport. The Southland community is highly engaged with the RoVE consultation because the risk to Southland is significant.
  6. SIT’s submission should be read in conjunction with particularly the submissions of the Southland Chamber of Commerce, the Invercargill City Council, and SIT’s Honorary Fellows.

          SIT2LRN distance learning

  1. SIT2LRN is the distance learning arm of SIT. SIT2LRN was launched in 2003 and is the largest faculty in SIT in terms of student numbers, EFTS and programmes delivered.[3]
  2. SIT2LRN was developed as an initiative to attract students into SIT study throughout NZ and staircase a proportion of these onto higher level study on campus in Invercargill to address Southland industry employment needs.
  3. SIT2LRN is modelled on Canadian distance tertiary provision run out of Nova Scotia, proving that technology overcomes the tyranny of distance and enables a lower overheads model to be utilised. The Learning Management System used by SIT2LRN is Blackboard Learn™, from the world’s largest global education technology company. Other users in NZ include Otago University, Victoria University and AUT. It is clear that online learning is evolving, and today’s learners require much more than just a framework for putting coursework online.  Blackboard Learn™ provides a course management system, content management, mobile and web conferencing solution on customisable architecture and scalable design to enable its integration with SIT’s student management and authentication processes, thereby providing a seamless entrance for students taking up flexible delivery courses. Additionally, the cloud-based SaaS solution of Blackboard Learn™ content means that should a catastrophic event occur (such as the Christchurch earthquake in 2011) all study access would still be available and uninterrupted. Another advantage of working with the world’s largest global education technology company is the ability for SIT to leverage off development work being undertaken elsewhere in the world, reducing the need for infrastructure development and management staff.
  4. SIT2LRN provides an invaluable tool for students who are in full-time employment, which makes it an important asset in the Minister’s initiative to engage more employees in VET. It is also invaluable for those students who are located at a distance from the SIT campuses, who are primary caregivers for family, or who have a disability which limits access to a physical campus. SIT2LRN offers NZQA accredited qualifications that range from Certificate level through to Master’s Programmes, as well as STAR and Gateway courses for high-school students serving over 200 secondary schools throughout New Zealand, providing staircasing opportunities into SIT, Southland.
  5. Through the flexible delivery provided by SIT2LRN, SIT has been able to quickly respond to industry needs. An example of this is seen in the provision of blended delivery of project management courses in Christchurch during the construction boom, with over 600 people (both staff and those seeking employment in Christchurch) gaining a qualification in project management through the SIT2LRN delivery. Additionally, after discussions with industry and health and safety representatives, the need for management level occupational health and safety training was identified. Through SIT2LRN provision, SIT is now recognised as the largest provider of occupational health and safety management training in New Zealand with over 800 students undertaking study year on year since 2016 and over 760 achieving diploma, degree or graduate diploma/certificate qualifications in the past 3 years. Additionally, one of the SIT development advisors in Health and Safety was recognised as the 2019 Senior New Zealander of the Year (Professor Bill Glass) and the SIT library houses the prestigious Professor Bill Glass Occupational Health and Safety Collection, donated to SIT in recognition of our ongoing industry partnership in this field.
  6. Student feedback in 2018 showed 94% of students that responded to the student satisfaction survey indicated overall satisfaction with the SIT2LRN programme.
  7. Since its establishment, SIT has had over 10,000 graduates who completed their qualifications through distance learning in over 65 programmes in a range of industries, including: Manufacturing, Primary Production, Retail, Processing, Construction, Central and Local Government, Education, and Service Industries.
  8. In 2018 SIT2LRN had 5,650 learners enrolled across 65 online programmes of study.[4]

Zero Fees scheme

  1. SIT is the only tertiary provider in New Zealand to offer a no tuition cost education to New Zealand students for every study year at all levels. The Zero Fees Scheme applies to all SIT and SIT2LRN courses; the MAINZ and Telford courses are currently exempt from the scheme.
  2. The Zero Fees Scheme was introduced in 2001 by SIT in response to the declining population trend in Invercargill, and as part of a wider initiative to attract more people to Southland, as well as lifting productivity in Southland industries by increasing the number of people with tertiary qualifications. The Zero-Fees Scheme has transformed SIT and subsequently Southland, increasing the number of student enrolments at the Invercargill campus from 1,400 to over 5,000 since its inception.[5]
  3. In the 18 years of its operation, 69,148 equivalent fulltime students or approximately 175,000 individual students have benefited from the Zero Fees Scheme.
  4. SIT conservatively estimates this equates to approximately $346 million worth of fees not having to be paid and therefore not requiring student loans from the government/taxpayer.
  5. This unique scheme was only made possible due to wide community support – the Southland community and business funders contributed $7.25 million over the first three years on top of government funding. The success of the scheme speaks for itself as it has been able to continue ever since.
  6. The scheme is currently guaranteed until at least the end of 2019 but it is SIT’s aim that the Minister of Education honour his comments to the SIT Council and community meetings on 1 March 2019 in Invercargill that it be retained, and enshrine the necessary mechanism into any decision to change the sector.

SIT’s International programme

  1. Since 2008 SIT has been very proactive in responding to the skill shortages being faced by Southland industries and businesses through a concerted International student recruitment programme.
  2. This has been a collaborative initiative with the community which has seen His Worship the Mayor of Invercargill, Sir Tim Shadbolt and other community leaders regularly joining SIT on marketing trips and consolidating institution to institution relationships.
  3. More recently this has been formalised in the Southland Regional Development Strategy (SoRDS) where SIT attracting additional international students to flow through as graduates into Southland businesses and industries is identified as a key driver to increasing the Southland population by 10,000 by 2025yr. [7]

SIT’s history of collaboration and financial leadership

  1. SIT has demonstrated a history of collaboration and financial leadership in its recent acquisition of MAINZ and support for the Telford Agricultural Training Campus (“Telford”) in Balclutha. These are examples of SIT stepping in to help other ITPs to deliver programmes that meet students and industries demands by providing financial and educational support.
  2. SIT has also supported Tai Poutini Polytechnic (“TPP”) throughout 2018 and prior, with moderation and quality assurance matters.
  3. SIT has offered the use of SIT2LRN to WITT, TPP, NMIT, Aoraki Polytechnic, MIT, and TEC to assist in enhancing programme portfolios of these institutions and improving financial viability through blended delivery. Presentations on how this could be done have been given on numerous occasions since 2003.
  4. SIT has also offered budgetary setting and monitoring tools to any ITP or Wananga who have asked over the past two decades. Te Wananga O Aotearoa modelled their own zero fees delivery on SIT’s and several ITPs adopted partial components of the scheme.

Telford Agricultural Training Campus

  1. On 5 February 2019, the Minister of Education approved the revised short-term proposal of SIT to take over Telford Campus in Balclutha from Taratahi Agricultural Centre (a Private Training Establishment) for one year. This was after Taratahi was placed into interim liquidation in 2018, due to declining student enrolments which resulted in a reduction in its funding.
  2. This acquisition facilitated Telford students who were already enrolled to continue their studies and complete their qualifications. It further enabled students who had enrolled to begin studies in 2019 at Telford to retain their places.
  3. In the acquisition, SIT retained approximately 20 equivalent full-time staff, which was the majority of Telford staff. In 2019, SIT aims to teach 200 equivalent fulltime primary industry students through Telford.
  4. Although currently only offering two Diplomas and two Certificate level qualifications on campus at Telford, SIT is investigating additional programmes from SIT’s portfolio to enhance Telford campus offerings. The distance delivery of Telford is being converted into SIT2LRN delivery format to digitise and modernise these programmes.

MAINZ Auckland and Christchurch campuses

  1. On 31 January 2018, SIT took over Tai Poutini Polytechnic’s (“TPP”) MAINZ campuses in Auckland Central and Christchurch. This decision was in response to TPP’s change in management direction under the Government-appointment Crown Manager.
  2. SIT was well placed to take over MAINZ as it already had an established music and audio production Bachelor’s degree and certificate. SIT has applied its proven financial and quality assurance operating policies and procedures to MAINZ and made the necessary changes to improve its viability and student achievements.
  3. Under the stewardship of SIT, MAINZ Auckland and Christchurch campuses were able to retain its ability to offer nine and four programmes respectively. This acquisition involved the transfer of approximately 300 equivalent fulltime students and approximately 46 staff to SIT.


  1. SIT has reviewed the Reform of Vocational Education: Consultation discussion document and other related consultation documents. We have set out our responses to the findings and recommendations made in these documents below:

Funding system is broken

  1. SIT submits that it is unjust for any Government to say there is a crisis in the VET sector when successive Government’s over the past 20 years have taken millions of dollars out of the sector by removing base grants, research EFTS top ups, and clinical placement allocations to name a few, as well as applying less than inflation adjustments to SAC funding, and the introduction of contestable funding that has fuelled the transfer of funds to private providers at the expense of ITPs.
  2. SIT submits that it is critical to implement a new funding system, which recognises:
  1. Health and safety requirements which limit class sizes when training for especially industries of particular importance to the New Zealand economy i.e. primary industries, construction and manufacturing trades.
  2. The need to implement a national Māori Accountability Framework to address under-achievement.
  3. Challenges in sparsely populated, geographically isolated delivery areas.
  4. Core provider requirements that should be covered through a base grant.
  5. A fund which specifically recognises applied research.
  6. Annual inflation adjustment

and that this new funding system must occur before any structural change to the ITP sector or any such structural change will be likely to fail.

  1. There is a very high risk that making decisions on structure before funding will entrench the current poor behaviour. This is a fundamental design flaw.
  2. SIT submits that any financial costs or benefits to a new single entity structure have not been identified and the potential risks are high given the NSW TAFE experience, which the one centralised entity is modelled on, of a $240m deficit in 2018, its second year of operation.
  3. The view of Universities New Zealand further highlights this in their recount of the significant initial costs of merging the teachers’ colleges into the Universities and further warns “The challenges in driving this sort of change across geographically dispersed entities with different business models and different regional operating imperatives will be immense” [8]   
  4. In our view, Southland’s student and employer choices should be what drives local provision and funding, based on robust labour market, provider and programme performance information.
  5. There is significant risk of monopoly behaviour from a single vocational education provider in the Institute. It is likely to result in higher costs, less flexible supply and funding qualifications which do not meet the needs of local employers.  This will undermine student and employer decisions at a local level.
  6. There is also considerable risk that a centralised single entity will reinforce the inefficiencies in the sector and spread them across currently well performing institutes.
  7. For these reasons SIT submits that any structural change if it is to occur, should occur incrementally, preferably with a pilot addressing the ITPs at most risk to mitigate against the whole vocational sector failing.

Tertiary Education Commission

  1. SIT submits that the Tertiary Education Commission (“TEC”) needed more guidance from successive governments regarding earlier intervention to prevent the financial failure of the poorly performing ITPs using its power under section 159KBA of the Education Act 1989 to monitor tertiary education institutions (“TEIs”) and report to the Minister responsible for Tertiary Education on the financial performance of the sector in order for the Minister to formally intervene.
  2. SIT considers it is of utmost importance to resolve this matter before putting in place any changes to the ITP system structure.

New Zealand Qualifications Authority

  1. The Education Act 1989 (“the Act”) prescribes the functions of the New Zealand Qualifications Authority (“NZQA”) including:
  1. To promote and monitor the delivery of inter-institutional programmes and training schemes (section 246A(1)(j) of the Act);
  2. To monitor and regularly review the standards for qualifications in tertiary education, either generally or in relation to a particular organisation or a particular programme (s 246A(1) of the Act);
  3. To maintain the Qualifications Framework and Directory of Assessment Standards (s 246A(1)(d) of the Act).
  1. SIT submits that NZQA did not receive sufficient guidance from successive governments to adequately perform its statutory functions, which has contributed to some of the policy problems as identified in the consultation papers. These include learners not having access to consistent, high-quality vocational education that offers clear pathways to credentials, qualifications and skills that will be recognised and valued by industry; and “too many small-scale programmes of similar nature that create complexity for employers and learners and waste resource”.
  2. SIT does not consider that these issues can be fixed by reconfiguring the ITP sector. 
  3. SIT submits that the roles of NZQA and TEC must be taken into account as part of the big picture to the reform of vocational education.  There needs to be a discussion about what is the best structural arrangement for purchase (or investment) and quality assurance in vocational education of provision and programmes, which we would welcome.


  1. Because of the identified issues and risks with a single New Zealand Institute of Skills and Technology, SIT strongly urges the Minister to pilot any structural change if it is to occur, with the Institutions most at risk and leave high performing Institutions out of the entity at least initially to mitigate the risk of destabilising the whole sector.
  2. The Southland community would strongly prefer SIT to be able to continue to operate as an independent legal entity under The Education Act 1989.
  3. SITs preferred position is to stay outside the amalgamation of 16 ITPs and operate independent of it, although purchase from it and contribute to it where applicable e.g. purchase centrally developed programmes and contribute to a network of CoVEs.
  4. SIT submits that it is a unique situation, supported by the Southland community, to meet the specific and unique circumstances of Southland.
  5. One New Zealand Institute of Skills and Technology will not be able to serve the needs of Southland and would inevitably come into conflict with the general requirements of other regions.
  6. We have looked at various solutions to the intractable problem of how the unique needs of Southland (as stated in sections 7 to 12) can be met in a centralised system. It is our strong belief, based on experience, that the prosperity and continued growth of the region depends on our competitiveness. We are not the same as other regions and thus cannot be treated as such, the outcome of such an arrangement will be detrimental to the region’s economy and ultimately, its community.
  7. SIT is required by the Southland community to work diligently to bring both domestic and international students into Southland because of the unique history, conditions and challenges facing Southland (see ‘About Southland’ section 7 to 12 above), and we can only do this if left to act independently.
  8. We also submit that leaving SIT (or indeed other well performing ITPs) outside a central body mitigates the risk for the sector and indeed country. If the centralisation implementation fails, there would still be some alternatives available to offer VET.
  9. Because of the academic and financial strength, and experienced governance and management of SIT, we have been able to provide vocational education and training to the Primary Sector through Telford, and there is the possibility of extending this support to the Taratahi home farm in the Wairarapa, an option supported and advocated for by the Tertiary Education Union (“TEU”). Both of these institutions operated under their own legislation and this precedent would seem to offer a solution for SIT to also remain independent.
  10. SIT is supportive of the ITP system and has offered its delivery and operating systems to other ITPs on numerous occasions (see 51 – 54 above). These offers were sometimes accepted and SIT’s acquisition of MAINZ, support for TPP, temporary management of Telford campus, strategic partnership with TWOA and a consortium approach to MITO Training are evidence of this.
  11. SIT remains committed to collaborations which enhance the VET system e.g. use of ARTENA; a consortium driven student management system, collaborative research, NZ Inc overarching marketing for international students, standardised systems, benchmarking etc.
  12. SIT have considered alternative models in response to the Minister’s advice during his meeting with SIT Council and Management 1 March 2019, where the Minister stated SIT could not stand alone outside any VET structural change as actions from the structural change would likely damage SIT. On reflection, we disagree with this analysis and although we offer an alternate proposal to facilitate the Minister, we strongly believe that our most prudent course is to be able to operate independently.
  13. SIT submits that to have at least SIT, but also preferably other high performing ITPs operating independently gives the opportunity to benchmark the performance of any new amalgamated institution through a range of metrics.


  1. As noted above, SIT and the Southland community strongly advocate for SIT’s independence. SIT therefore submits an alternative model, shown below, which would accommodate ongoing independence of well-performing providers, while harnessing the benefits of systems alignment and strategic national level planning and advocacy.

Association of Institutes of Technology and Polytechnics NZ (AITPNZ)

Council consisting of Individual Provider Chairs and Stakeholder Representatives with Independent Chair appointed by the Minister


  • Developing long term strategic plan targets
  • Programme and curriculum resource development at sub-degree level
  • Standard setting
    • Establish god practice for academic activities including applied research cooperation, and learner support.
    • Develp and share good practice operating standards for the business improvement of individual provider institutions.
    • Prmoting excellence and continuous improvement.
    • Establishing cmmon academic statutes.
  • National Māori Accountability Framework
  • Coordination of collaborative research
  • System standardisation
  • Liaison with large strategic national industries
  • NZ Inc vocational education advocacy, awareness, liaising, marketing
  • NZ Inc liaison with Education NZ for international student recruitment
  • Financial and academic recovery system support for individual providers not meeting specific criteria and thresholds
  • Centralised archiving


up to, but possibly less than 16 Individual Providers as members


Individual Provider e.g. SIT

  • The Board of the individual provider entities would be 6-8 appointed evenly between the Minister and the community. The Chairperson and Deputy would be elected from within the Council;
  • The Board of the individual provider would appoint the CEO of the individual provider;
  • Individual providers would each be autonomous legal entities;

Decision making rights over, but not limited to:

  • Programmes delivery, including decisions on curriculum context, delivery mode and assessment by tutors;
  • Integration of on-job, off-job training
  • Individual provider assets, both at establishment and ongoing;
  • Online programme provision that corresponds and staircase into the provider’s onsite programmes, including use of either the Association of Institutes of Technologies and Polytechnics New Zealand or the individual provider’s existing distance learning programme;
  • Operational budgets and capital asset management  
  • Establishment and administration of fundraising trusts, local initiatives such as the Zero Fees Scheme, and alumni operations
  • Local maintenance of systems, services and learning environment including improvement and innovation
  • Local recruitment and management of staff
  • Local identity, brand and marketing, for both domestic and international students
  1. SIT has seen the draft proposal of Otago Polytechnic (“Otago”). SIT supports much of Otago’s proposals however there are some points of difference.
  2. The main differences in SIT’s alternative model and that of Otago’s proposal are as follows:
  1. The “system head office” would be called Association of Institutes of Technologies and Polytechnics New Zealand (“AITPNZ”);
  2. The governing Council of the “system head office” would be made up of the Chairs of the boards of the individual providers, and representatives from industry, employers, students, staff/unions, with an independent chair appointed by the Minister;
  3. The Association would have responsibility for developing a Māori Accountability Framework to ensure the system is held accountable in meeting the needs of Māori, as proposed by the Ngāi Tahu’s submission. Associated funding would be needed to enable the accountability framework to initiate systemic change within the sector to be culturally responsible;
  4. The systems head office would not determine what providers would deliver, and would not allocate funding. These functions would remain with TEC;
  5. Standardised systems in the SIT alternative model would not include standardised employment agreements across all providers;
  6. The Board of the individual provider entities would be 6-8 and be appointed evenly between the Minister and the community. The Chair and Deputy Chair would be elected from within the Council;
  7. The Board of the individual provider would appoint the CEO of the individual provider;
  8. Association of Institutes of Technologies and Polytechnics New Zealand and individual providers would each be autonomous legal entities, however each individual provider would be a member of the Association of Institutes of Technologies and Polytechnics New Zealand;
  9. In addition to the individual provider’s decision-making rights as stated in the Otago Polytechnic model, the SIT model would have individual providers continue to have decision making rights over:
  1. Programme delivery;
  2. Any assets they might bring into the establishment of the system head office (for example, SIT will keep all decision-making rights and control over its assets as an individual provider);
  3. Online programme provision that corresponds and staircase into the providers onsite programmes providing flexible modes of study for students, including use of either the Association of Institutes of Technologies and Polytechnics New Zealand or the individual provider’s existing distance learning programme;

Ring fencing of assets

  1. In our proposal all individual provider’s assets are maintained at establishment.
  2. The Minister of Education attended meetings with SIT’s Council, and community and stakeholders on 1 March 2019 in Invercargill. At those meetings, the Minister confirmed that SIT would be able to retain control of its cash reserves, which are currently in excess of $36 million, should a centralised proposal be implemented.
  3. SIT wrote to the Minister on 15 March 2019 setting out further detail on the mechanism that could be used to give effect to that within the current proposal.
  4. We propose that should a centralised proposal be implemented and SIT not exempted from it, the best mechanism is to include a clause in any amendment to the Education Act 1989 that gives effect to your final proposal. The Minister has stated in the cabinet paper, Consulting on Proposals for Vocational Education System Reform (29 January 2019), that legislative change will be required to implement the reforms, including an amendment or replacement of sections of the Education Act 1989.
  5. We propose that the Government include a clause in the relevant amendment to the Education Act 19 that ring fences SIT’s control over its assets. We have drafted the clause for the Minister’s consideration below:

The [name of master entity, for example Association of Institutes of Technologies and Polytechnics New Zealand as in this proposal] will ensure that all of the assets and financial resources vested in the [parent entity] at the date of establishment by the Southern Institute of Technology are ring-fenced to be used exclusively by the [subsidiary entity, Southern Institute of Technology] for the community of Southland.

  1. Any ring fencing of assets would be required in legislation if the Minister is to proceed with the creation of the New Zealand Institute of Skills & Technology (as set out in the Government’s proposal and also possibly if the Otago Polytechnic option were adopted), however SIT reiterates its preferred option is to sit outside a centralised model to ensure SIT can continue to meet the needs of the Southland community, in which case different legislature might be needed from that suggested in 98 above.

SIT2LRN distance learning programme

  1. In our proposal all individual providers retain the ability to make decisions about their online provision.
  2. At the SIT Council meeting, and the meeting with the Southland community and stakeholders on 1 March 2019 in Invercargill, the Minister of Education confirmed that SIT would be able to continue delivering its SIT2LRN Distance Learning programme.
  3. SIT welcomes the Minister’s confirmation as the current consultation discussion document states that “the Open Polytechnic of New Zealand would be incorporated into the New Zealand Institute of Skills & Technology for the provision of online learning”.
  4. SIT submits that the retention of distance delivery via SIT2LRN should not be constrained to Southland boundaries, as this would not meet the Minister’s assurance, as noted in point 101 above.

Aspects of the Proposals which SIT Supports

  1. SIT has reviewed the consultation paper and supports some aspects of it. We provide further details below.

Proposal One – Redefine the roles of education providers and ITOs, and extend the leadership role of industry and employers across all vocational education.

  1. SIT supports this proposal subject to funding details being confirmed which are sustainable.

Seamless transition between on–job and off–job training

  1. The Government proposes that Industry Skills Bodies will pick up some of the roles that ITOs had previously been recognised and funded for.[9] ITOs would no longer arrange industry training, with the Institute, PTEs and wānanga being the only providers of vocational education and training, both on–job and off–job. These vocational education providers would incorporate more on–job training into their courses; making on–job and off–job training integrated seamlessly into the same course, with the same provider.[10]
  2. The Government proposes these vocational education providers to offer a complete “workforce development service” to employers, which would encapsulate an employee’s entire vocational education from pre–employment training through to professional development.[11]
  3. SIT supports the seamless transition between on-job and off-job training. SIT already appreciates the value of providing learners with an integrated mix of on–job and off–job training, and has endeavoured to provide as seamless a service as possible to its learners in collaboration with employers, ITOs and PTEs. For example, through consultation with industry, SIT pre-employment construction programmes are delivered from 8:00am to 5:00pm Monday to Wednesday to ensure students get used to a normal working day, then students undertake work experience in industry Thursday and Friday of each week to enhance their work-ready skills. Off job training of apprentices is currently undertaken by SIT, providing the training the ITO’s cannot, on-job. SIT provides practical and theory training for Skills (Plumbing, Gas fitting, Drain laying and Electrical), Competenz (Engineering Trades), HITO (Hairdressing), BCITO (Joinery) and MITO (Auto light and Auto heavy).  Extending this training to on-job would be achievable for SIT.
  4. SIT acknowledges the current difference in SAC and STM funding rates and our support of proposal one is qualified by the need for delivery rates to be financially sustainable.

Common and consistent qualifications

  1. The Government proposes qualifications, credentials, programmes and assessment to be consistent nationwide, so learners can be confident in the value of their skills and knowledge.[12] Curriculum and programmes would be developed centrally and supported by Centres of Vocational Excellence to ensure consistency.[13]
  2. SIT supports the proposal for commonality of qualifications. SIT has previously proposed to the Government in its submission on the TEC’s ITP Roadmap 2020, that a big saving from a financial and resource perspective for individual ITPs would be any shared services for programme development at sub–degree level (meaning any certificates or diplomas for study with a duration of two years or less).
  3. SIT also agrees that facilitating students to move around the country without having to lose their prior learning is a useful outcome for students. SIT wishes to draw attention however, to the operation of Recognition of Prior Learning and cross crediting in the current system which achieves a similar purpose as the proposal.
  4. SIT also supports the proposal for consistency of qualifications. SIT agrees qualifications should provide skills that employers recognise and value. SIT has always been of the view that graduate outcomes are one of the most important goals of Vocational Education. As reported in SIT’s Graduate Outcome Report 2018, 79% of SIT graduates are either working or self-employed. Only 3% are neither working, self-employed or in further study.

Proposal Two - Create the New Zealand Institute of Skills & Technology

Centres of Vocational Excellence

  1. The Government proposes that regional campuses will host “Centres of Vocational Excellence”. These Centres would focus on teaching and learning (and possibly applied research) in a particular key sector or industry. These Centres are intended to be spread across the country, including in the regions. The Centres will also work closely with Industry Skills Bodies to develop and maintain programmes, curricula and teaching and learning resources.[14]
  2. SIT supports this aspect of the proposals and would propose that SIT could host Centres of Vocational Excellence for a number of industry sectors which SIT would expect could be bid for under clearly outlined criteria and a transparent allocation process.
  3. For example, SIT has the potential to become a CoVE for the Primary Sector. SIT has recently acquired the Telford (Balclutha) Campus of Taratahi Agricultural Training Centre for 2019. Telford is part of New Zealand farming history and has been preparing students for their futures in agriculture since 1964. The Balclutha campus consists of halls of residence and associated facilities, technical workshops (machinery, carpentry and welding), classrooms and livestock units. The Campus also has access to the Telford Farm Board’s large commercial scale sheep/beef, dairy, deer and forestry units with a total land mass of 921ha. The farms aim to perform in the top 25% of their land class and regularly achieve this. This acquisition has allowed SIT to offer high quality courses in Agriculture, including the Massey University Diploma in Agriculture (level 5), the Telford Certificate in Agriculture (level 3), and the Diploma in Rural Veterinary Technicians (level 5). SIT intends to enhance the delivery portfolio of Telford Campus utilising existing SIT programmes. SIT is prepared to consider the possibility of replicating this operation at the Taratahi home farm in the Wairarapa.
  4. Other examples where SIT could host a CoVE include, Animation and Moving Imagery where SIT is highly regarded by industry and has excellent employment outcomes; Nursing where SIT has been the national leader in use of simulation technology and MaskEd; Audio and Sound Engineering which SIT dominates nationally; Mechanical and Civil Engineering where SIT supports significant manufacturing and infrastructure sectors; Occupational Health and Safety where SIT is the largest sub degree provider nationally as well as several others such as  Environmental Management and Construction Trades where SIT has been a proven performer. Our main point however is that the criteria and process for selection of CoVEs must be open and transparent and the relationship with other providers should be similarly clear.
  5. In terms of applied research, SIT also has an active research output. SIT publishes an annual outline of research outputs. Research from SIT is published in reputable journals and presented as papers at conferences and symposia. SIT also administers journals and publications for the printing of research outputs, including the Southern Institute of Technology Journal of Applied Research. SIT runs its own contestable research fund for staff, and this is administered by the SIT academic board.
  6. Furthermore, SIT is well placed to develop programmes and curriculum in line with industry needs. SIT currently uses 42 industry advisory committees with approximately 250 industry, business and community representatives, which enable SIT to respond quickly to regional labour needs. In its March 2018 EER review, the NZQA said:

SIT is a major regional player, responding to the needs of local industry and the community, and its contribution to local economies and regional development is significant. SIT leaders have featured prominently in the development of the 2016 Southland Regional Development Strategy, which focuses on growing Southland’s population and creating a more diverse economy.

Single student management system

  1. The Government proposes the Institute to take over the 16 existing ITPs and operate a single unified staffing, student and learning management system.[15] The Government envisages that the operational functions supporting this system could be located across the national campus network rather than centralised.[16]
  2. While SIT does not support a centralised single student management system, and indeed we do not believe there is a current system in use in the ITP sector that could cope with the intended volume, SIT certainly supports having a standardised student management system used by each provider to reduce administrative costs. SIT has previously expressed a similar opinion to the Government in its submission on the TEC’s ITP Roadmap 2020.
  3. SIT is aware that the majority of ITPs use ARTENA for their student management systems, which has been developed with input from a range of New Zealand ITPs. If ARTENA were to be rolled out as the standardised service for AITPNZ, then AITPNZ could manage any necessary updates for the student management system to meet its reporting needs.
  4.  SIT stresses that we support a single standardised student management system, but not a centralised one.
  5. In general SIT supports the standardisation, not centralisation of a number of ITP systems including, but not limited to, Finance, HR and IT, to enhance cooperation through better systems alignment.
  6. SIT does not support centralisation of ITP systems because we consider it will lead to an overly bureaucratic monolith which will slow decision-making, suppress innovation and disenfranchise regional delivery providers from their communities.
  7. Centralisation of services would almost certainly bring significant job losses to regional providers, a situation which would be at odds with the work being done for regions through the Government’s Provincial Growth Fund.
  8. In SIT’s case, given benchmarking figures which show SIT provides many of the ITP services at less than the ITP average, there is an expectation that centralisation might prove more costly for SIT.

Proposal Three – Create a unified vocational education funding system

  1. As has been previously noted in this submission we support the notion that the sector needs a new funding system, see sections 63 and 64 above. We acknowledge the Government’s analysis of the current problems within the funding system, but we caution that underfunding within the system continues to be a serious problem.


  1. We would caution the Minister against assuming economies of scale, greater effectiveness or money saving as motivations for moving to a centralised system[17], especially when one considers the initial investment that such a radical reorganisation of the system would incur.
  2. We would like to point out that the problems of distance can hinder effective collaboration[18]. This is especially pertinent if the Minister intends to distribute centralised services to various locations, including locations that may not have a history of performance in service.
  3. We would draw the Minister’s attention to research that has argued that merging smaller entities can create a large entity with the same underlying problems[19]. This is a risk that needs to be clearly identified and managed.
  4. While we recognise that research and examples from across the globe are available on how to structure effective VET systems, it should be noted that there is no one perfect system, however context matters and merger initiatives such as this “are more likely to succeed when their implementation is led by participating institutions”[20].
  5. We believe that there is too much risk for the sector in the current set of proposals and we would strongly advise the Minister to mitigate these utilising the suggestions we have made.
  6. SIT agrees with the Minister that the NZ economy needs a much greater number of participants entering vocational education. We are concerned however that there is nothing in the proposals which address this key issue. Furthermore, we are concerned that centralisation of ITPs and other policies such as Fees Free may in fact work against this.
  7. SIT has a proven track record in governance, management and the delivery of vocational education and training in the classroom, the workshop, clinical settings and in the field, as well as online, from foundation level 1 to postgraduate levels. We are exceptionally well integrated with the community, local industry and businesses, and Ngāi Tahu iwi, in particular, Murihiku Rūnanga Papatipu. They, in turn, are supportive of SIT. We do not want to undermine these relationships, lose our responsiveness to the needs of our region or fail to deliver on the ambitions of our region for a sustainable future.
  8. To this end, we strongly recommend that SIT be permitted to continue to operate as an independent legal entity.
  9. As with most major reviews, the time taken to implement invariably means not all components of the review are implemented. SIT submits that the most important component of these three proposals is the funding system. Should a structural change occur without the funding system being readjusted to be fit for purpose, any new structure will almost certainly fail. Conversely, should the funding system be fixed, even to the extent of inflation proof adjustment for the past decade, it is likely the majority of ITPs would survive without any structural change.

[1] Southland Times 9 June 2018.

[2] Southern Institute of Technology Annual Report 2018 “Our Year in Numbers” pages 6 and 36;

  [3] NZQA Report of External Evaluation and Review: Southern Institute of Technology (14 March 2018).

[4] Southern Institute of Technology Prospectus 2019 page 11

[5] Southern Institute of Technology Annual Report 2001; 2002; 2003; 2004; 2005; 2006; 2007; 2008; 2009; 2010; 2011; 2012; 2013; 2014; 2015; 2016; 2017; 2018

[6] Southern Institute of Technology Annual Report 2018.

[7] Southland Regional Development Strategy October 2015 page 24

[8] Universities New Zealand 29 March 2019 News page 1

[9] Reform of Vocational Education: Consultation discussion document (Ministry of Education, Wellington, 2019) page 19

[10] Reform of Vocational Education: Consultation discussion document (Ministry of Education, Wellington, 2019) page 21

[11] Reform of Vocational Education: Consultation discussion document (Ministry of Education, Wellington, 2019) page 29

[12] Reform of Vocational Education: Consultation discussion document (Ministry of Education, Wellington, 2019) page 16

[13] Reform of Vocational Education: Consultation discussion document (Ministry of Education, Wellington, 2019) page 26

[14] Reform of Vocational Education: Consultation discussion document (Ministry of Education, Wellington, 2019) pages 25-26

[15] Cabinet Paper “Consulting on Proposals for Vocational Education System Reform” (28 January 2019) page 3

[16] Cabinet Paper “Consulting on Proposals for Vocational Education System Reform” (28 January 2019) page 13

[17] ITP Roadmap 2020 “Mergers of tertiary education organisations – approaches and implications” (September 2018) pages 22-23

[18] ITP Roadmap 2020 “Mergers of tertiary education organisations – approaches and implications” (September 2018) page 24

[20] ITP Roadmap 2020 “Mergers of tertiary education organisations – approaches and implications” (September 2018) page 20

The Government is seeking feedback on the proposals for the Reform of Vocational Education by Friday 5 April 2019. 

Have your say and support SIT by:

  • Submitting your proposal directly to Education Conversation.
  • Making a submission using our template

Learn More

Reform of Vocational Education Consultation Discussion Document


Reform of Vocational Education Fact Sheet – Employers


Reform of Vocational Education Fact Sheet – Industry Training Organisations (ITOs)


Reform of Vocational Education Fact Sheet – Institutes of Technology and Polytechnics (ITPs)


Reform of Vocational Education Fact Sheet – International Education