Is Newzullin' getting dumber?

What's really ailing NZ's tertiary education sector? And are living standards in NZ lagging behind?

Tertiary education and research make vital contributions to social and economic outcomes in any country, but polytechnics and universities are going through hard times, financially and politically. And AI is changing everything. But governments aren’t helping.

New Zealand’s previous Labour government (under education minister Chris Hipkins) initiated an amalgamation of the country’s polytechs – with no educational aim in mind and no positive results. The present coalition government is reversing that model, but is equally ineffective, having no strategy – or simply no clue – about how to build a better system.

Restructuring after restructuring is achieving nothing, and the winners are the consultants.

The 2025 Budget provided a 3 percent increase in tuition and training subsidies in “many subjects” (which didn’t keep up with inflation), and an additional 1.75 percent rise for STEM (Science, Technology, Engineering and Maths), initial teacher education and healthcare professions. Courses and staff are still being cut.

The current government, to give credit, scrapped an assessment method that had repeatedly, since 2003, consumed untold working hours (of about 8,000 academics and a cohort of administrators) just to divide up a performance-based research fund. The evaluation methodology used would never have gained approval from a research ethics committee, had it been put before one, but nobody seemed to care about that. And yet, the basic numbers necessary for the funding allocation could have been derived by one person (or maybe two people!) using publicly available bibliographic databases.

Tertiary education policy hadn’t featured at all in the 2023 election debates, and very few journalists are on that beat. (Indeed, there are simply fewer journalists in New Zealand thanks to media industry downsizing – as noted with concern by Reporters Without Borders. Whole regions and sectors are becoming “news deserts”.)

Radio NZ’s John Gerritson covers education well, however. In a recent article, he quoted former Otago Polytechnic chief executive Phil Ker as follows:

“It’s an inconvenient truth that we would like to have a really good vocational education system, but we don’t want to pay for it. Employers don’t want to pay directly for their training and the government doesn’t want to pay adequately their share of the cost.”

At last someone from the sector offered some clarity: everyone wants it, but no one wants to pay for it. Neither do students want to pay more – largely because they can’t afford to, or because it only adds to their “loans” (i.e., the 12 percent poll tax they’ll pay when they earn $24,128 pa or more). Employers expect graduates to be “job ready”, rather than pay for training, but the public purse only goes so far. And everyone wants a cultured and civilised society on top of that.

How are institutions, including universities, dealing with these pressures? Here are three of the methods they use:

• Corral students into large compulsory courses.

• Cut elective courses (or whole majors) with low enrolments.

• Employ teachers on precarious part-time fixed-term employment contracts.

In universities, many people on insecure teaching-only contracts are willing nonetheless to do research (without pay) in the hope of one day getting a full-time or even a permanent job. It’s “publish or perish”, and the universities get named on the publications of those aspiring academics, thus boosting institutional reputations.

Precarious staff may settle for teaching those generic compulsory courses – in which, in many cases, few would enrol if they weren’t compulsory – meaning that reluctant teachers teach reluctant students. These part-time staff get a foot in the door, but often that’s as far as they get.

Here’s another fun fact about universities: for every 10 full-time-equivalent academic staff (who actually teach and research) there are 14 other staff. (Pause and read that again.) This ratio has grown over time, and it’s not counting external contractors and consultants.

Now, a university’s revenue comes from teaching and research, but most of its paid staff are not doing those jobs. They’re doing a multitude of other tasks, which may include running libraries and labs, but also administration, policy-making, compliance, counselling, human resources, student support, communications and servicing increasingly complex and costly IT systems. When it all gets too complicated for those highly paid managers, they bring in KPMG, PwC and the like.

University websites are insanely complicated, but what you see publicly doesn’t show you their Byzantine intranets. A lot of contracting out, then, inevitably goes to IT providers.

“Work expands to fill the space available” (Parkinson’s Law)

To service this techno-bureaucratic creep, the academic staff are made to do more of the admin themselves. What’s up, then, with the army of administrators? They’re co-creating more urgently needed stuff to keep themselves busy, like adjudicating over minor questions of research ethics, agonising over who can speak and who can’t, and converting their campuses into wellbeing centres.

But what business could survive if most of its staff did nothing to earn its revenue, and instead were producing more and more policy, digital paper-work and nice-to-have support services?

People often complain that “universities are just a business now”. But I reply that universities might be better off if they’d only be more business-like, in the sense of wasting less time on matters that aren’t critical to the organisation’s reason for existing. Have the universities forgotten why they exist?

To be fair, a lot of the admin gets imposed on them by control freaks in central government. The legislative stipulation that universities enjoy “institutional autonomy” is honoured by governments more in the breach than the observance.

In the 2000s, central government was eager to create a “knowledge economy” and turn tertiary education into its economic engine. The more people with degrees, the better, it was thought, but no one bothered to estimate an optimal rate of higher qualifications of various kinds. The sky was the limit, and universities became obsessed with growth, while polytechs strove to become universities. AUT (formerly AIT) succeeded in that institutional social-climbing; Unitec was held back.

Colourful strategy documents were produced by all. Their common “vision” about innovation, smartness and growth was largely vacuous, of course. As a sad indictment, I used to work in what was once dubbed “the innovation campus”. It’s since been mismanaged as a failed experiment and put up for sale or lease.

Is New Zealand becoming an intellectual desert and a dumbed-down, impoverished economy?

Judging by the inefficiency and policy sclerosis of tertiary education management, NZ is already there. And yet the world is undergoing the AI Revolution. This could mean that, after AI writes students’ assignments for them, AI then grades them too. All students will have to do is pay fees to get state-subsidised meal-tickets – and to keep administrators in jobs. But what jobs will the graduates do?

Tertiary education institutions are not prepared for this future. Surgically removing some of the techno-bureaucratic blockages and a clean-out at the top could help.

Part 2 coming soon:

The New Zombie economy

Growing unevenly and permanently lagging behind. Is that the Kiwi way? And is the underlying economic model unjust and unsustainable anyway?