Vote Education – Budget 2015 Presentation to Education Cross Sector Forum

Thursday, May 21, 2015 - 16:24
Budget 2015

Hi everyone. It’s great to see you all again this afternoon. Some of you are new to this lock-up; others have been here before. Regardless, I welcome you all and thank you for your ongoing commitment to education and to the future for all our children and young people. 

I’d also like to welcome the Under-Secretary for Education David Seymour who is here with us today. Like me, and all of you, Mr Seymour believes passionately in the ability of education to transform the lives of young people and I’m delighted he’s been able to join us.

I hope that you have found the last 24 hours constructive – it is invaluable for us to hear from you on the best way to ensure achievement for all our students

Right now, one thing is probably top of your minds – what’s in the Budget for education.

Budget 2014 saw spending on ECE, primary and secondary education rise to $10.1 billion. That’s more than we spend on police, defence, roads and foreign affairs combined – and that’s before considering our $3.04 billion investment in tertiary education.

Of course, every Budget brings new opportunities, and new claims on funding. As a Government, we have to balance these against those across the whole of the public sector, and ensure we are responsively and effectively using taxpayers’ money.

Much spending in education is about keeping up with demand – for new and more modern schools, for more quality early childhood education services, for better digital technologies. This Budget continues our pattern of increased spending in all these areas, and many more.

Education has always been a priority for this Government. When we took office in 2008 our predecessors had budgeted to spend $7.9 billion on early childhood, primary and secondary education in the following year. Today’s Budget takes the corresponding figure to $10.8 billion - an increase of over $2.8 billion or almost 36 per cent, at a time when the Government’s spending options have been severely constrained by a global financial meltdown and its aftermath.

While some other sectors have had funding squeezed, the Government has continued to prioritise education. We have done this because we know that a great education is the thing that can make the most difference to the lives of our children. The benefits are particularly pronounced for Māori and Pasifika, and for children from poorer families.

Budget 2015 continues the focus on meeting education demand whilst also providing and extending a series of initiatives targeted at kids who, through no fault of their own, are among our most vulnerable citizens.

The value of education

Over the last few years, we’ve spent a lot of time, effort and money on encouraging participation, improving achievement rates, and fostering collaboration across the education sector. We’ve challenged old assumptions and developed new approaches, tailoring what we do to match the needs of our kids.

We’ve done this because the value of starting education early and staying longer is well-established. The more time kids spend in the system the more likely they are to achieve.  And, when kids who’ve gained qualifications become parents themselves, evidence tells us they’ll instil in their children the same hunger for educational success. We’re not just helping individuals succeed; we’re developing a cycle of success that benefits the whole country.

We’re already seeing the fruits of all our efforts – ECE participation and NCEA achievement have risen dramatically over the past five years. These gains weren’t made by continuing to do the things that equipped most students for the future but left a sizeable number – about 20 per cent – behind. They were made by trying new things.

The Vote Education Budget package

Over the next four years the Government will be investing $442.9 million of operating funding and $243.8 million in capital funding into Vote Education – bringing total expenditure in the coming year to the $10.8 billion I mentioned earlier. This will enable us to meet demand pressures and increases in the costs of schooling, to provide further support for students in greatest need, and to provide more frontline services to raise educational achievement.

I would like to walk you quickly through the Budget package. I’m sure you’ll have some detailed questions, and there are a number of Ministry officials who will be available to answer these after I’ve finished and returned to the House to hear the Budget read.

Raising ECE participation

Raising ECE participation is important to us. All the research shows that the earlier a child gets into quality early childhood education, the more they achieve later. Conversely, kids that start behind too often stay behind.

We’re making good progress here. The national ECE participation rate is now over 96 per cent – less than 2 per cent short of the 98 per cent target we have set for ECE participation by 2016. Recent increases in Māori and Pasifika ECE participation rates are especially pleasing (up 3.5 per cent and 4.8 per cent respectively since 2012) but they still have a way to go to reach our target from 93.8 and 91 per cent respectively.

Budget 2015 includes an extra $74.9 million over four years to cover the cost of more children attending ECE services than ever before.

New and better schools

You will have already heard the Prime Minister’s announcement about our new schools initiative, but it bears emphasising that Budget 2015 commits a total of $373.9 million to improving schools’ infrastructure over the next four years.

Most notably, seven new schools and kura kaupapa are being built around the country and four existing schools are being expanded at a cost of $332 million. They will provide space for about 4,600 students.

The seven new schools are:

  • Two primary schools in Auckland at Kumeu and Scott Point
  • Rototuna Senior High in Hamilton
  • A primary school at Rolleston, near Christchurch
  • Three kura kaupapa Māori schools in Whakatane, Gisborne and Havelock North.

We are also committing $4.9 million to accelerate our national programme of earthquake resilience assessments of state school buildings.

You will also no doubt be reassured to note our $34 million commitment to paying our increased insurance bill.

Meeting school running costs

Budget 2015 acknowledges the increased costs of running a school, even in a low inflation environment. Schools operational grants are increased by $42.3 million over the next four years. This is a 1 per cent increase, which will deliver around $12 million in additional funding per school year. This is higher than current inflation and follows on from a series of increases that have outstripped actual inflation. A total of $1.32 billion will be spent on operations grants in the coming financial year.

Supporting our most vulnerable students 

The area of spending I’m particularly pleased with in this Budget is the extra assistance we’re providing for vulnerable students whether they have special education needs, or are otherwise at-risk of poor educational outcomes.

For special education students, we are spending a further $39.5 million to provide Ongoing Resourcing Scheme assistance to another 500 students with high and very high educational needs. The money will pay for specialists such as speech-language therapists, psychologists, physiotherapists and occupational therapists, and provides additional teacher time and teacher’s aide time.

This is backed up by a commitment of $23.3 million to provide Additional In-Class Support for a further 1,500 students with special education needs. This funding will provide teacher aide support for these students to help them reach their full potential. The funding in Budget 2015 is the first part of our commitment to extend this support to 4000 students over the next few years. Spending on special education has increased significantly in recent years – up 26 per cent from 2008, to about $530 million in 2013/14. The work on the streamlining of special education that is one of my priorities is aimed at ensuring that all this funding is targeted to where it needs to go and in a timely manner.

We are also committing a further $8.2 million dollars to three initiatives aimed at strengthening our support for at-risk and vulnerable students. These are the kids who stand to benefit the most from extra investment.

The Gateway Assessment Programme will get $4 million to ensure that another 3,800 needy children get access to the early childhood and schooling services that they need when they need them most.

We are also putting $4.2 million into two new initiatives trialling new approaches to supporting at-risk young New Zealanders – Year Nine Plus, and Count Me In.

The Year 9 Plus trial will invest $2.2 million into a new initiative assigning educational “champions” to 80 to 100 students and their siblings that evidence suggests are at risk of poor educational, employment or justice outcomes. The champions will work with the students, their schools and their families throughout their secondary schooling to see if early intervention increases their chances of achieving, at the minimum, the qualification of   NCEA Level 2.

The Count Me In initiative will receive $2 million over the next two years to assist around 2,000 Māori and Pasifika 16-18 year olds who have left school to re-engage with education or begin vocational training that leads to a meaningful qualification at NCEA Level 2 or better.

Today the Under-Secretary for Education and I are also announcing that funding has been set aside in a contingency to establish two additional partnership schools. Partnership schools are not the solution to all of our students’ educational challenges but they are another option that allows us to re-connect with learners who have disengaged from the existing education system or are at risk of doing so. The new schools are expected to open in 2016 or 2017. 

Outside of the Education portfolio, this Budget will also see an increase in the Childcare Assistance rate for those families that need it. The rate is being increased from $4 to $5 an hour and will apply to both the Childcare Subsidy for pre-schoolers and the OSCAR subsidy for out-of-school care and school holiday programmes. In a typical week during a school term the increase will deliver an average of $23 a week to 18,000 lower-income families. The higher subsidy will reduce costs for lower-income working parents who already use childcare and reduce barriers for parents moving off welfare and into work.

Raising achievement and student engagement in education

When we began Youth Guarantee, funding was provided for four years only. However, I’m pleased to announce a continuation of our commitment to support the sector in successfully implementing these initiatives. From fees-free tertiary study to Trades Academies and Vocational Pathways, the Youth Guarantee plays a significant role in improving engagement and raising achievement.

Budget 2015 includes an extra $16.6 million to improve student retention, further raise NCEA level 2 achievement and to enable more of our young people to successfully transition from secondary to tertiary education and on into employment.

To complement this, we are investing $8.6 million over the next four years so that up to 1200 students will gain access to Trades Academies between 2016 and 2019, as a result of this initiative.  

Education payroll

We are also making a continuing investment to ensure the sustainability and efficient operation of the payroll system and to support schools to self-manage their payroll. The system is improving and error rates are now below the 0.5 per cent rate deemed acceptable by the Technical Review. We will continue to support schools to simplify payroll processes.

The education-wide funding system

We are also investing $17.7 million in the development of a new education-wide funding platform that will be more flexible, more agile and more able to respond to policy changes in a swift and seamless fashion.

Where the money comes from

Around 85 per cent of the operating cost of these initiatives is new funding. The rest – $64.9 million – will come from reprioritisation within Vote Education. 

This is redirecting funds to places where they will have more impact on student achievement.

As the increases in operational grants to schools and funding for  to support our most vulnerable students shows, we have been careful do this in a way that supports front-line teachers and targets areas of most need.


We’ve made great progress over the last several years, but we all know we’ve still got a number of challenges to overcome if we are to ensure that all young New Zealanders are able to enjoy the full benefits of a world-class education system.

You’ve spent a lot of time over the last day and a half thinking about where we need to go as an education sector, and how we can get there.

I am confident that the initiatives I’ve laid out for you today will provide some of the framework, opportunities and tools to improve educational achievement. But no government can do this by itself. We all need to work together.

We have a lot of work to do. And what you have done here is just the start. I want us to keep working together, as teachers, principals, board members, parents and students, to build a world class education system that we, and all New Zealanders, can be proud of.

Thank you for your time, your energy, your views and your commitment.