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University leaders have voiced fears that legislation reforming the tertiary sector could lead to political interference and a clampdown on academic freedom.
MPs are considering Government legislation aimed at boosting the relevance and quality of tertiary courses.
Under the proposed regime - hatched after criticism of low-level tertiary courses such as twilight golf - institutions will be bulk funded on the basis of agreed three-year plans rather than on the number of students enrolled in specific approved courses.
But the New Zealand Committee of Vice Chancellors yesterday said the changes gave the Tertiary Education Commission (TEC), which manages funding, "sweeping and unfettered bureaucratic control over university activities".
Under the changes rather than scrutinising individual courses the TEC will scrutinise institutions' overall plans. If it is unhappy with any part of a plan - even with activities it does not fund - it can withhold an institution's entire funding.
Canterbury University vice-chancellor Roy Sharp said while the vice-chancellors' committee supported the intention of increasing quality and relevance it believed the bill as it stood would lead to an "unwarranted loss of autonomy and academic freedom".
The Government's strategy was too focused on the short term and too outcome and product focused, he said.
It also opened universities to political interference.
Under the legislation, a minister could direct TEC that a plan not be approved.
"Any political direction to universities is unacceptable," Prof Sharp told Parliament's education and science select committee.
In response to a question from National Party education spokeswoman Katherine Rich about whether universities were getting "pummelled" for questionable courses in other parts of the tertiary sector, Prof Sharp said it appeared that way.
Auckland University vice-chancellor Stuart McCutcheon said requirements under the legislation to provide information on all aspects of an institution's activities to the TEC could spell the end of commercial partnerships.
The university was also unhappy about the TEC being able to withhold funding because it disagreed with parts of a plan it did not even fund.
The vice chancellors recommended the Government stop the bill.
However, Tertiary Education Minister Michael Cullen told Parliament the changes would not affect academic freedom and would not focus them too much on short-term goals.
Universities were free to keep their charters which would provide a long-term vision of the institution's activities and goals.
- NZPA