Unitec axes 19 courses and at least 100 jobs in bid to rein in costs

Reporter·NZ Herald·

3 Sep, 2018 08:27 PM3 mins to read

Unitec has sold much of its campus at Mt Albert (above) for housing, but is looking at selling more land and cutting at least 100-200 staff to make ends meet. File photo

New Zealand's biggest polytechnic, Unitec, plans to lay off at least 100 staff and close 19 courses next year as it battles a financial crisis.

The institute has confirmed that it aims to cut operating costs by 20 per cent immediately, with more cuts possible.

Equivalent-fulltime students have plunged by 28 per cent from 9669 un 2016 to 6935 this year, and documents released by the Tertiary Education Commission (TEC) show that it is planning on a further drop to 6000 next year - 38 per cent down from 2016.

It has told staff it plans to close new enrolments next year in 19 programmes including its Bachelor of Arts, Bachelor of Communication, Bachelor of Sport and Diploma of Contemporary Music.

The TEC briefing to Education Minister Chris Hipkins in June shows that the institute would have run out of cash this month if Cabinet had not agreed to a $50 million loan, which the institute will have to repay as soon as it has "right-sized" its costs to match its plunging revenue.

"As well as aggressive re-sizing to manage costs, in the medium to longer term Unitec has additional land surplus to educational needs that can be used to raise future capital," TEC said.

The institute has already sold a large part of its land to the Government for an intensive housing development, but that capital was already earmarked for rebuilding the Mt Albert campus on a reduced site.

Interim chief executive Merran Davis told Radio NZ that it would need to cut 100 to 200 of its current 1200 fulltime-equivalent jobs to achieve a target 20 per cent cost reduction.

A spokesman, Nick Wilson, told the Herald that exact numbers were still being worked through.

He said existing students would be able to complete their courses in all 19 programmes that were being closed to new entrants.

Tertiary Education Union president Dr Sandra Grey said the union hoped that a slight upturn in enrolments in the second half of this year indicated that student numbers would not drop to 6000 next year as forecast, so the cuts could be moderated.

"We are hoping that we can stop some of the closures of some of the programmes," she said.

She says staff have known for a while Unitec is in a rough financial position and that jobs are going.

She says they're disappointed it's all happening very quickly, and there isn't a lot of time for staff to think about the changes and make representations.

But Wilson said that the slight upturn in enrolments this semester was mainly in part-time students, so equivalent-fulltime numbers were still falling.

All polytechnics have been hit by a dual whammy of falling domestic enrolments, as a booming job market has encouraged young people into jobs rather than training, and falling international students caused by tightening immigration rules aimed at stopping students using low-level education as a route to NZ residency.

Hipkins has appointed Murray Strong as a commissioner to replace the previous Unitec Council.