Surpluses at public institutions raise questions

Surpluses at public institutions raise questions about priorities

Ministry of Education statistics show the average surplus as a percentage of revenue at public tertiary education providers climbing dramatically from 1.9 percent in 2006 to 5.2 percent last year.

In 2006 public tertiary education providers made a combined surplus of $66 million on revenue of $3.5 billion. Last year the same institutions made a combined surplus of $280 million on revenue of $4.4 billion.

Public tertiary institutions are supposed to meet a benchmark surplus of 3 percent of revenue each year. By exceeding that benchmark by a further 2.2 percent last year the institutions pocketed nearly $100 million dollars more than they were required to.

"The large surplus last year does not seem to be a one-off aberration according to TEU National Secretary Sharn Riggs. "The average surpluses have grown steadily each year since 2006."

The public institutions that have generated the largest surpluses as percentages of revenue include Waiariki (16 percent) Te Whare W
nanga o Awanui
rangi and SIT (13 percent each), WITT and UCOL (12 percent each), the Open Polytechnic, CPIT and Bay of Plenty Polytechnic (11 percent each).

"While we commend these institutions on careful and prudent management, we need to remember that surplus money is money that could have been spend saving jobs, teaching students and protecting quality education," said Ms Riggs.

"Too many good people have lost their jobs, gone without pay rises or been told to turn away students because of tight fiscal circumstances. It is galling to see that those circumstances were not so tight after all."