Industry Training Organisations

Budget 2011 acknowledges the challenges of the current economic climate and the need to support the Christchurch rebuild, and strikes a balance between providing places and meeting higher costs. 

It continues the Government’s drive for high performance, value for money and flexibility in responding to demand. It shifts funding away from areas of low demand to provide more places in high-demand, high-value areas and sets clear incentives for both students and organisations to continue their drive for excellence.

In Budget 2011, the Government is reducing the size of the Industry Training Fund from 2013 because the current level of funding is not required to meet demand for substantive, high-quality industry training in New Zealand. From 2013, the Industry Training Fund (excluding literacy and numeracy funding) will be $139 million per year.

The reduction in the industry training fund is unlikely to result in reductions of trainees that are actively undertaking substantive qualifications. This is because the new level of the fund is set at the estimated level to meet future training numbers in quality provision.

Budget 2011 also acknowledges the impacts of the February 22 earthquake. Funding is being set aside for up to 1500 additional training places as part of a comprehensive cross-agency response to meet additional demand for labour for the reconstruction programme called Skills for Canterbury. $42m is available for additional funded places at polytechnics, private training establishments and ITOs if required.

Finally, as has already been signalled, this Budget shifts the responsibility for regulatory compliance training onto employers and industry, in line with other sectors, from 2012.

The reductions in the Industry Training Fund do not affect Modern Apprenticeships, trainees who are completing substantive qualifications, or literacy and numeracy training.

Key points for ITOs:

• Funding for industry training will reduce by $57.7m over 4 years ($11.5 million in 2012/13 and $23.1 million in 2013/14 and outyears) in response to a decline in demand, under-delivery and the TEC’s operational review.
• From 2013, the funding for industry training will be $139 million per year (not including literacy and numeracy funding).
• None of these changes affect literacy and numeracy training, trainees currently completing substantive qualifications, or Modern Apprenticeships.
• From 2012, industry training funding will no longer be available for short duration health and safety and regulatory compliance programmes that are the normal responsibility of the employer in providing a safe workplace.
• $42m in contingency funding to provide up to 1500 additional trades training places to support the Christchurch rebuild.