2012 Fund methodologies for PTEs, Schools and Community Education providers

2012 initial funding allocations for private training establishments (PTEs), community education providers and schools have been determined using a methodology specific to each fund received. They are outlined below.

Student Achievement Component

Student Achievement Component (SAC) 2012 initial funding allocations have been informed by three areas of 2010 performance. They are:

• Successful course completion rates as confirmed through the April Single Data Return (SDR) process;
• Delivery volume within and beneath the 97-103% tolerance band for SAC funding; and
• Delivery above the level agreed in each organisation’s Investment Plan.

Course completions

PTEs with 2010 successful course completions of 55% or less will receive an initial funding allocation of zero. This allocation applies regardless of 2010 delivery volume.

PTEs with 2010 successful course completions between 56% - 89% will receive an initial funding allocation that is based on their 2011 baseline allocation (provided they delivered at least 97% of their 2010 allocation).

PTEs with 2010 successful course completions of 90% or above will be offered a 10% SAC funding increase on top of their 2011 baseline allocation (provided their delivery is within the levels agreed in their Investment Plan). Agreement to this offer and how it will be reflected in the Investment Plan will be determined through discussion with the TEC as part of Investment Plan development.

Under-delivery

PTEs that achieved 2010 course completions greater than 55% but delivered below 97% in 2010 will receive a reduced initial funding allocation that reflects their actual 2010 delivery or 2011 baseline allocation (whichever figure is lower).

Delivery above agreed levels

PTEs that delivered by more than 110% of the total 2010 volume agreed in their Investment Plan (includes both funded and unfunded delivery) will receive a reduced initial funding allocation for 2012. The reduction will be 10% of their 2011 baseline allocation and will apply regardless of 2010 successful course completion rates.

The reduction will not apply to small PTEs where 110% above their agreed level is fewer than 10 EFTS. This issue will however, be raised during Investment Plan development with a view to better managing enrolment levels.

There will be also be a 2% increase in the subsidy rate for degree and post-graduate courses taking effect from 2012.

Equity funding

PTEs will continue to receive equity funding for Māori and Pacific learners enrolled in diploma level and above qualifications. Equity funding allocations for 2012 will be determined using verified EFTS enrolment data for those learners.

Equity rates are outlined below:

Qualification level	Rate per EFTs (excl GST)
Diploma	$133.33
Degree	$320.00
Postgraduate	$444.44

Foundation-Focused Training Opportunities

Providers delivering FFTO-funded programmes received a letter via TEC Workspace on 20 July which detailed their 2012 initial allocation information for this fund. The letter also described how the allocations were determined.

The key differences between the allocation approach advised on 20 July 2011 and the finalised approach for 2012 are identified in the table below.

Some programmes with a small number of learner places will not be subject to a reduction in response to sector feedback about the importance of maintaining the viability of smaller programmes.

July 20 approach	Finalised approach
Travel allocation – was increased to $30 per learner per week	Travel allocation – now remains at $20.87 per learner per week
Travel administration fee – 10% of weekly travel fee ($3 per learner per week)	Travel administration fee – 10% of weekly travel fee (now $2 per learner per week)
$235.56 per learner per week	Unchanged
Providers with 12 or fewer places in total across all FFTO programmes are not subject to any reduction	Unchanged
Providers with 13 or more places across all FFTO programmes subject to a reduction in purchased provision of approximately 14%	Providers with 13 or more places across all FFTO programmes subject to a reduction in purchased provision of approximately 5%

Youth Guarantee

Budget 2011 announced that the current Youth Training and Youth Guarantee programmes would merge into a new targeted programme for Youth Guarantee from 2012.

In order to minimise the impact of these changes on TEOs, the 2012 allocation approach will see TEOs receive an initial funding allocation that is based on 2011 Youth Guarantee and/or Youth Training funding allocations. This is provided the minimum performance standards for Youth Training have been met.

TEOs with Youth Training programmes that achieved Labour Market Outcomes of less than 30% and/or programme occupancy of less than 40% in 2010 will receive an initial funding allocation for 2012 of zero. 

Initial funding allocations for TEOs currently receiving Youth Guarantee were subject to the following considerations:

• that 2010 was the first year of implementation for the current Youth Guarantee programme and the TEC has incomplete performance data from that year based on mid-2010 enrolments
• that the TEC has limited performance information for 2011
• changes to the policy and operational parameters are required to implement Youth Guarantee in the 2012 transitional year and the TEC wanted to ensure continued access to the programme for eligible learners across regions.

For TEOs who receive both Youth Guarantee and Youth Training funding, the total amount from each programme was combined to give a total initial allocation for 2012.

Intensive Literacy and Numeracy

Initial allocations for Intensive Literacy and Numeracy (ILN) funding in 2012 are based organisations’ 2010 performance. Organisations that achieved 80% or above of their 2010 allocated learner numbers and learner hours will receive an initial funding allocation that is the same as 2011. However, this initial funding allocation will also be subject to a 5% funding reduction to manage funding within the 2012 appropriation.

Work Place Literacy

Due to decisions made as part of Budget 2009, the total amount of funding available for allocation across the three strands of Workplace Literacy (WPL) provision in 2012 has been reduced by 11% from 2011 levels. This reduction has been included in the 2012 WPL allocation methodology calculations and is reflected in initial allocations for WPL in 2012.

Adult Literacy Educator

Initial funding allocations for Adult Literacy Educator (ALE) funding in 2012 are based on those received in 2011. Finalised 2012 ALE allocations will be directly informed by the TEC’s assessment of the July progress report and may therefore be subject to change.

Adult and Community Education in Schools

ACE in Schools 2012 initial funding allocations are based on 2011 allocations and our consideration of the “ACE in Schools Final Report” for 2010 submitted by schools.

Adult and Community Education in Communities

ACE in Communities 2012 initial funding allocations are based on 2011 allocations and our consideration of the “Community Provider Final Report” for 2010 submitted by community organisations. They are also subject to approximately a 6% reduction due to the reduced ACE appropriation from Budget 2009 savings.

Gateway

Gateway 2012 initial funding allocations have been based on estimated student numbers for 2012 set out in the current Investment Plan. If 100% throughput occupancy was not achieved in 2010, allocations have been based on the higher of either actual delivery in 2010 or year-to-date throughput occupancy in 2011. The initial allocation may be adjusted following consideration of 2010 credit achievement. Any adjustments will only be made after discussion between the school and the TEC.