Industry Training

(Reference Code: 2890)

Purpose of industry training funding

The Tertiary Education Commission (TEC) provides funding to support industry training organisations (ITOs) performing their functions under the Industry Training Act and in undertaking the activities described in their approved Investment Plans. The funding is intended to meet a proportion of the costs incurred, the balance being provided by contributions from each ITO's recognised industry.

Rule ITO003: Training subsidised by the Industry Training Fund (ITF) is for each of the following:

Employees in formal training agreements that are linked to employment agreements
Self-employed contractors in formal training agreements with the organisation with which they have a principal contract of services
Members of the New Zealand Defence Force with a training agreement between the member and the New Zealand Defence Force
The training of volunteers who are in arrangements in the nature of employment that is eligible for industry training funding, under the same conditions as for paid employees; for this purpose the existing criterion requiring a training agreement with an employer is deemed to include a training agreement with the host organisation of a volunteer.

Eligibility for funding

In general, only ITOs are eligible for industry training funding. The only exception is an organisation funded to undertake an industry training-related project or activity under a designated portion of the Industry Training Fund.

Rule ITO006:* To be eligible for industry training funding industry training organisations (ITOs) must be fully or provisionally recognised under the Industry Training Act 1992. An ITO is eligible for Investment Plan funding if it has an Investment Plan approved by the Tertiary Education Commission.

Industry training must be within the ITO's recognised industry, and meet the relevant quality assurance requirements (See section 10 of the Industry Training Act).

ITOs must ensure that their governance and business arrangements are appropriate to the requirements of the Industry Training Act, the Education Act, and the Government's policies for Industry Training.

Organisations other than ITOs may be funded to undertake an industry training-related project or activity under a designated portion of the Industry Training Fund.

ITOs are expected to promptly raise, with their Investment Manager, any arrangements that are outside standard practice.

* Format updated 14 April 2009.

Valid training agreements

Rule ITO004: To claim funding, each trainee must have a valid training agreement that complies with the following requirements:

In the case of an Eligible Trainee who is:

employed, the training agreement is part of, or linked to, an employment agreement entered into by the trainee and their employer pursuant to the Employment Relations Act 2000
a member of the New Zealand Defence Force, the training agreement is between the member and the New Zealand Defence Force
a volunteer, the training agreement is between the volunteer and the host organisation of the volunteer
a self-employed contractor, the training agreement is between the self-employed contractor and the organisation with which they have the principal contract for services.

The training is intended to lead or relate to the achievement of at least 20 National Qualification Framework credits per year
The agreement provides for one of the following:

industry training that has been approved by the Tertiary Education Commission (TEC)
an equivalent programme of industry training that has been recognised by the TEC under section 18(a) of the Industry Training Act

The agreement is registered with the Industry Training Organisation.

Modern Apprenticeships

In 2009 Modern Apprenticeships allocations are not approved via an ITO’s Investment Plan. However, Modern Apprentices’ training will be subsidised through the Modern Apprenticeships fund Standard Training Measures on the same basis as other industry trainees.

Other funding

ITOs may seek or receive other funds from the Government other than the TEC. These include the following:

Membership fees and grants from government departments and Crown agencies that are in the nature of industry contributions where an ITO is providing industry training services to such government departments and Crown agencies and their employees, including standard setting and managing the delivery of industry training
Fees received from government departments or Crown agencies and/or their employees in return for providing industry training services to those departments or Crown agencies and their employees, comparable to fees received from private sector organisations and their employees for such services
Grants and fees from government departments and Crown agencies for the provision of services and resources that do not relate to meeting the costs of setting standards and maintaining associated quality management systems and/or managing training arrangements for the training of trainees registered with the ITO, for which the ITO is being funded by the TEC
National Moderation payments received from New Zealand Qualifications Authority.

ITO literacy, language, and numeracy projects

One of the Tertiary Education Strategy (TES) priorities for ITOs is to increase literacy, language and numeracy skills in the workforce. ITO Investment Plans therefore include Key Performance Indicators (KPIs) related to this TES priority.

ITOs are eligible to apply for funding to participate in the ITO projects as part of their overall Foundation Learning Strategy. However, raising workforce literacy, language and numeracy skills in the workplace is integral to the ITO's role and is not contingent on receiving additional funding.

Funding for the ITO projects will be included in the Investment Plan process for 2009.