Budget 2023

Budget 2023

Last updated 18 May 2023
Last updated 18 May 2023

The Government’s Budget includes initiatives for the tertiary sector that increase tuition and training subsidies, support for teaching of te reo Maori and mātauranga Māori, funding for expected increases in student numbers, and extends support for apprenticeships.

Key highlights

  • 5 percent tuition and training subsidy increase from 1 January 2024
  • 15 percent tuition and training subsidy increase for te reo Māori and other subjects that promote mātauranga Māori by 2027
  • $180.7 million for enrolment increases in 2024 and 2025
  • $220 million Crown loan to Te Pūkenga for IT integration
  • Apprenticeship Boost extended to end of 2024
  • Funding for Centres of Asia Pacific Excellence not renewed

The Government announced an additional $496.822 million funding over the next four years to increase the tuition and training subsidies by 5 percent from 1 January 2024. This will support tertiary education and training providers to maintain the quality of opportunities available to learners.

The Budget has an additional $24.207 million to support the delivery of te reo Māori and other subjects that promote mātauranga Māori; this increase will be phased in over four years and will result in an additional 15 percent increase in funding rates on 2023 rates for these courses by 2027.

Another $180.7 million will fund tertiary education and training enrolments in 2024 and 2025. It’s estimated that this enables TEC to fund approximately 15,000 more full-time equivalent learner enrolments in 2024 across provider-based and work-based tertiary education and training, and around 10,000 more in 2025.

All funding will be allocated by the TEC through its usual investment processes. As in previous years, TEOs do not have to amend plan submissions as a result of these changes.

Te Pūkenga gets access to an interest-free Crown loan of up to $220 million to support it to integrate IT systems. The investment in technology is a key enabler for Te Pūkenga to move towards a connected, national network, and support greater collaboration between staff.

Apprenticeship Boost is extended to the end of 2024 at an expected cost of $77.122 million. There is no change to eligibility.

Centres of Asia Pacific Excellence funding will end. CAPEs contracts expire on 30 June 2024.

Tertiary Education Summary of Initiatives 2023

*Includes outyears funding

Initiative $increase/($decrease)


Cost Adjustment for Tertiary Tuition and Training Subsidies

Operating Funding


2023/24: 74.203 million

2024/25: 145.916 million

2025/26: 148.942 million

Outyears 151.968 million


Five-year operating total: 521.029 million*

This initiative applies a 5 percent increase to tertiary tuition and training subsidies. This funding helps providers to manage increases in delivery costs and maintain the quality and accessibility of tertiary education and training. The initiative also provides an additional 15 percent increase in funding for the delivery of mātauranga Māori provision (including te reo Māori) at level 3 and above, to be phased over the next four years.

Tertiary Education and Training - Increased Funding for Enrolments

Operating Funding $increase/($decrease)

  • 2023/24: 50.000 million
  • 2024/25: 90.348 million
  • 2025/26: 40.347 million

Five-year operating total: 180.695 million

 This initiative ensures baseline tertiary education and training funding can fund close to the level of demand expected from 2023. Current baselines are unable to fund the expected demand for enrolments. If unfunded, providers may restrict learners’ access to tertiary education and training. This initiative therefore enables the Tertiary Education Commission to fund close to the current level of enrolments through to 2025.

Supporting the Transformation of Te Pūkenga

Capital Funding

  • Total: 220 million

This initiative provides Te Pūkenga with an interest-free Crown loan of up to $220 million to support it to implement an IT transformation programme. The programme enables Te Pūkenga to shift from operating more than twenty largely unconnected information systems to integrated IT infrastructure.

Apprenticeship Boost extension  

Vote Social Development; Vote Tertiary

Operating Funding

  • 2022/23: (60 million)
  • 2023/24: 20.347 million
  • 2024/25: 56.775 million

Five-year operating total: 17.122 million

This extends the Apprenticeship Boost initiative to the end of 2024, continuing the Government’s focus on apprenticeships and ensuring a strong pipeline of skilled workers for key industries. Apprenticeship Boost provides subsidies to employers of first- and second-year apprentices to support apprentices while working toward a qualification. The extension will enable an estimated 30,000 apprentices to start or continue being supported.


Vote Tertiary Education: 0.6 million

Vote Social Development: 16.522 million


Centres of Asia Pacific Excellence

Operating Funding $increase/($decrease)

  • 2024/25: (10 million)
  • 2025/26: (10 million)
  • 2026/27: (10 million)

Five-year operating total: (30 million)

This savings initiative will discontinue the Centres of Asia-Pacific Excellence (CAPEs) after the end of the current contract term, expiring on 30 June 2024. The CAPEs are university-led, cross-institutional centres of excellence, established to contribute to the development of Asia-Pacific knowledge and language skills in New Zealand.

Disestablishing funds for the Entrepreneurial Universities Initiative

Operating Funding $increase/($decrease)

  • 2023/24 (2.9 million)
  • 2024/25: (4.359 million)
  • 2025/26: (4.359 million)
  • 2026/27*: (4.359 million)

Five-year operating total: (15.977 million)

This savings initiative follows Budget 2019 decisions to discontinue the Entrepreneurial Universities initiative once current contracts ended. No new contracts have been issued since then and the last contract expires in 2023.


Returning underspend from Fees-Free

Operating Funding $increase/($decrease)

  • 2023/24: (70 million)
  • 2024/25: (70 million)
  • 2025/26: (70 million)
  • 2026/27*: (70 million)

Five-year operating total: (280 million)

This funding was allocated to the Fees Free policy. This is as a result of expected underspends due to updated forecasts, which shows spending on the Fees Free policy to not reach what is currently appropriated meaning a $70 million per annum saving from 2023/24.