Budget 2021 increases funding rates for apprentices and other work-based industry trainees and supports the success of traditionally under-served learners and young VET learners under 25 years old without a qualification at level 3 or above on the New Zealand Qualification Framework through equity funding, as well as reducing barriers for both learners and employers. 

The additional funding will step up over the next three years, starting with 36.8 million in 2022, increasing to over $97 million in both 2023 and 2024. This will not be allocated as an across-the-board increase in funding rates but instead in ways that signal the future transformation of the vocational education and training funding system.

Funding in 2022 will increase funding rates for apprentices and other work-based industry trainees by 5%. This will better align the funding rates for work-integrated learning with the rates for provider-based training, ahead of the transition to the new unified funding system.

It will also improve the fairness and reach of Equity Funding, which supports tertiary education organisations to improve access, participation, and achievement of their learners, by:

• boosting current Equity Funding rates for vocational education and training (VET) to match the Equity Funding rate for degree-level education
• expanding Equity Funding support to all vocational education and training (VET) learners, including apprentices and other industry trainees
• adding an additional category of Equity Funding relating to VET learners under 25 years old without a qualification at level 3 or above on the New Zealand Qualification Framework.

From 2023 the funding will become part of a unified funding system for VET, which will simplify the system, support and strengthen work-based education and training, address skill priorities and reduce barriers for learners and employers alike. 

The additional funding in 2022 will be on top of the 1.2% annual cost adjustment for 2022.

Budget 2021 also supports vocational education and training by committing:

• $4.2 million to provide ongoing funding for the Prime Minister’s Vocational Excellence Award established in 2019, so that all secondary schools can continue to recognise their top vocational student with a grant of $2,000
• $33 million operating and $14 million capital funding to retain capability and build a data interface for the unified funding system for vocational education to support the transition and integration phase of RoVE.