The 1991 Budget and Tertiary Education: Promises, Promises...


  • Michael A Peters
  • Michael C Peters
  • John Freeman-Moir



Educational Finance and Economic Policy


The 1991 Budget, described by Ruth Richardson in the news media as “the Mother of all Budgets”, in effect represents the most brutal assault on the welfare state we have witnessed in New Zealand. Its provisions have been even more far-reaching than the Treasury ideologues and other members of the New Right might have dreamed possible in the heady days of the 1980s. In terms of social policy we have seen a disestablishment of the foundations of the welfare state: the move from universalistic premises to targeting social assistance; the privatisation of the health system; the commercialisation of the Housing Corporation; a reneging on promises in superannuation and education; the emergence of greater state surveillance in the form of “information sharing” between government agencies. All this as part of devising “a strategy for enterprise and growth” based on three objectives – the reform of the labour market (completed under the Employment Contracts Act, 1991), “redesigning” the welfare state, and managing fiscal problems. Ironically, like Saddam’s conquest of Kuwait, Ruth Richardson’s strategy has turned out to be full of empty promises and U-turns. The “Mother of all Budgets” gave birth to a puny child which has needed all the life support systems that modern neo-liberal politics demand: expert PR to obfuscate the real issues; sheer repetition of claims; the stifling of internal dissent; and the stubborn ideological refusal to admit that many policies have been the product of haste, compromise and collusion. The tertiary education “reforms” put in place as a result of the 1991 July Budget are a perfect illustration – a case in point. The Minister of Finance’s speech as the preamble to the Budget reveals in general technocratic terms the place of education: A key element of the Government’s strategy is to boost skills and technological knowledge throughout society. In an increasingly competitive world, the quality of our education, science and technology will play a big role in our future prosperity (Budget 1991, p. 7). In practical policy terms for education what does this mean? The document, Education Policy (1991, p. 3) lays out the four key elements of the new policy: Parents as First Teachers; The Achievement Initiative; The National Certificate; and Study Right. Only the last of these is in the area of tertiary education. This paper, accordingly, will concentrate mainly on examining the changes brought about by the introduction of Study Right. It will also outline briefly and make some comment on the new capital charging regime to be introduced for all tertiary institutions in 1993. The paper concludes with a discussion of the notion of competitive neutrality...


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Author Biographies

Michael A Peters

Michael C Peters

John Freeman-Moir