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Kia ora koutou
Thank you for all the hard work you have done to implement our Renewal Plan to date, I know it has not been easy for anyone.
The advances made across our organisational and financial performance have been hugely impressive in such a short time frame. Unfortunately, on the financial front we are chasing a moving target as many factors beyond our control continue to impact student numbers (and revenues) across the sector.
Our Renewal Plan, developed in 2018, was based on a forecast for Unitec declining to 6,000 EFTS by 2020. Unfortunately, we are now facing a total of 6,000 EFTS this year and updated forecasts are closer to 5,500 EFTS for next year. We are by no means alone in this, the majority of the ITP sector is well down on last year and the TEC expects this trend to continue in 2020. The uncertainty of RoVE has impacted the sector and Auckland providers have had the additional sting of new visa rules for international students which have made studying in the regions more attractive.
While these challenges are acknowledged, the Minister and TEC have made it clear that all ITPs are still expected to ensure that they are financially sustainable and that the advent of NZIST will not solve these issues in the foreseeable future. To be financially sustainable by 2022 is also one of the strategic priorities in Manaakitia te Rito - our Renewal Strategy, to support our continued investment in the success of our students, particularly our priority groups.
What this means is that in addition to completing the cost reductions we committed to in the 2018 Renewal Plan, we will now need to make further cost savings of at least five percent across the organisation. This will mean we are still likely to have a deficit in 2020 and will need to draw down some more of our concessionary loan, but I believe it will enable us to maintain our commitment to our purpose and Renewal Strategy.
I realise the prospect of reducing more expenditure is difficult so it is important that all staff have the opportunity to have their say and contribute their ideas to how we can be more efficient as well as increasing revenue. In this environment, it is critical we continue to focus on increasing revenue which is why we are continuing with our new Waitakere Strategy, Unitec Pathways College activity and collaboration with other ITPs and ITOs. Please share your suggestions for reducing costs and increasing revenue using this form. This can be done anonymously if you wish, in the same way as Pulse Survey feedback.
There will need to be some reduction in staffing but we will be looking to keep this to a minimum by reducing operating expenditure wherever possible, which is part of consolidating the campus and our property strategy. We do recognise that in some areas this will mean a reprioritisation of workload and review of timelines.
I am very sorry and understand how disappointing this situation is. We have all worked so hard and managed to absorb the shortfall in student numbers this year but we cannot continue to do so without further change in our current approach. While most of the other ITPs are in a similar position, I believe with our commitment to Te Noho Kotahitanga and focus on our students we can ensure the hard decisions we need to make are done in a way that is transparent, respectful and does not derail the progress we have all contributed to over the last 18 months.
More information and detail on this will be available in the near future and please remember support is available from your Manager, HR or EAP Services.
He waka eke noa – we are all in this together.
Ngā mihi
Merran Davis
Interim Chief Executive
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