Budget 2024

Budget 2024

Last updated 30 May 2024
Last updated 30 May 2024

The Government’s Budget includes initiatives for the tertiary sector that will: increase tuition and training subsidies, fund additional medical students, keep both the Fees Free and Apprenticeship Boost initiatives in place with some changes to eligibility, and reprioritise underutilised funding to other areas of tertiary education.

Key highlights:

  • Replace first-year Fees Free with final-year Fees Free.
  • Increase tuition and training subsidies by 2.5 percent from 1 January 2025.
  • Provide funding to enable providers to increase fees by up to six percent in 2025.
  • Offer a $500 (exclusive of GST) per month subsidy to employers of eligible first-year apprentices, in targeted occupations.
  • Fund 25 additional first-year medical school places.
  • Fund Workforce Development Councils until 30 June 2025.
  • Reprioritise underutilised funding from several funds towards other areas of tertiary education, to improve effectiveness, efficiency and responsiveness.

Summary of announcements for Tertiary Education

The Government has announced two initiatives designed to help providers manage cost pressures and maintain the quality of their delivery:

  • $266.3 million of operating funding will be provided over the next four years to increase subsidies by 2.5 percent, from 1 January 2025.
  • Forecast costs funding will be provided to the Student Loan Scheme from increasing fees by up to six percent in 2025.

Budget 2024 will continue to provide Fees Free for the first year of study and training until the end of 2024. This will be replaced with a final-year Fees Free scheme starting from January 2025. The final-year scheme changes the incentive offered by Fees Free policy; instead of being for participation in tertiary education, it rewards learners when they complete their study or training.

Apprenticeship Boost will continue until 30 June 2028. There have been changes to eligibility. From 1 January 2025, Apprenticeship Boost will provide a $500 (exclusive of GST) per month subsidy to employers of eligible first-year apprentices only. The key occupations targeted will be communicated when they are finalised.

There will be funding for 25 more first-year medical school places, starting from 2025.

The total number of first-year medical school places the TEC funds will increase from 589 in 2024 to 614 in 2025. These places will be spread across the Universities of Auckland and Otago.

Current funding for Workforce Development Councils (WDCs) remains in place until 30 June 2025. This enables WDCs to continue to deliver on core functions while the Government considers the future of the statutory functions currently administered by these organisations.

The Government has been reprioritising under-utilised funding towards other areas of tertiary education, in order to improve effectiveness, efficiency and responsiveness.

Budget 2024 provides contingency funding to support the Government’s commitment to disestablish Te Pūkenga and restore regional decision-making.

Initial Cabinet decisions are expected in mid-2024 with planning and policy work undertaken in the second half of 2024. Further communications and details will be available after Cabinet decisions are made.

Funding for Centres of Vocational Excellence (CoVEs) will continue to June 2025. A new round of funding after this date will not be allocated. This initiative reprioritises $15 million that would have been allocated through a new round of applications to establish CoVEs in 2025. Where industries highly value the work that the pilot CoVEs have produced, the projects can be continued and built on by other entities.

To view budget announcements, visit Latest News from the Beehive | Beehive.govt.nz.