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MonitoringReport2004 Leadership and Management in TE Os ← Effective Teaching and Learning in Tertiary Education | Home Page | Support for Wider System Capability → Governance of TEOsGovernance is a critical area for ensuring overall leadership and capability in TEOs. This is particularly true as the complexity of the environment increases for all TEOs. It is an area that continues to be affected by turnover and the difficulty of attracting skilled members. To assist TEIs to develop good governance practices, the Ministry of Education’s Tertiary Advisory Monitoring Unit (TAMU) has continued to develop and deliver seminars for council members in conjunction with Institutes of Technology and Polytechnics of New Zealand (ITPNZ). Seminars are delivered on an open basis, as well as being individually tailored to the specific needs of individual TEIs. These will be stepped up in 2005 and new modules introduced. There will also be attention to governance and Māori. Management in TEIsThe overall financial health of TEIs has continued to improve. The sector averages are above the recommended thresholds in all four key financial measures, having improved across all four measures two years running. There has been a substantial recovery in terms of operating surplus with only two TEIs in deficit in 2003 (compared with 13 in 2000) and 23 of out the 36 TEIs at or above all four of the recommended thresholds (compared with only 11 in 2000). However, the Ministry of Education has noted an overall decline in working capital of TEIs which makes them more vulnerable to financial risks and shocks.  Key financial performance indicators for TEIs 1997–2003 Note: In order to compare indicators on differing scales, the percentage for each indicator has been transformed into an index, where 100 represents the Ministry of Education’s recommended threshold for the indicator. See Ministry of Education, New Zealand’s Tertiary Education Sector: Profile and Trends 2003, p 213 for original data, actual thresholds and an explanation of each indicator. The two notable ongoing financial management risk areas for most TEIs are:
For a number of TEIs, these are compounded with risks relating to reliance on and use of community education funding — in terms of declining income as government imposes greater control over the funding and reputational damage resulting from public exposure of a few poorly managed programmes. A reading of TEI profiles shows low emphasis on governance and management within strategic priorities and goals. The sheer complexities of the environment are challenging some TEIs’ overall management capability. The use and specification of key performance indicators and targets within profiles are uneven. Management in PTEsFinancial management information gathered by the Ministry of Education from PTEs that received student component funding in 2003 shows varied performance, which reflects the diversity of the sector. PTEs vary significantly in size and type of organisation (company, subsidiary, charitable trust etc), all of which has an effect on their financial structures and performance. The average operating surplus for PTEs in 2003 (2.6 percent) was around half that of TEIs (5.0 percent) and significantly lower than the operating surplus for PTEs in 2002 (7 percent). An indicator of general confidence in the management of PTEs is the length of the NZQA audit cycle. This varies from less than a year for PTEs with significant audit concerns to three years for well-performing and established PTEs. The general trend is towards more PTEs being on a two- or three-year cycle and few on less than one year, showing a maturing sector and overall development of management capability.  Percentage of PTEs by length of NZQA audit cycle 2001–2004 Source: New Zealand Qualifications Authority ← Effective Teaching and Learning in Tertiary Education | Home Page | Support for Wider System Capability → Page last modified on 26 November 2006, at 06:29 PM |
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