The Government has backed down on proposed changes to teacher-student ratios in schools following widespread public concern about the Budget 2012 policy.
The changes were tipped to save NZ$174 million over four years, with NZ$60 million of that going toward teacher training programmes. That NZ$60 million spending would no longer go ahead as planned, Education Minister Hekia Parata said today.
But a commitment to hitting a fiscal surplus in 2014/15 meant the remaining NZ$114 million worth of proposed savings would still need to be found from within vote Education over the next four years to make up for the cancellation of the ratio policy. That shortfall was made up of NZ$15 million in 2013/14, rising to about NZ$50 million in subsequent years - meaning just over NZ$60 million would need to be found by 2014/15.
Budget 2012 promised a wafer-thin NZ$197 million government surplus in 2014/15, a self-imposed target designed to illustrate the Government as fiscally conservative and aware of funding dangers faced by sovereigns in the face of growing global financial pressures and the European sovereign debt crisis.
However, Treasury warned this week that while it was still sticking to the central scenario presented in its Budget 2012 forecasts, risks pushing the books towards the downside scenario, where a surplus was not reached even by the end of the 2015/16 year, were increasing.
Parata told media in the Beehive this afternoon that the ratio back down would not put the surplus at risk.
“The remainder of the savings [the NZ$114 million] will be achieved through a combination of a pre-commitment against Budget 2013, and other savings we will work to find within Vote Education," Parata said.
Work would be done over the next few weeks to try and identify other areas in the Education Budget which could face cuts to pay for the NZ$174 million.
Parata said the decision to back track on the policy was made after a high level meeting on Thursday morning between herself, Prime Minister John Key, who is currently in Europe, Finance Minister Bill English, and senior Cabinet Ministers Steven Joyce and Gerry Brownlee.
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