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Govt bails out Whitireia with $15m after drop in student numbers kills cashflow

Whitireia Polytechnic has received a $15 million capital injection from the government after enrolment numbers plunged last year.

Te Auaha, the creative industry complex developed by Whitireia and Weltec polytechnics. Photo by Mark Cubey. 

Education Minister Chris Hipkins announced yesterday that the government was responding to a call for financial help from Whitireia, which lost $8.4 million last year after its full-time enrolments fell by over 500 students, including 200 overseas students.

Whitireia will not have to repay the $15m capital injection.

The troubled polytechnic has its main campus in Porirua, with other centres in Kapiti, Auckland, and in Wellington.

Whitireia has not received government capital funding since shortly after it opened over 30 years ago.

A financial advisor to Whitireia has been appointed. The government is now considering putting in a commissioner to replace the joint Council that Whitireia shares with the Wellington Institute of Technology (Weltec).

Whitireia and Weltec partnered on the new Te Auaha campus on the corner of Dixon Street and Cuba Mall, which opened at the start of the year. The five-storey complex, which houses a range of creative industry courses, and commercial tenants, was an expensive venture that has contributed to Whitireia’s cashflow problems.

Chris Hipkins said that Weltec’s financial position was not as serious as that faced by Whitireia, but the government is keeping a close watch on the situation, as there were still concerns about Weltec’s viability in the medium term.

In a statement, Whitireia said that the significant financial challenges experienced in the last two years were due to a reduction in international students, driven by a tightening of government immigration policy.

The income from international students had provided financial support to Whitireia, and enabled investment into its Porirua campus and Wellington campus to provide “modern learning facilities for students in a very competitive tertiary education environment”.

Whitireia said that the appointment of a commissioner and the Minister’s intention to consult on the dissolution of the board it shares with Weltec, “does not impact the day-to-day operation of Whitireia and WelTec”.

It claimed that Whitireia is one of the top performing ITPs in New Zealand for course and qualification completions and has the highest category rating for External Evaluation and Review from NZQA.