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No-nonsense McCully rides to the rescue

OPENING SALVO

Export education is a major government priority.

It already earns about $2.5 billion a year in foreign exchange, making it comparable with New Zealand’s combined fish and wine exports.

The government’s goal is to double that to $5 billion within 15 years, which would take the industry roughly to where meat is today.

The benefits are multi-dimensional. The foreign exchange is welcome and also subsidises the state school system, with some of the larger secondary schools generating as much as half of their operational spending from foreign students.

The school principals who drive such efforts are not neo-Marxist PPTA activists but sophisticated businesspeople.

Beyond the money, educationalists argue that foreign students enrich the learning environment, helping mould New Zealand students as citizens of the world, able to compete and win in the global economy.

As New Zealand found with the Colombo Plan, foreign students also become a pro-New Zealand network in their foreign services and business communities back home. Because of the importance of the sector, the government spent its first term reviewing the country’s export education effort.

Finally, Tertiary Education Minister Steven Joyce decided to re-establish Education New Zealand as a new government agency, shuffling staff from the Ministry of Education International Division, the Education New Zealand Trust and New Zealand Trade & Enterprise.

Charles Finny, a former “head of mission” in Taipei  – that is, the de facto ambassador to Taiwan – was brought in as chairman, along with BusinessNZ president Philip Broughton and former Auckland Grammar headmaster John Morris.

If you were a principal looking to make more money for New Zealand and your school, as well as enriching your learning environment and helping establish a pro-New Zealand global network, the future looked bright.

Bureaucratic idiocy

Alas, someone forgot to tell Immigration New Zealand.

To save a staff salary or two, it decided to change how student visa applications would be processed.

The decisions were made by Wellington bureaucrats with no discussion with the education sector, the board of Education New Zealand or the front-office staff offshore. No cost:benefit analysis was done.

Henceforth, Wellington announced, German visa applications must be couriered to London rather than be processed in Berlin, Taiwanese applications sent to Manila, South American applications to Washington, and Japanese and Korean applications to Shanghai.

Any history teacher, even a PPTA committee member, could recognise immediately that the changes would be bad for business – especially with Korea and Japan being our No 2 and No 4 education markets and South America having huge growth potential.

The Wellington bureaucrats have no excuse for their idiocy.

Sure enough, soon after the changes were announced, schools began noticing a drop in 2013 applications, with agents and potential students in the affected markets feeling New Zealand no longer wanted them.

School principals began talking among themselves and complaining to the authorities. They got nowhere.

In early November, a meeting was held at the country’s biggest secondary school, Rangitoto College, on Auckland’s North Shore.

Even at short notice, more than 100 principals and education exporters attended. The general consensus was that the immigration bureaucrats who showed up had not the slightest understanding of the international education market or how their decisions would disadvantage New Zealand compared with Australia and Canada.

The bureaucrats even expressed surprise Japanese and Korean people might be uncomfortable sending their passports to China.

Dismayed, the participants decided Rangitoto College should write to the school’s local MP, Foreign Minister Murray McCully.

Reversal inevitable

Mr McCully has a reputation of using innovative tactics to deal with the bureaucracy.

These include cutting up substandard submissions in front of the very bureaucrats who wrote them.

Mr McCully is not above briefing the media against his own departments or writing open letters criticising them.

When my wife was his housing private secretary in the 1990s, they received complaints from state house tenants in Wainuiomata that their houses were unliveable as Housing NZ painted the interiors.  Housing New Zealand bosses insisted that was nonsense. 

Mr McCully ordered a government limo to take him to Wainuiomata to find out. The fumes were overwhelming. He backed the tenants and arranged alterative accommodation. 

When Mr McCully received the Rangitoto College letter, verbal violence became inevitable. His most trusted Foreign Ministry officials were ordered to fix things. The immigration bureaucrats may not know it yet, but they will reverse their decisions.

Big fiscal issues

This column is a cautionary tale.

It is absolutely absurd that, to save a fistful of dollars, Immigration NZ would have risked undermining the government’s wider export education strategy.

It is the consequence of a government determined to return to surplus but unwilling to cut big-ticket items like Working for Families, interest-free student loans or KiwiSaver subsidies, or raise the age of eligibility for superannuation. 

Instead, it fiddles around with trivia, like an offshore immigration officer or two.

Even more absurd is that it requires the intervention of no less than the foreign minister to fix things.

After a horrendous year, John Key deserves a decent holiday. He needs to come back to work determined to deal with the big fiscal issues and stop the trivial penny-pinching that wastes political energy and can so undermine important export industries.

More by Matthew Hooton

Comments and questions

I had no idea until Mr Hooton's excellent expose as to the issue despite knowing some at the sharp end of public schooling. Remembering the old days of Malaysian students some who became friends I can affirm the lifelong on going goodwill. McCully is a man I cant warm to and some of the reports of issues past including the belief he is a career politician and less exposed to real life may be unfair if at all true, but stories like this need telling. When bureaucrats stuff up the public need to see the execution in full gory technicolour. I consider the state of affairs of so much is a result of too many faceless people with too much power hiding away. The recent NZ passport which continues to be a ludicrously short 5 years (effective 4.5) and a joke size and design for frequent business travellers despite complaints on talkback yet a review did nothing. I suggest McCully needs some better publicity of his genuine good deeds and maybe he might get back on our radar and less of the questionable stuff when he associates with the odious UN.

Bang on the money once again Matthew!

The Colombo Plan was a carefully managed program and is way different from the open slather approach to export education that right wing libertarians like yourself promote that have had an unintended concequence of local students (especially those at the the bottom of the achieivement tables), pushed out as schools make themselves more attractive to international students. This is a scandal that needs to be looked into.

New Zealand does not have "export education" - it has residency visa mills masquerading as education establishments.

Stuffing schools and "tertiary" institutions with "students" solely from China only does not "mould New Zealand students as citizens of the world" - it creates a Chinese first education system in New Zealand.

If New Zealand education is so highly thought of then why do New Zealand's smartest go overseas for their educations - and never come back? Why would anyone choose to be educated in New Zealand if they had options in a first world country?

What a croc. Folks - if you want to make big $$$ selling visas to people then just say so - stop pretending to provide export education when you just want a clip from selling passports.

Unfortunately there is a truth to your comments especially for the private institutions. It is common knowledge amongst some teachers who take things a bit more seriously that the classes are attended at random if at all. that cheating is rife and blatant and if challenged the students get angry about paying money and not being delivered a certificate. After all in countries where graft buys anything to not deliver a qualification in return for cash paid with no necessity to sit an exam is common place. I recall recently engaging a young Asian part timer in a chain store (Asian - meaning Indian subcontinent) who freely admitted he was a student. I was fascinated that he held a certain detailed knowledge of Australian immigration rules and helped advise me how kiwis can ensure settlement and future citizenship over the ditch. I did illicit an admission that that was where he was heading once he had done his time here. Who can blame them as NZ's brightest head away also.

you have NO idea. English language schools bring in first world (Europe, Japan, Korea, Saudi Arabia etc) high spending tourists.

Well Murray could perhaps take over Education because I will bet Hekia Parata's troubles are 100% the result of officials underminnig her

Probably correct. There will be a core who give her bad info and then watch her get crucified. She needs to work out who they are and fire them.

One problem with this analysis: INZ were major culprits, but McCully's MFAT precipitated the problem by withdrawing facilities for visa processing in embassies. Cost-cutting in one department led to cost cutting in another which has potentially resulted in income cuts for the country. The government talks the talk of NZ Inc, but they have not thus far walked the walk well.

This is an excellent article.I have operated an English school in provincial NZ for the last 15 years. My view is that the biggest limit to sustainable growth is a failure of government to access and listen to up-to-date market intelligence from front line operators This means experienced, credible , commercially minded people.. Who understand economics as it applies to this quirky industry. It does not mean the latest naive graduate from a marketing course or the International Policy section of the Department of Education. Niether does it mean 'Johnny come lately' owners of business colleges who are just selling residency for Indian and Chinese students in Auckland under the guise of 'education'. Sadly in the restructuring of Education New Zealand the industry consultation committee seemed to have been tacked on afterwards. There are 33 staff in Education New Zealand but none of them picked up this serious blunder. And strangely - niether did the CEO or the industry consultation group. Education NZ was set up apparently to bring together marketing spend, and give a unified direction. But intelligent decisions can only come when the real leaders of the industry are reliably identified, talked to at design stage so that crazy initiatives like this are strangled at birth. Surely a mechanism for this is what you would expect from a centre right government. Congratulations to Matthew Hooton - surely the best article I have seen in the media for quite a few years.

I wonder what Nathan Guy has to say about all this?

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