Off Campus magazine: November 2003

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Smiles in the south

Southlanders have revitalised their region with a zero fees policy at the local polytech. Pat Martin talked to Invercargill Mayor Tim Shadbolt.

Tim Shadbolt has always had a broad smile. That smile is even wider these days because of the runaway success of the local polytech's zero fees policy.

Proud Southlanders are relishing an air of optimism about the province that reflects more than just Southern Sting netball or Southland Stags' rugby success.

Three years ago, in an audacious piece of public enterprise, the polytech (actually the Southland Institute of Technology, SIT) decided to get rid of student tuition fees.

"I probably wouldn't be mayor now if it hadn't worked," says Mayor Shadbolt. "And I don't think the chairs of the Invercargill Licensing Trust, the Community Trust and the SIT would be in their jobs either."

The policy was born out of a unique situation in Southland, the mayor says. With just one head office in town, Invercargill has little corporate wealth. However, it possesses enormous community wealth.

In Roger Douglas's aftermath when local authorities all over New Zealand were selling public assets, canny Southlanders opted to hang onto theirs.

The Invercargill City Council owns companies in forestry, works, and the airport, plus two electricity companies. When the call went out for $7.25 million to bankroll the zero fees policy, the council was able to stump up with $1.2 million.

The Community Trust of Southland chipped in with another $3.45 million. The trust had been set up when Southland's Trust Bank was sold - $20 million from that sale had been reinvested and realised a massive community-owned profit.

And Southlanders voted to keep liquor retail in trust control - you can't buy beer or wine in local supermarkets, but the Invercargill Licensing Trust had $1.7 million on hand for free education.

"It shows how the conservatism of Southlanders can, at the end of the day, be quite beneficial," says the mayor.

Last year, Infometrics Consulting was able to write a glowing mid-term report on the scheme. The 2433 new students attracted to SIT by zero fees spent an estimated $26.6 million, more than double the predicted amount and the catalyst for an extra 266 full-time job equivalents.

It is even credited with turning around a population decline. In 2001, the year the policy was introduced, Invercargill's population had hit rock bottom at 49,833, down 3375 on the previous census.

But in 2002, the population began to edge up and this June it stood at 51,800.

Community funding stops this year, but SIT expects to show a profit by the end of 2004, says Mayor Shadbolt.

Classes are now full, and that attracts enough government money for SIT to stand financially on its own two feet.

In four years, enrolments including part-timers have gone from 5500 to 9000. In terms of full-time equivalent students, numbers have more than doubled from 1781 to 3600.

Many new enrolments are older students with families and an unexpected benefit of the new arrivals is the boost to local primary school enrolments.

At a time when universities and polytechs all over New Zealand are ratcheting up student tuition fees, SIT is a golden example of what can happen when politicians and administrators think beyond the prevailing economic wisdom.