Close to $2.5m paid to Bell Gully for Te Pūkenga set up

Thursday, 15 June 2023

Te Pūkenga has paid close to $2.5 million to law firm Bell Gully since January 2020.

A written Parliamentary question by MP Chris Baillie to Education Minister Jan Tinetti found $2,427,419.00 had been paid to the leading commercial law firm.

In her written reply, Tinetti said most of the total was spent on establishment costs for the new entity and transferring 24 organisations into a single organisation and associated legalities.

Chris Baillie, Act list MP, says the merger has been an “expensive disaster”. (File photo)

Baillie, ACT’s education spokesperson, said the merger three years ago of the country’s 16 Institutes of Technology and Polytechnics (ITP) and nine Industry Training Organisations (ITO) had been an “expensive disaster”.

“Spending $2.5 million on legal fees is just one small example of the massive cost taxpayers are going to have to bear for this experiment,” he said.

Baillie said the concept of Te Pūkenga “misses the point of what makes many polytechnics successful” – engagement with local communities and preparing people in areas that have the greatest employment outcomes for their area.

Tertiary institutions should succeed or fail based on the value they create for their students, Baillie said.

Te Pukenga, the education organisation that's taking over the 16 polytechnics and most industry training organisations.

“Perfectly good institutions have been pulled down to mediocrity in a chaotic new super-bureaucracy to cross-subsidise underperforming organisations elsewhere.”

Asked for further comment, Tinetti said via a written response that it was “worth keeping front of mind, the merger of 24 organisations into one crown entity is a major undertaking” and due diligence needed to be followed.

“When Te Pūkenga was established, the Institutes of Technology and Polytechnics were facing significant financial challenges and the Crown had provided nearly $90 million in support to ensure the sector remained viable,” she said, adding this was unsustainable.

Tinetti said Te Pūkenga was responsible for its own operational decisions, including spend on legal services.

The Auditor-General, which audits its accounts, also had the power to make comments about the appropriateness of spending, she said.

Te Pūkenga chief executive Peter Winder said via a written response that Bell Gully was an “all-of-Government provider” that was initially engaged by the Ministry of Education for the establishment of the New Zealand Institute of Skills and Technology.

It had provided “additional or specialist legal expertise” since April 2020. This included advice about setting up governance and regulatory policies and processes for council, and legal advice regarding organisation structures and the transfer of 24 organisations into one.