A report released under the Official Information Act showed the Tertiary Education Commission approved of Otago Polytechnic’s plan to make savings of more than $10 million by the end of this year, but "declining equivalent fulltime students, coupled with increased personnel costs, had turned surpluses into deficits".
It said Otago Polytechnic’s average salary for teaching delivery was $96,000, compared to about $90,000 across the polytechnic network, while the shape of Otago’s staffing structure was markedly "top-heavy" with a higher proportion of senior staff.
"There is an opportunity to right-size both the size and shape of Otago Polytechnic’s workforce", the report said, although it noted Otago Polytechnic lost more "local capability" as part of the Te Pūkenga centralisation.
It said although 2025 was a "critical period for which Otago Polytechnic must maintain a resolute focus to be able to operate as a standalone entity", there was going to be an implementation period of "two to three years" for the overall "improvement plan".
Otago Polytechnic executive director Dr Megan Pōtiki said yesterday it would be embedding "solid business review practices".
"Annual evaluations will allow us to continue to look at how we are resourcing demand for training and education in our community.
"We have completed a series of reviews across our departments. As some of these are still in progress and are active periods of consultation, the privacy of our staff is essential as we work through appropriate processes, so we cannot comment further."
The report was compiled by consultancy firm Deloitte as part of the TEC’s government-mandated viability process, which took place in 2024 and earlier this year.
It was completed shortly before it was announced that Otago Polytechnic would be lumped into a federation model with Open Polytechnic and Universal College of Learning, rather than being a stand-alone entity.
Asked whether the federation model was necessary, Dr Pōtiki was diplomatic.
"If we achieve our financial recovery, which we are on track to do, we understand that if we do not need to access any shared services from the Federation, we may have the ability to move out of the federation at some point in the future."
Dr Pōtiki also acknowledged that the polytechnic did not hit the equivalent fulltime students (EFTS) target of about 5000 required in early 2025.
"Based on our progress, we are on track to achieve this."
The document has a target of 5100 EFTS for 2026, and Dr Pōtiki said the polytechnic was "currently trending positively".
Green MP Francisco Hernandez said the guidance made for grim reading.
"While Otago Polytech is apparently tracking on a pathway to viability, this has come at the expense of staffing and programming that the community relies on.
"Further, it’s been suggested there may be more cuts possibly to come."
Thriving, regional polytechnics required "real" investment, Mr Hernandez said.
"The fact remains, cuts like we’ve seen in Otago undermine the long-term viability of these critical institutions that communities like Dunedin rely on. "However, thanks to the government’s lack of support and absence of a clear plan for the sector, many polytechs like Otago have been forced to make these cuts."
There was still time for the minister to do right by Otago Polytech and other polytechs around the country.
"We must invest in our critical polytechs and work with — not against — communities for a solid plan for our polytechs and wider vocational education sector to thrive."
In Parliament on Tuesday, Vocational Education Minister Penny Simmonds said: "I think I’ve met with Otago more often than with any other polytechnic".
"I met with them first, as soon as we had appointed the Establishment Advisory Groups. They were the very first polytechnic to be met with, the day after we inducted those Establishment Advisory Group members. I was able to discuss with them the mechanism for if they achieve the changes that they are wanting to."
