2012 Performance

Industry training organisations

Industry training organisations (ITOs) co-ordinate structured on- and off-the-job training for employees, enabling them to gain New Zealand Qualifications Framework (NZQF) qualifications while earning money. ITOs are owned by industries, are recognised by the Government and receive funding from both.

In 2012, the Tertiary Education Commission (TEC) funded 32 ITOs through the Industry Training Fund and Modern Apprenticeship scheme. As a result of mergers throughout the year, there were 20 funded ITOs at the close of 2012.

ITOs are formally recognised under the Industry Training Act 1992 and Education Act 1989, which provide for ITOs to be partially funded by the Crown via the TEC and Investment Plans. ITOs differ from other tertiary education organisations in that they do not deliver industry training themselves. Instead, they:

The Tertiary Education Strategy (TES) defines the core roles and expectations of ITOs as:

In 2012, ITOs received $136.4 million in government funding – 5 percent of its total spending on tertiary education organisations

Core roles Government expectations
  • Provide leadership in industry training needs
  • Design national qualifications and run moderation systems to ensure fair, valid and consistent assessment against national standards
  • Arrange for the delivery of industry training that enables trainees to attain these standards
  • Provide leadership to their industries on skill and training matters, identify current and future skill needs, and work with employers and employees to meet those needs
  • Work with industry to ensure that vocational learning meets industry needs
  • Enable working New Zealanders to complete nationally recognised qualifications
  • Create clear pathways towards advanced trade qualifications at Level 4 and above
  • ​Build and maintain strong support from the industries they serve

ITOs contribute to advancing the Government’s TES priorities by:

ITO highlights

ITO performanceTop

In 2012, the Government invested $136.4 million across the ITO sector to arrange training and apprenticeships across New Zealand. The number of industry trainees continued to decline in 2012. There was also a slight drop in credit achievement and programme completion, compared with the 2011 year.

Operating environment

The 2012 year was focused on consolidating and optimising the policy changes introduced in 2011 to improve the link between funding and performance, and maintaining the Government focus on strengthening and simplifying the sector with a series of mergers to create fewer and stronger ITOs.

The main challenges and factors influencing ITOs included:

Participation

The number of trainees participating in industry training in 2012 was 130,679 (42,074 standard training measures (STMs)), which was down against 2011 (see figure 54). The decrease in numbers was partially attributable to a lower uptake of training in line with lower employment rates.

Figure 54: ITO enrolments by trainees and STM, 2009–12
Figure 54: ITO enrolments by trainees and STM, 2009–12 Notes:
  1. All figures include Industry Training Fund and Modern Apprenticeship funded places.
  2. The 2011 industry training organisation results were the first to be produced using data from the Industry Training Register (ITR). Results from 2011 and 2012 are not strictly comparable to previous years, and, as such, all data before 2011 in the graphs has been greyed. More information on the impact of the ITR can be found on the Tertiary Education Commission website.

In 2012, the majority of ITO training was at Levels 3–4 (61%). While there was a decrease in trainees across all levels, the distribution of training by level remained similar to previous years (see figure 55).

Figure 55: ITO trainees by NZQF level, 2009–12
Figure 55: ITO trainees by NZQF level, 2009–12 Notes:
  1. All figures include Industry Training Fund and Modern Apprenticeship funded places.
  2. The 2011 industry training organisation results were the first to be produced using data from the Industry Training Register (ITR). Results from 2011 and 2012 are not strictly comparable to previous years, and, as such, all data before 2011 in the graphs has been greyed. More information on the impact of the ITR can be found on the Tertiary Education Commission website.

Participation by ethnicity fell slightly for Europeans but remained relatively steady for all other groups (see figure 56). Although the numbers of Māori and Pasifika trainees dropped slightly, in 2012 they continued to account for 17 percent and 7 percent of total ITO enrolments respectively.

Figure 56: ITO trainees by ethnicity, 2009–12
Figure 56: ITO trainees by ethnicity, 2009–12 Notes:
  1. All figures include Industry Training Fund and Modern Apprenticeship funded places.
  2. The 2011 industry training organisation results were the first to be produced using data from the Industry Training Register (ITR). Results from 2011 and 2012 are not strictly comparable to previous years, and, as such, all data before 2011 in the graphs has been greyed. More information on the impact of the ITR can be found on the Tertiary Education Commission website.
  3. From 2011, trainees can identify with up to three ethnicities and may be reported more than once across ethnicities.

Performance against TES priorities

The ITO sector has committed to improving trainees’ credit achievement and programme completion and, while youth achievement declined in 2012, Māori and Pasifika trainee achievement improved over the same period (see figure 57).

Figure 57: ITO participation and achievement, 2011 and 2012
Figure 57: ITO participation and achievement, 2011 and 2012 Note:
  1. All figures include Industry Training Fund and Modern Apprenticeship funded places.

TES Priority: Increasing the number of young people (aged under 25) achieving qualifications at Level 4 and above, particularly degrees

Trainees under 25 years of age accounted for 33 percent of total ITO enrolments in 2012. Youth achieved 65 percent for credit achievement and 61 percent for programme completion in 2012. While youth participation in industry training marginally increased as a proportion of all trainees in 2012, youth achievement in industry training dropped over the same period (see figure 58).

Figure 58: Participation and achievement by ITO trainees under 25 years, 2011 and 2012
Figure 58: Participation and achievement by ITO trainees under 25 years, 2011 and 2012 Note:
  1. All figures include Industry Training Fund and Modern Apprenticeship funded places.

In 2012, youth participation at Level 4 and above accounted for 16 percent of total youth in industry training (20,348 trainees). Achievement across this group was higher than for the overall youth cohort in industry training, with youth achievement at Level 4 and above at 75 percent for credit achievement and 76 percent for programme completion.

TES Priority: Increasing the number of Māori students enjoying success at higher levels

Māori continued to make up 17 percent of the ITO sector’s trainees in 2012. Māori educational performance improved compared with 2011: credit achievement increased from 62 percent in 2011 to 63 percent in 2012, and programme completion increased from 56 percent in 2011 to 57 percent in 2012 (see figure 59).

A small proportion of Māori trainees participated at Level 4 and above in industry training (5%; 6,822 trainees) in 2012 and this group demonstrated higher educational achievement than the overall Māori trainee cohort. Māori trainees achieved 70 percent credit achievement and 66 percent programme completion for Level 4 and above programmes.

Figure 59: Participation and achievement by Māori ITO trainees, 2011 and 2012
Figure 59: Participation and achievement by Māori ITO trainees, 2011 and 2012 Note:
  1. All figures include Industry Training Fund and Modern Apprenticeship funded places.

TES Priority: Increasing the number of Pasifika students achieving at higher levels

In 2012, educational performance by industry trainees improved for Māori and Pasifika trainees

Pasifika accounted for 7 percent of all industry trainees in 2012. Pasifika trainees’ educational performance improved in 2012, with 61 percent programme completion and an unchanged credit achievement rate of 60 percent (see figure 60).

A small proportion of Pasifika trainees engaged in Level 4 and above programmes in 2012. This group demonstrated strong educational performance, with 70 percent credit achievement and 76 percent programme completion across Level 4 and above programmes.

Figure 60: Participation and achievement by Pasifika ITO trainees, 2011 and 2012
Figure 60: Participation and achievement by Pasifika ITO trainees, 2011 and 2012 Note:
  1. All figures include Industry Training Fund and Modern Apprenticeship funded places.

Financial performanceTop

Industry contributed $87.4 million – 41.3 percent of total ITO funding – towards training arranged by ITOs in 2012

The industry cash contribution rate is a measure of the extent to which employers and industry value the training that ITOs arrange. In 2012, industry support rose to $87.4 million or 41.3 percent of total ITO funding, an increase of about 2 percentage points compared with 2011. This was above the 30 percent target rate.

The TEC allocated $136.4 million in government funding to ITOs in 2012. The majority went to Teaching and Learning ($134.6 million) and the remainder to Capability ($1.8 million) (see figure 61).

Figure 61: Total ITO government funding by type, 2012
Figure 61: Total ITO government funding by type, 2012

Future focus for ITOsTop

The focus in 2013 is on preparing for the implementation, from 2014, of the results from the review of industry training. This includes ensuring apprenticeship programmes are aligned with the New Zealand Apprenticeship, which redefines the content of an apprenticeship programme and removes the age restriction of the current Modern Apprenticeships scheme. An ‘apprenticeship reboot subsidy’ to encourage uptake of apprenticeships came into effect in March 2013 and is payable to the first 10,000 apprentices to sign up and their employers. The sector will also be considering the potential impact on ITO business of an ‘employer direct access pilot’.

Further ITO mergers will continue to strengthen and consolidate the sector to provide a strong platform for increased industry and cross-tertiary collaborations.