New Zealand Moves to Disband Centralised Vocational Education System

Vocational Education and Training Minister Penny Simmonds hailed the development as a major milestone toward building a more responsive, regionally empowered education system that aligns better with workforce and community needs.

New Zealand has embarked on a transformative journey to overhaul its vocational education and training (VET) system, with the Education and Training (Vocational Education and Training System) Amendment Bill passing its first reading in Parliament. Vocational Education and Training Minister Penny Simmonds hailed the development as a major milestone toward building a more responsive, regionally empowered education system that aligns better with workforce and community needs.

“This is a commonsense reset that ensures polytechnic education and training is responsive to regional needs and work-based learning for apprentices and trainees is led by the industries that rely on it,” Minister Simmonds stated.

From Centralisation to Regional Autonomy

The legislation marks a clear departure from the centralised model established under the previous Labour government’s initiative, Te Pūkenga — a mega-entity created to unify New Zealand’s 16 polytechnics and institutes of technology under one national umbrella.

Under the proposed reforms, Te Pūkenga will be disbanded and replaced by a decentralised structure, returning governance and operational control to a network of regional polytechnics. These institutions will either function as fully independent entities or collaborate within a federation model, offering flexibility based on local needs and capacity.

Te Pūkenga will continue to operate for a transitional period of one year, primarily to manage the redistribution of unallocated educational programmes and activities during the system reset.

Industry to Lead in Standard Setting and Workforce Planning

Another major shift proposed by the Bill involves replacing Workforce Development Councils (WDCs) with new Industry Skills Boards. Starting 1 January 2026, these new statutory bodies — led primarily by industry representatives — will take over key functions such as:

• Setting training standards and qualifications

• Undertaking comprehensive workforce planning

• Advising the Tertiary Education Commission on sector-specific funding needs

• Assuming responsibility for work-based learning across different providers

The transfer of work-based learning responsibilities from Te Pūkenga to the Industry Skills Boards will take place over a two-year transitional period. This gradual shift will allow time for polytechnics, private training establishments, and Wānanga to develop new collaborative arrangements that ensure continuity and quality in vocational training.

Furthermore, amendments to the training levy framework will allow these Boards to levy their respective industry members, contingent upon securing adequate industry support.

A Two-Year Roadmap to Full Implementation

The full rollout of the new vocational education framework is expected to take up to two years. The first wave of regional polytechnics and Industry Skills Boards will be operational from the beginning of 2026.

Minister Simmonds underscored the importance of putting industries back in charge of skills development, saying, “Industry knows the skills it needs. That’s why we’re putting them back in charge of standard setting and qualification development for their industry.”

She added that the proposed model is designed to ensure that education and training are aligned with real-world labour market demands, setting New Zealanders and the economy up for future resilience and success.

Public Consultation to Shape Final Framework

With the Bill now moving into the select committee phase, the government is encouraging public feedback to refine the proposed changes. Stakeholders including educators, employers, learners, and community leaders will have the opportunity to provide input on the structural reset.

“We look forward to hearing what New Zealanders think during the select committee process so that we can get on with the changes,” said Simmonds.

Implications for Students and Employers

The government anticipates that decentralisation will allow vocational institutions to tailor their offerings to regional labour demands, leading to improved outcomes for learners and better talent pipelines for employers. The integration of industry leadership into education design and delivery is expected to reduce skills mismatches and create a more dynamic, future-ready workforce.

As New Zealand proceeds with this significant education reform, all eyes will be on how successfully the transition is managed — and how effectively it serves the diverse needs of regional communities and industries across the country.