The role of subnational governments in adult skills systems: New Zealand

This country note provides an overview of the governance of the adult skills system in New Zealand. It is part of an extensive review of all 38 OECD countries. The main findings across all countries are summarised in the OECD policy paper The Role of Subnational Governments in Adult Skills Systems. Representatives from the Luxembourg Government reviewed the country note in February 2025 and published it in June 2025.

Table 1. Overall governance and expenditure structure

Governance structure	Levels of governance	% of general government expenditure at the sub-national level
Unitary	National: State Regional: Regional councils (11) Local: Territorial authorities (67)	10.3%
How is the adult skills system governed?
Centralised ✓	Combined system	Decentralised

Note: For more information on the definitions of the governance models, please see (OECD, 2025[1]).

Source: (OECD/UCLG, 2022[2])

How is the adult skills system governed?

The adult skills system in New Zealand is relatively centralised. The national government sets the overarching legislative framework and allocates funding through ministries and agencies. Implementation and delivery happens across the national, regional and local levels.

• Since 2020, implementation of Vocational Education and Training (VET)1 policies has been the responsibility of the national network of Te Pūkenga - New Zealand Institute of Skills and Technology combined with private providers. The VET system is now undergoing substantial reform, with a new model expected to come into effect from 1 January 2026. This is the second substantial reform in 5 years, with the current system only fully operational since January 2023. As part of the reform, Te Pūkenga - New Zealand Institute of Skills and Technology, which consolidates the country’s 16 Institutes of Technology and Polytechnics (ITPs) into a single entity, is to be disestablished, and the ITPs will be established as autonomous entities. The reform will also result in the disestablishment of Workforce Development Councils and Centres of Vocational Excellence as well as the establishment of Industry Skills Boards, changes in the funding of the VET system, and mechanisms aimed at creating a more industry-led system for standards-setting and industry training. While responsibilities for strategies, intelligence and funding of VET remain at the national level, the reform also aims to strengthen regional decision-making in VET provision.

• Adult community education (ACE) covers Continuing Education and Training (CET) and adult education (AE). ACE is delivered locally by various providers (e.g., community-based organisations, tertiary institutions, and private training providers). These can be broadly split into those that receive funding from the national government through the Tertiary Education Commission (Te Amorangi Mātauranga Matua) and non-government-funded provision.

• Active Labour Market Policies (ALMPs) are managed, funded and/or delivered across various government agencies. However, the Ministry of Social Development (Te Manatū Whakahiato Ora) is responsible for the majority. The Ministry also operates the Public Employment Service (PES) (Work and Income New Zealand) through a network of regional offices and localised centres.

Table 2. Allocation of responsibilities across policy areas and levels of government

		Strategy	Intelligence	Implementation	Funding	Delivery
Policy area	National level
	VET	✓	✓	✓	✓	✓
	AE/CET (ACE)	✓	✓	✓	✓	✓
	ALMP	✓	✓	✓	✓	✓
	Regional level
	VET	-	-	-	-	-
	AE/CET (ACE)	-	-	-	-	-
	ALMP	-	-	-	-	-
	Local level
	VET	-	-	-	-	-
	AE/CET (ACE)	-	-	-	-	-
	ALMP	-	-	-	-	-

Legend: ✓ = Yes; - = No

Note: In New Zealand, adult education and Continued Education and Training are called Adult and Community Education (ACE). For more information on exact definitions of policy areas and responsibilities, please see (OECD, 2025[1]).

Infographic 1. Overview of the adult skills system

Note: Colour code: Dark blue → government/national/subnational agencies, Green → social partners, Lighter blue → private actors and education providers, Yellow → Expert councils/foundations/associations/research institutions. For more information, please see (OECD, 2025[1])

Source: OECD compilation based on available information.

Stakeholders and responsibilities at the national level

The national government has the strategic and legislative decision-making power and funding responsibility across policy areas. A range of actors design and support policy-making at the national level:

• For VET and ACE (covering CET and AE), the Ministry of Education is responsible for setting the strategic and legislative framework and the general funding mechanisms, which are partly managed and allocated to VET and ACE providers by the Tertiary Education Commission. Six Workforce Development Councils represent New Zealand’s industries and regions while performing four statutory functions: 1) skills and workforce leadership, 2) developing and setting standards, capstone assessments and qualifications, 3) endorsing programmes and moderating assessment and 4) advising the Tertiary Education Commission on its overall mix of investment. In addition, two Centres of Vocational Excellence (focused on the food, fibre, and construction sectors) are responsible for driving innovation in the VET system and providing training support for employers to improve their in-house skills-building capacity. The Workforce Development Councils and Centres of Vocational Excellence are being disestablished with the ongoing reform.

• The Ministry of Business, Innovation and Employment sets the general priorities and regulations for employment, industry and migration policy but does not play an active role in the education system. It focuses on improving employment outcomes, promoting long-term employment opportunities and enabling economic growth and productivity.

• The New Zealand Qualifications Authority (Mana Tohu Mātauranga o Aotearoa) approves VET and ACE providers and manages the national Qualifications and Credentials Framework.

• The ongoing reform of the VET system will result in a redesign of the Te Pūkenga —New Zealand Institute of Skills and Technology, a network of public providers. The current network will be redesigned to establish a more agile network of institutes of technology and polytechnics focused on core delivery, either as standalone entities or as members of a federation. The government is also currently consulting on the future of work-based learning, such as apprenticeships.

• The Ministry of Social Development is the primary agency responsible for the legislative framework and design of ALMPs and for running the regional and local branches of the PES in the field. Other government agencies also provide or administer ALMPs at national, regional and local levels.

Table 3. Stakeholders and responsibilities at the national level

Name of institution	Responsibilities					Organisation type	Areas	Description
	Strategy	Intelligence	Implementation	Funding	Delivery
Ministry of Education (Te Tāhuhu o te Mātauranga)	✓	✓	-	✓	-	Ministry	VET ACE	The Ministry of Education oversees the entire education system, including VET and AE. It is responsible for setting the legislative framework for tertiary education, including VET, and leads the ongoing reform of the VET system. It is also responsible for approving budgets for ACE, which are allocated to providers by the Tertiary Education Commission.
Ministry of Business, Innovation and Employment (Hīkina Whakatutuki)	✓	✓	-	✓	-	Ministry	ACE	The Ministry of Business, Innovation and Employment is responsible for developing policies and strategic advice about the labour market, including identifying re- and upskilling opportunities for employers and employees and fostering workforce planning. MBIE also focuses on skills mismatches and shortages in emerging sectors (e.g. AI, cyber security and data science). MBIE has traditionally been a leader of ALMPs and still owns some, including Te Ara Mahi Māori (the Māori Employment Action Plan) and Alo Vaka: the Auckland Pacific Skills Shift. MBIE also monitors labour market trends and forecasts future directions. In 2024, MBIE was responsible for leading the development of the current Government’s Employment Action Plan, which sets out challenges and trends in the labour market and outlines the Government’s vision to support people into work and lift the economy. This plan highlights the current key actions being taken across government agencies. Through its Sector Workforce Engagement Programme (SWEP) team, MBIE also works in partnership with select industries to address their labour market needs, assisting in the development of strategies to address skills shortages
Ministry of Social Development (e Manatū Whakahiato Ora)	✓	✓	-	✓	-	Ministry	ALMP	The Ministry operates the PES and is the primary agency responsible for designing and delivering ALMPs. This includes responsibility for a range of job placement and employment services, training and upskilling programmes, wage subsidies, and incentives. The Ministry publishes statistics and reports on ALMPs and their impact on implementation.
Tertiary Education Commission (Te Amorangi Mātauranga Matua)	-	✓	✓	✓	-	National agency	VET ACE	The Tertiary Education Commission (TEC) allocates national government funding to VET and ACE providers. The Commission is also responsible for monitoring the financial performance of institutions and Workforce Development Councils. TEC is also responsible for providing a publicly available careers information service, facilitating and strengthening connections between schools, employers, and tertiary education, and leading and co-ordinating the National Careers System Strategy (NCSS) implementation. The Commission is responsible for providing intelligence and advice to the Minister of Education.
Work and Income (Te Hiranga Tangata)	-	✓	✓	✓	✓	National agency	ALMP	Work and Income New Zealand is the PES operated by the Ministry of Social Development. It operates through a network of service centres across the country. The national PES oversees strategic planning and ensures alignment with government priorities in ALMPs, while the regional and local offices are responsible for direct delivery.
New Zealand Qualifications Authority (Te Mana Tohu Mātauranga o Aotearo)	-	✓	✓	-	-	National agency	VET ACE	The agency holds several responsibilities related to quality checks on the performance of VET institutions and all tertiary education institutions, except universities. The agency is also responsible for managing the national Qualifications Framework. Furthermore, it approves VET programmes, e.g. programmes leading to industry qualifications. It provides quality assurance of non-university education providers, qualifications recognition, and standard-setting in general.
Workforce Development Councils	-	✓	✓	-	-	Expert council	VET	The six councils, representing different industries, are responsible for setting standards, developing qualifications, and helping shape the VET curriculum to align skills and workforce development with industry needs. They primarily engage with industry to effectively give a voice to their concerns, but also with the Centres of Vocational Excellence, the Ministry of Education, advocacy groups, learners, and other groups in this process. They provide advice to the Tertiary Education Commission that informs about investment priorities. These entities are being disestablished as part of a broader VET reform.
Centres of Vocational Excellence	-	✓	-	-	-	Expert council	VET	As of December 2024, two centres have been established to drive innovation, development, and excellence in vocational education. Members of the centres are appointed by the Tertiary Education Commission, and work closely with the Workforce Development Councils and with VET providers to ensure education provision aligns with industry needs. The centres are part of a structure under the Te Pūkenga.
Te Pūkenga - New Zealand Institute of Skills and Technology	-	-	✓	-	✓	Education provider	VET ACE	A national education body, structured as a network consisting of all of the country’s 16 Institutes of Technology and Polytechnics and 9 of the previous Industry Training Organisations. The network offers a wide range of programmes, covering qualifications in VET and ACE. The network is currently being reformed. As at 2024 this network of regionally accessible providers is one institution. A priority of this group’s VET offer is apprenticeships and on-the-job training. They are funded by the government and by industry (by way of work-based learning), and cover education and training from introductory studies to degrees. Courses cover qualifications ranging from certificates, and diplomas to degrees, and postgraduate qualifications

Legend: ✓ = Yes; - = No

Source: OECD compilation based on (Ministry of Business, Innovation & Employment, 2024[3]), (Ministry of Education, 2024[4]), (Tertiary Education Commission, 2023[5]; 2024[6]; 2024[7]; 2024[8]; 2024[9]),

Stakeholders and responsibilities at the regional level

The regional government is comprised of 11 regional councils, which do not hold any formal responsibilities in the adult skills system. Other stakeholders at the regional level include:

• Regional Leadership Groups (RSLGs) were established in 2021 to provide advice and intelligence on ongoing labour market changes and ways to meet future skills needs.

• Private Training Establishments, which provide VET programmes for students, and some offer work-based learning, including apprenticeships. They can apply for national funding through the Tertiary Education Commission, although only about half of the providers operate on government funding.

• Wānanga are educational institutions separate from Te Pūkenga. They provide both higher learning (in the same way as universities) and VET using tikanga Māori ways of teaching and learning, contributing to the survival and well-being of Māori as a people. There are three wānanga recognised under the Education and Training Act 2020: Te Wānanga o Raukawa, Te Wānanga o Aotearoa, and Te Whare Wānanga o Awanuiārangi.

• With the reform of the VET systems, the Polytechnics will become regional institutions.

• Work and Income New Zealand Regional Offices deliver ALMPs in larger regional offices, including opportunities for up- and reskilling for job seekers and employed people

• Jobs and Skills Hubs operate as one-stop shops for recruitment, matching employers with people with the right skills and providing short-term courses for skills for specific industries. While the Ministry of Social Development plays a significant role in funding and operating these hubs, they operate under a collaborative model that emphasises partnerships with local employers and industry stakeholders to tailor services to local needs.

Table 4. Stakeholders and responsibilities at the regional level

Name of institution	Responsibilities					Organisation type	Areas	Description
	Strategy	Intelligence	Implementation	Funding	Delivery
Regional councils (Kaunihera ā-Rohe)	-	-	-	-	-	Subnational government		The regional government is made up of 11 regional councils that do not hold any substantial responsibilities in the adult skills system. The regional government may collaborate with local bodies or the national government to support nationally driven implementation of policies tailored to regional and local needs.
Regional Skills Leadership Groups (RSLGs)		✓				Expert councils	VET HVET CET AE ALMP	The government established these groups in 2021 to actively support the country’s evolving labour markets. Their primary role is advisory, which focuses on identifying and supporting better ways to meet future skills and workforce needs within their regions. They are composed of representatives from local industries, economic development agencies, iwi (Māori tribes) and community organisations. They are responsible for creating Regional Workforce Plans and analysing labour market trends to provide recommendations to regional and national stakeholders. The groups may be changed as part of ongoing reforms.
Work and Income New Zealand Regional Offices	-	✓	-	-	✓	National agency	ALMP	Regional PES offices that deliver ALMPs in some regional areas. In addition, related labour market monitoring is undertaken and/or informed at the regional level.
Private training establishements (Ngā whare whakangungu Motuhake)	-	-	-	-	✓	Education provider	VET	There are over 400 private VET providers in New Zealand. They can apply for funding from the Tertiary Education Commission and must be recognised by the New Zealand Qualifications Authority. They can be a privately owned or publicly listed company, a trust, or another entity providing education and training at the post-compulsory levels. These providers have an industry focus and cover, e.g. institutes, universities, and colleges. Only about half of the establishments receive Government funding.
Jobs and Skills Hubs	-	-	-	-	✓	Skills and employment provider	VET	The Hubs are established between the regional and local levels as one-stop shops for recruitment, training and upskilling in, e.g. construction and infrastructure. They aim to find people with the right skills at the right time. The Hubs coordinate training offers and provide opportunities in centres for upskilling, e.g. short skills development courses for specific industry sectors. The Hubs are a function of the Ministry of Social Development. While the Ministry is significant in funding and operating the hubs, the model emphasises partnerships with local employers and industry stakeholders.
					✓	Education provider	VET ACE	Wānanga are educational institutions separate from Te Pūkenga. They provide both higher learning (in the same way as universities) and VET using tikanga Māori ways of teaching and learning, contributing to the survival and well-being of Māori as a people. There are three wānanga recognised under the Education and Training Act 2020: Te Wānanga o Raukawa, Te Wānanga o Aotearoa, and Te Whare Wānanga o Awanuiārangi.

Legend: ✓ = Yes; - = No

Source: OECD compilation based on (Tertiary Education Commission, 2021[10]; 2023[11]), (skills Consulting Group, 2022[12]), (Competenz, 2024[13]), (Work and Income, 2024[14])

Stakeholders and responsibilities at the local level

67 territorial authorities (district and city councils and six unitary councils with regional council responsibilities) constitute the local governmental level, which has no formal responsibilities in the adult skills system. The territorial authorities may be indirectly involved in the skills system, e.g. through participation in local programmes funded by the national government. In addition to the territorial authorities, the following actors operate at the local level:

• ACE is offered at the local level as adult and community education by various providers. These providers can be broadly split into those who receive national government funding and those who do not. In New Zealand, a range of organisations provide ACE training. These include secondary schools, Private Training Establishments, Community Education Providers, Rural Education Activities Programme (13 organisations around New Zealand) and other large organisations such as English Language Partners and Literacy Aotearoa. No universities offer non-formal Adult Learning and Education.

• The majority of employment-focused programmes are delivered locally by the Work and Income New Zealand Service centres operated by the Ministry of Social Development. Other agencies and local partners also deliver ALMPs.

Table 5. Stakeholders and responsibilities at the local level

Name of institution	Responsibilities					Organisation type	Areas	Description
	Strategy	Intelligence	Implementation	Funding	Delivery
Territorial authorities (Kaunihera ā-Takiwā)	-	-	-	-	-	Subnational government		The local government may participate in different local skills programs overseen by the national government.
Work and Income service centres	-	-	-	-	✓	National agency	ALMP ACE	The Ministry of Social Development operates a network of around 180 office locations, including 122 Service Centres in towns and cities nationwide. These service centres deliver the PES and ALMPs.
National government funded adult and community education	-	-	-	-	✓	Education provider	ACE	To apply and receive government funding (operationalised by the Tertiary Education Commission), providers must ensure that the courses can be identified in the NZQCF, are required to provide reporting data to the funder (Tertiary Education Commission) on several course completions and attendance, and align with the Tertiary Education Strategy. As a result of receiving national government funding, there is an expectation that learners will have access to ACE at low or no cost.
Non-government funded adult and community education	-	✓	✓	-	✓	Education provider	ACE	Non-government-funded providers and providers receiving funding from different sources can deliver a vast range of other ACE-based programmes in response to community demand, interest and need. Despite commonalities in delivery, the ACE-provider landscape is highly diverse and shows a sector catering to learners from diverse demographics, backgrounds and circumstances and with diverse learning needs.

Legend: ✓ = Yes; - = No

Source: OECD compilation based on (Local Government New Zealand (LGNZ), 2024[15]), (Otago Polytechnic, 2024[16]), (Skillsec, 2024[17]), (Tertiary Education Commission, 2024[6])

References

[18] (n.a.) (n.d.), .

[13] Competenz (2024), Reskill, upskill or new skills?, Te Pūkenga – New Zealand Institute of Skills and Technology, https://www.competenz.org.nz/employers.

[15] Local Government New Zealand (LGNZ) (2024), Local employment programme exceeds target fourth year running, https://www.lgnz.co.nz/news/media-releases/local-employment-programme-exceeds-target-fourth-year-running/.

[3] Ministry of Business, Innovation & Employment (2024), Focus area: Enhancing the skills and talent pipeline, https://www.mbie.govt.nz/business-and-employment/economic-development/digital-policy/digital-technologies-industry-transformation-plan-2/focus-area-enhancing-the-skills-and-talent-pipeline.

[4] Ministry of Education (2024), 2024 Vocational education and training reforms, https://www.education.govt.nz/have-your-say/2024-vocational-education-and-training-reforms/details.

[1] OECD (2025), “From national to local: Exploring the role of subnational governments in adult skills systems across OECD countries”, OECD Local Economic and Employment Development (LEED) Papers, No. 2025/XX, OECD Publishing, Paris.

[2] OECD/UCLG (2022), 2022 Country Profiles of the World Observatory on Subnational Government Finance and Investment., https://www.sng-wofi.org/country-profiles/new_zealand.html.

[16] Otago Polytechnic (2024), Mosgiel Community Learning Centre, https://www.op.ac.nz/services/community-learning.

[12] skills Consulting Group (2022), New Zealand’s vocational education system, https://skillsconsultinggroup.com/wp-content/uploads/NZ-Education-System-Overview-August-2022_v2.pdf.

[17] Skillsec (2024), Reskill : A pathway to support you into employment or further education, https://skillsec.co.nz/reskill.

[11] Tertiary Educaiton Commission (2023), Private training establishments (PTEs), https://www.tec.govt.nz/vocational-education/vocational-education/delivering-vocational-education/private-training-establishments.

[6] Tertiary Education Commission (2024), Adult and Community Education, https://www.tec.govt.nz/funding/funding-and-performance/funding/fund-finder/ace.

[7] Tertiary Education Commission (2024), Adult and Community Education in Communities, https://www.tec.govt.nz/funding/funding-and-performance/funding/fund-finder/ace/ace-in-communities.

[8] Tertiary Education Commission (2024), Centres of Vocational Excellence (CoVEs), https://www.tec.govt.nz/vocational-education/vocational-education/strengthening-vocational-education/centres-of-vocational-excellence.

[9] Tertiary Education Commission (2024), Skills Highway – information for employers, https://www.tec.govt.nz/focus/our-focus/foundation-education/skills-highway.

[5] Tertiary Education Commission (2023), Workforce Development Councils (WDCs), https://www.tec.govt.nz/vocational-education/vocational-education/strengthening-vocational-education/workforce-development-councils-wdcs.

[10] Tertiary Education Commission (2021), Change of ownership, https://www.tec.govt.nz/teo/working-with-teos/ptes/change-of-ownership.

[14] Work and Income (2024), Extra support and training for job candidates, https://www.workandincome.govt.nz/employers/subsidies-training-and-other-help/index.html.

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Note

← 1.  New Zealand does not distinguish between Vocational Education and Training and Higher Vocational Education and Training. The Vocational Education and Training system is part of the tertiary/higher education system.