2450 NEW ZEALAND GAZETTE, No. 93 23 AUGUST 2007

Annual Fee Movement Limit (AFML)

5. Fee movements in 2008 at a course level are limited to 5% for certificate, diploma, degree-level and short award courses
   that receive student achievement component funding.

6. If the application of the annual fee movement limit (AFML) on fee and course costs allows for an increase above the
   relevant maxima in 2008, then the provider can only increase up to the level of the maxima.

Low or Zero Fee Courses

7. If the fee and course costs for a course are less than $444.44 (GST excl.) per equivalent full-time student (EFTS) in 2007,
   then for 2008, the provider can increase the fee to up to $444.44 (GST excl.) per EFTS, or can increase the fee for the
   course by 5%, whichever is the greater.

Postgraduate Qualifications and Courses

8. Postgraduate courses are excluded from the fee and course costs maxima.

9. Postgraduate fee and course costs can be increased by $444.44 (GST excl.) per EFTS in 2008.

10. Professional masters programmes (eg MBAs) are exempt from the postgraduate fee increase limit, and are not subject to
    any limit on fee increases.

Exemptions for Exceptional Circumstances

11. Only TEIs may apply, on the basis of exceptional circumstances, for exemptions in 2008 from the AFML of 5%, to allow
    for up to an additional 5%. An AFML exemption may allow fees to increase over the relevant fee and course costs maxima.
    In subsequent years, these fees will be subject to the policy for fees over the maxima.

12. TEIs and PTEs may apply, on the basis of exceptional circumstances, for exemptions in 2008 to:

    (a) the restriction on increasing fee and course costs to the level of the fee and course cost maxima; and
    (b) the limit on postgraduate fee increases.

13. In considering “exceptional circumstances” exemptions, the TEC will use the following principles:

    (a) The cost of providing the course(s) is not being met by the income from the course(s);
    (b) the organisation is unable to cross-subsidise the course(s) from its total financial surplus while remaining financially
    viable; and
    (c) not increasing fees and course costs would compromise progress towards the achievement of the Tertiary Education
    Strategy 2007/12, the Statement of Tertiary Education Priorities 2008/10, or other critical elements of the tertiary
    reforms.

14. An application for exemption will be assessed for the overall balance of the principles above. It is not sufficient to satisfy
    one principle, but it is not necessary to satisfy all principles to gain an exemption.

Sanctions

15. Where the TEC finds that a tertiary education provider is not complying with the conditions set out in this notice, it can
    withdraw student achievement component funding for that course. This sanction will only be exercised as a final resort, and
    the TEC will work with the provider to rectify any non-compliance in the first instance.

Note: Effect of this Notice

These notes do not form part of this notice, but are intended to indicate its general effect.

A. Section 159ZA(2) of the Education Act 1989 (“the Act”) provides that the Minister, when determining the design of a
funding mechanism, may specify the conditions that the TEC must attach to funding provided under the mechanism,
including conditions that limit the fees that an organisation may charge domestic students.

B. Under section 159ZA(6) of the Act, the Minister may not specify conditions setting limits on fees until two months after the
date of publication of a notice in the New Zealand Gazette that:

(i) states that the Minister proposes to specify such conditions; and
(ii) sets out the proposed conditions; and
(iii) invites submissions on the proposed conditions; and
(iv) specifies the date by which submissions must be received, which must be a date no more than 21 days after the date of

the New Zealand Gazette notice.

C. The conditions setting limits on fees subsequently specified by the Minister in accordance with section 159ZA(2) of the Act
will be attached as conditions on the use of funding payable by the Tertiary Education Commission to an organisation
under sections 159ZC and 159ZD of the Act.

D. Under sections 227(1A) and 236C of the Act, TEIs and PTEs respectively must not charge domestic students a fee which
exceeds the maximum specified as a condition on funding by the TEC under sections 159ZC and 159ZD of the Act.

Notice of Direction to Appoint a Limited Statutory Manager for the Board of Trustees of Longford Intermediate School (3979)

Pursuant to section 78M of the Education Act 1989, I direct
the Secretary for Education to appoint a limited statutory
manager for the Longford Intermediate School Board
of Trustees because of the risks to the operation of the
school and the educational performance of the students at
the school.

The following functions, powers and duties of the board are
to be vested in a limited statutory manager:

• All functions, powers and duties of the board as an
  employer (whether statutory or otherwise).

A limited statutory manager must also advise the board on
the following:

• Consolidating all new and improved systems into board
  management practice.

This notice takes effect the day after the date of publication.
Dated at Wellington this 20th day of August 2007.

STEVE MAHAREY, Minister of Education.