Payments and reporting

Payments and reporting

Last updated 9 June 2021
Last updated 9 June 2021

We make bulk payments to TEOs to cover the estimated cost of fees-free enrolments for each calendar year.

Funding allocation

How we calculated your 2021 allocation for the Fees Free Funding

This is a summary of how your indicative allocation was calculated. For more details regarding your specific allocation, please contact customerservice@tec.govt.nz or your Relationship Manager.

The information below details how we calculate the indicative allocations for Fees Free Funding for each type of TEO. You will be notified of your final 2021 Fees Free allocation at the time we provide you with a 2021 Fees Free contract.

We considered an approach to Fees-Free allocations which is based on 2019 actuals and/or 2020 allocation, similar to allocation methodologies used for on-plan funds (i.e. SAC3+).  However, doing so for 2021 would not take into account the impact of the following events:

  • the impact of the COVID non-recovery for 2020 Fees-Free, and the lack of in-year amendments. This would mean that the 2021 allocation could be higher, or lower, than the anticipated actual Fees-Free delivery
  • the impact on some providers of the introduction of the Targeted Training and Apprenticeship Fund (TTAF), meaning some fees previously paid by Fees-Free will now be paid by TTAF. Not adjusting for this would mean that we could over allocate for Fees Free payments for 2021, for these providers, and require adjustments and recoveries to right-size the allocation.

To determine the starting point for calculating your 2021 allocation we used your Fees-Free 2020 allocation.

We made the following adjustments to your 2021 starting allocation:

  • reduce the 2021 allocation by the value of the YTD 2020 estimated under-delivery (if any).[1] We will ring-fence the amount of the reduction to ensure money can be made available for in-year amendments to increase allocations should demand pick back up in 2021.
  • reduce the 2021 Fees-Free allocation by the value of reported delivery funded by the targeted training and apprenticeship fund (TTAF), as at July 2020, and multiplied by 2 to create a full year adjustment (as was established in July 2020).
  • increase the allocation, after the two reductions above, by 1.1% to reflect the Annual Maximum Fee Movement.

How we calculate allocations for transitional or new TEOs during the Reform of Vocational Education

Allocations for Te Pūkenga will be based on prior performance and funding data of its subsidiaries. Te Pūkenga allocations will be paid in four quarterly payments to Te Pūkenga.

How we will calculate allocations for new providers

Where you do not have a history of Fees Free enrolments in 2020, you will receive an initial zero Fees Free funding allocation, and 2021 payments will be made based on actual 2021 delivery volumes.

We do not allocate fees-free funding to transitional Industry Training Organisations (transitional ITOs)

Due to the nature of transitional ITO reporting and payments, we do not provide a Fees Free allocation for transitional ITOs. 2021 Fees Free payments will be made monthly based on validated Fees Free reporting data.

 

[1] Refer to the Fees-Free 2020 Recovery methodology to understand the value of funding recoverable in 2020.

Funding wash-ups

2020 Fees Free Wash-Up Methodology

We will write off and not be recovering any under-delivery of 2020 Fees Free funding approved prior to 1 April 2020 from Tertiary Education Organisations (TEOs).

Exceptions that will be recovered:

  • Additional Funding approved since 1 April 2020 if there is under-delivery.
  • Fees Free funding paid to Transitional Industry Training Organisations (TITOs) prior to 1 July 2020, for the delivery of Targeted Training and Apprenticeships Funding (TTAF) after 1 July 2020.

Payments, recoveries, and write offs are based on:

  • A TEO’s December 2020 ‘All Enrolments and Costs’ Report as at the date the data is captured (20 January 2021), after TEC validation and allocation rules have been applied.
  • TTAF learners fees paid by Fees Free based on fees reported in the FF06 and the Fees Free Refund Report.

How we will calculate any Recovery of Additional Funding

We will recover under-delivered Additional Funding approved since 1 April 2020, at the fund level.

  • We will calculate the difference between the dollar value of actual delivery and Fees Free funding.
  • Recovery will be not exceed the amount of Additional Funding approved.

How we will calculate any Recovery for TITO funding

We will:

  • determine the dollar value of Fees Free paid before 1 July 2020, in relation to delivery to trainees eligible for industry training based TTAF funding after 1 July 2020,
  • notify you of these values on Workspace 2,
  • remove the value from your 2020 actual Fees Free delivery, resulting in a Fees Free Recovery, and
  • set-off the Fees Free recovery value against your final TTAF wash-up.

The TTAF funding agreement states that we are not liable to pay fees on behalf of a student to the extent that their fees have been paid through the fees free tertiary education initiative. This means that where a learners fees had been paid by Fees Free based on fees reported in the FF06 prior to the introduction of TTAF, these fees are considered to have already been paid, and no further payment will be made by TTAF.

We will determine the amount of Fees Free already paid and notify you of these amounts via Workspace 2. This amount will then be deducted from your 2020 actual Fees Free Delivery, resulting in a Fees Free Recovery. We will set-off this Fees Free recovery against your Final TTAF wash-up.

How we will calculate any payment for over-delivery

We will pay if a TEO over-delivers:

  • If actual delivery is more than the TEO’s full-year Fees-Free allocation, we will pay the difference.
  • The balance paid may be recoverable at a later date if further wash-ups are performed as additional data becomes available.

How we will calculate any Recovery, for write off purposes

  • We will write off the dollar value of any Recovery that exceeds the value of Additional Funding approved since 1 April 2020.
  • Any write off excludes 2020 funding paid to TITOs prior to 1 July for learners subsequently funded by TTAF.

Write off adjustment for SAC funded TTAF learners

We will:

  • determine the dollar value of Fees Free paid prior to 1 July 2020, in relation to learners eligible for provider-based TTAF funding after 1 July 2020,
  • notify TEO’s of these values on Workspace 2,
  • remove the value from any Fees Free write off, and
  • remove the value from TEO’s 2020 actual TTAF delivery, resulting in a TTAF Recovery.

The TTAF funding agreement states that we are not liable to pay you fees on behalf of a student to the extent that their fees have been paid through the Fees Free tertiary education initiative. This means that where a learners fees had been paid by Fees Free based on fees reported in the FF06 prior to the introduction of TTAF, these fees are considered to have already been paid, and no further payment will be made by TTAF.

Fees-free payments reported in FF07 after validations for SAC funded TEOs

Validations and allocation rules are processed as follows:

  • TEOs submit Fees-free All Enrolment and Cost Report (FF06).
  • Validation of the FF06 report against validation checks, detailed in the validation guide, including:
    • eligible NSN
    • eligible Course
    • eligible Qualification
    • eligible Source of Funding
    • GST checks x 3
    • course EFTS factor check
    • CSSF check
    • eligible Date
    • STEO check
  • Validation report submitted to TEOs (FF42) detailing the validations against the FF06.
  • Reconciliation against the December 2020 SDR for valid enrolments.

Allocation report submitted to TEOs (Multi-enrol and Cap Limit Report, FF07) detailing by NSN the reported Fees, Allocated fees and messaging for any variance.

Reporting

How to check learners’ eligibility

On the Notices section of your Workspace 2 Home page, you'll find a notice called Lists of NSNs eligible for Fees Free study. This page lists the following three files which we use to tell you about the eligibility of learners:

  1. Fees-free eligibility
  2. Fees-free eligibility changes, and
  3. Checking the eligibility of specific NSNs.

Currently (for the 2020 calendar year), there are five status options: Y (yes), N (no), U (unknown), 8 (2018 Starter) and 9 (2019 Starter). For the 2021 calendar year’s fees-free eligibility we’ll also use a 2020 Starter status. 2020 Starter (0) will indicate learners who have consumed some or all of their fees-free entitlement in 2020.

Please note:

  • Each National Student Number (NSN) may have multiple records.
  • For the remainder of 2020, you should continue to use 2020 fees-free eligibility to identify those learners you should be including in your Fees Free All Enrolments and Costs returns.

We’ll continue to indicate to you (through the Fees-Free Multiple Providers and Cap Limit Report) which of these learners has fully consumed so you’ll be able to invoice them.

Reporting dates

See our business calendar for fees-free reporting dates.