School spending scrutinised

A news story about a report into school spending has brought public education spending into the media spotlight.  

On Sunday 8 May, the Sunday Star-Times published a story based on a report by the Office of the Auditor-General (OAG) looking into school spending. The unpublished report from the OAG apparently found “excessive” spending in some schools. OAG released limited instances of the expenses it audited to the Star-Times following “months of repeated requests”. 

Read the latest print edition of School News online HERE.

The report investigates 54 national instances of “sensitive” spending by principals, who did not have agreement from the Ministry of Education. The news story does not note that New Zealand has over 2500 primary and secondary schools.  

These instances reportedly included expenses for leaving parties, staff jackets, gifts and “perks” such as gym memberships and fitness classes and overseas travel.  

Many of these investigations concerned historical spending.

The Auditor-General apparently interrogated the “appropriateness… and lack of clarity” on how “professional development and wellbeing support” grants were being utilised. In 2022, $6.3 million was given to 524 schools, and in 2023 and 2024 principals could access grants of up to $6000. 

Auditors highlighted one case from Canterbury’s Tamariki School where $6000 was paid directly to the principal by the board, tagged for “professional coaching and wellbeing support.  

“It was therefore not possible to assess whether the funds have been spent in accordance with school policies… and the expectations for the use of public funds.” 

NZEI Te Riu Roa said that spending allowances for principals are to help stress and burnout for senior staff. Spokesperson Veronica Schmidt noted that these factors are crucial drivers of workforce attrition. 

“Right now, principals are under more stress than ever … trying to make squeezed operations budgets stretch to meet the needs of children with complex learning needs.” 

Taxpayers’ Union spokesperson Tory Relf called expenses like staff jackets “vanity spending” and claimed it was a “misuse of public money [that] deepens public disillusionment at a time when New Zealand is grappling with declining educational achievement.  

“Taxpayers fund schools with the clear expectation that every dollar will support students’ learning, not subsidise luxury perks for senior staff. 

“The Auditor-General’s latest report confirms what we’ve long warned: the Ministry of Education is asleep at the wheel.”  

The Ministry of Education responded by saying school fund spending is up to individual school boards.  

“All school boards are self-governing and report to their communities, so they must have suitable checks and balances so that funding is used appropriately,” said Sean Teddy, operations and integration lead. 

Minister for Education Erica Stanford said her expectation was that funding would “benefit learning outcomes for students”.  

But auditors said there was “poor controls” for approvals of expenses, especially on credit cards. In 23 schools principals approved their own credit card spend, and in 32 schools another staff member approved a principals’ spend. Nine schools did not have any documentation for spending approvals.

“Credit cards are susceptible to error and fraud or being used for inappropriate expenditure. Money is spent before any approval is given, which is outside the normal control procedures for spending public money,” the Auditor-General’s report says. 

The OAG also found a lack of oversight over schools paying funds to board members.  

Buckland School reportedly paid $77,569 to a board-chair-owned company for a roofing project in 2019. Blockhouse Bay Intermediate was also found to have contracted a board-chair owned company, spending $117,138 for “a deck area”.  

“Under the Education and Training Act 2020, members of the board are disqualified if the total payments made to them by the board exceed $25,000 in any year without the approval of the Secretary for Education,” said auditors.  

PPTA President Chris Abercrombie told Newstalk ZB that though some spending may be seen as “excessive” the reality is that schools are self-managing and so have a lot of discretion in the use of taxpayer funding.  

“There’ll definitely be some discussions… about expectations and about the rules. Some of these [instances] probably would’ve been within the rules.” 

On the specific scrutiny of the wellbeing fund, Abercrombie said that there was a lack of guidance when the fund was made available. 

“At the start there was very little guidance about the [wellbeing] fund, so effectively principals could do as they see fit. Then there was some guidance that came out later on.” 

President of the NZ Principals’ Federation Leanne Otene said that she found school boards and principals were generally “very mindful” of taxpayer funding.  

“I am aware, however, that following media attention, many principals sought further guidance from their unions on the appropriate use of the $6,000 [wellbeing] fund.” 

Otene said she believes financial governance courses should be mandatory. However, Otene says most schools are struggling with operating costs due to tight budgets.  

“Many school boards, including principals, are now facing the very real challenge of trying to balance the books while maintaining the quality of education their communities expect and deserve.”