Hostel running costs
Hostel ownership
Under the Education Act 1989 (New Zealand Legislation website) , a hostel is “a boarding establishment used mainly or solely for the accommodation of students enrolled at a registered school”. Most hostels were established many years ago.
If your school has a hostel, it is beneficially owned by the school’s board of trustees. This means you are entitled to all the benefits and responsibilities of ownership. These benefits include collecting and using the boarding fees. It also means you are responsible for all the operational, maintenance and capital costs.
Paying for the running of a school hostel
Hostels are self-funding. You must be able to pay the running costs, including its upkeep, from boarding fees or other board funds. The Ministry doesn’t provide any operating, maintenance or capital funding for hostels. This means that you cannot pay for your hostel’s maintenance costs using your school’s Property Maintenance Grant (PMG) funding or 5 Year Agreement (5YA) funding.
You must set hostel fees at a level that will cover all operating, maintenance and modernisation costs including:
- depreciation of buildings
- furniture and equipment
- long- and short-term maintenance
- capital upgrades, like roof replacement
- insurance premiums (even if the building is Ministry owned)
- heat, light and water
- fixing damage due to vandalism
- local council service charges.
Financial accounting for your school hostel
Our requirements for school property management and financial reporting do not apply to hostels. However, you still must record all revenue and expenditure directly related to hostels in the correct section of your annual accounts. These must show the income and expenses separately to identify the actual hostel operating costs.
For accounting advice, go to chapter 4 of the Financial Information for Schools Handbook .
If you have any questions or concerns, contact your regional financial advisor .
Funding a new hostel
If you wish to build a hostel, you must:
- pay for it using board funding, such as grants and fundraising, and
- get Ministry approval to go ahead with it.
For more information, go to Board funding to find out about the sources of board funding and how to seek Ministry approval to use it to pay for non-Ministry funded projects.
You may be able to borrow money to build the hostel but there are restrictions on boards’ borrowing. See Chapter 3.3: Financial Systems and Internal Control’ – part one of the Financial Information for Schools Handbook on board borrowing generally.
Designing and building a school hostel
The Ministry does not have any specific design requirements for hostels, such as size or standards for accommodation. However, the hostel design must comply with all statutory and regulatory requirements, like the Building Code and the Education (Hostels) Regulations 2005.