The troubled vocational education organisation, Te Pūkenga, is cutting $8 million from its head office costs.
Photo: supplied
The institute is trying to avoid a forecast deficit of $110m.
Te Pūkenga is taking over the 16 polytechnics and most industry training organisations from the start of next year.
But it is running late with plans for how that will work and is under orders to cut costs.
The institute says it has identified savings totalling $8m so far and its council will consider a new financial forecast in the next few weeks.
It says it will start consultation with staff later this month on its operating model.
The institute said its chief executive, Stephen Town, was still on leave and it would continue to monitor that with him.
Education Minister Chris Hipkins earlier this week rejected criticism about the new model telling the Otago Daily Times that although the old system had strengths and weaknesses, it had not delivered the skilled workers that employers and businesses were crying out for.