Regional TAFE enrolments plummet after sector gutted

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Skills Australia (now the Australian Workforce and Productivity Agency) document ‘Skills for prosperity’ (2011) cited that: Public TAFE institutions and the adult and community education sector will continue to have an essential and catalytic role in social and economic development in regions and communities, a role that is not limited to training provision.

Part one: Regional TAFE enrolments plummet after sector gutted

From: Australian Education Union, 26 March 2015, http://bit.ly/1DMh91r

Cuts to Victoria’s TAFE funding system by the previous Coalition State government of $1.2 billion over the past four years have left Victoria’s TAFEs in disarray. The Department of Education and Training’s Training Market Report 2014 shows TAFE enrollments fell by 33 percent last year.

“This latest report confirms what we already know,” says AEU Victorian branch president Meredith Peace. “TAFE enrolments have plummeted because TAFEs have been chronically underfunded.”

In the Barwon South West region there was a 13% drop in TAFE enrolments in 2014, despite youth unemployment in the region sitting at 18%, above the state average of 16.5 per cent. In Gippsland and the Grampians regions, there was an 8% drop in TAFE enrolments.

“This report shows taxpayer supported vocational education and training enrolments in regional areas declined by 20% in 2014. Unfortunately, many young people who would have been attending TAFE are now blocked from accessing the pathway they need to get a job,” says Peace.

Regional economies in Victoria have been devastated as a result of the cuts to TAFE. Meanwhile, many private training providers have been rorting the system and making huge profits for delivering what is often sub-standard training.

Victoria’s funding system, where TAFEs and private providers must compete for funding, is a failure. Deregulation of the training sector has been a bonanza for unscrupulous private providers, at the expense of regional communities and the taxpayer.

The AEU says there is a direct link between TAFE cuts in regional areas and de-skilling of workers in our regional economies.

Students must have access to education and training to develop skills that will lead to real jobs. Instead, they are left owing hefty course fees, only to find that at the end of the course they have not received the quality education and training needed to gain employment,” says Peace.

The Victorian Government is currently conducting a review into vocational education and training funding. In its submission, AEU Victoria has recommended that at least 70% of vocational education and training funding be dedicated to the public TAFE system to ensure quality education and training in the state.

This review is a first step, but there is no easy fix,” Peace warns. “TAFEs have suffered such deep funding cuts that rebuilding will require a concerted, long-term commitment.

Part two: The Role of TAFE in Regional and Remote Australia

Extracts: The Role of TAFE in Regional and Remote Australia, TAFE Directors Australia, August 2004,  http://bit.ly/1dw7QMP

Regional Australia contributes significantly to the economic, social and cultural viability of the nation. The Minister for Transport and Regional Services, John Anderson, in his statement Stronger Regions, A Stronger Australia articulated the Australian Government’s commitment to “a strong and resilient regional Australia now and into the future – supporting community ideas, leadership and development.”

In addition, State and local governments throughout Australia are articulating regional renewal, regional development and sustainability policies advocating increasing engagement and collaboration to enable regional communities to maximise opportunities to participate in the new economy and benefit from Australia’s economic development. TAFE training is developing the skills base of regional and remote Australia, contributing to the development of viable industries and the creation of job opportunities.

The contribution made by TAFE to sustaining regional communities and providing opportunities to individuals for life long learning experiences cannot be overstated.

The Australian National Training Authority (ANTA) outlined its vision for the strengthening of communities and regions through education and training in its National Strategy for Vocational Education and Training, 2004-20102 , as:

“Communities and regions will be strengthened economically and socially through learning and employment. Integrated learning and employment solutions will support regional economic, social, cultural and environmental development and sustainability. Vocational education and training will stimulate interest in learning. It will strengthen the capacity of TAFE and other providers and brokers to partner with local government and nongovernment agencies, businesses and industry clusters. It will encourage local planning and innovation and help communities deal with change and take advantage of opportunities for growth.”

TAFE provides education and training programs that prepare people for work, and re-skilling for the changing workforce. The expectation is that this training will be responsive to local community and industry needs.

The effectiveness of TAFE training in preparing clients for the employment market is borne out by the statistics for graduates entering the workforce. National statistics indicate that in 2003, 74% of TAFE graduates were employed after their training. Of these, 42% had not been in a job prior to their training.

TAFE Institutes and TAFE Colleges occupy a unique role in terms of contributing to the development of Indigenous people and their communities through the provision of education and training. If ANTA’s strategic priority of increasing participation by Indigenous people in VET is to be realised, mechanisms for developing and supporting training including funding, availability of appropriate training products, support services and recognition policies need to be sufficient and flexible enough to reflect fundamental differences without marginalising Indigenous training.

Part three: The challenges

However, the ability of TAFE to respond to the training needs of regional communities has been steadily eroded by inadequate funding, insufficient training technology and infrastructure and difficulties in attracting and retaining the high calibre delivery staff necessary for quality training outcomes.

Regional and remote TAFE providers face significant challenges in trying to meet the expectations placed on them by communities, industries and enterprises. In many regional areas,

TAFE is the only significant provider and communities usually look to TAFE to provide a wide range of education and training options to meet perceived local needs and maximise opportunities for their young people. They are expected “to be all things to all people”.

TAFE’s diminishing capacity to meet these expectations will impact in very real ways on communities. The community’s expectation of TAFE is the most critical difference between metropolitan and regional TAFE. Metropolitan residents have a range of choices available to them; Institutes and Colleges can afford to specialise; clients have alternatives.

Few such alternatives exist for regional and remote clients. Regional and remote TAFE Institutes and Colleges face a number of impediments and difficulties in attempting to meet the challenges posed by community and industry expectations. The critical problem areas are:

1. Resourcing – the cost of delivery and adequacy of funding

2. Impact of unproductive competition

3. Adequacy of information and telecommunications infrastructure

4. Recruitment and retention of suitable staff

4 opportunities and support the services and broader social and cultural activities that encourage people to remain in regional areas.

TAFE Institutes and Colleges play a critical role in the educational, economic and social infrastructure of regional Australia. The TAFE system has a network of campuses covering the country. TAFE Institutes and Colleges are often the only provider of post compulsory and vocational education and training in a region.

The service they provide means that young people can undertake post compulsory education and training locally rather than relocating to metropolitan areas and undertaking further education without the benefits of a family support network.

In total, there are over 1,460 TAFE campuses throughout Australia, many located in small rural and regional communities. The university system by contrast has a much smaller network (about 100 campuses) and these are concentrated in the larger population centres. In many regional and remote areas partnerships exist between TAFE institutions and universities that facilitate the provision of face-to-face tertiary programs to regional communities.

TAFE Institutes and Colleges are not only the main provider of post compulsory education and training, but also play an important role in working with local government and business to help create and grow industries, as well as supporting the broader community.

There is an expectation that TAFE will provide for the “difficult to service” markets, where student numbers are low, delivery resources scarce and costs high. Training is needed for targeting local skills shortages and enabling skills development, re-skilling and training that lead to job outcomes locally. But TAFE’s ability to do this well is currently constrained by a difficult environment and insufficient funding.

Existing enterprises, even those in mature industries, rely heavily on training and education to remain competitive in their markets. In many regions a number of factors, including technological change and globalisation, are driving workplace and industry re-structuring. The result is generally that existing workers, displaced workers, and those re-entering the workforce after absence all require new skills.

Indigenous Students TAFE’s continuing ability to play a major role in addressing Indigenous training issues relies on maintaining and building its capacity to foster stronger consultation processes with Indigenous people to better identify training needs and the outcomes desired from training.

Considerable unfunded time is spent developing and negotiating training solutions with Indigenous communities who may not have the same training priorities as those set by Government. TAFE has been able to reach the Indigenous client group because of its position within the community and by recognising that a “one size fits all” approach to Indigenous training will not work. Needs, aspirations and capacity differ from one Indigenous community to another, even within a relatively close geographical area; and accordingly flexible, adaptive education and training solutions are required to meet these needs and aspirations effectively

Part four: Unproductive Competition

TAFE Institutes and Colleges in Australia operate in a competitive training market.

The introduction of a competitive publicly funded training market into a regional environment has, in a number of instances, led to the duplication of resources and services. The thin markets that characterise regional environments do not always lend themselves to competition, which spreads resources and expertise inefficiently and undermines efforts to strike a balance between the provision of viable courses to meet local needs and the efficient deployment of resources. Government should review the ability of regional areas to sustain unfettered competition without the loss of quality or choice.

The KPMG Report commissioned by ANTA found that competition by providers for small markets has led to a fragmentation of the market with a consequent increase in costs due to smaller classes. In some cases these increased costs have led to course options being withdrawn. It also found that to maximise clients and profits, some providers offer only generic or cheaper courses.

This increases cost pressures on TAFE, both by requiring it to meet community needs for more expensive courses, and by reducing the revenue from the higher profit courses that might subsidise the lower profit ones.

This in turn reduces TAFE’s ability to provide low-profit, low-demand courses, which reduces choices in regional and remote areas.

Part five: The effects of a competitive training market on TAFE.

From: Submission to the Senate Education and Employment References Committee Inquiry, TAFE Directors Australia, March 2014, http://bit.ly/1bhmB4t

TAFE institutes have been operating in a competitive market for almost 15 years, however in most recent years the “market” exploded with many states and territories allowing the registration of several extra thousand RTOs prior to the referral of powers to the Commonwealth in 2012-13, creating the Australian Quality Standards Authority (ASQA).

The total number of RTOs reached 5,001 registered training organisations on or about this time of referral, although some recent audit action and deregistration under ASQA has seen that number decrease marginally, to some 4,700 RTOs.

Disturbingly to TAFE Institutes and our clients, ASQA made little attempt to quickly refine this enormous cohort of RTOs under their jurisdiction, despite representations from TAFE Directors Australia.

Yet the regulator proceeded with full cost recovery charges (again a major ‘hit’ to TAFEs), nor responded at all to our written submission during the regulatory impact statement that such charges had required of the ASQA agency.

A further concern to TAFEs throughout has been that compliance costs have been adversely affected, no special provisions have ensued on a risk framework.

Because so many RTOs require regulation, this lack of a risk framework being applied to either the registration, or even criterion for which RTOs may qualify for VET public funding, are major issues affecting TAFE, major enterprises operating as RTOs, and some private colleges showing quality in the VET sector.

TAFE Directors Australia has also noted that the introduction of contestable funding models has seen some financial analysts of Australian Stock Exchange (ASX) companies indicate that the trend for private RTOs to move to ASX listings is one issue, however a wider issue (for compliance) is that even more providers may choose to enter the VET market to access public VET funding, to take advantage of marketisation policy imposed without reference or restriction under the NATIONAL PARTNERSHIP AGREEMENT ON SKILLS REFORM http://bit.ly/1DEdoKl

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