What many Private RTOs don’t get: Institutes of TAFE sustain communities beyond the bottom line


TAFEs play a central role in direct community building and social capital development.

A campus contraction or closure, through a withdrawal of CSO or other funding, as has occurred across Victoria, therefore has cascading negative effects through a community.

What can Private RTOs learn about their own current and future motivations and operations from this ?

by intermediatescan, 15/05/2013, http://bit.ly/1Jdzcoh 

TAFEs contribute to meeting the education and needs of communities and to the maintenance of the economic, social and cultural fabric of their host communities.

Geographic disadvantage manifests in a number of forms, many of which overlap and reinforce each other. For example, a concentration of low socio-economic status families in a particular location will likely have limited social and cultural resources (as well as economic resources) and low education attainments, with limited employment opportunities.

With the appreciable gap in education and training attainments between metropolitan and regional populations, the range of opportunities now provided by TAFEs can be life changing opportunities.

With its wide geographic distribution, TAFE can and does play a key role in addressing education disadvantage. TAFEs typically provide support to local schools to achieve better outcomes, they provide pathways from one qualification to another, up to and including higher education and they ensure a reasonable degree of accessibility for persons of limited mobility and/or resources.

Locally accessible education and training benefits not only individuals but supports local businesses, in ensuring the availability of qualified workers from within the local population and both skilled, as well as the contribution that TAFE can make to innovation and business.

It also contributes to the viability of regional communities in a number of ways beyond education and training.

As the population across the whole of Australia ages, a strong youth demographic is essential to reinvigorate and regenerate communities. One of the challenges associated with this need is that, traditionally, rural and regional communities have often seen their young people move away to pursue education and job opportunities elsewhere.

The presence of a strong local provider in the form of a TAFE can counter this trend and contribute in other ways to the viability of regional communities.

TAFE institutes provide tangible economic benefits, in the form of direct employment and the economic activity they generate, which can be shown by reference to Victoria.

Overall, Victoria’s 14 standalone TAFE institutes had revenues in 2012 in excess of $1.2 billion (of which $338 million – 28% – was generated by fee for service activity), had net assets of $2.2 billion, employed over 7,500 staff and had nearly 400,000 student enrolments at 86 campuses across the state.

The 8 regionally based TAFEs generated revenues of over $400 million ($84 million – 21% – in fee for service activity), had net assets of nearly $700 million, employed 2,800 staff and had student enrolments of nearly $700 million at 49 campuses.

What is this worth to a regional community?

Apart from the regional development benefits of a locally based tertiary provider in providing education and training services, a TAFE presence obviously contributes directly to local economic activity and employment.

The positive impact of the regional economic impact of the presence of a tertiary provider can be illustrated by economic modelling that showed the University of Ballarat’s expenditures of $225 million in 2012 over its 5 campuses generated more than half a billion dollars annually and 2,000 jobs for the regions in which it operates (in addition to the 700 staff it employs directly).

This sort of multiplier effect would suggest that regional TAFEs would generate hundreds of millions of dollars (up to $600 million) in additional economic activity for their regional economies, creating several thousands of jobs.

The negative impact of institutional contraction can be illustrated by the estimated costs to the community of the announced closure of a campus at Traralgon in Victoria, as a result of the cessation by the Victorian Government of public funding for “comprehensive service provision”.

Baw Baw Shire Council modelling indicated a loss of 10 jobs in the local education sector could also see three supporting jobs go and cost the local economy $903,000. If GippsTAFE cut 15 jobs, the council said five supporting jobs will be lost at a cost to the local economy of $1.354 million.

All the evidence indicates that individuals who study at regional tertiary institutions are likely to remain in regional areas after they complete their courses, regardless of whether they decide to engage in further study or to move directly into employment – the “train in the country to stay in the country” rule. Moreover, this pattern holds true five years after course completion and is particularly the case for those who also attended a primary school in a regional area.

Students who move from regional areas to urban areas in order to undertake a higher education are unlikely to return, while those who are able to remain in regional areas while they are studying are likely to stay. Regional provision is therefore very important in the skilling of regional communities and in the retention of skilled workers in regional areas.

Social and cultural benefits are less easily measurable than economic ones, but this does not diminish their importance and impact.

TAFEs play a central role in direct community building and social capital development through, for example:

• providing social, cultural and sporting infrastructure,
• hosting events, projects and alliances;
• understanding, addressing and advocating for regional needs; and,
• developing linkages between local, state, and national business and other interests.

A campus contraction or closure, through a withdrawal of CSO or other funding, as has occurred across Victoria, therefore has cascading negative effects through a community:

• It reduces education and training opportunities across-the-board.
• It results in direct job losses.
• It reduces regional economic activity, results in other job losses and undermines viability for at least some businesses.
• It can lead to population loss, as people are forced to relocate to pursue education or employment opportunities.

Each effect obviously weakens the sustainability of a community.

What can Private RTOs learn from this, about their own current and future motivations and operations ?



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