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Tuesday, 15 October 2002
Page: 7577

Ms MACKLIN (8:50 PM) —I am very pleased to be able to speak on the Vocational Education and Training Funding Amendment Bill 2002, which is a very important piece of legislation. As far as Labor is concerned, education and training are right at the heart of generating the high-wage, high-skill jobs that will lead to a decent standard of living for as many Australians as possible. We know that Australians actually want to be able to work smarter and to have more time with their families. I think the previous speaker, the member for Canning, should have a look at the recent Productivity Commission report, Skills and Australia's productivity surge. That report found that Australia's growth in skills has dropped under the Howard government and is low compared to other countries. The figures in that report actually show that skills accounted for over 28 per cent of productivity growth in the late eighties and early nineties but only 2.9 per cent in the late nineties—a massive drop in the contribution that skills were making to our productivity growth.

We should not kid ourselves; this lack of skills growth will mean that Australians will have to slog it out, working harder and longer to earn a decent standard of living. If we want to improve our way of life, skills growth has to accelerate and make a greater contribution to our productivity growth, not suffer the massive decline which we have seen recently. Of similar concern is another report released by the Productivity Commission. The report also found that Australian investment in higher education had gone backwards under the Howard government, dropping us from third to fifth place among the developed countries that were surveyed by the Productivity Commission. This decline began with the Howard-Costello budgets of 1996 and 1997. I will not go into what happened to university funding; I will concentrate my remarks tonight on what happened to Commonwealth funding for training.

In those two budgets, we saw the government under the Howard-Costello leadership renege on the Commonwealth's commitment, which was in the original ANTA agreement signed by the Labor government, and which had seen growth funding go into training. In the 1996 and 1997 budgets, this government reneged on that commitment. Instead, we saw a cumulative reduction of over $200 million in Commonwealth funding of vocational education and training in those years and a related massive cut to labour market programs. Just concentrating on the vocational education and training sector, these big cuts to the ANTA agreement had a very big impact on our TAFE systems, as the big public providers of vocational education and training.

By 1998, when the Commonwealth and the states were renegotiating the new ANTA agreement, we saw the end of the Commonwealth's commitment to growth funding. Through the then minister David Kemp, the Commonwealth insisted on the concept of `growth through efficiencies'—one of the many examples of what can only be described as Orwellian newspeak if ever we heard it. In return for this growth through efficiencies, the Commonwealth was going to maintain funding in real terms. The result was that between 1997 and 2000 the Commonwealth's contribution to the vocational education and training operating revenue actually fell by $112 million. This pretty much neutralised the $150 million increase that was put into vocational education and training by the states and territories over the same period. Let us not muck around with the figures: a very significant cut happened.

We have seen some independent research on this issue by Louise Watson, the Director of the Lifelong Learning Network at the University of Canberra. She has reported that the cumulative reduction in Commonwealth revenue for vocational education and training over the period 1997 to 2000 was $386 million. It is no wonder that this sector is experiencing such enormous pressure. Unless urgent action is taken—and we are certainly not seeing it in this bill—we will continue to spiral further downwards and become a low-skill, low-wage economy and, as a result, our standard of living will go down.

We know that we have serious problems with shortages of skilled apprenticeships. We know that Australian businesses desperately want more skilled workers. We also know that the government's New Apprenticeships program focuses on the low-pay, low-skilled end, instead of the high-growth, high-pay, high-demand skilled workers that so many industries are crying out for. We are hearing repeatedly from industry groups that the government's program has produced a severe skills shortage in the high-skill, technical areas such as medical services, engineering and mechanical and electrical trades.

Just last week, I went to the Toyota plant at Altona in Melbourne, where enormous investment is being put into a new engine plant. Skilled workers and engineers have had to be brought to Australia from overseas because there are not enough in Australia. That is an absolute indictment of this government's incapacity to deliver the numbers of skilled workers that our industry needs and to provide the work opportunities that so many young people want. Instead of helping our young apprentices into the high-paid, high-demand jobs, the government is forcing them down to the other end of the spectrum. Government speakers do not have to take my word for it; if they were reading the Australian Financial Review recently, they would have read the following:

There is no room for complacency, yet this point seems to be lost on Brendan Nelson ... Asked about a recent report showing very low rates of high-skill job creation, Dr Nelson dismissed this as a macro-economic issue to be addressed by the ministers for employment and industry.

Instead of dismissing his responsibilities, the minister for education and training should be directing his efforts at making sure that we have near full participation in education and training by young people. He should see it as his responsibility to make sure that the skills and training being offered in our VET and TAFE sectors are going to provide opportunities at the high-skill, high-wage end and not push people down the low-wage end. We on this side of the parliament do not agree with the view of the minister for education that people who cannot make it in education should just go off to a quiet pond. It will be a very stagnant pond if they do not get a decent education. All of this requires the development of policies that remove the significant barriers that exist in education and training for young people. These are significant barriers between schools and TAFEs in particular. It will require an enormous amount of effort from the Commonwealth, the states and the institutions.

We know that our vocational education and training sector caters for a very large number of people, most of whom are enrolled in our TAFE system. Over 1¾ million students are enrolled in Australia's vocational education and training system, which is a huge contribution being made by that sector. Through our TAFE system, one in every 10 Australians is acquiring education and skills and laying the foundations for lifelong learning. But, as the recent Productivity Commission report shows, this is not enough; we are not contributing enough to our productivity growth through skill development.

What is particularly troubling is the government's indifference to the vocational education and training needs of young people in this country, particularly those who are at risk of being marginalised from education and training, and employment. We know from the latest report of the Dusseldorf Skills Forum, entitled How young people are faring, that the number of young people aged between 15 and 19 who are in neither any form of education and training nor full-time work is growing. Over 200,000—about 15 per cent—of all young people in that age group are not in the sort of education or employment that will lead to a decent job in the future. The report indicated that more than 40 per cent of young people who left school before year 12 were in `at risk' activities within six months of leaving school. Of course, those sorts of `at risk' activities are drug taking and other illegal activities. The best thing that we can do for those young people is to engage them in education and training, engage them in opportunities for employment, to make sure that they do not get involved in these sorts of risky activities.

In contrast to the government's inaction, particularly for this very significant group of young people who are at risk, today I was in the Illawarra where I announced Labor's commitment to addressing the urgent education, training and employment needs of young people in that region. We know that unemployment in that region, particularly for young people—as exists right across the country—is very high. I announced in Wollongong today that a Crean Labor government will support the proposal of a local committee, the Illawarra Apprenticeship and Traineeship Committee, to pilot a special apprenticeship scheme in the region for young people who are in danger of unemployment. So we have committed ourselves to the committee's proposal by committing $6 million for the creation of 220 apprenticeships to pilot this scheme. It is aimed at ensuring that young people are provided with training and job placement over a number of years to give them the skills and experience that are in demand in the region. Obviously that is a very important point, because we want to make sure that they will get jobs at the end of that scheme. The pilot will target young people who are at risk of unemployment and will make sure that we get them into apprenticeships in those industries in that region that are suffering serious skill shortages. I want to place on record my congratulations to all those who have been involved in this project and for bringing this proposal to our attention, and I am very pleased to be able to indicate our strong support for it.

Nationally and additionally, we have to direct our policy effort at improving not only the level of funding but also the funding arrangements to enable students to move more easily between schools, VET providers—whether TAFE or private providers—and universities. We do need to work with the state and territory governments in building those more flexible arrangements, but we do not see anything from this government in that regard. We want to make sure that there is much greater flexibility in delivery across those institutions. This will mean changes to assessment, certification and funding systems that will actually support students rather than hinder them in undertaking courses that will improve their skills. We do not want to see secondary schools that are offering VET in schools programs struggling to meet the workplace learning requirements; we do not want to see universities refusing to provide proper credit transfer. These areas require urgent policy attention, and we are certainly not seeing that from the current government.

I know that there has been some movement by the Australian Vice Chancellors Committee. It has recently announced a system of minimum credit transfer between TAFE and participating universities. Of course this is welcome but it is not sufficient. We really do need to see some national leadership from the government to push this issue along. Just last week I met with some of the state and territory education ministers; all eight of those ministers and I put out a statement last week recognising explicitly the need to develop clear and consistent procedures for the recognition of prior learning, particularly between vocational education and training and higher education. We on this side of the parliament know that this is a priority area and we certainly will be working cooperatively with the state and territory governments and the institutions to make sure that we address this policy disaster.

There is also the effect of different rates and sources of funding. It is not the case, as the previous speaker, the member for Canning, said, that TAFE is funded only by the states. TAFE and vocational education are funded by both the Commonwealth and the states. Schools are also funded by the Commonwealth and the states but in completely different ways from the vocational education providers. Students who want to undertake vocational education courses while at school have different funding arrangements from those who might want to do them at a TAFE. Some students want to stay at school and do TAFE courses, but at the moment the funding arrangements do not facilitate that. In many cases they make it very difficult for the students, for the schools and for the TAFEs. So our job at the national level is to work with the states and territories and to work with the institutions to sort this mess out. There are practical barriers to doing this—and, at the moment, nobody is seeking to fix them.

We know that these problems are not being addressed in the minister's current review of higher education. He seems to think that the problem with TAFE is that it is just a backdoor entry into university, as he says, `on the cheap'. These comments have been resoundingly denounced by many TAFE directors, including the Victorian TAFE Association. They point out that, far from rorting the system, such students demonstrate the benefits of a publicly funded tertiary education system that promotes lifelong learning. The association were also very critical of the minister's view that universities convey knowledge while TAFE education is purely about teaching and developing skills. I must say that the association did not hold back their criticism of the minister. They stated, `The regrettable part of such specious and, when viewed in isolation, fallacious rhetoric is that it invariably becomes the stuff of education policy.' The failure of the minister to understand the role played by TAFE in the tertiary education system is certainly alarming to those who are right in the middle of it. It seems to us and to the TAFE sector that the minister is more interested in finding ways to make students and their families pay more for education than he is in building the system needed for a high-wage, high-skill economy.

I want to finish with some words by the Victorian TAFE Association. In their document, they point out that the minister and this government should be focusing on ways to expand learning opportunities by improving links between schools, vocational education and universities, not talking down TAFE as a back door to universities on the cheap. I could not agree more strongly with this statement. That is the urgent work that needs to be done and it is certainly not happening as a result of this higher education review.

We know that the answer to getting more students into TAFE, more students into vocational education, does not involve charging students and their families more, which certainly seems to be the only approach in the higher education review. We know we need the investment in this area. We know we need to facilitate students moving between schools, TAFE and universities to give them the best opportunity to get the education that best suits them if we are to become the high-wage, high-skill economy that will see our standard of living improve.