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Monday, 6 November 2000
Page: 19149

Senator LUDWIG (4:44 PM) —I rise to speak on the Vocational Education and Training Funding Amendment Bill 2000. It is a short bill but it has far-reaching consequences. Its shortness underscores its lack of completeness. This bill does two things: it provides supplementary funding for vocational education and training, which it provides through the Australian National Training Authority, ANTA, for distribution to the states and territories in the year 2000 in line with real price movements; it also appropriates funds for vocational education and training for the year 2001. For the sake of completeness, it is worth going to some of the background.

The Commonwealth provides grants to the states and territories for the provision of support for vocational education and training, primarily in the technical and further education system. Funding decisions are made consistent with the national strategic plan for vocational education and training, VET, based on agreed national objectives and priorities. The Commonwealth tips in, as a consequence, something in the order of about one-third of public expenditure on the vocational education and training system. This bill, as a consequence, contains two figures: firstly, it increases the amount payable for 2000 from $918.352 million to $931.415 million; and, secondly, provides a base funding appropriation of $931.415 million for the year 2001. That is partly the heart of Labor's argument: the funding is only for one year. In other words, the funding is not like that for higher education, which is a three-year cycle or a triennium; it is for one year only.

The importance of the vocational education and training system has grown. It has grown from, as many people of my age and older would recall, an apprenticeship based system—a system where you would go to TAFE as an alternative to university or further training. You would leave school at grade 10 and go on to vocational education and training and experience that through an apprenticeship—a seven-week block release or one-day a week if you were a hairdresser, or so on. TAFE has changed greatly since those days. TAFE is now far more sophisticated, far wider and far more strategic in its outlook. It provides enormous resources for not only training in those traditional fields of apprentices but also management courses and the gamut of technical and further education qualifications, so much so that it is also being inculcated into the educational system of state schools and the like. In an article in the Australian on Monday, 29 May 2000 headed `A hire calling', the by-line states:

Vocational subjects are proving a smart choice for students.

The beginning of that article on Monday, 29 May 2000, which underscores the position I am putting, states:

While vocational education was once seen as the poor cousin of traditional academic studies, the overwhelming success of those programs and their smooth integration into high schools around the country has revitalised the old tech-school image.

It is no longer a case of the vocational education system being preserved for apprenticeships or the like; it is far wider. As the article underscores, it provides one spin-off—and it is anecdotal to this point. There seems to be support that the upswing in vocational education—the idea of being able to translate from school to vocational education and training and then on to higher studies—retains people in the schooling system and ensures that the knowledge nation, which Labor stands for, is also tied to lifelong learning. The vocational system provides a key—a bridge, if you will—but also an end in itself. It has a multiple function. The matter was also raised by Mr Lee, the member for Dobell, in the House of Representatives on 14 August 2000. Amongst other things, he stated in his second reading amendments:

(a) the broadest possible access to quality training opportunities is a vital part of Australia becoming a Knowledge Nation;

He also significantly stated:

(2) condemns the Government for:

(a) failing to provide any funding to support this growth;

The second reading amendments that were moved in the House of Representatives have also been reflected in part in the Senate, and they go to `failing to provide any funding to support this growth'. That is the crux of the matter. You have failed abysmally to support the growth of the vocational education and training system. You have failed to negotiate a fair and reasonable new ANTA agreement with the states and territories, and you have failed to pursue policies which do not damage the quality of training and put at risk the nation's skills base.

If you look at this government's budget for 1997-98, you will see that the Commonwealth reduced annual funding to the states and territories and appropriated, under the Vocational Education and Training Funding Act 1990, to provide `an incentive to the states to achieve efficiency gains in the vocational education and training operations'. This reduction continued from 1 January 1998 to this year. The catchcry that has been bandied about by this government is `growth through efficiencies' and has meant that this bill provides only a $13 million increase in funds. This only represents the impact of the movement of the consumer price index, the CPI. But the vocational education system is not stagnant or growing at the same rate as the CPI. It seems that the vocational education and training system will grow by something in the order of 16 per cent over the next five years and perhaps even more.

It is clear from the foregoing that it is time for this government to reconsider the direction it is taking. A recent Senate Employment, Workplace Relations and Small Business and Education Legislation Committee, in the Labor minority report, has highlighted some of these problems. Firstly, there has been a funding shortfall for vocational education and training. Secondly, the system should be funded on a three-year cycle, and the minority report states that it ignores the need to fund growth in the vocational education and training system. Curiously this growth that it ignores on the funding side is not ignored when it comes to encouraging growth of the system. This government's policy seems to be predicated on the view that future growth can be funded through efficiencies. However, this seems to have a problem. It underscores what can happen. It can quickly spiral into a cost cutting exercise only. There must be an end to this unfair funding regime. This government has a clear responsibility to accept its share of the duty of funding growth in the national vocational education and training system. The system is not for show.

The important issue is that, if Australia is to become and then remain a highly skilled nation and if this nation is continue to grow and prosper, then moneys will need to be found to meet the extent of vocational education and training. The vocational education system has increased participation—and it is something which it can be congratulated for—by something in the order of 29.4 per cent since 1995. This growth is unlikely to drop off or flatten out over the next few years. This growth is being underpinned by a greater concentration on structured entry level training in areas where previously there was none. I alluded to that earlier in my speech—the growth of the vocational education and training system into all areas. It is filling the needs of students and of adults who wish to participate in lifelong learning, short courses, broader courses, and courses in marketing, managing and training and in all sorts of areas. There are many awards now which make provision for structured training. They recognise vocational education courses; provisions in awards now recognise the need for training and education. There has been a significant change in both the culture and the view of both employers and employees about the importance that education, especially vocational education and training, plays. In Queensland unions and employers have recognised this need. Employees want skills, accreditation and recognition for skills and certification to demonstrate that they both have those skills and have completed courses.

In addition, there is a growing recognition amongst people that there is a need for both training and recognition of training. The various state bodies have also emphasised the need for vocational education and training. ANTA itself has a marketing strategy to increase the profile of vocational education and training and likewise has been promoting New Apprenticeships, so you would expect that such emphasis would attract growth funding. Instead, the states have had to face this growth by finding efficiencies. The states have been assiduous in endeavouring to reduce these costs. The danger is that efficiency drives can often lead to a cost cutting exercise and this in turn can often lead to a reduction in the quality of training. Also the availability of VET institutions to use innovation and flexible training approaches where they may cost more is sometimes the first to go under these sorts of drives. It is worth looking at issues like quality and equity to make sure that, if there are going to be efficiency drives, the first thing to go out is not the more difficult, more expensive and more troubled courses because you then reduce the width and expanse of the vocational education and training system. The report draws attention to the fact that submissions made out of that drive to lower costs have impacted adversely on quality. ANTA itself in the report commented:

All States and Territories consider that if growth in new apprenticeships were to continue at current rates, current funding arrangements would be unsustainable and they would expect to have difficulties resourcing future demand for new apprenticeships. It seems that on the one hand the Commonwealth government has promoted apprenticeships and traineeships, which is a good thing and marketing has been successful but on the other hand they have not made provision for it.

The writing is clearly on the wall. Clause 1.51 puts the message loud and clear. The message from the states is that efficiency policies that have been pursued at the expense of quality are no longer going to be tolerated. This bill is here before us to deal with appropriation for next year, and there is a better approach, as I commended earlier to this parliament. The Labor minority report highlighted the need for the vocational education and training funding budget to be on a rolling triennium in a way similar to higher education funding. This would, amongst other benefits, allow state and Commonwealth negotiators to be sufficiently distanced from the deadlines and from the pressures of a 12-month negotiating cycle to be able to provide enough time, trouble and experience to bring together a meaningful strategic approach to the funding issues and also to put the outcomes in a more positive frame. The present method provides no scope for meaningful negotiations.

There is absolutely no security for planning purposes. It is also worth noting that the committee forewarned of some of these difficulties when it examined the Vocational Education and Training Funding Amendment Bill 1997 when the growth through efficiency policy was put into effect by ANTA agreement. Labor senators drew attention to the policy and expressed concern that there was no real knowledge of what was a likely or a desirable rate of growth in the vocational education and training system and similarly there was no knowledge about the ability of the states to find efficiencies.

What would this system look like? A submission by the Australian Education Union to the Senate Employment, Workplace Relations, Small Business and Education References Committee in December 1999 on the inquiry into the quality of vocational education and training summarised some of these very important ideals which characterised world's best practice for a vocational education and training system. They include that the funding of the vocational education and training system should reflect the recognition that TAFE is a vital public asset, that all Australians should have an equal right to access and participate in high quality technical and further education irrespective of their location, capacity to pay or other factors, that quality and effectiveness should be the key principles, and that they must be underpinned by future development of vocational education and training.

About 1.5 million people have gone through vocational education and training in Australia. They deserve a system that is of high quality and capable of meeting not only their present needs but also their changing needs into the future. Vocational education is not an adjunct to work or a place to go for apprentices or trainees; it is part of a broader strategy. It is about developing a knowledge nation. It fits in with school based education, higher education and also research and development. There is a continuum that this government must recognise exists—and vocational education and training fits into that continuum—if it is to consider lifelong learning, if it is to consider a higher skills base, if it is to consider a more profitable work force.

Vocational education does play a key role developing a commitment to lifelong learning, as I have said. This is not a slogan. If Australia is to be successful in the new economy and if it is to maintain traditional industries, government must invest sensibly in a strategy that is more than 12 months out. No-one doubts that investing in education and training will lead to positive rewards. It is the key driver to reduce unemployment. It underpins economic growth, and it has the capacity to help address social inequality. There is a rising concern amongst many workers that precarious employment is becoming the norm. A proper vocational education system is an empowering tool that will assist.

The government does not seem to want to do anything about it. To my mind the clearest way of decreasing the number of unemployed is through skilled education, knowledge and experience to maintain people in the work force. The skills, knowledge and experience also need to be moulded by industries so that employees have the capacity to change with those industries over time. Vocational education plays a significant role in this. But what does this bill do to help with that? A quietness pervaded when I asked that question. This bill does nothing to address the skills problems that this nation is experiencing now. The ACTU contributed to the debate in a positive way by addressing their concerns about the vocational education system to the Senate committee inquiry. That organisation recognises the important role that vocational education and training plays.

The state of Queensland, which I represent, has not been sitting on its hands either. A recent TAFE review task force echoed the goals that should be looked at. It stated, firstly, that governments have both social and economic reasons and responsibilities to fund the vocational education and training system—to build a skills base for enterprises to draw on and to give individuals the opportunity to develop their own skills to pursue career and life goals. The government has a preoccupation with delivering quick schemes to make workers ready for the market with limited skills. There is a culture of blame: if it does not work they will try another quick fix scheme. This idea will fail.

Chris Robinson, the managing director of the National Centre for Vocational Education Research, argues that there needs to be `a proper balance between generic skills needed for the work force to adjust rapidly to new requirements and even more emphasis on the continual acquisition of new specific skills in the industry context which will meet the focus of the vocational education and training products in the 21st century.' This Liberal government is doing very little about this. Queensland is also to be congratulated for taking the initiative in this area. The draft strategy document Skilling Queensland sets out a vision for Queensland to address vocational education in a meaningful and responsible way.

Debate interrupted.