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Wednesday, 27 June 2001
Page: 25257


Senator CROSSIN (4:28 PM) —The purpose of the Vocational Education and Training Funding Amendment Bill 2001 is to amend the Vocational Education and Training Funding Act 1992 to supplement funding for vocational education and training provided to the Australian National Training Authority for distribution to states and territories in the year 2000 and to appropriate funds for vocational education and training for the year 2001. By way of background to this bill, and for information, we know that the VET Funding Act 1992 gave effect to the first ANTA agreement between the Commonwealth, states and territories for the establishment of the Australian National Training Authority. It was announced by the then Labor government. Under that first agreement, funding arrangements were made for the 1993-95 triennium. These included the Commonwealth's agreement to maintain its then current financial support for VET, to provide an injection of $100 million in recurrent funding provided in the November 1991 One Nation economic statement and an additional $70 million of growth funding for each year of the triennium. These arrangements were subsequently extended to 1996 and 1997 by the then Labor government.

After only five years of this coalition government, the vocational education and training system is in crisis. The government has ignored the state of this industry, has turned its back on students undertaking VET courses and apprenticeships and has squabbled with ministers from each state and territory over the level of funding that is needed to assist in this vital sector of the education manifold of this country. This government has a responsibility to ensure that young people in particular have an opportunity to obtain a job and are either skilled, qualified or in a position to obtain training during their working lives. At the same time, the government has to be mindful of the needs and the skills required by this nation to be competitive, innovative and successful. Under this government, that is not happening.

This government needs to make sure that as many Australians as possible have access to quality training that suits their needs as well as the needs of employers. Lifelong learning is not a one-way street or a one-sided seesaw, but this government is dictated to by business at all or any cost, particularly when it comes to training and vocational education. The actions of this government over the last five years demonstrate that there is no commitment to providing better quality training or to improving the resources or the provisions or even the access to this sector of tertiary education.

In the 1996-97 budget, the new coalition government introduced an efficiency dividend on the Commonwealth's own purpose outlays, which resulted in a five per cent reduction of funding provided to ANTA. In addition, the five per cent real growth on base recurrent funding was discontinued. Those massive cuts to education in the 1996 budget included a reduction in vocational education and training grants to the states and territories of $66 million; a reduction in ANTA's operating expenses of $13 million; and the abolition of the five per cent real growth on the base recurrent TAFE funding, which was a cut of $91 million. Then, in its 1997-98 budget, the Commonwealth reduced annual funding to the states and territories, appropriated under the Vocational Education and Training Funding Act, to provide an `incentive' to the states to achieve efficiency gains in their VET operations. The introduction of that term, which is now known commonly throughout the industry as `growth through efficiencies' has subtracted another $72 million from the sector. These cuts over the last five years now total $240 million and constitute money that could have been invested over those years to at least maintain quality and to expand access to quality training.

As I said previously, Australia's vocational education and training sector has reached crisis point. New Apprenticeships have contributed substantially to the growth of overall VET, yet the Commonwealth has exacerbated the effect of the withdrawal of growth funding by heavy marketing of the New Apprenticeships scheme. In August 1998, without any consultation with the states and territories, the government extended employer incentives to existing workers signed up as new apprentices. These actions have placed severe pressure on those within this system and have placed financial pressure on the states and territories so much so that, last year, the Senate conducted an inquiry into the quality of vocational education and training. Aspiring to excellence, as the report was titled, contained 28 recommendations to the government that go to the heart of restoring quality in vocational education, beginning with a renegotiation of VET objectives with major participants in the training network and strengthening institutional arrangements that ensure compliance with the quality control process.

The inquiry took many submissions. We heard from a number of witnesses who were very critical of the government's policies and the effect that these were having on the needs and responsibilities in maintaining a quality system of VET, yet this government has chosen to reject the key recommendations of this report. Jacqui Elson-Green, in 6-12 June edition of Campus review, a newspaper dedicated to the post-compulsory sector, states that the actions of the government hit directly at the people who are challenged daily to keep the system running despite the worst funding crisis in the history of the sector.

New directions are urgently required for Australia's vocational education system if it is to realise its full potential and to reshape vocational education and training by providing leadership in the development of a national, quality assured system. Even TAFE Directors Australia, at its annual meeting earlier this year, said the report of the Senate would be a good starting point for the development of a much needed charter for the VET sector. Some of the recommendations rejected by the government were not substantiated by a reasonable explanation, and most of them were shoved under the umbrella of ANTA's mantra. Why is this government continuing to deny VET educational professionals a place on the ANTA board? What is the real reason and rationale for failing to embrace the suggestion that training plans play a more strategic and effective role in planning and delivering training? As the article in Campus review also comments, the government's response to not accept a recommendation to strengthen and more rigorously monitor and enforce measures to avoid real or potential conflicts of interests between organisations operating such as the New Apprenticeships centres or group training companies is avoiding the issue, and the recommendation to protect students and workers to ensure a balance between portability of skills and enterprise based needs was also disregarded.

The historical monopoly on apprenticeship training has been broken, and recognised training is now offered by multiple training providers of variable capabilities in multiple sites of differing quality. Employer incentives combined with the proliferation of private providers, the opening of contracts to existing employers and full on-the-job training have all contributed to exponential growth, mainly in the traineeship component. Throughout all of this and, in these circumstances, the training system in this country has struggled to provide consistently good quality training.

Earlier this year we had the Prime Minister's innovation statement that highlighted even further the marginalisation of this important education sector. Both the ACCI and the Allen Consulting Group have criticised the government for failing to include the contribution of the vocational training sector in the innovation statement. Vocational education must be a key instrument in the creation of a highly skilled, well-paid work force, which is critical to Australia's economic prosperity. A truly collaborative partnership between government, employers and unions could achieve broad agreement on the application of available resources to develop a nationally consistent system. Such a system would combine legally enforceable national standards for quality assurance, with a focus on the creation of advanced skills training in areas of economic growth and employment demand.

The Prime Minister's quick fix for Australia's desperate skill shortage in technical areas is to import skilled migrants, according to the innovation statement. But this glib response to a grave situation fails to face the reality of the government's own shortcomings in vocational education and training. Australia lacks tradespeople in technical and technological occupations, which is entirely due to the Howard government's own short-sighted VET policies. Its so-called New Apprenticeships scheme has failed to deliver skilled workers where they are needed, because it lacks direction and does not identify priorities. Instead, it favours the delivery of cheap, low-level training in areas that are not capital intensive, such as office administration, retail and security.

Australia needs to turn around its approach to skill development and establish a robust, truly national system of vocational education and vocational qualifications. This was also a central recommendation of last year's Senate inquiry. The problems are well known, but the government has not been prepared to act by funding growth in the VET sector so that identified high priority areas can be expanded. Instead, its `growth through efficiencies' policy has forced growth into the cheapest possible areas of training and has undermined the quality of that provision. Only a real commitment to growing a targeted, quality system of VET will meet Australia's emerging needs. Five years of the so-called `growth through efficiencies' policy, which has provided no real increases in a climate of rapid growth in student numbers, have seriously undermined the system and the quality of education it can provide.

Let us turn to the essence of this bill and the actions of the government since last November in funding and assisting this sector of the education industry. Several weeks ago, the Minister for Education, Training and Youth Affairs finally reached an agreement with the state and territory training ministers for a new funding agreement for ANTA. But this process has taken many months, and it is an arrangement that still comes with many strings attached. Federal and state training ministers had met several times to negotiate a new Commonwealth, state and territory agreement, the ANTA agreement, but they were unsuccessful because Dr David Kemp, the federal minister responsible, refused to meet the cost of growing student demand. This cost was estimated to be $152 million for 2001. This estimate is based on a report by the state training authority CEO's National Resourcing Working Group in April 2000, which identified an estimated 5.7 per cent increase in growth in enrolments for 2001.

The state and territory ministers told Dr Kemp that Commonwealth funding must increase, particularly to provide funds for demand growth. As at last December, with a then surplus of $4 billion in the federal government coffers, the Howard government could have afforded to increase funding by at least $152 million to expand access to TAFE for all Australians. The ministers responsible for vocational education in all four eastern states united to call for a `sensible funding agreement' that would provide for additional funds for the growth necessary in our training system. But Dr Kemp refused to engage with the states in any meaningful discussion on funding for the next three years in VET. While bragging about his government's plans for growth in TAFE on the one hand, on the other hand he refused to allocate one extra dollar to pay the Commonwealth's share of it.

The current funding ran out on 31 December last year, at the same time that the Commonwealth was handing back $220 million in unspent training money to Treasury. This amount was uncovered, of course, during the estimates process towards the end of last year. That money was fobbed off by this minister as being money that was identified for employer incentives and the like. It was still within his capacity, though, to transfer some or all of that money to growth and funding in the TAFE sector. But, at that time, the government had only offered a temporary one-year funding arrangement, which failed to meet its responsibility for growth or forward planning.

When the minister first started negotiating this ANTA agreement, his initial offer was for absolutely no growth at all when it was put on the table, despite the fact that, as I said, state and territory ministers had previously identified an estimated 5.7 per cent increase in enrolments. That has been the government's policy throughout all of this. While there has been growth in the sector and increased student enrolments and increased demand, a demand that has been encouraged by the government in their employer initiatives and marketing of the New Apprenticeships system, there has not been one extra dollar from the government to assist the states and territories to actually cater to that growth.

We have seen massive changes in the TAFE sector over the last five years, and that was evident in the submissions presented to us during the inquiry last year. There has been increased casualisation of TAFE teachers, courses that have had to be cut and full on-the-job training that has led to a decrease in the quality that these students have had to obtain. There has been a decrease in the access to equipment in institutions and a decrease in the access to library and computing skills. Generally, all in all, this is a system with which students are quite dissatisfied—they are unhappy with the outcomes and quality they are getting.

But let me go back to last December. After pressure from the states last December, which was the third time they had met in six months, Dr Kemp was forced to increase that offer from a one-year offer to a three-year offer of an extra $20 million in the first year, $25 million in the second year and $30 million in the third year—in a climate where it had been identified that at least $152 million is needed to cater for this increase in growth. As a result of the new pressure placed on the federal government by the states—except South Australia of course—the government had to significantly increase that offer to a total of $230 million over three years, which is the amount that is before us today. Immediately following the meeting in December, the New South Wales Minister for Education and Training branded the offer back then as `insulting and unfair'. He said that the Commonwealth's offer amounted to an extra $14.50 per TAFE student, which he said at that time would barely buy a movie ticket—and he is correct.

When a further meeting was held in March this year, state and territory training ministers declared no confidence in their federal counterpart and labelled the offer illogical and unfair. The old agreement was rolled over until June, amid calls from the executive director of TAFE Directors to provide significant additional funding to meet the growth in demand for VET. Earlier this month, the Minister for Education, Training and Youth Affairs finally reached agreement with the state and territory training ministers for a new funding agreement for ANTA. It has taken well over eight months and at least half a dozen meetings. The minister for education described this as a `major milestone' at the time. As my colleague Mr Michael Lee said in the House of Representatives, another milestone it may well be but not in the context that the minister implied.

This is another example of how this government has failed to provide appropriate support for vocational education and training by cutting $240 million from TAFE and then replacing it with only $230 million with this agreement and by contributing no growth funding for five years, thereby restricting training opportunities and damaging the quality of training. The structures and resourcing of the vocational educational system must be based on the recognition that TAFE is a vital public asset. The figures prove that the vast majority of students undertaking vocational education and training undertake that education and training in TAFE institutions, which are valued public assets to this day. TAFE institutions play a vital and complex role in the development of Australia's skill base.

In conclusion, I would like to make a few comments about the new agreement. This new agreement comes with strings attached. There will be no capping or no limit on the user choice policy. In the Northern Territory, the Northern Territory Employment and Training Authority blew their budget on user choice and had to put a cap on it. In the Territory we have seen a proliferation of students who have gone to providers that have been encouraged to set up and to establish themselves as training providers, at the very unfortunate expense of the Northern Territory University, which was a significant and most important public provider of TAFE in the Northern Territory and one of the only providers that offers significant training in Aboriginal communities. Why? Because it is too expensive to deliver training out there. So, in this climate where we have private providers being encouraged to proliferate, we have a user choice policy now being expanded beyond belief and the value of our TAFE institutions as public assets continually being undermined.

This government stands condemned for allowing the Australian National Training Authority agreement to lapse by failing to make a realistic offer of funding and finally offering an amount of funding which is even lower than the amount of previous funding cuts and which fails to adequately address the needs of Australian vocational education and training. (Time expired)