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Tuesday, 9 October 2012
Page: 11698

Mr CHEESEMAN (Corangamite) (17:55): I too rise to speak on the Higher Education Support Amendment (Streamlining and Other Measures) Bill 2012. This bill will introduce a number of measures to help streamline the Higher Education Support Act 2003. The bill reflects the federal government's important initiative to extend the FEE-HELP system to VET and TAFE training for the first time. This will enable students to defer their vocational training costs until they earn sufficient income. This will enable more students to study at local TAFEs and VET providers throughout the country. That is important because, with the record low unemployment rates we currently have in a very strong economy, we know that vocational training is important to this economy to enable us to expand its productive capacity. Vocational training is critical to meeting that skills gap, and building on FEE-HELP will drive that.

I am saddened at the devastating budget cuts announced by the Baillieu government back in May. They have decided to rip some $300 million out of our vocational training system, which will principally hurt our TAFE colleges and our community not-for-profit organisations that provide opportunities for people wishing to gain access to vocational training.

On Thursday of last week I was particularly concerned to have word passed to me that the Otway Community College, located in the Colac Otway Shire in the heart of Colac itself, was about to place itself into voluntary administration because the cuts that the Baillieu government was proposing were leading to that institution running out of the critical cash it requires to be able to maintain its presence. The Otway Community College has been providing vocational training and resettlement opportunities in the Colac Otway Shire for more than 30 years. This is an organisation that provides training to the most disadvantaged, often to people who otherwise would not be able to access vocational training. The nearest training provider to the township of Colac is the Gordon Institute of TAFE, which is an hour to the west.

If you are a single mum—perhaps a teenage mum—a refugee or someone who has been unemployed for a long period of time, finding the capacity to drive to Geelong, some 100 kilometres away, is impossible. The township of Colac and many other townships like Colac throughout Victoria are simply too small for TAFE providers, so we require community colleges, such as the Otway college, to provide vocational training to people in these communities. In talking to a number of key stakeholders, it is absolutely clear that the Baillieu government's cuts to vocational training have driven this decision that the board had to make under our corporations law. An organisation that has been providing vocational training in Colac for more than 30 years to some very disadvantaged people has had to close the doors as of five o'clock last Thursday night. This organisation employed some 80-odd people, equating to about 40 effective full-time employees. This organisation provided training opportunities to some of the most disadvantaged.

Having said that, there is in my view one person who can address this issue, and that is Ted Baillieu. The Premier of Victoria must fess up, man up and acknowledge that the $300 million vocational education cuts that he is imposing on the sector have placed the sector in an insecure financial position. It is leading to TAFEs having to close campuses. It is leading to private sector providers having to close their doors. It is leading to community colleges, like the Otway Community College, becoming financially insecure and unstable and having no choice but to place themselves into voluntary administration.

I want to go through some of the cuts that the Liberal government of Victoria is imposing on the sector. Firstly, if you look at certificate II in business administration or customer services, the fee that will be given to training providers has been slashed from $6.45 per student hour down to $1.50. Such types of cuts are unsustainable and are designed to ensure that we see what is happening before us today, which is TAFE campuses closing and cuts in the number of courses provided across Victoria.

In my community there is also a TAFE college, the Gordon college, which has been educating people in the Geelong district for 130-odd years. It is a very proud organisation. It has provided training opportunities for people in Geelong and across the western district for a very long time. The callous TAFE cuts that Ted Baillieu is imposing on this organisation are likely to see some 43 courses cut—that is what will happen under Ted Baillieu's funding model; that is what it will mean to this organisation. I suspect that when we do a headcount of that organisation in terms of the number of people that that organisation will employ when these budget cuts have been fully implemented, we will see 130 to 150 fewer people employed in the Gordon college and providing training opportunities to the Geelong community.

Coming back to the Otway Community College and the cuts that the Baillieu is imposing on this sector, previously the way that providers were funded to provide training opportunities for people was quite simple. You did a census of the number of people that each course was going to train. Then there was a weighting system. Then a number of dollars were provided per person per contact hour. Normally, depending on the nature of the course, that would be somewhere between $6 and $11 per training hour per student. As I said earlier, that is being cut down to $1.50. And instead of providing that money upfront on the number of enrolments, they have changed their policy settings so that that money will be provided at the conclusion of the course.

Otway Community College and some other TAFEs service low-socioeconomic communities in particular. They train people who have been out of the workplace for a very long time or people who are not suited to remaining in school, because they are a single mother or whatever, and who may well be dipping their toes back into the water of vocational training for the first time in a long time. It may well be that they do not have the wherewithal to remain at that institution and complete that qualification at their first attempt. It may well be that they take a number of attempts to complete their qualification.

Changing the funding policy in a very simple way from upfront funding to funding on completion is going to savage the budgets of institutions that are working hard to service those demographics, which will be more challenging. It may well be that for a course to be viable 12 or perhaps 15 students are needed. That is what might be needed to get enough money in the door to be able to employ a trainer or a teacher—someone who can work with that cohort. If at the completion of the course those 12 or 15 students who are needed to make it sustainable for that organisation to train them has become four or five there will be a massive consequence for the budget of those training organisations. That is the particular concern that has been raised with me by people from the Otway Community College. That is the change that has had the biggest impact. The reduction in the hourly rate will have an impact in the not-too-distant future. All organisations in the training space in Victoria will have to address that.

It is no wonder that we are seeing massive community reaction to the Baillieu government decision. People are angry about this. Regional and rural Victoria will suffer the most as a consequence of these budget cuts. I remind those who might be listening that Jeff Kennett, when he was the Premier of Victoria, described regional and rural Victoria as the toenails of the state—those were his words. He was reported at the time to have made that comment. Ted Baillieu was then the President of the Liberal Party in Victoria. It seems to me that his great mentor, Jeff Kennett, has had a quiet word to him and suggested that the TAFE sector is worth going after and that it is worth imposing these budget cuts on that sector. Ted Baillieu is following his master down the same track that he himself went down in the early nineties. Vocational training is very important to our economy. I call on Jeff Kennett to talk to Ted Baillieu and make the point that he has gone too far, that Mr Kennett's comments when he was Premier that the regions were the toe nail to the state were inappropriate, that he should not follow him down that path and should reverse these budget cuts, restore the funding and give regional and rural Victoria and the suburbs the opportunity to access vocational training. It is too important for our economy.