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TAFE CAMPAIGN 2005. National TAFE Funding: 2005 Update. May 2005. Michaela Kronemann Federal Research Officer. Contents:. The Commonwealth role in funding VET Impact of the resource pressures A new federalism: the federal agenda Future funding & federal conditions AEU campaign 2005.

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tafe campaign 2005
TAFE CAMPAIGN 2005

National TAFE Funding:

2005 Update

May 2005

Michaela Kronemann

Federal Research Officer

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

contents
Contents:
  • The Commonwealth role in funding VET
  • Impact of the resource pressures
  • A new federalism: the federal agenda
  • Future funding & federal conditions
  • AEU campaign 2005

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

funding overview
Funding Overview

Governments provide 78.3% of recurrent revenue for publicly funded VET.

  • The Commonwealth provides:
  • 28.7% of recurrent government funding
  • 61% of capital funding.

The states and territories

continue to provide the bulk of recurrent funding.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

slide4

ANTA Agreements- funding

1993-97 An initial $100 million and $70m per year (cumulative) to fund enrolment growth. States required to maintain effort.

1996-97Budget cuts reduced funding base by a cumulative $240m. Labour market programs slashed.

1998-00Growth funding abolished, Commonwealth funding freeze. Growth through efficiencies: estimated cost of loss of growth funding - $377m.

2001-03Limited growth funding restored, states required to match. Commonwealth input $230m over 3 years, states sought $900m.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

failed negotiations for 2004 06
Failed negotiations for 2004-06
  • Commonwealth offer – no additional growth funds – only indexation of 2003 amount, $119.5 million for Welfare Reform Measures from previous budgets.
  • States argue they need $348m more.
  • Minister Nelson imposes penalties for rejecting offer.
  • States reluctantly sign up to a 12 month rollover for 2004:
  • No indexation of growth funds
  • Comm. direct purchase of 7,500 places ($20.5m)
  • Indexation of base funding, terms and conditions apply (eg matching growth funds)

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

slide6

Commonwealth funding for VET

C’wealth funding is 6.5% less than in 1997

(CPI adjusted).

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

slide7
Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006
slide8

Proportion of revenue by source

The proportion of total operating revenue coming from the Commonwealth has fallen from 25% to 22.5%.

The states’ contribution has fallen from 56.1% to 55.8%.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

vet system growth
VET system growth

Since 1997:

  • Enrolments increased by 272,100, or 18.8%
  • Annual hours increased by 78.1 million hours, or 26.8%

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

real contribution to vet costs per student hour per ahc
REAL CONTRIBUTION TO VET COSTS PER STUDENT HOUR ($ per AHC)

Change (%):

Comm -26.3%

States -18.6%

Other -5.8%

Total -18.1%

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

slide11

Share of funding for Non-TAFE Providers

$58.6m in 1995 $316m in 2003

  • 79.9 % increase since 1997
  • Share fell from 6.7% in 2002 to 6.5% in 2003

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

slide12

Unmet Demand for TAFE

  • TAFE student places:
  • 44,400
  • 2000 48,700
  • 200140,100
  • 2002 44,100
  • 2003 45,900

Other :

15,600

17,000

16,500

10,600

9,500

Total VET:

60,000

65,700

56,600

54,700

55,400

  • Unmet demand for TAFE is increasing.
  • 68% of those unable to gain a place in post school education and training sought access to VET.
  • Unmet demand for TAFE was 3.5% of all those who did participate in TAFE in 2003.
  • ANTA 2004

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

slide13

Impact of the Resource Pressures

  • Concerns re quality: Schofield, 2000 Senate report.
  • Higher class sizes, rationalisation and reductions in TAFE courses, cuts to student services, amalgamations and closures and colleges facing significant financial difficulties.
  • The overall failure/withdrawal rate for students has increased from 13.7% in 1997 to 15.6% in 2003. NCVER 2004)
  • Growth in precarious employment (but some recent moves back to more secure employment).
  • Increased workload and stress for teachers: unpaid overtime equivalent to 6500 teachers. (Kronemann 2001)

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

skills shortages
Skills shortages
  • Unions and employers concerned: ACTU estimate a shortfall of 130,000 skilled workers over 5 years.
  • Growth in new apprenticeships has been in areas like retail rather than trades.
  • Industry-led, employer-subsidy driven approach has failed to address skills shortages.
  • Complex causes – and solutions. (ACTU 6 pt plan.)
  • Skills shortages are both real and a rationale for deregulatory ‘solutions’.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

the coalition agenda in brief
The Coalition agendain brief:
  • new federalism more control over state & territory activities through funding conditions and direct funding
  • Privatisation user choice, tendering, third party access, encouraging privatisation
  • Industrial relations attacks on worker rights and role of unions

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

election announcements skills shortages skills shortages skills shortages skills shortages
Election announcements(skills shortages skills shortages skills shortages skills shortages…)
  • Institute for Trades Skills Excellence
  • Australian Technical Colleges
  • Some specific measures re apprentices: tool kits, extension of Youth Allowance, pre-voc places in Group Training Companies, scholarships etc.
  • post election:

Abolition of ANTA

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

australian technical colleges
Australian Technical Colleges
  • 24 ATCs by 2008, $349m over 4 years
  • Up to 300 select-entry students or 7,200 total
  • Years 11& 12, academic and trade course, & school-based New Apprenticeship
  • Need to be registered as schools and RTOs (or partnership arrangements)
  • Industry led and endorsed, industry Chair of Governing Council
  • Run autonomously by Principal, offer performance pay and AWAs
  • Tendering by consortia
  • States & territories required to provide school funding.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

abolition of anta
Abolition of ANTA
  • Transfer of responsibility to DEST by July 2005
  • New Ministerial Council for VE (VE MINCO)
  • Replacement of ANTA Board advice with new National Industry Skills Committee to provide advice to VE MINCO.
  • New multi-lateral funding agreement with the states – national objectives, funding (and conditions).
  • Bilateral agreements re performance levels and implementation of national priorities, can include additional conditions.
  • New legislation needed to enable new structures and funding to proceed.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

federal funding offer 2005 08
Federal funding offer 2005-08

Reported:

  • An ‘additional’ $174.7m over 3.5 years
  • Basically redirected money – re-inclusion of VET Priority Places Program (put out to direct tender last year) & $3.8m p.a. from Indigenous Strategic Initiatives Program, plus indexation for 2004 and 2005.
  • States required to match funds to deliver up to 116,400 new places by 2008– trades, skills shortages (eg child care), mature age, people with a disability.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

federal conditions on funding offer
Federal conditions on funding ‘offer’
  • Greater autonomy for Institutes, with AWAs and performance pay
  • User Choice reform and expansion
  • Implementation of ‘true’ competency based training by removing impediments in state based awards
  • Third party access to facilities that get Comm. Infrastructure funding
  • Adherence to the National Construction Code & Implementation Guidelines
  • Development of a national fees policy to limit fee increases
  • Joint funding pool for Indigenous Australians ($3.8m matched by states)

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

april minco meeting
April MINCO meeting
  • ANTA MINCO met 15 April, failed to agree re future funding arrangements.
  • Agreement to continue current funding until end 2005 (legislation required to establish new structures).
  • Further meeting late May/early June (now 8 June).
  • State & territory communiqué calling for increased investment in training & concern re the conditions.
  • Department officers to report back to next MINCO re impact of Comm. proposals on availability and quality of training before an agreement is signed.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

federal budget
Federal Budget
  • Federal budget on 10 May funds election commitments re New Apprentices etc as expected. Funding for Welfare to work measures.
  • ‘Additional’ funding offer for 2005-2008 now increased from $174.7m to $215m as a result of ‘welfare to work’ measures –

$39m for 2006-08. (bulk is still Priority Places funding returned to states and indexation).

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

legislation bombshell
Legislation ‘bombshell’
  • On 11 May, Government introduces Skilling Australia's Workforce Bill 2005 – lays out funding levels and the conditions which states and territories must agree to in order to get VET funding.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

conditions on federal vet funding 1
Conditions on federal VET funding (1)

Conditions on funding include:

  • Offer AWAs to all staff.
  • Give more authority to Directors for recruitment and remuneration.
  • Have performance management systems including performance pay and managing underperformance.
  • Neither encourage or discourage union membership.
  • Change practices and policies except where directly inconsistent with a current EBA/Award.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

conditions on federal vet funding 2
Conditions on federal VET funding (2)
  • Increase entrepreneurialism & commercial activities.
  • Fully comply with User Choice.
  • Increase proportion of New Apprenticeships eligible for User Choice funding by 5% per year.
  • Participate in establishing a national unit price band for each New Apprenticeship.
  • Remove requirements in awards for time-based training.
  • Make TAFE facilities available to third parties on a commercial basis.
  • Have Annual State VET Plan approved by Federal Minister.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

no federal funding after july 2005
No federal funding after July 2005?
  • The Commonwealth provides 29% of recurrent funding. (That’s about 450,500 student places).
  • The legislation would allocate $605.8 million for July – December 2005.
  • States and territories will cease to receive funding from the Commonwealth from July 2005 unless they agree in writing to the conditions set out in the Government’s legislation if it is passed.

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006

national campaign 2005
National Campaign 2005

What you can do:

  • Support AEU campaign activities.
  • Help build activism and recruitment.
  • Keep Federal politicians informed about TAFE issues and concerns: invite them to your Institute.
  • Inform local employers and unions about loss of course offerings & student waiting lists.
  • Inform your local community, industries and students about TAFE issues.
  • Keep informed.

www. aeufederal.org.au

Say ‘NO!’ to AWAs

Authorised and published on the internet by P. Forward, AEU Federal TAFE Secretary, 120 Clarendon Street Southbank VIC 3006