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Vocation shares suspended Vocation

19  September 2014     |    Trading of shares in ASX-listed VET provider Vocation has been temporarily suspended, at the request of the company, given ongoing speculation regarding its Victorian government funding contracts. Since listing in December 2013, Vocation has derived 80% of its revenues from subsidiary BAWM, most of which (90%) comes from Victorian government VET funding. However, that funding is being withheld, pending the outcome of an audit of courses provided by Vocation….[ MORE ]…..

AQF Council disbanded

AQF19  September 2014    |    The Australian Qualifications Framework Council, which was responsible for governance of the Australian Qualifications Framework, has been disbanded. The council was originally established to deliver a review of the AQF, which culminated in the strengthened AQF. With this work completed, the government says it was timely to reconsider the role of the council. Stakeholders have been advised that the decision does not diminish the government’s commitment to the AQF, the residual functions of the council will be transferred to the Commonwealth department of education. Expert consultative bodies are to convened as required to advise ministers on any AQF policy matters which arise….[ MORE ]…..

Sweeping VET deregulation 

12 September 2014     |     Industry minister Ian Macfarlane has announced sweeping deregulation of the vocational education and training (VET) sector with “high performing” VET MacFarlaneproviders delegated the authority to manage their own scope of registration and no longer needing the regulator’s permission to change courses or introduce new ones. Under the proposed changes, registered training organisations (RTOs) can apply to the Australian Skills Standards Agency (ASQA) for a delegation to manage their scope allowing RTOs to “get on with what they do best — delivering the high calibre training that meets industry and economy needs”. Macfarlane told a national VET conference that “quality training speaks for itself” and “ the best way to ensure an RTO delivers high quality training is to let it stand on its reputation – not fill out reams and reams of paperwork and jump through endless hoops.”….[ MORE ]…….

Apprenticeship funding revamp

One stop

9 September 2014    |     Small businesses in regional areas with high youth unemployment will gain access to federal government funding for training, as part of an overhaul of skills programs including the including replacing Australian Apprenticeships Centres with an Australian Apprenticeship Support Network. The apprenticeship centres were described as government-contracted “one-stop shops” for businesses seeking to hire apprentices or people wishing to take up an apprenticeships. In announcing the new arrangements, prime minister Tony Abbott said the new streamlined system would provide a “one-stop shop for employers, particularly small business, looking to hire a new apprentice suited to their business” but would replace “the unwieldy and overly bureaucratic system that has become bogged down in red tape”….[ MORE ]…….

SA TAFE jobs to go – in bulk 

5  September  2014      |       SA TAFE jobs are set to be slashed by almost a third over the next four years as part of a cost-cutting drive, raising fears a training shortfall will hit just as theTAFE SA 2 automotive sector shuts down. A leaked parliamentary briefing note prepared for Employment, Higher Education and Skills Minister Gail Gago shows TAFE’s full-time job cap will fall by 814 by 2017-18. The Government announced cuts to TAFE in the June Budget where it revealed almost 300 jobs would go over 12 months. However, Gago was unable to detail the full four-year impact of the State Government’s savings drive when questioned in Budget Estimates. The briefing note shows TAFE’s current full-time equivalent cap of 2609 jobs will fall to 1795 in 2017-18 as the Government’s annual spend on the sector drops by $94 million to $251 million…..[ MORE ]……

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Comment & analysis

Fee free-for-all a risky strategy

19  September 2014

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Cap needed to take the idea of $100,000 degrees off the table

Andrew Dempster(Swinburne University) argues that a cap on fees needs to be considered to avoid universities competing solely on price, which would see all universities move to or near the price set by first movers, in order to maintain reputational value.  He suggest it’s no accident that the current fee for an Australian student to study a Bachelor of Business at Bond University is $95,568, which is almost identical to the maximum HELP borrowing limit of $96,000 for such a degree.

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mortar board


Long-time watchers of Australian higher education know that only one thing really gets the public excited – how much students pay to go to university. It’s where public policy meets the hip pocket. So far as universities are concerned, it’s the only barbeque stopper we’ve got.

Kicking off this debate is not for the faint-hearted. It’s made Christopher Pyne the most politically courageous education minister Australia has seen since John Dawkins.

Twenty-five years ago, Dawkins took on the yoke of reform when he introduced the user-pays principle, creating a system of financing Australian higher education which has delivered stable, long-term growth.

Pyne’s ambition is an order of magnitude bigger than this. What the government is proposing is bold but it is also fraught with risk. It’s a bit like attempting a high dive at a degree of difficulty of 9.0 with smoke obscuring the water below.

The decision to move rapidly to a position of full fee deregulation, rather than setting new maximum limits on fees, is allowing opponents to fan public sentiment against the proposed changes. Nobody likes the idea of $100,000 degrees and it’s this contention which, if unanswered, may be enough to sink the reforms or to seriously delay them.

Underpinning the government’s narrative is a strong belief that the market will produce downward pressure on fees and that over time there will emerge clear differences between what Australian universities are prepared to charge their students for an undergraduate degree.

If the government has this right, there is little for people to worry about. If the government has this wrong, the country can buckle down for a period of rapid fee inflation.

A lot of faith is being placed in the ability of a new insurgent band of private colleges to offer higher education cheaper and better than incumbent universities – threatening to erode universities’ market share unless they respond by competing with the private colleges on price.

This is a big ask, both of the private colleges and universities themselves.

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19 September 2014

Meanwhile, in the US…

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With a furious debate going on about university fee deregulation in Australia, the US system of fee deregulation, lauded by the proponents of fee deregulation, has seen student debt in the US surpass debt from credit cards and auto-loans, and become second only to mortgages.
US talk show host John Oliver advises US college students to enjoy themselves – to party and to get out and about:

Please, make sure your colleges years are the best ones of your life, because thanks to the debt we are saddling you with, they almost certainly will be.

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For a summary :
Drink Beer, Shoot Fireworks Out Your Bum: John Oliver’s Uni Debt Warning

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 Higher education reforms face mounting odds

    19  September 2014

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Crunch time has arrived for the government’s higher education reforms. Having passed in the House of Representatives, the legislation is now being kicked around the Senate like the football it  has become, having been referred to a committee.  Geoff Sharrock (LH Martin Institute) at the policy trade-offs that might be necessary to get the package through.

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The accompanying table shows the package as a balancing act of spending and saving. Politically, the odds are stacked against the three major reforms: higher HELP loan interest rates Higher education budget(Policy 7), cuts to the amount of public subsidy (Policy 6) and fee deregulation (Policy 5).

Universities Australia has called on the Senate to support fee deregulation, keep loan interest charges linked to the consumer price index rather than the bond rate, and moderate subsidy cuts “to reduce upward price pressure on fees”.

Education Minister Christopher Pyne’s dilemma is clear. The two main sources of budget savings – higher interest rates and lower subsidies – each amplify the risk of larger HELP debts, undermining support for fee deregulation. Yet without savings the other spending measures will exceed the budget bottom line.

In the Senate a spectrum of positions can be found. Some are utopian. Free higher education, a world away from decades of Labor and Coalition policy, is sought by the Greens and the Palmer United Party. If adopted, an analysis by the Group of Eight universities sees this adding $5 billion a year to the current $6.6 billion spent on subsidies.

Apart from fee deregulation, most spending measures in the table have wide support, Policy 1 in particular. While not a reform – it retains Labor policy to let institutions offer subsidised places without limit – this is a costly decision. As the graph shows, even with subsidy cuts, the budgeted expenditure for grants plus HELP lending rises from less than $6.4 billion in 2013-14 to more than $9 billion in 2017-18.

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Australia’s tertiary education system needs a rethink

19   September 2014

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The reform of Australia’s federation is under review. In a special series, The Conversation has asked leading Australian academics to begin a debate on renewing federalism, from tax reform to the broader issues of democracy.   Victoria University’s Peter Noonan examines the effect of the funding relationship between the state and Commonwealth on tertiary education and says funding of vocational education is suffering given neither the state nor Federal government has sole responsibility.  

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 federalisme

A major imbalance exists in Australia’s tertiary education system. Left unaddressed it will lead to growing disparities in funding between higher education and vocational education and training, distort student choices and create an imbalance in skills in the Australian labour market.

An effective tertiary education system would comprise a range of high quality courses and providers operating across the vocational education and training (VET) and higher education sectors under an equitable funding system.

What would an effective funding system look like?

An effective tertiary education funding system should have three main features:

  1. Public subsidies that balance public and private benefits, course costs and the circumstances of individual students
  2. Private contributions supported by income contingent student loans that ensure that students only pay when they start to get personal benefits
  3. Student income support targeted to the needs and circumstances of individual students.

There is already great diversity of courses and providers across the Australian tertiary education system with growing and better connections between the sectors. The Commonwealth also operates a consistent and comprehensive student income support system for tertiary education students.

But the potential of this system is undermined by growing divergence in how, and at what levels, VET and higher education are funded, and how, and at what level, the states fund their VET systems.
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TAFE :the essential ingredient

8  September 2014

TAFE and other govt

Non Tafe Students by state

Click images to enlarge

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In late April 2012, the Victorian Coalition government, building on the skills reform initiative of its Labor predecessor, unleashed its own radical model of vocational education and training (VET) market reforms.  Basically, these reforms opened up the public funding of VET to virtually all comers and removed any dedicated funding to sustain the public character of TAFE (the public VET provider network).  Most commentators predicted that these reforms would undermine the TAFE sector and, with it, the whole VET system.  After the passage of a couple of years, those commentators can say, on the available evidence, “we told you so”.

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Now, I’m relatively agnostic as to the efficacy – or otherwise – of a market orientation in VET provision: in policy terms, it doesn’t matter what institution is delivering a qualification – public or private, TAFE or university, domiciled in a particular jurisdiction or some other – so long as it represents value in terms of both cost and quality.

So I don’t come from the perspective of denigrating training provision by private registered training organisations (RTOs) nor seek to insulate TAFE from competition from RTOs:  RTOs can and do add useful diversity, innovation and choice to the overall system.

It follows that governments should be equally agnostic but that appears not always to be the case.

TAFE, as the public provider network, underpins the whole VET system (which is widely acknowledged by industry) and contributes to the public good in numerous tangible and intangible ways that private RTOs do not, to which some governments appear largely or entirely  blind.

Present moves to contestability of public VET funding do present fundamental challenges for the public TAFE sector which need to recognised and addressed in appropriate ways.  In Victoria, which is most advanced of the jurisdictions along the path of contestability and with its radical outlier model, the TAFE system is wobbling mightily, with declining overall enrolments, mounting financial losses and incipient signs of market failure.

One TAFE leader has expressed doubts that TAFE can survive in Victoria.

Publicly provided TAFE will survive, for the time being at least, but it in greatly diminished form.  We can see already that many of the TAFEs have become “residualised”, with underutilised assets and need special assistance to cover declining revenues.  This runs counter, of course, to the logic of “marketisation” and it runs counter to Australia’s economic and social interests.

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In the past, TAFEs have been instruments of public policy, in a way that private RTOs have not been and, I would suggest, never will be. TAFEs have also been described as “bulwarks against market failure.

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Life & stuff

David & Magaret to leave the building

17 September 2014

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Margaret Pomeranz and David Stratton have been, for the 28 years that they have been reviewing cinema together, the voice of Australian film criticism. They have now announced that they’re leaving their long-running SBS/ABC program At The Movies (The Movie Show) at the end of 2014. The show will not be returning with new hosts.  Here, Cate Blanchette and Geoffrey Rush review Margaret and David for the 25th year of their program.

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