Direct public expenditure on VET dropping
The Australian | 10 December 2015
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Explosive growth in the VET FEE-HELP scheme has masked massive direct public disinvestment in vocational education and training. While 
a report by NCVER shows a notional growth of 1.7% in 2014 over 2013 (plus $141.0 million, from $8512.4 million to $8653.4 million), it’s all in VET-FEE Help payments: actual direct expenditure by governments, including the Commonwealth declined markedly VET FEE-HELP. VET funding through state and territory governments fell almost $320m, while fee-for-service revenue — largely contributed by businesses — fell more than $130m. Federal government funding through channels other than VET FEE-HELP fell almost $500m.
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Financial information 2014 shows that VET FEE-HELP is supplanting traditional forms of VET financing, as state governments and businesses withdraw hundreds of millions of dollars from the sector. Government spending fell $416m last year, even though Canberra shovelled an extra $1.06 billion into VET FEE-HELP.
The figures predate an even bigger shift to the training loans this year. As observed by John Ross of The Australian, “they suggest that Australia’s world-recognised public VET system is being colonised by a rort-ridden scheme which graduates fewer than one-fifth of its students.”
Victorian Skills Minister Steve Herbert said the scheme was “skewing the entire training system”, inducing students and colleges to abandon state-funded VET:
People who should have done lower-level qualifications closely linked with jobs (are) being sucked into high-cost diplomas that they never complete.
NCVER managing director, Craig Fowler, said the figures suggested there may have been a “significant rebalancing” in the sector. He said other centre research indicated that the loan scheme had increasingly attracted unprepared students studying online — all indicators that they were “more likely to fail”:
Many appear to have come from backgrounds and educational circumstances which meant they were poor recruits into a program at that level.
The federal government has moved to revamp the scheme following reports of widespread rorts and poor completion rates, Fowler said the figures suggested that many more ill-prepared students had already taken out loans this year and “he outcomes may well continue to be less than good.
State spending on staff plunged by $397m, reflecting widespread job losses in TAFEs.
Key Points
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Financial information 2014