TAFE in Victoria

Nothing to be proud of

Warrnambool Standard, Warrnambool VIC  

LAST month Premier Denis Napthine said in response to a question about TAFE funding at the Public Accounts and Estimates Committee that he was "proud" of the reforms at TAFE.

His statement is out of touch with the damage his government’s TAFE "reforms" have done to the Warrnambool community.

Rather than being "proud", Dr Napthine and his Coalition colleagues should be ashamed.

He should come and speak directly with the people in the Warrnambool area who have suffered because of these so-called reforms.

Dr Napthine should talk to the people who were planning to do one of the 30 courses with South West TAFE in 2013 but now can’t because they have been cut.

He should meet the students who are coping with massive increases in their fees and he should meet with the 50 teachers and other staff who have lost their jobs at South West TAFE.

He must explain to them why he is proud they are now unemployed.

The Warrnambool community will lose $28 million over four years because of Dr Napthine’s TAFE reforms.

At critical times government needs to invest in local economies, not strip tens of millions of dollars from them. Dr Napthine, to say you are proud of these reforms shows a total lack of empathy and understanding for the damage done to people’s lives, our local community and to the undermining of South West TAFE.

Meredith Peace, Victorian president, Australian Education Union

Questions without Notice
Members LENDERS; HALL

Vocational education and training: quarterly reporting

Mr LENDERS (Southern Metropolitan) -- My question is to Mr Hall in his capacity as Minister for Higher Education and Skills. I refer to the minister's answer to my question of 20 February regarding TAFE enrolment numbers and whether foundation studies were double-counted and his answers more generally to my questions on the financial viability of our TAFEs. The Victorian Training Market Quarterly Report is now four weeks late; is that to avoid scrutiny by this Parliament?

Hon. P. R. HALL (Minister for Higher Education and Skills) -- Far from it. What I want is to be in a position to report accurately to the Parliament. Because there is a delay in the returns of some of the training activities of a couple of TAFE institutes I am not in a position to provide that accurate information to the Parliament. That is partly due to the implementation of a new student management system amongst 9 of our 14 stand-alone TAFEs. When I have accurate information which I can put before the Parliament and the people of Victoria I will do so.

Supplementary question Mr LENDERS (Southern Metropolitan) -- I thank the minister for his answer, but if I read his answer correctly -- that two of the TAFEs are having trouble in providing the data, or even more TAFEs -- what I ask him, given that we are about to go into a long winter recess from this Parliament and there will be no scrutiny of the minister, is: will he table in the Parliament all the data from the TAFEs that have provided it before Parliament rises for the winter break?

Hon. P. R. HALL (Minister for Higher Education and Skills) -- Yes.

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Victoria Legislative Council Hansard
Thursday, 13 June, 2013
Bendigo TAFE: funding
Questions without Notice
Members LENDERS; HALL

Mr LENDERS (Southern Metropolitan) -- My question is to the Minister for Higher Education and Skills, Mr Hall, and it relates to his previous advice to this house that based on troubles in the Bendigo TAFE he had injected further money into that TAFE. I also refer to his comments regarding the reliability of data. My question to the minister today is: can he confirm that he has data that shows a radical slump in enrolments in the Bendigo TAFE now?

Hon. P. R. HALL (Minister for Higher Education and Skills) -- In respect of Bendigo TAFE, it is one of the fine institutions that serve central and regional Victoria and will continue to do so. That is no thanks to the opposition, which seems to be taking every opportunity to talk Bendigo TAFE and others down. Quite frankly I have been extremely disappointed in some of the views expressed by local opposition members which have not been helpful towards the marketing opportunities and reputation of those within that area. Let me say that the government is right behind those at Bendigo Regional Institute of TAFE. Yes, everybody acknowledges that it has faced some difficult periods of time -- and it has not been just the last year or two; it was the case under the previous government also -- and we needed to put in place some measures to ensure that it continues to be a strong, viable and sustainable provider in that region. The current Napthine government has done more for Bendigo Regional Institute of TAFE than ever the previous government did, and it will continue to do so. The beneficiaries of the $200 million structural adjustment fund money that has been made available for TAFEs in regional Victoria will greatly assist Bendigo and others to ensure that they build a strong viable business. It does the opposition no credit whatsoever to continually talk down our education system, and in particular Bendigo.

Supplementary question Mr LENDERS (Southern Metropolitan) -- Apologies for daring to ask a question on government administration! My substantive question to the minister was about data for Bendigo TAFE, so I put to him in a supplementary: will he confirm or not confirm that under his government's radical policy of TAFE budget cuts, Bendigo TAFE's enrolments now are down in the order of greater than 10 per cent, on the data available to him?

Hon. P. R. HALL (Minister for Higher Education and Skills) -- Mr Lenders, as I said, runs a fine line here about his responsibilities as a member of Parliament and his responsibilities in the promotion of training activity in the electorate of Bendigo. In respect of this particular matter, I again report that this government has been more transparent than ever in terms of vocational education and training activity. There has been a full publication of the 2012 activity report, and I gave a commitment in this house yesterday to Mr Lenders that I would publish the 2013 first quarter data before this Parliament rises, and I will do that. At that point in time those facts that Mr Lenders seeks will be clear and available to all.

Victoria Legislative Council Hansard
Thursday, 13 June, 2013
Vocational education and training: enrolment data
Questions without Notice
Members LENDERS; HALL

COUNCIL Vocational education and training: enrolment data

Mr LENDERS (Southern Metropolitan) -- My question is to Mr Hall in his capacity as Minister for Higher Education and Skills. In answer to a Dorothy Dixer from Mrs Coote on 6 February the minister said TAFE enrolments are up by 7 per cent, and the Premier made similar claims in the Legislative Assembly on 8 May. How can the minister make these claims when, as he has just told this house, he does not have the data, due to difficulty in the translation of student records from one computer system to another?

Hon. P. R. HALL (Minister for Higher Education and Skills) -- The answer to this question is fairly simple, and that is that the data reported from 2012 came from using the old data management systems, not the new. Supplementary question

Mr LENDERS (Southern Metropolitan) -- I thank the minister for that, but I draw him to his response to a question during the Public Accounts and Estimates Committee hearing on 21 May -- it is on page 4 of the transcript -- where he referred to figures from the previous year but then, when asked about the current year, said those figures were on track to be pretty well the same. I ask the minister: how could he say at the Public Accounts and Estimates Committee hearing that this year's figures will be the same as last year's figures when he does not have the data?

Hon. P. R. HALL (Minister for Higher Education and Skills) -- 'On track' is absolutely the term that I used and the minister has quoted me as using. We can always get an estimate of where the figures look like landing in respect of the ultimate final figures. We do that all the time when we are budgeting, making estimations as to what the outcomes might be. The words I used in the Public Accounts and Estimates Committee hearing -- that those figures

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Auditor-General: Tertiary Education and Other Entities -- Results of the 2012

Members PENNICUIK

Auditor-General: Tertiary Education and Other Entities -- Results of the 2012 Audits

Ms PENNICUIK (Southern Metropolitan) -- My statement tonight will be on the Victorian Auditor-General's Office report, Tertiary Education and Other Entities -- Results of the 2012 Audits.

The summary of the report concludes that, notwithstanding some areas for improvement, Parliament can have confidence in the adequacy of financial and performance reporting and the internal controls of the entities audited. The Auditor-General makes 17 recommendations.

Most of those are directed towards TAFE institutes and universities with regard to key performance indicators, quality of data, internal processes et cetera, but on reading through the report, particularly with regard to the TAFE sector, there are some concerning aspects in it that highlight the impacts of the competitive funding model that was put in place by the previous government and has been continued by this government.

For example, regarding financial sustainability, the report finds that the operating results for TAFEs deteriorated again in 2012, with the overall operating surplus falling to $58 million, a decrease of 39.1 per cent; in 2011 it was $100.5 million, down by 32.5 per cent; and in 2010 it was $149 million, up by only 14 per cent. Based on that three-year trend TAFEs will be heading for an operational deficit.

Regarding individual TAFE results, operating results were lower for 10 TAFE institutes in 2012 compared with 2011, with 4 TAFEs recording deficits and a further 2 with marginal surpluses. The Auditor-General found that the underlying results for the TAFE sector have been declining over the last five years, indicating that expenses are growing faster than revenue and posing a long-term risk to the financial sustainability of the entire TAFE sector.

One-third of TAFEs face a more serious medium-term risk to their sustainability. Just under 80 per cent of TAFE assets are land, buildings and plant and equipment, and during the three-year period from 2009 to 2011 TAFEs spent on average $120 million per year on capital assets, including asset replacement. The Auditor-General found that TAFE institutes' capacity to self-finance has fallen from 15 per cent to 11 per cent over five years and that this poses a number of problems for TAFEs, including an inability to replace assets in a planned and timely manner and the risk that the asset base will deteriorate over time if asset renewal falls below depreciation rates.

Page 32 of the report shows that the Auditor-General found that only 4 of the 10 TAFEs that generated an operating surplus reported an improved underlying result in 2012. The report says: The worsening position indicates that expenses are growing faster ... During the past five years, 9 of the 14 TAFEs recorded a deficit at least once'. On page 30 of the report the Auditor-General found that: The underlying result, liquidity and debt-to-equity results are positive, with all TAFEs recording risk assessments of low during the past five years.

However, deeper analysis revealed that the average underlying result for TAFEs has decreased since 2010 ... The decline highlights the challenge for the sector to achieve positive financial operating results following changes in the funding model. ... Cash generated from operating activities decreased 41.9 per cent from 2010 to 2012 and now represents less than 10 per cent of underlying revenue balances. The capital replacement indicator also declined over the five-year period.

The Auditor-General also found that: Changes in the funding model have resulted in TAFEs cutting expenditure viewed as 'non-essential', including construction of capital assets. Payments for property, plant and equipment decreased by $53.5 million (35.6 per cent) ... in 2012. He additionally found that: Changes to the legislative framework and funding model ... mean that TAFEs are more reliant on tuition fees for generating a major portion of their operating revenue.

These issues pointed out by the Auditor-General in his report should concern the Parliament as to the impacts and risks that the competitive funding model has imposed on the TAFE sector.

Speaking on the Auditor-General's Report on the Results of the 2012 Audits, Ms Pennicuik said that the Audit finds that the operating results for TAFEs deteriorated again in 2012.

"Based on the three-year trend, TAFEs are heading for an overall operational deficit. For individual TAFE institutes, operating results were lower for 10 institutes in 2012 compared with 2011, with four TAFEs recording deficits and two with marginal surpluses," Ms. Pennicuik said.

"The Audit found that the underlying results for the TAFE sector have been declining over the last five years, posing a long-term risk to the financial sustainability of the entire TAFE sector," Ms. Pennicuik said.
"One-third of TAFEs face a more serious medium-term risk to their sustainability."

"The capacity of TAFE institutes to self-finance has fallen over five years and that this poses a number of problems for TAFEs, including an inability to replace assets in a planned and timely manner and the risk that the asset base will deteriorate over time if asset renewal falls below depreciation rates."

"This five year period coincides with the imposition of the market contestability on the TAFE sector by the previous government and continued by this one," Ms. Pennicuik said. "It should be ringing alarm bells as to the impacts of this inappropriate funding model on our public TAFE sector."

"The Audit revealed that the average underlying result for TAFEs has decreased since 2010, highlighting the challenge for the sector to achieve positive financial operating results following changes in the funding model and the capital replacement indicator also declined over the five-year period."

"The Audit also found that changes in the funding model have resulted in TAFEs cutting expenditure viewed as 'non-essential' and that changes to the legislative framework and funding model ... mean that TAFEs are more reliant on tuition fees for generating a major portion of their operating revenue."

"The issues pointed out in this Audit Report should concern us all as to the impacts and risks that the competitive funding model and huge funding cuts have imposed on the TAFE sector, undermining its proud history of providing affordable training and re-training for Victorians," Ms.
Pennicuik concluded.

For further comment: Sue Pennicuik – 03 9530 8399

The campus is scheduled for closure on 1 July as a result of the Victorian Government’s $300 million cut to TAFE funding last year.

Josh Cullinan, NTEU Industrial Officer at Swinburne University of Technology, said that in the past week the NTEU had uncovered two startling discoveries in the campaign, Keep Our Campus Alive.

“At the Yarra Valley Educational Precinct meeting last week the Yarra Ranges Council CEO announced he had been secretly negotiating with Swinburne and local Liberal politicians to shut the campus,” Cullinan said.

“In an astounding admission, the Yarra Ranges Council Management Executive had even started to seek planning permission from the Liberal Minister for Planning, Matthew Guy, to rezone the Swinburne University site away from education.

“To fund the purchase, it would appear Yarra Ranges Council intends to levy ratepayers. Council Executive Management proposes to pay Swinburne to take over the campus for Yarra Ranges Council’s new offices.”

Cullinan said that at Senate Estimates this week, the Commonwealth Department for Higher Education (DIICCSRTE) acknowledged that Swinburne had not received ‘prior written approval’ to close the Lilydale campus.

“This means that Swinburne is potentially in breach of its Federal funding agreement worth millions of dollars per year. The bureaucrats told the Senate Estimates Committee that the Commonwealth ‘has not raised any objections to this point in time’.”

Yesterday the NTEU wrote to the Prime Minister seeking an unequivocal guarantee that the Commonwealth will not grant Swinburne written approval to close the campus.

“This will become the single biggest election issue Melbourne’s outer east has ever seen. We are shocked that Tony Smith, the Federal Liberal MP for the region, has not been fighting for our campus in Canberra,” Cullinan said.

“We are not just waiting for the Feds, however. We’re calling for the whole community to join us in defending the Lilydale campus next Friday.

“We have found out the Swinburne Vice Chancellor is hosting Liberal politicians and Council management at a party to shut the campus. We’re not going quietly so we encourage everyone from the community to come together and deliver a very clear message that our campus is not for sale!”

Save Swinburne Lilydale Campus Rally – 2pm Friday 14 June, Jarlo Drive, Lilydale. All welcome. Dress appropriate for the weather.

Media comment: Josh Cullinan, Swinburne NTEU Industrial Officer, 0416 241 763; jcullinan@nteu.org.au

Linda Cargill, Swinburne NTEU Industrial Organiser, 0409 778 892; lcargill@nteu.org.au

Media enquiry: Carmel Shute NTEU Media Officer: 03 9254 1910; 0412 569 356 cshute@nteu.org.au

The National Tertiary Education Union covers all employees of universities, including general staff such as librarians, gardeners, technical specialists and administrative staff, and academics. It is incorrect to characterise NTEU’s members as “academics” or the NTEU as “the academics’ union”.