Report on Government Services: Bad news for VET

The annual Productivity Commission ‘Report on Government Services’ was released last week and it shows bad news for the VET sector.

Note firstly how in Table 5A.1 total government recurrent revenue has declined in the last decade in every jurisdiction except New South Wales and Tasmania. Victoria has reduced its funding for VET by -40% (albeit off a very high level a decade ago when it funded a training guarantee for all eligible students) and the Northern Territory by -24%. Nationally the decline was -15%.

Of course, different jurisdictions have very different populations and hence a larger jurisdiction will always invest more in VET than a smaller jurisdiction. To help make comparisons easier across jurisdictions of different sizes, the Productivity Commission also publishes data on recurrent expenditure in VET per annual hour. That data (Table 5A.2) shows that the Victorian ($15.96) and Queensland ($17.74) governments spend less per average hour than the national average ($20.21) and less than all other jurisdictions.

With the exception of Queensland, all jurisdictions increased the share of funding they gave to non-TAFE providers in 2021, and the increase was largest in Tasmania, Western Australia, South Australia, New South Wales and the ACT (see Table 5A.4). The Victorian and Queensland governments continue to provide the highest level of funding to non-TAFE providers (32% and 25% respectively).

Although South Australia had been recently been significantly increasing the proportion of funding it provided to non-TAFE providers, including in 2021; the election of the South Australian Labor government in early 2022 and their lifting of restrictions on TAFE SA offering face-to-face delivery of popular courses in Adelaide – means that South Australian funding can be expected to show a swing back to the TAFE sector in future years.

The Productivity Commission also reports data on ASQA’s activities. While they caution about ASQA’s different treatment of serious and critical non-compliances since their Rapid Review – there are nonetheless significant differences in the amount of audit activity undertaken in 2021-22 compared with five years earlier in 2016-17. There is also a very significant reduction in the number of providers identified as seriously or critically non-compliant with the Standards for RTOs between 2016-17 and 2021-22 (down from 4.6% to just 0.4%).