With university tuition fees deferred entirely to HECS, university students are spared significant upfront fees associated with pursuing a bachelors degree. But the generally lower-income students choosing to head to TAFE face costs before they even get in the door.
Economists who designed the original HECS system have long called for vocational education and training (VET) to be comprehensively covered by income-contingent loans, so students have the costs subsidised by the government and can pay off their debt when they receive income as a result of their education.
In 2015, an average of 44.5% of students who enrolled in courses with VET providers, including TAFE, were from low socioeconomic backgrounds, while in the same year only 17.7% of commencing university students were.
Professor of Tertiary Education Policy at the Mitchell Institute Peter Noonan told Crikey that students enrolling in VET courses which don’t qualify for loans or assistance, such as Certificate IIIs, faced upfront costs.
“A lot of these [certificate] courses are now going to $3,000 or $4,000 up front with no access to an income contingent loan,” he said. “It means that generally people in VET from lower income backgrounds have got no choice but to pay up front – it’s not as equitable as HECS-HELP.”
Noonan said it would take a new federal and state government agreement to implement a universal income contingent loan scheme, similar to how health and the National Disability Insurance Scheme are funded.
“This is not rocket science,” he said, pointing to a model where the state would provide the subsidy for the course and the Commonwealth would provide the income contingent loan at an agreed price.
The VET Student Loans scheme, which replaced a dysfunctional and abused VET FEE-HELP scheme in January, only applies to a set list of diploma courses, capping loans at amounts set for each course. If fees exceed this cap, students need to pay the difference up front. This also risks pricing low income students out.
Bruce Chapman, the economist lauded as the architect of HECS and who has worked with Noonan, has long advocated for an extension of HECS-HELP to TAFE students.
While making changes to the VET sector, the Coalition government has struggled to make headway on higher-education funding reform for universities since full fee deregulation was proposed in 2014 and faced widespread backlash. The sniff of $100,000 degrees was noxious.
Education Minister Simon Birmingham couldn’t get new, softer changes to higher education funding through the Senate in October, which would have lowered the HECS-HELP repayment threshold to an annual income of $42,000 at a repayment rate of 1% a year. It continues to languish as government policy.
While Chapman thinks the proposed $42,000 threshold is a “little bit low”, he told Crikey lowering it from the current rate of a $54,869 annual income at a repayment rate of 8% has got “the advantage of allowing TAFE and other areas of higher education to be covered, because the government can get their money back quicker”.
“I don’t think it’s going to affect behaviour at all. The people who want to go to university will still go to university but it will allow people, governments in particular, to get the system working for TAFE,” he said.
TAFE graduates will typically earn less than university graduates so a lower repayment threshold would be required for the government to recoup debt incurred funding TAFE students.
A spokesman for the Department of Education and Training said in a statement to Crikey the approved course list for the VET student loans program ensured there was a focus on training programs that would lead to good employment outcomes. They said the program delivers income contingent loans that “are student-centred, deliver high quality training, are fiscally sustainable, and hold providers to account”.
But federal TAFE Secretary of the Australian Education Union Pat Forward said in a interview that students from low income backgrounds are excluded from “softer and arts” areas of study at vocational institutions because those courses are “not determined to be needed by society”.
“Yet you don’t have that same restriction on higher education, where kids can still basically go to a university and enrol in a qualification of their choice,” she said.
It is very simple. Boot these bloody shysters in the arse and bring back proper TAFE which worked with the state DoEs to integrate VET and school. They are nothing but thieves and crooks.
There is an additional upfront cost that VET students face – the cost of tools. Students studying to be chefs (an industry which has chronic shortages because of poor award wages as well as crook bosses who try and avoid even paying the award) have be kitted out with a full set of knives etc by the first class. It makes it extremely difficult for people from poor families to enter the industry.
>“A lot of these [certificate] courses are now going to $3,000 or
> $4,000 up front with no access to an income contingent loan,”
> he said. “It means that generally people in VET from lower
> income backgrounds have got no choice but to pay up front
The problem is that Howard/Hockey initiated the “user-pays” mentality and now this situation exists. Thirty years ago a decent TAFE certificate cost $2.00 (NOT a misprint) per term or $6.00 per year. Certificate II amount to rubbish; Cert. III is marginally better and, depending upon the subject someone with Cert IV MIGHT be worth employing. Thirty years ago a “normal” TAFE certificate course was were a TAFE Diploma course is now.
The polies, in league with the various State Education Departments (broken up for appearances into VET and others) were complicit in the “dumbing-down” – a term actually used – of TAFE courses (into Cert I, II, III etc) to make them more “assessable”. The current situation is a problem of a TAFE Director’s own construction and the entire sector has only itself to blame. Some “training providers” know what they are doing but they are not part of the majority.
As an aside there is an argument for the State to educate for vocational (trade) courses. There is also the expectation, by industry, that a usable product will be produced – for the implied taxes required to undertake the training. The remark made by the Australian Education Union is typical of the inherent idiocy and the bemoaning that if the hospital did not have patients the system would work perfectly.
I am a former TAFE teacher. Started in TAFE in 1980 when TAFE was in its glory days. (Shades of Gough Whitlam.) Apprentices were attending because they were (a: obliged to attend..) but they also wanted to learn. Over time our politicians started targeting TAFE as an opportunity to disguise unemployment figures by forcing people into training courses – unemployed farm hands placed into hospitality courses and so on. Then the market was opened, firstly to VET courses in high schools leading vocational students to a career, and then to ‘private providers’. By this time, College ‘Manager’s’ were being appointed, seemingly briefed to reduce senior staff numbers, especially the more dynamic staff members, as quickly as possible before being moved on to another site, to repeat the cull. The came the ‘Private Providers’, who largely plundered the ‘inexpensive to run’ classes, to maximise their returns, leaving TAFE with the rest of the courses that could never, ever cover costs. And, as history shows (and common sense informs.) many millions of tax payer dollars have been defrauded, and so many students ripped off. Who would have thought? Of course the politicians could never see this situation eventuating from their thought bubbles.
So within TAFE, it became an era of showing a picture of a crayfish, or a model of a gizmo. Now, many years later, our glorious leaders are still playing silly buggers with bullshit plans; Michaelia Cash’s thought bubble of ‘internships’ where an ambitious young person can work for next to nothing for three months with no promise of a job at the end, and the exploitative employer can just move them out and sign up another trooper to the man the front line for peanuts. What can go wrong with such a wonderful idea? Where in heaven do we find these imbeciles? So the next step, when all else fails, when you’ve ripped off all but the most desperate or gullible, what can you do? Charge the remaining buggers heaps!
In keeping with this ethos, invite trained people from poor countries who are more than likely state trained and probably desperately needed at home, to come over here to fill vacancies that exist due to the lack of government investment in education and training.
Makes me proud to be Australian. (With the unlikely option to apply for a dual citizenship.)
They also reduced the length of apprenticeships from 4 years to 3 – which was promoted as a “reform” but eliminated that essential final year of training.
What a load of apologist twaddle! We are so short of tradies, employers are importing them on 457 visas! This isn’t a fair go at all! Trade course tuition should be free, and PFP providers, who shy away from “nuts’n’bolts” should only be subsidised for outcomes, not enrolments. Then just watch the shonks disappear! The money so saved should then be diverted to funding TAFEs.
I don’t want to go all Guild of Cunning Artificers or nuttin but I doubt that there is any boss breathing who wouldn’t prefer to employ someone who’d done a real apprenticeship.
Yet another baleful leftover from the Rodent years of neocon madness, young people forced through the sausage machine of these dodgy VETs.