Refocussing Vocational Education and Training at Victoria University Update for Staff 6 June 2012
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- Ambrose Harris
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1 Refocussing Vocational Education and Training at Victoria University Update for Staff 6 June 2012 Background In May 2012, the Victorian Government introduced the Refocussing VET in Victoria policy, dramatically changing State funding for vocational education particularly for TAFE institutions. The changes are intended to control the unexpected blow out in Government spending following the progressive introduction of uncapped funding for over 400 private RTOs as well as TAFE institutions in The resulting dramatic surge in VET delivery by private registered training organisations has fuelled Government VET expenditure of $1.3b in 2011, far exceeding the Government s budget estimate for the year of $900m. Unfortunately the TAFE sector has not grown and has seen its market share of government funded enrolments shrink from 66% in 2008 to 48% by the end of Summary of changes stemming from Refocussing VET in Victoria: 1. The removal of TAFE differential payments: All differential TAFE payments will cease from 1 January The TAFE differential payment of $14 million in 2012 covered enterprise agreement salary supplementation for staff, specialist equipment costs and professional development funding amongst a range of other areas. Additionally, TAFE institutions will be funded at the same rate as private RTOs for all courses commencing from 1 July New subsidy system: There is a new system for determining the Government funding rates for courses through subsidy bands that range from a subsidy of $ $ Many subsidy rates for Victoria University courses go down. 3. Removal of tuition fee caps: Tuition fee caps are removed and it is assumed that institutions will raise fees especially for diploma courses which offer students fee support through the VET FEE-Help system. However State Government fee concession reimbursements for eligible students will be capped. 4. Removal of youth concessions for Diploma and Advanced Diploma courses. 5. Reduced youth supplementation: A reduced youth supplementation will be only available for students aged who have not completed year 12 and are considered low SES students. This supplementation is paid as a 1.3 weighting of the subsidy rate. 6. Reduced funding for RPL: Funding for RPL is reduced to 50% of the subsidy rate for many courses and RPL is not funded for Foundation category courses; 7. Enterprise bargaining: Public providers will be able to negotiate their own enterprise bargains 8. Regional Loading: There will be a 5% loading on Government subsidies for all non-metropolitan provision, public and private 9. Stand alone TAFE boards: Stand alone TAFE institutes will have more flexibility around their board appointments Note that these changes signal the Victorian Government s commitment to manage the open training market through manipulation of the rate at which it subsidises enrolments. This approach means that we can expect further funding changes as the market fluctuates. The courses that are most affected at this time fitness, business, finance, hospitality are the course areas in which the private providers over-delivered and flooded the labour market. For example in ,500 fitness instructors were trained in Victoria. The Victorian government policy statement which provides further detail about these reforms is available on the DVC Jones intranet site under VE Strategy. Financial Impact on Victoria University The table below demonstrates the magnitude of the impact on Victoria University. It provides an estimate of the reduction of government funding in 2013, based on 2011 delivery. Victoria University is particularly affected by changes to fee concession reimbursement because approximately 50% of our TAFE students have low incomes and are entitled to pay minimum fees. 1
2 We will also be penalised for our success in building RPL services for industry. The total loss represents 1/3 of our State Government revenue. Funding Impact $m Loss of TAFE public provider block funding 14.0 Estimated loss of State funding for delivery based on actual delivery note this is DEECD s estimate Estimated loss of youth supplementation 2.2 Decrease in fee concession reimbursement 1.3 Decrease in funding for RPL 5.0 Total 32.1* *Represents over 25% of VU s TAFE revenue & 33.3% of VU s government funded training delivery Staff will be interested to see how the loss of public provider block funding affects their school. This funding has always been provided to TAFE institutions and includes funding for equipment, building maintenance, e-learning initiatives as well as the salary supplementation provided by the Government to cover TAFE teacher salary increases approved under the State Government s salary policy. The following table presents the estimated loss of public provider funding for each faculty and school: TAFE block public provider funding impact on Faculties by reduction of funding VU College Pathways and Transitions Teacher Development Unit Foundation, Community & Indigenous Youth Language and Learning Harvester Technical College TOTAL Faculty of Technical and Trade Innovation Engineering Construction Industries Service Industries Total TTI Faculty of Workforce Development Sport & Science Health and Community Services Business Creative Industries & IT Total Workforce Development $ 590,259 $ 63,499 $ 1,019,694 $ 677,159 $ 244,711 $ 59,463 $ 2,654,788 $ 1,306,288 $ 2,234,850 $ 1,213,819 $ 4,754,958 $ 1,336,656 $ 1,840,184 $ 1,888,139 $ 1,613,440 $ 6,678,420 Total overall VE/FE $ 14,088,166 It is important to note that this loss of revenue affects the whole University since approximately $13m of the lost revenue would have potentially contributed to the University s corporate costs. Victoria University s Response The University is not positioned to absorb funding cuts of this magnitude. We will seek to mitigate the impact through a number of strategies including increasing tuition fees, discontinuing courses and other activities that are currently crosssubsidised and ensuring that we have the best course mix possible to align with the University s proposed structure. The fees and funding changes will require a number of changes to internal systems including VU Connect. Deputy Vice-Chancellor, Professor Anne Jones established three groups to manage the University s response: A Refocusing VET Response Steering Committee A Refocusing VET Courses Working Party A Refocusing VET Systems Working Party. 2
3 The Steering Committee including the Executive Deans from the affected faculties has identified short and long term priority areas: 1. Short term priorities: maximise pre 1 July enrolments; maximise post 1 July enrolments; implement a revised fee structure by 1 July, create an efficient course profile, implement necessary changes to VU systems. 2. Longer term priorities: further analysis of strategic and financial viability of all VE and FE courses in the context of the VU agenda including what courses will best fit the proposed new entities for Review of VE courses and student fees The Refocusing VET Courses Working Party, including representatives of the VE faculties and VUC, was established to review the strategic alignment and financial viability of all VET courses and to provide recommendations to the Steering Committee. The Working Group developed a set of principles for evaluating courses: Strategic alignment with the VU agenda Financial viability Elimination of internal competition Simplification of course ownership Overall reduction in numbers of cost courses Availability of or potential for guaranteed pathways for qualifications (except certificate III) Minimum course numbers of 50 per year Discontinuation of advanced diplomas except where there is a demonstrable vocational outcome beyond that provided by the cognate diploma Discontinuation of certificates I and II (with the exception of English, VETiS, senior secondary, academic support, and pre-apprenticeships). Schools identified courses which could be commenced prior to 1 July 2012 and completed by the end of the year. These courses leverage current funding rates and freeze the student tuition fees at the current rates until the end of The list of selected courses is included as Attachment A. Results of course review The working party identified a number of course areas that are not sufficiently aligned strategically and/or are not financially viable under the new funding system. Courses areas that will not be taking new enrolments post 1 July 2012 are: Animal Studies and Veterinary nursing these courses will be taught out except for students studying at the Diploma level. These students will be supported to transition to another provider. Boatbuilding - these courses will be taught out in 2012, however if any students do not complete by the end of 2012, they will be given the option to complete through enrolment in engineering units at Sunshine campus. Events and Tourism current students in these courses will be taught out by the end of There will be reduced course offerings in the following industry areas: Sport and fitness - current courses below Diploma level will be taught out and there will be no further intakes into those courses. The Diploma of Fitness and Diploma of Sport Development will continue to take enrolments. Hospitality - current courses other than Certificate III and IV in Hospitality (Commercial Cookery) will be taught out with no further intakes into those courses. Hospitality VET in School programs will be fully auspiced from 2013 or we will assist schools to identify alternative providers. Business - discontinued courses will be taught out and there will be no further intakes into those courses. A full list of retained courses can be found at attachment B and will continue to take enrolments. Financial services - discontinued courses will be taught out and there will be no further intakes into those courses. A full list of retained courses can be found at attachment B and will continue to take enrolments. Other impacts: Higher fees for many courses, particularly at Diploma level and above. Inability to underwrite the Trade Training Centres currently planned for construction on our land at Werribee and Melton. Higher fees for directly delivered and auspiced VET in School programs. 3
4 Staff implications Since we will progressively transition out of the discontinued courses it is unlikely that further redundancies will need to take place until the end of 2012 With the substantial reduction in government funding and subsidies it is inevitable that there will be a realignment of staffing numbers to ensure financial viability of programs. As part of previous faculty change plans there are already currently approximately 50 positions being made redundant in the faculties of Technical and Trades Innovation and Workforce Development. These redundancies were planned because we expected funding reductions following the State Budget although the magnitude of these was more significant than expected. It is not envisioned that further redundancies will occur until additional financial analysis is undertaken in the later part of All staff who teach in the course areas which are taking no new enrolments post 1 July 2012 have had the opportunity to be briefed in staff forums held on Wednesday 6 th June For staff teaching in the course areas which are being streamlined, the staffing impact will be analysed throughout the second half of A further review of redundancies may be required for staffing in excess to 2013 requirements. For all other course areas, analysis is being undertaken to determine whether structural changes to course delivery is required which may impact on staffing numbers both teaching and support staff. Both the Australian Education Union and the National Tertiary Education Union have been briefed about these implications. Staff Support The Employee Assistance Program is a free professional and confidential counselling service for all VU employees and their immediate families. It provides short-term assistance to VU staff for work-related or personal issues affecting your ability to do your job, either in person or on the phone. EAP consultants will help you clarify a problem or situation, identify your options, and help develop possible solutions and an action plan to put into place. The EAP can also make a referral to external support agencies for longer-term assistance. The EAP hotline is open 24 hours a day and can be reached on (1300 EAP AT VU). Further details of the EAP program can be found at attachment C. Staff are encouraged to discuss any further issues or concerns directly with their Head of School. Next Steps System Changes A range of system changes are being implemented to meet the new requirements from 1 July These include: Changes to tuition/concession fees for all courses commencing post 1 July These will be reviewed to determine the tuition fees to be charged to all students from 1 January Changes to tuition/concession fees to be programmed into VU Connect Changes to tuition fees for Diploma and above to be published and reported to the Department of Industry, Innovation, Science, Technology and Education (DIISRTE) for VET-FEE HELP purposes. Options for the part-payment of tuition fees is being investigated to support students below Diploma who will be required to pay higher fees. Communication A range of fact sheets are available for staff and students and can be found on the intranet site of the DVC (Academic & Students) under the VE Strategy site. Further communication for staff will be made available prior to Open Day to ensure we have appropriate messaging for potential students. This will include details of guaranteed pathways. 4
5 Milestone course review dates The response team has identified 2 key milestone dates which will provide a guide to how effectively Victoria University has responded to the new funding environment. July 16: To review the success of our student recruitment for pre June 30 courses. August 31: To review the success of our second semester enrolments. A further course review process for 2013 will take place, where decisions will be made about what courses will be retained and, if so, how they will be positioned within the new university structure. It is important to remember that the University is in the midst of significant and unpredictable changes in both its higher education and vocational education markets. We should expect further changes to funding and therefore to our courses as a result of (i) the State Government s determination to control the training market through manipulation of enrolment subsidies and (ii) the unpredictable impact of large numbers of enterprising providers in an uncapped funding environment. I encourage your involvement in the changes outlined and invite you to provide your feedback to the following address: dvc.academic.students@vu.edu.au Professor Anne Jones DVC (Academic & Students) 6 June
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