VCOSS Analysis of the 2009-10 State Budget

Skills and workforce participation

Key initiatives resourced through this investment include:

Skills

• $66.9 million towards upgrading administrative systems across TAFEs in preparation for the implementation of the State Government’s skills reform package, Securing Jobs for your Future;
• $25 million for one year to extend the Apprenticeship/Traineeship Completion Bonus program. Under this program, employers receive $3500 for each eligible apprentice and $1300 for each eligible trainee they accept;
• this additional investment does not contribute to an increase in output targets in this area. The 2009-10 target for apprenticeship/traineeship commencements by new employees is the same as the 2008-09 target, with a target of 1,000 fewer apprenticeships and traineeships qualifying for the completion bonus than in 2008-09. The 2009-10 Budget also does not provide for an increase on the 2008-09 target of apprenticeships and traineeships commenced under the Government Youth Employment Scheme;[1]
• $13.8 million over two years for the Skills to Transition program. This funding will create up to 6,400 training places at Certificate I to IV levels for workers who want to retrain or who are in industry transition;
• $14 million over four years to ensure that jobseekers enrolling in qualifications at Certificate I to IV levels are not required to contribute to the costs of their tuition;
• $50 million over three years for an additional 15,000 training places under the Productivity Places program; and
• $22 million towards the Income Contingent Loan Scheme being administered by the Commonwealth Government which will apply to Diploma and Advanced Diploma courses from 1 July 2009;[2]  

This investment contributes to an increase in the target for investment in the 2009-10 Skills budget of $169 million since 2008-09, representing a real effective change of 6.3%.

The Skills budget also provides for new output targets for 15-24 year olds and 25-64 year olds participating in training and further education in Victoria (25.1% and 9.2% for 2009-10 respectively).

Workforce participation

The key measure funded in Workforce Participation is the New Workforce Partnerships program (formerly Workforce Participation Partnerships) established to improve access to employment by people facing systemic barriers to employment. The program received an additional $10.2 million in the 2009-10 Budget, contributing to the 2009-10 target of up to 650 jobseekers achieving employment outcomes of at least 16 weeks’ duration. However, this target incorporates the 2008-09 target of up to 450 jobseekers achieving such outcomes, meaning that the funding allocated in 2009-10 will provide for an additional 200 employment outcomes on the previous target.

This additional funding contributes to a real effective change in funding for Workforce Participation in the 2009-10 Budget of 41.4% compared to the previous year’s budget.

Additionally, $3 million was allocated for the Returning to Earning program in the 2009-10 Budget in the Labor Financial Statement, although there is no increase to the 2008-09 output target for the program.

Conclusion

VCOSS welcomes the strong investment in Skills and Workforce Participation in the 2009-10 Budget. In particular, investment in initiatives to ensure that workers in employment transition, and those who wish to retrain, can enrol in enabling courses are welcomed as an appropriate response to the global economic downturn. VCOSS also commends the Government for its commitment to additional funding for the New Workforce Partnerships program, which has achieved very positive outcomes to date. Such initiatives are particularly crucial in the current economic climate to improve employment outcomes for Victorians who are disadvantaged in terms of labour market participation.

VCOSS remains concerned however that the introduction of an income-contingent loan for Diploma and Advanced Diploma courses will present a significant disincentive to people experiencing financial and other forms of disadvantage who are considering undertaking a TAFE course. The high proportion of students currently undertaking Diploma and Advanced Diploma courses at the concession rate is evidence of the demand for these courses by disadvantaged students. Ensuring their continued participation in education and training at this level should be a priority in terms of Victorian Government objectives of addressing skills shortages and increasing the workforce participation of Victorians experiencing disadvantage.

[1] The Government Youth Employment Scheme is reported on in the ‘Workforce Participation’ section of the DIIRD budget.

[2]  Diploma and Advanced Diploma courses, defined as ‘skills deepening’ courses in the Securing Jobs for your Future package, currently cost students $877 per year, $55 for concession card holders. Under the package the cost of these courses will increase progressively from 1 July 2009. As of 1 July 2009 they will cost $1,500 p/a, $2,000 p/a from 1 January 2010 and $2,500 p/a from 1 January 2010. Under the package there will no longer be a concession available for these courses, rather an income contingent loan repayable at $42,000.