MYEFO: What it means for education and training?
The federal government has responded to Australia’s growing debt and declining growth by slashing spending on several fronts. Announced on Monday 19 December, Treasurer Scott Morrison’s Mid-Year Economic and Fiscal Outlook (MYEFO) contained a mix of bad and good news for the education and training sectors. Below are some highlights on how the MYEFO report will impact education and employment.
If you want to first remind yourself of the budget announcements made back in May 2015, in order to compare the before and now, see our previous posts on the budget announcements.
VET loans to be overhauled
Just as university students can apply to the HELP (or HECS) system for a loan which they need only start paying back when they earn a certain amount of money, students studying at TAFE or other vocational institutions, including private colleges, can apply for the revamped VET Student Loan. In October, however, the government released a list of 478 courses that would not be covered under the new scheme, such as acupuncture, energy healing and pilates.
“We want to ensure that the courses that Australian taxpayers are subsidising and that we are encouraging students to study, will optimise employment outcomes,” the Education Minister Simon Birmingham said. “Currently there are far too many courses that are being subsidised that are used simply to boost enrolments, or provide ‘lifestyle’ choices, but don’t lead to work.”
Monday’s MYEFO promises to slash spending further by introducing tougher barriers to entry for course providers, introducing loan caps on courses and having tighter course eligibility criteria. The government expects this combination of measures to save $7 billion over the four years, and $25 billion over the decade.
Industry Skills Fund to go
The Industry Skills Funds (ISF) has also been axed to save another $119 million over four years. A training and support services scheme, the ISF was designed to help micro, small and medium businesses to develop a new range of skills.
Education Investment Fund
The Education Investment Fund (EIF) is also set to close. One of three nation-building funds launched by the Rudd government in 2008, the EIF offered eligible universities, VET providers and research institutions funds for infrastructure projects.
No more Green Army
Tony Abbott’s Green Army is no more. Theoretically designed to give 17 to 24-year-olds practical skills, training and experience in conservation, which might lead to future jobs in the field, the $224.7 million cost of the scheme has mostly been recommitted to Landcare in a deal with the Greens.
Establish a New Centre of Agricultural Excellence
As promised in the lead-up to the federal election, the government will establish a Centre of Agricultural Excellence at the University of New England in Armadale by merging it with the Australian Pesticides and Veterinary Medicines Authority. “Creating Centres of Excellence in Agriculture in regional areas will drive further growth in agricultural productivity, farm production and boost rural exports,” Prime Minister Turnbull said at the time. “This will deliver substantial economic benefits not only to regional Australia but to the national economy and all Australians.”
Teach for Australia
An increase in funding of $20.5 million to the Teach for Australia (TFA) program will provide 300 new teachers into some of Australia’s most disadvantaged schools. The program provides an accelerated path into teaching for high-achieving graduates, professionals and career changers with non-teaching backgrounds, with approximately 45 per cent of participants coming into the program with qualifications in STEM-related fields.
Boost for SA jobseekers
The government has also set aside $24.8 million for a scholarships scheme in South Australia, where unemployment remains alarmingly high. “From 2017 at least 1200 Enterprise Scholarships of up to $20,000 each will be available for higher education and training places across areas of skills shortages and economic priority (such as naval shipbuilding, advance manufacturing, and medical research),” the MYEFO paper say. “To link study to employment outcomes, scholarships will include up to $3,000 for a four-week paid internship placement.”
Employment
Employment growth has also been marked down from 1.75 per cent in the budget to 1.25 per cent but the unemployment rate is still predicted to be 5.5 per cent overall. However the government has established new initiatives to expand on self‑employment opportunities, encourage entrepreneurship and improve employability in young Australians.
The New Enterprise Incentive Scheme (NEIS) will receive an additional $88.6 million over four years with the aim to engage young job seekers to explore self‑employment as an alternative pathway to employment. Starting from 2016‑17, the Youth Jobs PaTH program is designed to improve employment outcomes for job seekers aged under 25 years through real work experience.
How has the 2015-16 budget affected you and those that you advise?