The NSW Skills Minister has called on the federal government to extend the HECS tertiary loan system to TAFE, arguing there is currently a “perverse incentive” for students to choose university over a trade because there is no up-front cost.
Concerns over the decline in vocational education and a funding disparity with the higher education sector was raised by state ministers during the Skills COAG held in Melbourne on Friday.
NSW Skills Minister Geoff Lee believes the up-front cost of many TAFE and vocational education courses was pushing potential students towards university, where their fees were covered by the Commonwealth HECS loan scheme.
“There is a perverse incentive for people to actually go to uni and do degrees that are irrelevant to what they want to do in life because there are no upfront fees,” Mr Lee told the Sun Herald.
“So if you’re from a low socio-economic background or some disadvantage, it’s pushing people into the higher-ed sector where they’re probably better off to do jobs and get good jobs and get good careers in the skills and training area.”
While the issue of funding inequity was on the table at COAG, Mr Lee went a step further after the meeting, suggesting the best solution would be for the federal government to allow TAFE students to access HECS loans, which are repaid incrementally once someone begins earning more than $51,000.
“It should be the one program in my opinion…HECS actually works very well,” Mr Lee said.
“We’d like to see that rolled out…there should just be one system that actually allows people in the VET system or TAFE to take advantage of those very low fee services, you know low interest rates so they can enroll in the course of their choosing.”
While certain commonwealth loans are offered to vocational education students studying a diploma or higher courses, a spokeswoman for Mr Lee said there were caps on those loans and they weren’t given to people undertaking certificate level studies.
Mr Lee said the federal government “recognise the disincentives” students faced when considering undertaking vocational training.
Mr Lee, who was promoted to cabinet following the Coalition’s March state election win, said it was currently taking too long for TAFE to recognise where skill shortages were, consult with the industry and develop a course.
The member for Parramatta said it took up to six years for TAFE to develop courses, which could be redundant by the time they were offered to students. He wants courses developed in six months.
“Every time I met with industry leaders, they all say a shortage of critical skills will negatively impact productivity and we need to act now,” he said.
NSW opposition spokesman for skills Jihad Dib said he would welcome further commonwealth funding for vocational education.
“Anything that is going that is going to improve enrolment into TAFE is something that we would be supportive of, but I’m not going to let the government get away with not acknowledging that they’ve made a massive mistake over a long period of time where they’ve run TAFE into the ground,” he said.
“We had teachers that were losing their jobs, courses that were being cut and accessibility really limited….the policies of the last eight years is what has led us to this.”
Federal Skills and Employment Minister Michaelia Cash, who met with state ministers at COAG on Friday, did not respond to requests for comment.