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Legislative Assembly for the ACT: 1999 Week 4 Hansard (22 April) . . Page.. 1144 ..

MS TUCKER (continuing):

In relation to the AEU's claim that some of the Oliphant report's basic tenets are not supported by nationally published data and therefore the report's recommendations cannot be sustained, the Minister claimed that the AEU had been selective in the data it examined.

On the issue of future public funding for the CIT, the Minister told the committee that, in determining the CIT's market-based price, the Government determined the 1998-99 GPO by reference to the Australian average VET costs per adjusted annual hour of curriculum. If CIT is to meet the national average, it will need to reduce its costs by 27 per cent.

Government payment for outputs plus the operating injection have reduced the operating deficit to $5.6m in 1998-99. The forward estimates show that operating result deteriorating by 2001 to 2002 as the operating injection is decreased. The CIT also generates about 16 per cent of its total revenue from non-ACT government sources, such as contestable funding, user charges and Commonwealth grants.

The Government told the committee that it is committed to increased access to training, with vocational education and training hours expected to grow by 40,000 hours in each of the next three years. However, since the Commonwealth has stopped injections of funding, any growth has to be made through efficiencies. In other words, the CIT has to do more with less.

The AEU pointed out that, given that employee expenses account for a large proportion of the CIT's budget, there is not much room to move in making efficiencies without reducing teacher conditions, increasing class sizes and further casualising the work force. Information provided to the AEU by the CIT as background for the enterprise bargaining discussions shows a reduction in expenditure of $10m over the next three years. When the committee asked the Minister to comment on this projected reduction, the Minister referred the committee to the 1998-99 budget and declined to make any other comment.

Another area of concern to the AEU is loss of funding to the CIT through increased contestability. At present 10 per cent of the vocational education and training budget is allocated by contestable means. This will increase to 15 per cent in 1999-2000. The Minister advised the committee that the CIT is expected to win a large percentage of those funds back. Nevertheless, there will be some loss to the CIT.

The committee concluded it would be most disturbed if reductions in public funding to the CIT were based on benchmarking with Victoria; resulted in any lowering of standards or limiting of access to courses; resulted in the CIT not being able to meet its community service obligations to disadvantaged groups in the community; or resulted in the CIT not having the resources to apply for contestable funding.

In conclusion, the meeting and information provided since highlight the need for continued scrutiny of the CIT budget to ensure that the CIT is adequately funded to provide quality programs which are responsive to the needs of industry, students and the community. There are a number of complex issues relating to CIT funding which need to be explored further, and the committee urges the Select Committee on Estimates to take a very close look at what is happening.

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