A comparative analysis looking at expenditure across Australian schools, vocational education and training (VET) and higher education over the past ten years has found that while spending on schools and universities has risen significantly, there has been a much lower rate of growth in VET spending.

The report, Expenditure on education and training in Australia, by the Mitchell Institute for Health and Education Policy at Victoria University, draws on work by ACIL Allen and looks at expenditure on education by government, as well as public entities such as government schools, TAFEs and universities between 2003-2013.

The analysis was previewed at the TAFE Directors Australia Conference last month by one of the report authors, Mitchell Professorial Fellow Peter Noonan. The full report, which contains additional data and analysis, is being released today.

Expenditure on higher education has grown markedly, increasing by over 40 per cent over the decade in real terms.

In schools, overall investment has grown significantly and collective government expenditure in the Australian school sector has grown by over 23 per cent over ten years.

By contrast, expenditure on VET nationally remained largely unchanged from 2003-04 to 2008-9, with modest increases in 2011 -12 when it plateaued again. This overall flat to negative trend becomes even more pronounced if we exclude Victoria from the analysis, a state that has run counter to the national trend by significantly increasing its spending on VET in recent years.

Overall, expenditure on VET grew around 15 per cent over the decade — modest when compared to spending on schools and higher education.

Disparities in VET spending across states

The analysis also identified significant disparities in expenditure on VET across the states.

In Victoria, investment in VET has grown significantly over the last ten years at an average of 4.2 per cent per year. This contrasts with New South Wales and Queensland at the opposite end of the spectrum, averaging no growth, or slightly negative growth respectively over the same period.

Western Australia has also seen relatively strong growth in expenditure (averaging 3.2 per cent per year) over the same period. Growth in Tasmania over the ten years was relatively strong at 3.5 per cent per year on average, with South Australia and the ACT both showing a modest rise averaging 0.4 per cent per year.

VET expenditure by the Commonwealth (grew on average 1.6 per cent per year) grew faster in recent years than that of five state and territory governments, including the populous states of New South Wales and Queensland.

On the day of the report's release, Professor Noonan stressed the need for a co-ordinated approach to investment in Australia's education and training system.

"The low growth in VET expenditure over the past ten years is a major concern because the VET sector is key to addressing the challenges Australia is facing in terms of workforce training, the changing labour market and rising youth unemployment," he said.
"But with diminishing investment and an uneven, sometimes disjointed, approach to investment in education and training, the prognosis is grim."

"Many Australians would agree that a high quality, integrated and responsive education and training system is key to ensuring our future, and that this is something worth considerable public investment."

Peter Noonan is a Mitchell Professorial Fellow and Professor of Tertiary Education Policy at Victoria University

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Professor Peter Noonan: +61 407 373 433


Peter Noonan
Emeritus Professor of Tertiary Education Policy, Mitchell Institute