TAFE SA, Funding Conflict

The Hon. D.W. RIDGWAY (Leader of the Opposition) ( 14:24 :12 ): My question is to the Minister for Employment, Higher Education and Skills. I would like the minister to listen.

1.Can the minister confirm that her department sought advice from the Crown Solicitor's Office regarding potential legal and financial implications of conflicts between the Skills for All funding model and the competitive neutrality provisions of the commonwealth Competition and Consumer Act and the COAG National Partnership Agreement on Skills Reform?

2.What have you done with that advice, minister?

3.Does the advice show that TAFE SA cannot compete in the VET space without large, indefinite taxpayer subsidies?

The Hon. G.E. GAGO (Minister for Employment, Higher Education and Skills, Minister for Science and Information Economy, Minister for the Status of Women, Minister for Business Services and Consumers) ( 14:24 :55 ): I thank the honourable member for his most important questions. It would be most inappropriate for me to discuss any crown advice that I have or have not received. I seek advice from a range of different sources when considering decisions, so it would be most inappropriate to be discussing what I may or may not have sought directly from crown. But in a general way I can certainly talk about the importance of the role of TAFE SA as a training and educational institution. It is an incredibly important part of our VET sector. It is, if you like, the centrepiece of our VET sector. It is renowned not only for high quality training provision but also as cutting edge in a wide range of different ways. If you look at its development out there at Tonsley, some of its achievements there are absolutely international cutting edge.

TAFE SA is also highly renowned for its activity in the international student space and international training space. It is not just about bringing over international students to train them but it also offers Train the Trainer programs and also curriculum development and suchlike. It always impresses me when I travel overseas. One of my recent objectives was to assist in promoting training at our higher education facilities here in South Australia to open up new international markets. We did quite a bit of work in the TAFE space overseas, and it was just astounding. It did not matter where we went, people overseas, in particular in India but also in China, knew of TAFE SA and held it in really high regard and spoke very highly of it. So, it is a very important facility.

As I said, not only does TAFE SA provide excellent quality training but, more importantly, it provides training in a number of very unique areas, particularly some of those areas that are extremely high cost in terms of equipment and other technology but also in terms of meeting training needs in country areas, where the commercial benefits are much less and where private providers do not tend to operate because it is not as commercially viable. We know that TAFE carries these extra burdens. They operate as additional costs to TAFE, so it is not surprising that the TAFE costs are higher than those of private providers.

TAFE infrastructure burdens are much larger and, as I have said, they tend to operate in very high-tech areas, where there are high levels of very expensive equipment needed, and they operate in regional areas where many private providers do not operate. I think that their costs at the moment are operating at around 2½ times those of the private sector, and we know that TAFE is working hard to reduce that differential. Also, TAFE carries a community service obligation in terms of training on the APY lands, and that is additional cost as well but, again, hardly an area that commercial operators would find particularly financially viable.

As I said, they carry these additional burdens and cost pressures. It is not surprising that their costs are somewhat higher. I know that they are working to reduce that differential; however, as I said, they are a critical service provider in our VET sector and are highly renowned for their fabulous quality training.

The Hon. D.W. RIDGWAY (Leader of the Opposition) ( 14:30 :21 ): I have a supplementary question. Has TAFE been specifically made aware of its responsibilities with regard to separating its community service obligations and the provision of standard courses with which it competes with privately-owned RTOs?

The Hon. G.E. GAGO (Minister for Employment, Higher Education and Skills, Minister for Science and Information Economy, Minister for the Status of Women, Minister for Business Services and Consumers) ( 14:30 :33 ): Yes, TAFE is well aware of its responsibilities. One of the things that I discussed with both DSD and TAFE is that there are many grey areas. Our community service obligation is pretty obvious at the moment in terms of Aboriginal services, but there are many elements of community service obligations that are entwined throughout the activities that TAFE, in particular, undertakes—and some of the RTOs do, as well.

They are particularly courses that really go to issues of access and equity, to assist people often in those very early first steps, so they might not be directly related to training, but without these activities those particular individuals—and obviously they are our most disadvantaged and often disenfranchised individuals—would simply never be able to take that first training step.

I have talked to both the agency and TAFE and said that I think we should be able to articulate that sort of activity in a much more transparent way because it is integrated, if you like, within the cost structures of training per se. There is some work in progress and it is something that I would like to achieve to ensure that whether you call it a community service obligation or a social justice component or whatever we might call it, I believe that we can do much better in being able to articulate that more clearly and account and report for it more transparently.

The Hon. D.W. RIDGWAY (Leader of the Opposition) ( 14:32 :34 ): I have another supplementary question. Is the minister aware or has she been advised that TAFE SA is liable to incur financial and legal penalties for breaches under the Commonwealth Competition and Consumer Act?

The Hon. G.E. GAGO (Minister for Employment, Higher Education and Skills, Minister for Science and Information Economy, Minister for the Status of Women, Minister for Business Services and Consumers) ( 14:32 :41 ): For what?

The Hon. D.W. RIDGWAY: For competing in the private sector; anti-competitive?

The Hon. G.E. GAGO: I am not aware, and if the honourable member has any detailed information that he would like to show me or any problems that he believes he has uncovered, I would be very pleased to see them. Really, TAFE SA is a model training institution. It is the largest TAFE—

The Hon. J.S.L. Dawkins: In South Australia?

The Hon. G.E. GAGO: In Australia, Mr President. This is how ignorant the opposition is.

The Hon. J.S.L. Dawkins: Rubbish!

The Hon. G.E. GAGO: Rubbish, he says. The Hon. John Dawkins says rubbish—

The PRESIDENT: The Hon. Mr Dawkins.

The Hon. G.E. GAGO: —that our TAFE SA is not the largest TAFE organisation in Australia. He says 'rubbish'. That's how ignorant they are. They do not even acknowledge the achievements of TAFE, let alone understand how it operates, and dare to come into this place bagging TAFE SA and putting it down—the largest TAFE organisation facility in Australia.

That is because we have shown leadership and vision with what was many TAFE businesses—originally I think there were about 13 or so. We brought those into three businesses and then amalgamated them into one TAFE SA. It created huge efficiencies, much better coordination of services, much greater articulation between activities, less duplication, less replication, and much greater efficiency.

Do they acknowledge those achievements? No. They come in here bagging and putting down TAFE South Australia. It is a model institution. Other states aspire to the sort of achievements that TAFE SA have delivered. They aspire to that, because in most jurisdictions TAFEs are still numerous small businesses scattered throughout the states, poorly articulated and poorly coordinated activities, with lots of inefficiencies in them. They look at us and say, 'Wow, look what South Australia has done.' Is that acknowledged here? No: I am told it is rubbish that TAFE SA is a leader nationally. It is a leader nationally. What does the opposition say? 'Rubbish!'

The Hon. D.W. RIDGWAY (Leader of the Opposition) ( 14:35 :28 ): By way of further supplementary; sorry to prolong things. Could the minister take on notice whether she has or has not received advice? Does the crown law advice, that she does not know whether or not she has received, advise that TAFE SA could be open to legal action by private competitors or competitors in the VET market for damages as a result of anti-competitive practices?

The Hon. G.E. GAGO (Minister for Employment, Higher Education and Skills, Minister for Science and Information Economy, Minister for the Status of Women, Minister for Business Services and Consumers) ( 14:35 :55 ): I have answered both those questions very clearly, and again they are misleading and dishonest in this place. I did not say that I did not know: I said that it was completely inappropriate for me to comment on what advice I do or do not get. This is how they misconstrue and mislead, and it is a dishonest activity. I have indicated that I receive a great deal of information from a wide range of sources in making a decision. I have indicated that if the Hon. David Ridgway has any information about inappropriate activity that TAFE is participating in, let him bring it to me, let him show it, and not sit there putting down and bagging TAFE SA. If he really has an issue of concern, why has he not brought it to me?

The Hon. D.W. Ridgway: I just did.

The Hon. G.E. GAGO: Here in question time! How dishonest is that? If he really has a concern, as I said, let him bring that information to me and make me aware of it.

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