Bills Digest 34 1996-97 Vocational Education and Training Funding Amendment Bill 1996


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WARNING:
This Digest is prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments.

This Digest was available from 27 September 1996.

CONTENTS

Passage History

Vocational Education and Training Funding Amendment Bill 1996

Date Introduced: 18 September 1996
House: House of Representatives
Portfolio: Schools, Vocational Education and Training
Commencement: Royal Assent

Purpose

The major amendment proposed by the Bill sets the level of Commonwealth vocational education and training funding for 1998.

Background

The Commonwealth provides grants to the States and Territories for the provision and support of vocational education and training primarily to the Technical and Further Education system. Prior to 1 January 1994, grants to the States and Territories were provided in accordance with the provisions of the States Grants (TAFE Assistance) Act 1989. These grants contributed to general operating costs (recurrent expenditure grants) and infrastructure (capital expenditure grants).

>From 1 January 1995, the funding arrangements under the States Grants (TAFE Assistance) Act 1989 were replaced by funding arrangements under the Vocational Education and Training Funding Act 1992. Under the new arrangements, a single pool of funds comprising the previously separate recurrent expenditure grants and capital expenditure grants is passed to the Australian National Training Authority (ANTA) for allocation among the States and Territories.

The Australian National Training Authority Act 1992 gave effect to an agreement (the Agreement), announced by the then Prime Minister on 21 July 1992, between the Commonwealth, States and Territories for the establishment of ANTA. The objectives of the Agreement include:

  • the establishment of a national vocational education and training system;
  • closer interaction between industry and vocational education and training providers;
  • an effective training market; and
  • improved cross-sectoral links.

The key elements of the Agreement, the text of which is set out in the Australian National Training Authority Act 1992, relate to the roles and responsibilities of ANTA, the Ministerial Council and funding arrangements.

The functions of ANTA include allocating and remitting funding to State and Territory training agencies on the basis of guidelines determined by the Ministerial Council, and administering any programs, agreed by the Ministerial Council as requiring national delivery, within the guidelines approved by the Ministerial Council.

Main Provisions

The effect of item 1 of Schedule 1 of the Bill is to amend the amounts payable to ANTA under section 9 of the Vocational Education and Training Funding Act 1992 (the Principal Act) in the following manner:

  • increasing the amount payable for 1996 from $844.721 million to $858.057 million;
  • decreasing the amount payable for 1997 from $972.2 million to $869.779 million; and
  • setting the amount payable for 1998 at $872.154 million.

Section 9A of the Principal Act provides for payments to ANTA for additional trainees under the Australian Traineeship System (ATS) and Career Start Traineeships (CSTs). Item 2 of Schedule 1 of the Bill:

  • reduces the amount payable for 1997 from $22.68 million to 21.546 million; and
  • sets the amount payable for 1998 at $21.546 million.

Section 9 amounts payable to ANTA are amounts determined by the Minister for a particular calendar year. Section 9A payments are conditional on the Minister being satisfied there has been an increase in the number of people receiving training in a State or Territory under the ATS or CST. The amounts payable are amounts determined by the Minister for a particular calendar year.

Remarks

The following provides a summary of the noteworthy changes flowing from the 1996-97 Budget in relation to vocational education and training at the sub-program (ANTA) level.

The Government intends to reduce vocational education and training grants to the States and Territories, abolish the 5% real growth on base recurrent technical and further education funding introduced by the previous government, apply an efficiency dividend to parts of the ANTA sub-program of the Employment, Education, Training and Youth Affairs portfolio and reduce cash balances held by statutory bodies in order to (partly) fund the other commitments of the previous government which are being retained. On the basis of the 1995-96 budget allocation plus additional estimates, the 1996-97 budget funding of the ANTA sub-program represents only the change due to estimated inflation. The larger increase shown below has come about because the 1995-96 allocations were underspent.

Differences between the figure shown under 'Main Provisions' above and (total) figures shown below for 1995-96 and 1996-97 are due to the way monies are allocated under the Agreement for each calendar year under the triennial funding arrangement and accounted for under financial year budgeting.

SUB-PROGRAM 4.3.2 Australian National Training Authority
  OUTLAYS
AMOUNTS ($ MILLION) 1995-96 ACTUAL 869.9
  1996-97 ESTIMATE 954.3
 
SIGNIFICANT BUDGET MEASURES EFFECT OF MEASURE ON BUDGET OUTLAYS $ MILLION
MEASURE 1996-1997
Savings from reduced cash balances held by statutory bodies -14.7
Applications of efficiency dividend -13.5
Reduce Australian National Training Authority running expenses -2.0
Reductions in VET grants to States and Territories -28.8
Abolish 5% real growth funding on base recurrent TAFE funding -5.3

Source: Parliamentary Research Service. Budget Review 1996-97. Department of the Parliamentary Library, August 1996.

Contact Officer and Copyright Details

Geoff Winter Ph. 06 277 2437
Ian Ireland Ph. 06 277 2438
26 September 1996
Bills Digest Service
Parliamentary Research Service

This Digest does not have any official legal status. Other sources should be consulted to determine whether the Bill has been enacted and, if so, whether the subsequent Act reflects further amendments.

PRS staff are available to discuss the paper's contents with Senators and Members and their staff but not with members of the public.

ISSN 1323-9031
Commonwealth of Australia 1996

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1996.

This page was prepared by the Parliamentary Library, Commonwealth of Australia
Last updated: 20 September 1996



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