The following article appeared in The Australian on 16 March 2016 (www.theaustralian.com.au/...hunter.../cbcac7cf31d7962df7cadad4de594707)
WEC Hunter College forced to abandon diplomas
- THE AUSTRALIAN
- MARCH 16, 2016 12:00AM
A NSW community college has been caught on the wrong side of reforms to rein in the snowballing VET FEE-HELP loans scheme, after a one-sledgehammer-fits-all policy response unleashed a litany of unintended consequences.
WEA Hunter says it has been forced to abandon diplomas in two employment-starved coastal communities because of the federal government’s cap on VET FEE-HELP places. And it says the cap has also hamstrung its ability to offer state-subsidised courses.
The cap prevents colleges from enrolling more VET FEE-HELP students than they had last year. WEA Hunter general manager Rowan Radvan said the change had forced her to cancel well-advanced plans to conduct diplomas of business and community services in the mid-north coast centre of Forster-Tuncurry.
“We spent about six months working with local businesses, creating internship-style programs where young people would train and then go into workplaces to get skills and (form) relationships. But the changes came in, so we are unable to run those projects.”
Ms Radvan said colleges that over-enrolled would be forced to repay the extra loan amounts with interest. “As a small provider, we can’t afford that.”
She said the cap excluded students who had put themselves on waiting lists for courses this year. Consequently, the college has also been forced to scrap plans to run a diploma in remedial massage in the tourist mecca of Byron Bay, where alternative therapies are viable vocational options.
Ms Radvan said the cap had also created a bind where she could not risk offering some diplomas partly subsidised by the NSW government. Its Smart and Skilled scheme obliges approved colleges to let diploma students borrow the costs of their fees, she said. “If I have VET FEE-HELP, I must offer it, but it would push me over the cap.”
Ms Radvan said she supported the intent of the reforms, but they had been applied too inflexibly. No distinction had been made between the ballooning, mostly online for-profit colleges claiming $200 million or more in VET FEE-HELP funding, and small services such as WEA which did not use enrolment incentives or brokers, offered classroom training and attracted $700,000 last year from VET FEE-HELP.
She said her college was set to fall foul of more reforms, with the government signalling plans to reduce loan availability for courses outside recognised skill shortage areas.
Skills Minister Scott Ryan said the cap had been applied to ensure financial sustainability while the government considered “an essential redesign” of the scheme. “This freeze does not preclude training organisations from enrolling new students or providing new courses — that is a business decision for each provider.”
He said WEA Hunter had raised its concerns with his department and they were “under consideration”.
Meanwhile, a new report says a handful of providers have enjoyed the bulk of VET FEE-HELP spoils. The report, to be released today by tertiary education analyst Peter Noonan, says 50 per cent of VET FEE-HELP outlays have been absorbed by just six providers, with the other half scattered among 207 colleges.
Professor Noonan, of Victoria University’s Mitchell Institute, says the states agreed in 2011 to limit fees for state-subsidised diplomas and to share the costs of loan non-repayment. “However, these measures were not required for non-subsidised VET FEE-HELP programs,” the report says.
“Unsurprisingly, it has been in this area that there has been dramatic growth and most evidence of excessive fees and unethical provider behaviour.”
