PM proposes HECS scheme for TAFE IT courses

Australian Prime Minister Julia Gillard has announced an ambitious policy to address skills shortages in the Australian workforce, promising HECS-style loans to students studying technical courses at State Government-funded TAFE colleges.

The ‘Labor Skills Guarantee’, which requires agreement from several State Governments hostile to Gillard’s ALP Government, aims to convince young Australians to consider enrolling in technical courses at TAFE colleges.

“Under the plans now being developed, thousands of vocational education and training students would no longer have to pay upfront fees, while others would be guaranteed a significant fee subsidy of up to $7800,” Gillard said in a speech to the Australia-Israel Chamber of Commerce today.

Students working towards a Diploma or Advanced Diploma for courses like Engineering, Computing and IT (among others) would “no longer have to pay upfront fees, but would have access to HECS-style loans to cover their fees instead,” the Prime Minister said.

The HECS system enables students to borrow the money required to pay for tertiary education degrees, which is progressively repaid as a percentage of their salaries as they enter the workforce.

The scheme “gets rid of upfront, out of pocket costs,” Gillard said, “saving thousands of dollars at the time they need it most – paying the costs back only when they can afford to.”

Gillard noted these schemes have been “available to university students for decades”.

Budget surplus still on the agenda

The Prime Minister renewed the ALP’s promise to return the Federal Budget to surplus in May 2012.

“We will hand down a Budget surplus in May,” she said.

Her speech painted Australia’s high dollar as an opportunity for the country to shift towards ”a high skill, high tech, fast broadband, clean energy economy”.

The high dollar is “making our economy leaner and stronger, forcing us to move more of our effort – more money, more equipment, more people – into the parts of our economy where we can create the greatest value,” she said.

“Given a choice between competing on quality or competing on price, we’d compete on quality; that we’d take the high road to high-value, high-wage, high-skill employment, that we want to create jobs based on making and selling the best products and services we can.

"We never really wanted to compete on price alone – but now it’s just as well, because at parity with the US, we just can’t.”

Gillard said the Government still plans to roll out NBN fibre to more than 60 sites across Australia in 2012, and expects the introduction of carbon pricing and the minerals resource rents tax on 1 July to drive employment growth in greener, high-tech industries.

Workers in some traditional manufacturing and export industries will need to change career path to adjust.

“Every year, around a million workers change jobs – a quarter of them changing industries too,” she noted.