A quick trawl through the morning papers provides an indication of what yesterday’s 2017 Federal Budget will mean for Australian education, both schools and tertiary education, and future employment prospects. Here’s an overview of the main changes:
- Schools will receive an additional $18.6 bn over 10 years to be distributed on a needs-based model (in line with the Gonski recommendations). This equates to an average annual increase per student, across all school sectors, of 4.1%.
- University students’ tuition fee contributions will increase by 1.8% each year between 2018 and 2021, equating to a total increase of 7.5%. Students will now be paying 46% of the real cost of their degree, rather than the current 42%.
- The HECS repayment debt threshold will be lowered to $42,000 (from $55,874) adding approximately 180,000 graduates to the repayment scheme. On the face of it, this could be an issue for some individuals on fairly modest incomes, but importantly, the rate of collection of the debit will be reduced from 4% to 1% of income. This climbs to a 10% repayment rate for those on a ‘high income threshold’ of $119,882 and above.
- Universities are hit with 2.5% ‘efficiency dividend’ over 2 years, resulting in a cut of $384m over the period.
- VET changes –a levy on foreign workers employed under the new short term skills shortage visa will be introduced, and which will directly contribute to the $1.2bn Skilling Australians Fund. This Fund will support up to 300,000 apprenticeships, traineeships and higher level skilled workers and is designed to arrest the decline in trade occupations and reliance on foreign workers.
- Initiatives for ‘Backing Regional Communities’ include $24m for Rural and Regional Enterprise Scholarships for up to 1,200 students, and potentially for the establishment of eight regional study hubs in remote areas with enhanced access to VET programs.
- Federal Government is forecasting the Australian economy to reach 3% growth over the next 2 years.
- Wage growth is expected to increase from 2% to 3%+ over the next 4 years.
So, what are the implications of this Budget for students?
It makes sense to spend time doing the up-front thinking as to which career you want to pursue and therefore which tertiary course is the best one for you. This will minimise the chances of you needing to change course, keeping both your costs down and the duration of your tertiary education to a minimum. Katie Adler works with clients to ensure the study and career choices they make are the best they can be, while taking individual holistic considerations into account.
Call Katie today to discuss your options.