South Australian State Government 2012-13 Mid-Year Budget Review – major employment, training and skills savings

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Jack Snelling, MP today handed down the South Australian State Government 2012-13 Mid-Year Budget Review where $464 million worth of savings need to be made over the next four years to align with lower than expected revenues.

From a workforce planning and development, employment plus Vocational Education and Training (VET) perspective the main saving announcements relate to:

Source: adelaidenow
Source: adelaidenow

 

Reviewing employment and grant programs in DFEEST at a saving of $40.4 million to better align with Commonwealth Government programs;

and,

Training efficiencies to save $31.5 million including a review of subsidy levels and targeting funding to areas of industry demand

aka Skills for All with the publication of suggested caps and changes to the funded training coinciding with the budget review.

Consultation about the composition of Funded Training List in Feb 2013 is underway from 19 December 2012 to 21 January 2013.  There is an invitation to participate in the consultation by completing the Funded Training List Consultation Survey and the survey should be read in conjunction with the consultation on proposed changes to Funded Training document.

Consultation on proposed changes to Funded Training (PDF) (Word) 

Major savings in the Department of Further, Education, Employment, Science and Technology (DFEEST) include $10.0 million in 2013?14 increasing to $15.0 million per annum (indexed) from 2014?15 by reviewing employment and grant programs to better align with Commonwealth Government programs.

For DFEEST, from 2012 – 13 to 2015-16 respectively the following areas of savings are outlined in the full mid-term budget review report ($000):

Employment and grant programs —        10 000             15 000             15 375

Information economy programs —        —                    —                    2 522

International & higher ed programs —        —                    —                    3 000

Training efficiencies —        —                    9 640               21 870

Note on Training efficiencies: This measure provides savings of $9.6 million in 2014–15, increasing to $21.9 million per annum (indexed) from 2015–16, from training efficiencies including a reduction in the differential price to TAFE SA, a review of subsidy levels and ensuring funding is targeted at areas of industry demand.

This means by 2015-16 investment in employment, training and skills will be far reduced with huge implications for service providers, TAFESA, enterprise based and private Registered Training Organisations.

Flinders University will provide funding for the construction of an educational facility within the Noarlunga TAFE Campus. The facility will enable students in the Flinders Foundation Studies Program access to university information technology equipment while studying on the campus.

Other areas of savings relate to 1% efficiencies for each department, reducing the number of contractors, and centralising communications functions across Government – this will mean restructuring and job losses.

Areas of new spending ($482 million) include:

  • The State Government’s contribution to the Equal Remuneration Order covering community sector workers at a net cost to the Government of $76 million over the forward estimates;
  • Increasing the allocation of funding required from TVSPs of $59.6 million to reflect the cost of savings in the 2012-13 Mid-Year Budget Review;
  • Additional support for the resourcing for children requiring alternative care arrangements at a cost of $40.3 million over the next four years;
  • $27 million over two years to assist timber mills in the South-East invest in capital upgrades to their mills in the wake of tough global conditions for their industry; and
  • $21.1 million over two years for additional park-and-ride facilities at bus and train interchanges together with improved public transport facilities.

It’s difficult to see many opportunities in the list above, perhaps retrenchment programs and out placement services for public sector employees with significant job cuts (close to 5000 FTE from 2012 – 2016), implementation of the Public Sector Renewal Program, workforce planning and development for the timber industry, the health sector and for transport related projects.

Free wireless in the in the CBD is a nice to have and it’s good to see the Adelaide City Council co-investing with the state government.

The government has increased funding for the new advanced manufacturing strategy for South Australia from $8.3 million to $11.1 million over four years. The additional $2.8 million has been reallocated to the strategy from within the Department for Manufacturing, Innovation, Trade, Resources and Energy’s existing budget.

With employment growth for the current financial year forecasted at 0%, the mid-term budget taking a few steps backwards in terms of skills investment, and no new major projects, 2013 will be a transitional year.

An efficiency theme, which on the positive side must spark innovation however there will be major workforce planning and development implications.

Workforce gaps will include:

  • demand and supply forecasting into the future and the identification of critical job roles;
  • skills profiling and utilisation(where a job does not equal a qualification – this is a fundamental flaw of the state governments policy and planning approach);
  • leadership development, change management and communication;
  • workplace health and safety;
  • innovation as a core competency;
  • retention strategies (particularly regions); and
  • managing the balance across industries and occupational areas of growth, sustain, maturity and labour market adjustment.

For further information including the detailed Mid-Year Budget Review report go to: http://www.statebudget.sa.gov.au/home.html

Written by Wendy Perry, Head Workforce Planner, Workforce BluePrint.

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