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Policy report

This report draws on analysis of data included in the Australian Bureau of Statistics (ABS) Government Finance Statistics 2015-16. This data collection provides the total operating expenditure on education and training by government (Commonwealth, State/Territory and local governments), as well as public entities such as government schools, TAFEs and public universities. Included in this analysis is government expenditure paid to private providers. Figures are in 2015-16 dollars.

Important notes and caveats on the data are included at Appendix A.

Overall, this series has shown a significant rise in expenditure on school and higher education over the last decade and a comparative decline in spending in the Vocational Education and Training (VET) sector.

This year, we see this trend continue, with VET expenditure in 2015-16 falling below expenditure levels over a decade ago, in real terms.

While we need to be mindful that expenditure on higher education accounts for much more than just teaching and learning, the divergence between VET and higher education is considerable.

In order to see the full picture of our collective investment in education we also need to take into account the income contingent loan programs in the tertiary sector. Although the amount loaned to VET students grew strongly after the introduction of VET FEE-HELP, this represents a significant cost shift onto students and access to this funding has since been tightened.

This paper also continues last year’s inclusion of the preschool sector, where expenditure has grown rapidly, although coming from a much lower base. The overall picture is complex, and continues to show the disjointed approach to expenditure on education and training in Australia.

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