Commonwealth and states failing on productivity targets
Australian governments are “not on track” to meet their goal to increase the number of annual diploma and advanced diploma completions to 86,000, according to the commission. Completions have trended down since 2012, falling to a decade low of 34,000 in 2020.
Employment outcomes for vocational education and training (VET) graduates have gone backwards over the past 14 years.
In 2021, 65.2 per cent of VET graduates experienced improved employment outcomes after completing their training, down from 68.5 per cent in 2008.
Australian Chamber of Commerce and Industry chief executive Andrew McKellar said the way vocational education was funded in Australia made achieving targets difficult.
“A lack of certainty and inconsistencies in funding are the greatest weaknesses of the VET system,” he told The Australian Financial Review.
He said the current National Skills Agreement had failed to meet almost all of its targets.
“With the agreement overdue for renewal, it’s critical for the new federal government to finalise a new agreement where all jurisdictions must commit to real funding increases to VET, enabling more students to complete their qualifications and improve employment outcomes,” Mr McKellar said.
In education, Australia has made “no improvement” in lifting the year 12 or certificate three attainment rate, while the proportion of students attending school 90 per cent or more of the time has gone backwards.
Governments are achieving “mixed results” in their attempts to get more students into the top two bands of the NAPLAN reading and numeracy tests.
Federal and state governments have also made no improvement in reducing the proportion of low-income people experiencing rental stress, which is when a person spends more than 30 per cent of their gross income on housing costs like rent and water bills. In 2019-20, 42 per cent of low-income households were in rental stress.
Committee for Economic Development of Australia chief economist Jarrod Ball said the performance dashboard showed just how much work governments needed to do to lift the country’s lacklustre levels of productivity growth.
“We cannot underestimate the time, effort and multitude of levers that it will take to sustainably lift productivity growth. Past periods demonstrate that a confluence of reform, technological transformation and investments in human capital underwrote sustained strong productivity growth,” Mr Ball said.
Waiting times for general practitioners and emergency departments have also lengthened, according to the PC.
While the pandemic has contributed to the increase in waiting times, Grattan Institute health and aged care program director Peter Breadon said there were longer-term factors at play.
“The first is an ageing population with rising rates of chronic disease. More effort to prevent and manage chronic disease is the best long-term way to slow that growing demand,” Mr Breadon said.
“The second is the lack of a national plan for the health workforce, which could better match supply with demand, and develop and scale up new models.”
But governments are succeeding on other health targets, including boosting life expectancy, which now sits at 81.2 years for males and 85.3 for females. The number of potentially avoidable deaths has also steadily declined since 2007.
CEDA’s Mr Ball said the Productivity Commission’s last five-year productivity review issued 28 recommendations, 23 of which involved co-ordination between multiple levels of government.
“The dashboard once again confirms that Australia’s skills system needs urgent investment and refurbishment. But any improvements here will take some time to show up in the productivity numbers,” Mr Ball said.