A NET operating loss of $4.36 million by South West TAFE last year highlights the most tumultuous period in the organisation’s history, triggered by a major shake-up in government funding support.
The 2013 deficit was almost seven times the net operating loss for the previous year which followed successive years of surplus results.
However, the institute’s leadership is confident of achieving a projected surplus this year.
According to the annual report tabled in Parliament last week, the Warrnambool-based tertiary institute’s 2013 result was better than forecast.
Allowing for a $2.4m drop in government contributions, $1.1m in redundancies and a $911,000 write-down of Glenormiston College plant and equipment, the underlying operating result dropped back to a $712,000 deficit.
A year earlier the institute posted a $2.78m underlying operating surplus.
Acting chief executive Mark Fidge told The Standard yesterday it had been an extremely challenging year.
“We realised we had to make big adjustments and ended up about $1m better than expected,” he said.
“It wasn’t pleasant, but after having done the hard yards we are confident of achieving a projected surplus for 2014.
“We are aiming to meet industry and student needs better and have secured new contracts across the state.”
The state government operating funding for the 14 Victorian TAFEs fell by $119m or 159 per cent last financial year while capital funding was down $14m or 26 per cent.
Seven of the institutes recorded deficits with an overall total of $12m.
According to South West TAFE’s annual report the institute has identified non-core assets deemed to be in excess to requirements and will realise these assets when required.
Despite a lower than-expected student enrolment due to changes in subsidy rates and increased market competitiveness, a record 2.98 million student contact hours was achieved — a positive sign the institute is heading to calmer waters after the storm.
“This figure underlines the institute’s dedication to delivering high-quality training programs in a year of complex changes to the vocational education and training industry,” the report said.
According to the report the institute decreased its net asset base from $62.4m to $63.8m during the year and holds $3.32m worth of properties listed as heritage assets which cannot be modified or disposed of without ministerial approval.
Fees for service fell by $956,917, but revenue from student fees and charges rose by $1.2m.
Teaching staff numbers were trimmed from 322 to 260 and non-teaching staff went from 250 to 210.
Contract terminations involved four in-lieue-of-notice payments and two gratuity payments totalling $34,174.
Mr Fidge said the staff trimming came through redundancies, by not renewing contracts and using more casuals.
About 60 courses were cut during the past two years and the institute is confident its remaining 220 courses can meet industry demands.