TAFE Queensland's financial future hangs in the balance, while universities in the state grapple with declining domestic enrollments.

According to a report by the Queensland Audit Office, seven public universities in Queensland have collectively suffered a loss of $1.3 billion due to reduced funding from the Australian Government, investment losses, and escalating costs.

In a grim projection, TAFE Queensland is anticipating a $41.5 million deficit in the upcoming financial year, despite expecting $41.9 million in government funding. 

The report further notes that this funding falls short of the $56.4 million received by TAFE in the previous year. 

The report suggests that TAFE's losses are expected to persist due to decreased demand for training resulting from consistently low unemployment rates, providing training in regions with low demand, and increasing employee expenses due to enterprise bargaining agreements.

The audit also highlights the challenges faced by universities, which have seen a decline in domestic student enrollments. 

Many students are deferring or reducing their study load to join the workforce and cope with the rising cost of living. 

While international student revenue saw a slight increase of 0.8 per cent, domestic student revenue decreased by 3.9 per cent. Only the University of the Sunshine Coast managed to report a profit, as it did not experience the same funding and investment setbacks as other institutions.

With Australian government funding guarantees set to expire in 2023, the report emphasises the need for universities to innovate and diversify their revenue streams. It says they must explore non-traditional sources to sustain their competitiveness in research and student recruitment.

The audit also raises concerns about the vulnerability of the education sector to cyber security attacks, identifying 60 weaknesses in the information systems of education entities.

In response to the report's findings, the Minister for Training and Skills Development, Di Farmer, has announced consultations on a new Queensland Vocational Education and Training Strategy. The goal is to ensure the provision of priority skills in both traditional and emerging industries, supporting Queenslanders in securing good jobs. 

The report has prompted the opposition LNP party to call for a review into the operation of TAFE Queensland, urging the government to release the results of this investigation.