Though GippsTAFE chief executive Peter Whitley told The Express he shared VTI's concerns potential cuts of up to $230 million could mean 20 per cent of all TAFE campuses could close within the next four years, he said "I would say we would not be looking to close any campuses, although, depending on where the cuts come there could be a reduction to the number of courses available".

Mr Whitley was addressing concerns raised following an Essential Services Commission review which recommended the State Government pay private institutions and TAFEs at the same rate for each hour a student is taught.

"TAFEs currently receive a slightly higher differential funding rate than private businesses," he said.

"The gist of the recommendation is there should be more of an equal status but the reality is TAFE institutes have much bigger infrastructure and we have salaries essentially governed by the government itself so we cater to higher costs there," Mr Whitley said.

He said TAFE campuses also incurred greater maintenance costs associated with providing "very conducive learning environments".

"We are very committed to seeing a strong vocational community maintained here and we don't want to see any reduction of this in the Latrobe Valley," he said.

"If anything, with the challenges the future might bring to this area, it should be about expansion and bolstering (TAFE) and looking at how we can build on it."

Mr Whitley said any funding cuts would have a greater impact on regional TAFEs than their metropolitan counterparts, adding "we don't have a lot of capacity for absorption".

"If there are funding cuts it would be very detrimental because our campuses are pivotal to our communities," Mr Whitley said.

"Our institution alone is a $42 million business annually and most of our purchasing is local so cuts of any magnitude would have a real impact."