2017: VET at the Crossroads

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21 December 2016

2017 shaping up as a crucial year for public vocational education, with the chance to restore public funding to a sector buffeted by budget cuts and dodgy private providers.

Although 2016 has seen the scrapping of the disastrous VET FEE-HELP scheme, TAFEs are still being starved of funds and forced to compete against for-profit providers who can cut corners to make quick profits.

There are also major concerns about the replacement for VET FEE-HELP, VET Student Loans, which looks set to repeat many of the mistakes of its predecessor.

AEU Federal TAFE Secretary Pat Forward said years of under-investment and a lack of resources for TAFEs was hurting students, and it was up to all levels of government to properly fund vocational education, and recognise TAFEs unique role.

“We need to move away from the disastrous agenda of privatisation, which has seen billions of dollars wasted on dodgy private providers, and lift investment in our TAFEs,” Ms Forward said.

The National Agreement for Skills and Workforce Development and the National Partnership Agreement for Skills Reform expires on June 30, 2017

Ms Forward said the new agreement needed to revamp VET funding and increase investment in TAFEs.

“The National Agreements, signed in 2012, have had a devastating impact on TAFE and the vocational education system across the country in the last four years,” Ms Forward said.

“The new agreements are an opportunity for all governments to properly fund TAFEs and restore trust in the VET system.”

Among the so-called ‘reforms’ in the 2012 National Agreements were:

  • The introduction of a national training entitlement for the first qualification up to a CIII, to be accessible at any RTO, public or private;
  • Increasing the availability of income contingent loans; and
  • Encouraging responsiveness in training arrangements by facilitating the operation of a more open and competitive market.

The AEU warned at the time that these conditions would have a devastating impact on the VET system by handing the system over to unregulated for-profit providers.

The VET FEE-HELP scheme locked thousands of young Australians into debt for over-priced, low-quality qualifications.

Private providers were able to charge what they wanted, with no requirement to deliver minimum hours, payment on enrolment nor course completion and minimal oversight from regulators.

Over the four years, government funding for VET has dropped, as both state and federal governments were able to temporarily shift their funding responsibilities onto students through VET FEE-HELP.

Nationally, TAFE’s market share has declined by almost 20% during the period of the 2012 National Agreements - from 69% in 2011 to 50% in 2015.

Over that period student enrolments in vocational education have declined by 17%. Between 2011 and 2015, government investment in TAFE has declined by almost 10%.

This has accelerated a downward trend in funding. Since 2008, funding for vocational education has declined by 24%, and by 42% since 1997.

Ms Forward said that the disaster of VET FEE-HELP had damaged the reputation of all providers and would cost governments for years to come.

“85 per cent of VET FEE-HELP loans have gone to private for profit providers, and while all of the rorting of the system has occurred within the private sector, significant reputational damage has been done to the whole sector – including to the public TAFE system.

“It is estimated that only 8 per cent of students will complete their VET FEE-HELP funded qualification, and a large number of students will never pay back their debt,” Ms Forward said.

“Replacing VET FEE-HELP with a new scheme – which still does not require private providers to provide minimum hours for courses – won’t fic the big structural problems facing VET.”

“We need all governments to make 2017 the year that they deliver the investment that TAFEs need.

“That means a guarantee that at least 70 per cent of funding is reserved for TAFEs, while the issues of quality and value which have plagued private providers are fully resolved.”