VET: time to reform 'forgotten middle child' of education

By David Donaldson

August 29, 2016

Australia’s vocational education and training sector has developed a bad reputation for unscrupulous operators taking advantage of “naïve” system design in recent years.

So it’s important there’s a national review of Australia’s “forgotten middle child in education” — the VET sector — before governments renew national agreements underpinning its operation next year, argues a new report from the Committee for Economic Development of Australia.

The think tank recommends a comprehensive national review of the sector be undertaken, which would underpin discussion at the Council of Australian Governments on reaching a new National Partnership on Skills Reform for when the current one expires at the end of this financial year.

CEDA is concerned that the VET system lacks effective regulation, transparency and is geared towards an economy with different skills requirements. Recommendations include:

  • Improving data and transparency of data to help stakeholders make more informed decisions;
  • Shifting from narrowly defined qualifications to broader sets of skills transferable across occupational clusters;
  • An increased focus on delivering Certificate III and Diploma qualifications to better align with industry needs;
  • Strengthening regulatory oversight and ensuring regulators have the power to act if standards are not being met; and
  • Providing national information around providers, pricing, qualifications, audit findings and satisfaction survey results to the public.

There are a few big issues to be tackled. One is to consider what VET should be trying to achieve. The way we think about vocational training will need to adapt to the changing nature of work, CEDA argues, so the sector should be moving from a narrow focus on achieving competency in a particular job towards including a more diverse set of skills, such as creativity, social intelligence, patience, critical thinking and resilience. This would help to improve employment mobility and flexibility.

Of course, dealing with private operators abusing the system is another big issue. But governments’ response to the problem of dodgy providers must find “the fine line between allowing the sector to continue to be competitive and adaptable to stay true to the spirit of contestability, and ensuring that there is enough oversight to prevent fraudulent behaviour”, CEDA warns. Governments should consider bringing in a risk-based oversight approach “whereby regulators can assess risks based on factors such as student cohorts, provider performance and student outcomes, with regulators given the power to act if standards are not being met”, says CEDA.

Introducing a small up-front fee for students to act as a price signal may also make it less likely students will enrol in courses that aren’t useful. Indeed, it can be hard for students to know whether the course they’re enrolling in is useful, so making national information around providers, pricing, qualification, audit findings and satisfaction survey results more accessible to the public would help reduce information asymmetries.

CEDA has released the report to prompt a debate on how the sector should look before the current national partnership agreement finishes. “It is extraordinary that despite the fact that the NP [National Partnership agreement] is concluding at the end of this financial year, there has been little said or done about another agreement,” argues the report.

“It is critical that work be undertaken under the COAG process to decide what the eight jurisdictions will do about the VET system beyond 2016-17 given the sector’s contribution to skills and growth. In fact, a holistic VET policy has been sorely missing from the landscape, with VET policy debates tending to be relatively narrow in focus, for example, the redesign of the VET FEE-HELP program.

“To this end, COAG should consider undertaking a long-overdue comprehensive, national review of the sector that aims to examine its role in meeting Australia’s skills needs. The review would form the basis for COAG discussions towards a new agreement into the VET system once the NP expires.”

VET has changed significantly since the principles for its funding were laid out in 2012 in the current agreement between the Commonwealth, state and territory governments, which came out of COAG.

The Victorian government announced an overhaul of its training and TAFE system to improve quality and system stability last week, to be introduced progressively from January 2017.

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