Representing quality private education
providers in Australia

It is over – I wish

Monday, December 5 2016

Well, we can now at least say that government has brought a formal end to the VET FEE HELP program,that has hurt students and pretty much everyone else. 

The suite of VET Student Loans bills were finally passed by the Senate on 1 December 2016 and will supposedly be implemented from 1 January 2017.

I of course remain disappointed about elements of the design, however Minister Birmingham does deserve praise for getting it done.

Our quality private providers look forward to meeting the higher benchmarks that have now been imposed on non-government providers.

In terms of the course list and loan caps, while I was shocked that some of the very strong cases put forward in the review process were ignored, I do hope the instruments put in place will, through genuine consultation and collaboration, allow these issues to be addressed.

Of course in the horse trading that is now known to be the Senate the Nick Xenophon Team secured an undertaking from the Minister that he would consider, on a case by case basis, requests from TAFEs and not-for-profit providers to continue to deliver some courses not on the eligible list, if they could demonstrate strong employment outcomes.

A fair test indeed and I do recognise the important role of our high quality not-for-profit providers. The discretion though does not address the low caps in high skill and cost programs many of these providers deliver.

Both Senators Xenophon and Griff told the Senate that this undertaking should be extended to other good quality, ethical private providers. I agree with that, as it should always be about the evidence of employer support and outcomes, not the ownership structures.

Time will tell.

We must now focus on the implementation of the new scheme – this will not be easy and students must be our key priority. In such short timeframes things will need to go very smoothly indeed or students will be severely affected.

In other news, while much of the attention of our sector over the last few weeks has been focused on the fate of the VET Student Loans legislation, several reports have been released that highlight why it is so important that Australians have the opportunity to participate in education and training and, despite some of the negative commentary, that the VET sector overwhelmingly continues to meet the needs of its students. 

Data released by the Australian Bureau of Statistics last week, Education and Work, Australia, May 2016, highlights the strong growth in the number of persons with a non-school qualification. Over the 10-year period from 2006 it has grown from 6.9 million to 9.4 million. Of course much of this growth has been in the higher education sector, where those whose highest level qualification is a Bachelor degree or above rose from 2.7 million to nearly 4.6 million.

The importance of lifting participation in tertiary education and training is evident in the report’s findings. This is compelling reading and cannot be lost in the education debate:

  • 80.6 per cent of persons with a Bachelor degree or above were in employment,
  • 77.5 per cent with a Certificate III or IV were in jobs,
  • for those with Year 12 or equivalent it was 65.7per cent, and
  • Year 11 or below, only 49.3 per cent.

Qualifications do matter!

It makes me wonder what difference we could make to the lives of more Australians if a sustainable, responsive funding model could be established for the Tertiary sector.

On Thursday the National Centre for Vocational Education Research (NCVER) released its 2016 student outcomes survey results. Importantly for the first time, in addition to the Government-funded student outcomes, 2016 report, the Total VET graduate outcomes 2016 report, that is now possible as a result of the collection of Total VET Activity (TVA) was also released.

This latter report highlights that students remain overwhelmingly satisfied, with 85.2 per cent satisfied with the overall quality of training delivered by private providers (86.1 per cent for all providers) and that 86.2 per cent (88.0 per cent for all providers) would recommend their private provider.

The results for the government-funded activity are similar.

This data highlights the overwhelmingly high quality training being delivered by the majority of public and private providers alike and puts the recent concerns with VET FEE-HELP into some perspective.

Last week also saw the first round of ACPET’s new higher education benchmarking service completed with a workshop of participants in Melbourne. The workshop, a key part of the service, provided the opportunity for participants to better understand the results of their detailed benchmarking reports and discuss good practice and strategies to enhance their operations.

A Community of Practice will now be explored to build on the service. 

It’s not too late for higher education members to join the service for next year. Please contact Stephanie Dellow if you would like more information.

On a final note you have read previously just how important I believe deep thinking is to future educational reform.

There can never be enough of it.

One of the drivers for the reform of the VET FEE-HELP program was its exponential growth which was reflected in the growth of student loans. Separate reports by the Grattan Institute and the Parliamentary Budget Office earlier this year highlighted the rapid, and unsustainable, growth in the Higher Education Loans Program (HELP) debts. Of course, strong growth in higher education (highlighted in the ABS publication above) has also been a major factor in the growth of the HELP loans portfolio.

As we know, federal government proposals to introduce higher interest rates on student debts as part of its 2014 higher education reforms were not supported by the Parliament. As part of its May 2016 discussion paper, Driving innovation, fairness and excellence in Australian Higher Education, this issue was revisited with a 5 per cent loan fee canvassed.

Overnight the Grattan Institute has released a paper Shared interest: a universal loan fee for HELP that calls for a 15 per cent loan fee on all HELP loans to address the unsustainable existing arrangements.

The Grattan Institute argues that a loan fee would address some of the equity concerns with the Government’s 2014 proposals to charge higher interest rates on loans. It also recognises the political reality that further proposals to lift interest rates are likely to meet the same fate as the previous proposals.

It is worth noting that full fee-paying higher education and VET FEE-HELP students already pay loan fees of 25 and 20 per cent respectively. These fees are expected to be around $440 million in 2016 according to the paper. ACPET has long argued the unjustifiable inequity when Commonwealth supported students pay no such fees. The Grattan Institute paper agrees.

Clearly this matter needs to be addressed as the Government looks to finalise its higher education reforms. This paper makes a valuable contribution to addressing the present unsustainable HELP arrangements. ACPET will continue its strong advocacy for arrangements that provide equitable access to higher education for all students regardless of their provider.

Anyway, have a great week.

I would like to say it will all go smoothly from here.

I can hope.

Rod Camm


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