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providers in Australia

The Road Ahead

Monday, February 6 2017

I am pleased to open with the news there is no breaking news. History tells me that can only be a good thing.

Following on from our recent trip to Western Australia, which is very much in Election mode, I have been spending some time focusing on policy reform – or more specifically what is needed to lift both the standards, and confidence in Tertiary education.

Yes, elections see announcements about apprenticeships, infrastructure and funding (hopefully). All good things but the notion of an internationally recognised system does not appear to be considered an election winner – go figure, though I do hope the ALP’s National Skills Summit will focus on the long road ahead. 

Interestingly, the underlying quality and credibility of Australia’s VET system is already recognised around the world. While there have been hiccups with Australia’s approach to international education, the sector has worked in partnership with both federal and state and territory governments to put in place what is regarded as best practice worldwide. Recent reforms to student visas and tuition assurance have played an important part in this.

So, if a long-term approach can work in international exports, why not domestic?

With VSL ‘dealt with’ for now (please understand I am fully aware of the many operational issues and we are focussed on solving them) the Government is turning its focus to higher education reform.

Australia does need to continue to develop its tertiary education sector with reforms that provide the integration, flexibility and choice necessary to respond to diverse student and industry needs.

In May 2016, the Federal Government released the Driving Innovation, Fairness and Excellence in Australian Higher Education consultation paper that outlined the need for funding arrangements that support the best higher education choices for students, industry and the national interest. 

However, we do need to be realistic and accept that current VET and higher education funding arrangements now encourage university studies over sub-bachelor degree qualifications that may be more suitable and more affordable for both students and taxpayers. 

The May 2016 consultation paper identified the need for all Australians with the ability and motivation to succeed in tertiary education to be supported - there should be no perverse incentives for students to choose a VET course over a higher education course or vice-versa.

Unfortunately, the funding and governance arrangements for Australia’s tertiary education system feature some very strong perverse incentives that are evident in the relative performance of the VET and higher education sectors.

Largely as a result of state and territory funding restrictions, and now significant differences in the student loan schemes, current arrangements drive a preference for higher education courses over VET. This is not in the best interests of students, industry or taxpayers. Funding availability should not be the deciding factor in addressing workforce skill needs.

To that end Australia really needs a strong voice from employers in this discussion.

Anyway, the Mitchell Institute has mapped (see graph below) the impact of current VET funding arrangements that has seen enrolments decline in recent years, while higher education sector enrolments have grown significantly.

Clearly, this widely acknowledged failure in VET sector governance and funding must addressed in order to have a tertiary education sector that best meets of the needs of students, industry and the Australian economy.

My main point today is that in any reform discussion does need to acknowledge that the future arrangements for higher education should not be considered in isolation of the VET sector. As the Mitchell Institute argues, there is a need for a coherent overarching tertiary education policy and funding framework supported by an independent tertiary education financing authority. The continuation of the silo approach to VET and higher education funding must be addressed.

Therefore, I am hopeful that we can ensure the debate considers pathways, both from and to higher education and from and to VET.

An integrated approach will truly position us for the future.

Rod Camm


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