Summary —

Each year the Australian Government provides around $1.6 billion to the state and territory governments to invest in skills. A new five-year agreement to continue this funding is currently being negotiated, with discussions between governments potentially reaching a stalemate. ITECA has been closely monitoring the negotiations and advocating at a Ministerial and departmental level for an outcome that empowers students. The outcome ITECA seeks would allow students to access the government’s investment in vocational education and training to study with a broader range of independent vocational training providers.

Key Issues —

The context of the skills funding negotiations is the Heads Of Agreement For Skills Reform signed by the Prime Minister, state Premiers and territory Chief Ministers in August 2020. This committed their governments to the adoption of a new funding model that improves national consistency for students, integrates subsidies and loan programs, and is linked with efficient pricing and the skills needs of employers. Significantly, there was also a commitment to support a viable and robust system of public, private and not-for-profit providers, with contestability in vocational education and training markets, to ensure high-quality training and student choice.

“ITECA welcomes this approach, one that will ensure that the investment by government in skills is more transparent and delivers quality outcomes for students. We want students to be empowered with the ability to select the provider of their choice, whether this be a quality independent training organisation or a public TAFE college,” said Alexis Watt, ITECA Deputy Chair – Vocational Education and Training.

The Australian Government, and the state and territory governments, also agreed to work with the National Skills Commission to develop an approach to estimating the costs of delivering training and to share data that will enable the Commission to release efficient prices for common vocational education and training qualifications. This is one aspect to the proposed funding model that has the potential to bring negotiations to a standstill.

“ITECA’s discussions with state and territory governments have indicated that, when managing their investment in skills, they have the flexibility to offer high-quality training to student cohorts where delivery costs may be higher. This may include the long-term unemployed or students from remote and regional Australia. ITECA certainly appreciates this and is broadly supportive of a new funding model that provides the state and territory governments with this flexibility,” Mr Watt said.

Another area of apparent tension between the Australian Government, and its state and territory counterparts, are the arrangements for determining which courses will be funded. The Australian Government’s approach is for the Commission to develop a list based upon its assessment of current and future labour market needs.

“ITECA’s discussions with state and territory Ministers has identified the fact that although they recognise the importance of the Commission’s work; however, each government wants the flexibility to meet local skill needs as they see them. When skills needs can vary widely within a state, and when their economic cycle can vary from the national experience, ITECA agrees that this flexibility is desirable,” Mr Watt said.

Of interest to the ITECA membership is the priority, set out in the Heads of Agreement, placed on to the development and funding of nationally accredited micro-credentials and individual skill sets, in addition to full qualifications, and supporting lifelong learning through an integrated tertiary education system.

“This is an innovative area of skills funding, and there are many different was for governments to make this investment in skills. ITECA looks forward to working with state and territory governments as microcredential funding models are developed,” Mr Watt said.

One aspect to the skills funding agreement that has generated considerable debate are provisions within the Heads of Agreement to enhance transparency and accountability when it comes to skills funding. There is a desire to increasing data collection and analysis to support regular assessment of governments’ policies and performance.

“There is considerable pushback from some state and territory governments to the reporting framework that the Australian Government is seeking. ITECA is carefully monitoring this as it is likely to be independent RTOs that will ultimately be responsible for collecting the data and forwarding it to government,” Mr Watt said.

So, what does this mean for independent training providers with a current state / territory skills funding agreement?

“Ideally, the new skills funding agreement will provide enhanced opportunities for independent training providers to support a greater number of students. There would also be greater transparency as to which courses government are going to invest in. The initial challenge will be to get the Australian, state and territory governments to sign up to this framework, and then to implement it for the benefit of all students,” Mr Watt said.

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Getting Involved —

Members in the international education sector play a lead role in setting the framework for ITECA's engagement with TEQSA on the regulation of international education through their participation in the ITECA State / Territory Funded Provider Interest Group.  ITECA Membership – It's a great time to get involved.

Further Information —

If you're an ITECA member and would like more information on this matter, the ITECA team would value the opportunity to talk to you.  Simply send an email to [email protected] or telephone 1300 421 017.  Stay up to date via Twitter, Facebook and LinkedIn.

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