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National Update - 
Why students need to matter more than institutions

Well, as we see quite often in tertiary education, governments restrict choices so that business and students have a much more limited range of options. 

For example, the recent Federal Budget restricted apprenticeship incentives, removing eligibility from businesses employing more than 200 employees. These businesses employ around 40% of all apprentices. Measures like this restrict choice for learners, limit career options and curb national productivity. 

Australia’s tertiary education system depends a great deal on trust. Trust between institutions, students, communities, business and governments. As governments feel a growing need to intervene across all aspects of these relationships, the more the trust erodes. 

However, it is really important that taxpayers are able to rely on governments to intercede sparingly as they must so that public investment delivers genuine outcomes on their behalf.

This trust with institutions is built through strong governance and real accountability. 

Independent skills training providers and higher education institutions operate in one of the most intensely regulated environments in the country. Every student, every enrolment and every outcome matters. And every one of these is overseen and factored at multiple levels. Providers that fail to deliver quality, industry relevance or student support simply do not survive.

Overwhelmingly, independent tertiary education providers are unable to compete on price due to the huge subsidies being directed to public institutions. So, independent institutions compete on quality. And overwhelmingly they succeed on that basis despite the mass subsidy program for public institutions. 

For example, students across the independent sector enjoy greater satisfaction and employability despite the 20% tax placed by government on their student loans under the VET Student Loans and FEE-HELP loan schemes. 

The commercial and regulatory discipline of being in a business environment creates a culture of responsiveness and accountability often absent from large public institutions.

Independent providers must constantly prove value to students and employers alike. That means adapting quickly to changing workforce and student needs. It also means doing it without the structural complacency that often stifles heavily subsidised public systems.

We have seen some recent, very well publicised, instances of that where institutions operate with scattered accountability and hampered bureaucratic protections. These don’t support student outcomes, and deliver poorer course offerings mostly without meaningful consequence. Governance failures in public institutions are frequently absorbed through additional taxpayer funding rather than structural reform.

History shows this type of situation isn’t allowed to embed itself in independent institutions because it is a regulatory focus when it has emerged. Rightly so. So why aren’t we seeing strong, robust quick and transparent action at public institutions? 

Because this is what happens when governments prioritise institutions over students.

Investment artificially favours public institutions and ignores student choice, and this distorts the market to reduce accountability and transparency. It weakens competition and risks public investment being directed at the preservation of institutional norms, rather than at educational quality or workforce outcomes.

Strong governance in tertiary education should not be measured by the size of an institution or the scale of its public subsidy. It should be measured by transparency, responsiveness, financial discipline, student outcomes and alignment with employer needs.

The independent sector has consistently shown that high-quality tertiary education can be delivered with agility, innovation and accountability. 

Australia confronts workforce shortages, productivity challenges and increasing financial pressures. The policy conversation about tertiary education governance, investment and structure needs to shift. 

Governments must be prepared to back a tertiary education system where accountability, quality and student outcomes matter more than institutional status.

Felix Pirie
ITECA Chief Executive Officer

Further Information —

If you have any questions regarding the above, please contact the ITECA team at [email protected].