Summary —

The Business Council of Australia (BCA) has expressed significant concerns regarding the Free TAFE Bill 2024 (Cth) that the Australian Government has introduced into parliament. The Senate Standing Legislation Committee on Education & Employment is undertaking an inquiry into the Bill and the BCA’s submission has highlighted several shortcomings of the proposed legislation.

Key Issues —

The Business Council of Australia (BCA) represents over 130 of Australia's largest businesses. While the BCA supports the Australian Government’s broader skills and training strategy, it opposes legislating Fee-Free TAFE as a permanent feature of the skills training sector.

The BCA contends that programs like fee-free TAFE should be evaluated and implemented as part of the regular budget and policy-setting processes, which focus on identifying specific workforce challenges and delivering tailored, sustainable solutions. Enshrining such programs in legislation, according to the BCA, could limit the government’s flexibility to adapt to changing industry needs.

Australia’s VET system comprises over 4,000 providers, of which only 24 are publicly funded TAFEs. The remaining providers include private Registered Training Organisations (RTOs), dual-sector institutions, enterprise (industry) RTOs, community RTOs, and schools. Approximately 80% of VET students choose to study with non-TAFE providers. The BCA states that this competitive mix enables students to select courses aligned with their goals and fosters high performance and responsiveness to labour market demands across the sector.

The BCA highlights the critical role of private RTOs in delivering specialised, industry-focused training, particularly in fields requiring higher-level or complex qualifications. As the BCA notes, national Centre for Vocational Education Research (NCVER) data reveals that private RTOs consistently achieve better completion rates and superior employment outcomes for students compared to TAFE. The BCA argues that restricting fee-free skills training places exclusively to TAFE could discourage students from selecting courses that best suit their aspirations, ultimately weakening workforce development and completion rates.

The impact of fee-free TAFE on regional skills development is another area of concern to the BCA. Independent RTOs in rural and regional areas often serve as the primary providers of training in communities where no TAFE is present. Recent funding cuts to private providers in states like Victoria and New South Wales exacerbate this issue. The BCA suggests that Fee-Free TAFE placements be extended to include private RTOs in areas without TAFE to support equitable access to education and ensure regional workforce needs are met.

The BCA underscores the importance of a collaborative, balanced VET system where public and private providers work together to address Australia’s workforce challenges effectively and sustainably.

Getting Involved —

ITECA's award winning policy advocacy on this matter is determined by members participating in the ITECA Skills Training National Policy Committee.  ITECA Membership - It's a great time to get involved.

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