What would a next Labor Government do with Australian vocational education and training: read this book

Speculation about changes of governments in Australia even reaches international audiences. So what would a change of national government mean for Australian vocational education and training? CCA’s CEO, Dr Don Perlgut, has been monitoring the statements of the Federal Labor Opposition, and provides the following report.

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Few areas of Australian public policy are more fraught than the recent experience with vocational education and training (VET). For years, commentators have criticised the marketisation/privatisation of Australian VET. They are particularly scathing over the failings of the (now defunct) VET FEE-HELP program, which may have cost Australian taxpayers up to $7.5 billion. Even the economically dry Productivity Commission described that program as “a well-documented example of how policy can fail if governments do not ensure proper policy design along with suitable regulatory oversight.”

The failures have been compounded by consistent ability of VET funding to keep up with other education funding, as the Mitchell Institute has shown: funding has gone backwards in the last ten years, especially notable compared to funding increases in university (53% up), schools and pre-schools.

The results of funding scarcity and VET brand “trashing” continues to have a “long tail” impact: Australia's lack of a national VET policy means that not-for-profit community providers have continued to lose out.  The recent VET FEE-HELP reforms, while necessary and welcome, are not sufficient. Despite numerous well-publicised private for-profit VET college failures, it’s not over yet: On 9^th November, the Australian Competition and Consumer Commission (ACCC) instituted Federal Court proceedings against Productivity Partners Pty Ltd, trading as Captain Cook College, alleging "systemic unconscionable conduct in breach of the Australian Consumer Law" going back to 2015, and impacting 5,500 students.

So how is VET shaping up in the Federal sphere? If you are looking to work out the Federal Labor policy on VET, the easiest way is to read the speeches of Shadow Skills Minister Senator Doug Cameron.

An interesting theme runs through Senator Cameron’s speeches: his most quoted source is Dr Phillip Toner, Honorary Senior Research Fellow in the Department of Political Economy at the University of Sydney. Senator Cameron has quoted Dr Toner three times this year: in his speech at a Federal VET Policy Forum in Melbourne on 16 July, at ACPET’s national conference in Canberra in August and at the AEU National TAFE Council meeting in Melbourne in April.

So what does Dr Toner advocate? The best way is to read his chapter, entitled “A Tale of Mandarins and Lemons: Creating the Market for Vocational Education and Training”, published in a recent book that he co-edited with Damien Cahill, Wrong Way: How Privatisation & Economic Reform Backfired (Black Books).

Toner’s article is 1 of 19 case studies of how “marketisation” has failed Australia. The other chapters deal with early childhood education, private health insurance, prisons, aged care, employment services, public sector engineering, electricity reform, labour market policy, financial deregulation, housing, the National Broadband Network, monetary policy, productivity, inequality, free trade agreements and foreign investment.

In other words, it’s the most complete handbook of what Australian governments have done to deregulate and to send services out to the “market”.

It’s not pretty reading. Here’s how Toner commences his chapter (p.59):

“The creation of a ‘training market’ for public and privately funded vocational education and training (VET) is one of the most transparent failures of neoliberal public policy over the last three decades. There is a direct line connecting the early neoliberal economic arguments and pedagogy formulated by VET mandarins – those who designed and managed the VET system in the early 1990s – to its subsequent implementation. The VET market is an exemplar of the great damage inflicted when a naïve , idealised neoliberal conception of how markets work becomes the basis for public policy. Serious quality problems in the VET market arose from a misconceived analysis of both the economics of the private training market, and from the actual level of demand for quality training in large parts of the labour market. Further, the pedagogical system known as competency based training (CBT), instituted to develop competition between registered training organisations (RTOs) and flexibility in all aspects of training content and delivery has actually led to diminished quality of training and malfeasance among many RTOs, employers and students.”

After an analysis of why VET matters, Toner analyses the creation of the Australian training market, modelled on the UK experience. He points out that TAFE (83%) and not-for-profit adult and community education providers (15%) delivered almost all publicly funded VET as late as 1996, but this fell to 49% and 6% (respectively) by 2016. The number of RTOs increased from 400 in 1995 to 1931 in 2016, the majority private for-profit providers.

Toner discusses the scale of the quality problem (“significant”), and examines the specific economic and pedagogical conditions in the training market that explain the scale and scope of poor quality and malfeasance. Minimal investment is needed, inadequate standards for teaching qualification and teaching resources and the low barriers for RTOs to enter are all exploited by opportunistic providers.

Toner concludes (p. 78) that:

“The training market has followed the classic trajectory of neoliberal public policy: ebullient expectations quickly followed by disappointment leading to incessant and expensive – through largely futile – bureaucratic tinkering resulting in intensified regulation and altered incentives…. The time remaining to effect a rescue of the public VET system is rapidly diminishing.”

Further reading

“Social Service Futures: Marketization and regulation of vocational education and training”, by Professor Valerie Braithwaite, The Power to Persuade, 23 May 2016.

“Marketisation of VET: The New South Wales response 1990s–2017”, by Robin Shreeve and Joanna Palser, Centre for the Study of Higher Education, University of Melbourne, 16 July 2018.

“New figures quantify the extent of the TAFE disaster”, by Professor Leesa Wheelahan, 23 June 2018.

Competition Policy and Human Services: Where Theory Meets Practice, by Rhonda L Smith & Alexandra Merrett, commissioned and edited by the Australian Council of Social Service (ACOSS) and CHOICE, September 2018.

Your comments on this post?

Email Don Perlgut at CCA with your comments.