Commonwealth Government’s VET Student Loans Program Continues to Discriminate Against Community Providers

The Australian Government’s VET Student Loans program – which replaced the much-abused and scandal-prone VET FEE-HELP loan program in January 2017 – continues to discriminate against the not-for-profit community education providers of vocational education and training (VET). Program design faults of the former VET FEE-HELP program allowed a significant number of private for-profit VET providers to abuse the system, resulting in a series of national scandals that saw hundreds of millions of dollars wasted, and the integrity of Australia’s VET system damaged.

The latest program report by the Australian Government Department of Education and Training, entitled VET Student Loans Six Monthly Report 1 July 2017 to 31 December 2017, highlights this issue.

Community Colleges Australia (CCA) holds major concerns about the VET Student Loans program:

• Only 16 not-for-profit providers appear to be participating in the scheme, in large part because of the way the guidelines are written, including the focus on diplomas and advanced diplomas. Of those 16, only 1 or 2 appear to be general community providers, despite extensive interest expressed by the community sector. The others are mostly deliver highly specific aeronautics, media or religious courses, or are industry associations.
• The Australian Government Department of Education and Training figures continue to lump in not-for-profit and community providers with the for-profit providers, despite a number of requests to differentiate between the two. The business models and the orientations of for-profit and not-for-profit/community VET providers are very different. This lack of data prevents the Government from making proper VET policy decisions.
• The Australian Government Department of Education and Training has not properly consulted the states and territories in the development and implementation of the VET Student Loans scheme, even though the states are the primary funders of Australian vocational education and training.

“How much does the VET Student Loans program contribute to quality delivery of Australian skill development? What other alternatives could the Commonwealth consider? Australia’s VET provision is complex system of national and state policies and programs. What is the impact of this program on other elements of the system, especially state government-funded VET? We don’t know the answer to these questions. What we do know is that VET Student Loans has almost no relevance of Australia’s large not-for-profit community sector, which in 2016 delivered to some nine percent of Australian VET students – and particularly engaged the most vulnerable and disadvantaged,” said Dr Perlgut, CCA CEO.

During the last six months of 2017:

• 144 providers operated as approved course providers under the VET Student Loans program, down from the 167 providers under the transitional arrangements in the first half of 2017;
• the 144 approved course providers comprised 23 TAFEs, 12 “other public” organisations such as universities and 109 “private” providers;
• 35,197 students took part in the income contingent loan scheme, for a total loan value of $114,147,477;
• 360 (94%) of the 384 courses were at either the Diploma or Advanced Diploma level;
• all of the top 10 providers (by student numbers) were TAFEs or universities, and 16 of the top 20 (see Table 1 below);
• 9 of the top 10 providers (by tuition fees) were TAFEs or universities, and 14 of the top 20 (see Table 2 below); and
• the most popular courses were (in decreasing order, by tuition fees) were the Diplomas of Nursing, Aviation, Screen and Media, Beauty Therapy, Community Services, Early Childhood Education and Care, Remedial Massage, Business, Counselling and Music Industry.

“CCA is pleased that the overwhelming majority of VET Student Loans are now going to public universities and TAFEs,” said Dr Don Perlgut, CEO of Community Colleges Australia. "We support quality VET provision, especially by TAFEs, which constitute the anchor institutions of Australia's training system."

Table 1: Top providers of VET Student Loans by Student Numbers, 1 July to 31 December 2017

Source: https://docs.education.gov.au/documents/vsl-six-monthly-report-1-july-31-december-2017

Table 2: Top providers of VET Student Loans by Tuition Fees, 1 July to 31 December 2017

Source: https://docs.education.gov.au/documents/vsl-six-monthly-report-1-july-31-december-2017