June 25, 2015

First step back from the brink

By Pat Forward

The announcement by the ALP that it intends to "rebalance" the VET market by allocating guaranteed funding to TAFE is a small but significant step back from the brink for Australian TAFE colleges. When combined with the proposal that an ALP government would develop a national statement collaboratively with the states and territories to define and support TAFE, it is clear that we are witnessing a turn in the tide of TAFEs fortunes. But the battle is not over, and TAFE has not yet been saved.

All governments in Australia are currently working towards a VET market where all government funding is made contestable. All governments are committed to replacing public funding for Diplomas and Advanced Diplomas by forcing students to take out VET FEE HELP loans to pay from them. In 2008, VET FEE HELP cost students $25m. Last year this had grown to $1.6b. In the first 5 months of 2015, the figure has exceeded $1.7b. 75 per cent of this money is going to private for-profit providers. TAFEs have become increasingly reliant on VET FEE HELP as government funding to the sector has collapsed - by 25 per cent since 2004.

The collapse of TAFE in a number of states has occurred in the context of a massive growth in the private market, and for-profit providers making, on average, 30 per cent profit from their increasing share of scarce government VET funding. There is absolutely no certainty now for students of the quality of their VET qualification, or of whether their qualification will secure them a job. The activities of rogue private providers is trashing the reputation of the whole sector. If students and employers do not trust the usefulness of qualifications, they will not enrol and they will not study. The danger in the current situation is both social and economic. We are saddling future generations with huge debt for worthless qualifications - and we are threatening the future of skills development in the economy.

The ALP's commitment to guaranteed funding for TAFE is an important first step back. But the situation is dire and the need for action urgent. The sector is right to ask for more detail from the ALP, and to urge both sides of politics to collaborate on a plan to rebuild the public TAFE system they have all argued they support.

There is courage and vision required at this point. Governments have funded and encouraged a large and voracious private for-profit VET sector. It has grown fat on public funds, and as recent events in South Australia show, it has developed a sense of entitlement and a well resourced (again from public funding) capacity to pressure and lobby. This private sector has let the government and students down, and it has grown at the expense of TAFE.

We need tangible bipartisan support for a robust TAFE system. Guaranteeing funds is an acknowledgement that market models have failed. Now we need to see the money.