Michael Bachelard, The Age’s Investigative editor, has posted a ripping article today cautioning against the Harper Competition Review’s recommendation to outsource “human services” to the private sector, arguing that privatisation is behind the widespread rorting of the Vocational Education Training (VET) system:
The Harper review, seeking to revive competition policy in Australia, has spruiked the outsourcing of public service delivery as a way of increasing choice, efficiency and productivity. The market, they say, can solve most problems, both social and economic.
Urged on by the business community, the government agrees.
But even as these messages hit the news stands, nobody drew the most obvious possible link with another big news story of the day: how the privatisation of a significant public good has this year turned into a $4 billion get-rich scheme for shonks and shysters.
Australia’s private vocational education system is now almost twice as expensive as Labor’s home insulation scheme, and that prompted a royal commission.
Those growing rich on government funding are the operators of private colleges and the brokers (salesmen operating door to door or from hothouse call centres) who sign up the poor, the uneducated, the mentally disabled and those living in Aboriginal communities for useless online diplomas at a cost of $20,000 each. For reference, that’s twice what a year studying medicine at Melbourne University costs…
The great unwinding of vocational education began almost a decade ago as the states cut funding to TAFEs – the stodgy and expensive bricks-and-mortar, government-run institutions that generations of people once looked to when their skills needed upgrading.
In the place of TAFE, state governments slung money at private operators…
Bachelard has hit the nail on the head.
As noted by The Australian’s Natasha Bita today, what we have with VET is a “financially cancerous system that combines open-ended public funding with poor quality control”. VET course fees have “trebled in the three years since university-style student loans were made available to vocational training students” to the point where “colleges can charge as much for an acting diploma as a university does for a medical degree”.
Indeed, last month The Australian published a series of reports (here, here and here), which revealed that that private colleges were handed more than $1.4 billion in government-funded VET Fee -Help loans last year, which was four times as much as was provided to public vocational education and training providers. Yet, only 14,400 students managed to complete courses at private colleges last year, compared with 18,400 students at TAFE and other public providers. Thus, the figures reveal that private colleges are inflating course costs, gouging taxpayers, and providing very poor educational outcomes.
The Australian’s Judith Sloan neatly summarised the problem as follows:
Fly-by-night operations could lure students to expensive, inadequate courses and send the bill to the federal government. Students were urged to take loans on the understanding they would not have to repay the principal…
Fairfax Media has also identified a series of rorts in the private colleges industry (here and here). Included are reports of the “vocational education sales industry” targeting poor areas, providing them with “free” laptops if they sign-up to an expensive online diploma course. In the process, the education providers pocket thousands of dollars in fees for students that will in all likelihood never finish their courses, courtesy of the Australian taxpayer.
In the case of the VET system, there is a clear case for greater government regulation: by capping course prices or limiting how much students can borrow for each course. Because what we have now is a quasi private system that continues to drain taxpayers all the while public universities, schools and TAFEs go under funded.
It’s a cautionary tail that’s well worth considering before embarking on further privatisations of human services.
