The Canberra Times has reported today that the Federal Government has released a draft plan that would overhaul TAFE funding so that they compete on an even keel with private vocational education providers:
Under the Turnbull government proposal, obtained by Fairfax Media, TAFE fees would be deregulated and TAFEs would receive the same levels of funding as private colleges in a bid to increase competition in the sector.
States could provide some top-up funding for TAFE, but only enough to ensure “competitive neutrality” with private providers…
The leaked COAG paper states: “While prices will be deregulated, basing subsidies on analysis of the cost of delivery will increase competition and improve choice in the sector and see all providers competing on value for money and on the quality of their learning and training product.
“Government-owned providers will be funded on the same basis as private providers.”
The private vocational educational training system has been riddled with rorts, so I fail to see how further deregulation would result in better outcomes.
As was revealed by The Australian late last year (here, here and here), private colleges received more than $1.4 billion in government-funded VET Fee-Help loans in 2014, four times as much as was provided to public vocational education and training providers. Yet despite this massive funding imbalance, only 14,400 students managed to complete courses at private colleges in 2014, compared with 18,400 students at TAFE and other public providers.
The private “vocational education sales industry” was also found to have targeted poor areas, providing them with “free” laptops if they sign-up to an expensive online diploma course. In the process, the private education providers have pocketed thousands of dollars in fees for students that will in all likelihood never finish their courses, courtesy of the Australian taxpayer. That is, thousands of students have been signed up to courses that they have little or no chance of completing.
As explained by Mary Leahy from the Melbourne University Graduate School of Education, the whole business model pertaining to private vocational education is busted:
- Register as a training provider and ensure your students have access to VET FEE HELP income-contingent loans.
- Sign up as many students as possible for single or double diplomas.
- The student takes on a VET FEE HELP loan to defer payment of course fees.
- The training provider receives the VET FEE HELP payment from the government.
- As long as the student is enrolled beyond the census date, the training provider is paid.
- Even if the course is never started, the provider will receive funds from the government and the student is liable for the debt…
This has given reprehensible providers a stream of revenue without the expense or trouble of providing much in the way of education.
Fees have grown, with a number of providers charging over $10,000 for a diploma.
The figures are staggering. A total of $2.4 billion in VET-FEE HELP was paid to training providers in 2015 (up to November 15), a big increase from $1.7 billion in 2014.
Yet graduation rates for many providers were abysmal, well under 10%.
Other providers do graduate their students, pushing them through qualifications in improbably short times. The approach has been described as “tick and flick”.
In Victoria alone, around 9,500 qualifications were revoked in one year.
The implementation of demand-driven training systems across Australia was supposed to give students greater choice and make providers more responsive to students and employers. Instead, Australia has produced a wasteful system that has produced a huge Budget blow-out and poor education outcomes.
Given the poor track record, how will the deregulation of TAFE funding provide better outcomes when it has failed so spectacularly with private vocational education?
