Standing Committee on Employment, Education 
        and Workplace Relations 
      
      This document has been scanned from the original printed submission. 
        It may contain some errors 
      
Submission 76
      ACCI SUBMISSION TO THE HOUSE OF REPRESENTATIVES STANDING COMMITTEE ON 
        EMPLOYMENT, EDUCATION AND TRAINING ON:
      
        - the appropriate roles of institutes of technical and further education; 
          and
- the extent to which those roles should overlap with universities.
NOVEMBER 1997
      Introduction
      The Australian Chamber of Commerce and Industry (ACCI) is the peak council 
        of Australian business associations. ACCI members are employer organisations 
        in all States and Territories and all major sectors of Australian industry. 
        Through our membership, ACCI represents over 350,000 businesses nation-wide, 
        including the top 100 companies. That makes ACCI the largest and most 
        representative business Organisation in Australia.
      Membership of ACCI comprises State and Territory Chambers of Commerce 
        and national employer land industry associations. Each ACCI member is 
        a representative body for small employers or sole traders, as well as 
        medium and large businesses.
      Each ACCI member Organisation, through its network of businesses, identifies 
        the concerns of its members and plans united action. Through this process, 
        business policies are developed and strategies for change are implemented.
      ACCI has worked closely with Government to ensure that the needs of business 
        are taken into account in the development of policies and has contributed 
        significantly to reforms within the education and training system.
      There is general support from the business sector for the Federal Government's 
        package of education and training reforms. An industry led outcome is 
        critical to the successful implementation of these reforms. ACCI and its 
        member organisations have continued to emphasise at all levels of Government 
        the need for policies to focus on industry needs. Employers play an important 
        role in setting training policy, establishing links with education and 
        training institutions and providing training for employees.
      The pressures to increase training and skills acquisition are enormous. 
        These mainly stem from technological and structural changes, industry 
        competition and workplace change. A well developed vocational education 
        and training system is crucial to the broader microeconomic reform agenda. 
        These pressures have also acted as a driver in determining the way in 
        which future education and training services must be delivered on the 
        ground.
      The fundamental changes being implemented will help expand employment 
        opportunities for all Australians and particularly for young people. As 
        well as enhancing productivity the reforms promote pathways from school 
        to employment. Positioning of technical and further education institutions 
        (TAFE's) in the light of these changes is an important issue which needs 
        to be addressed as a matter of some priority.
      Background
      The new training initiatives will open up the national training market. 
        It has placed competitive pressures on training providers to deliver quality 
        customised training, particularly structured training for apprenticeships 
        and traineeships. Measures such as user choice, national industry and 
        enterprise competency standards and modernised entry level training arrangements 
        will all help to take industry forward. Industry also needs a responsive 
        and flexible training system.
      TAFE's were set up to provide courses which articulate within the workplace. 
        This has largely been true of the trade areas and fee-for-service training. 
        There has been a growing tendency for elements of TAFE to enter the credential 
        race to get full articulation with universities or to maximise credit 
        transfer. Articulation pathways have become blurred and inconsistent.
      TAFE's have often found it difficult to respond quickly and flexibly 
        to training demands. They have operated on a supply driven system, although 
        this has been slowly changing within some campuses. Over time, TAFE infrastructure 
        and facilities have become under utilised. The full use of capital assets 
        has slowly fallen away as a result of the need to move to more flexible 
        training options which cannot always be accommodated within existing facilities. 
        The need for training diversity has added to this problem.
      As public funding for TAFE's has been tightened, Institutes have become 
        more reliant on other funding sources in order to remain viable. Significant 
        variations have emerged in delivery costs for comparable training.
      ACCI's Position
      ACCI supports education and training principles which: 
      
        - change the emphasis of the training market from a supply driven system, 
          based on the needs of the public training provider, to a system based 
          on demand that is specifically aligned to employer and student needs;
- encourage competition which will result in a more efficient and cost 
          effective process while increasing employer and student options irrespective 
          of the location of enterprises;
- diversify the supply of training and education and ensure all appointments 
          of practitioners are merit based;
- increase the participation of employers in the training market by 
          ensuring public funds are linked to employer demands and to provider 
          of choice;
- integrate education and training programs with nationally recognised 
          outcomes and standards;
- focus on training delivery models which are flexible and user friendly; 
          and
- promote training initiatives which are enterprise focused and devoid 
          of extensive bureaucracy.
      
      
User Choice
      ACCI supports the full introduction of 'user choice' in the vocational 
        education and training system. It fosters a partnering approach between 
        industry and training providers which enhances the responsiveness and 
        flexibility of the training system. This in turn facilitates industry 
        expansion.
      The new apprenticeship and traineeship arrangements enable employers 
        and trainees to determine the training provider and negotiate the means 
        by which the training will be delivered. ACCI supports moves to examine 
        the introduction of a voucher system which enables eligible people with 
        training needs to be issued with a training voucher enabling them to purchase 
        training from any accredited provider. This would enable a more complete 
        introduction of 'user choice.'
      ACCI will maintain an active interest in the implementation of 'user 
        choice' particularly in: 
      
        - the operation of 'user choice' in rural and remote areas and exception 
          reports filed by State and Territory Training Authorities on instances 
          where 'user choice' has been deemed difficult to implement;
- access to publicly funded infrastructure by all training providers 
          to ensure all providers have the best available resources at their disposal 
          to meet the needs of employers at a given location; and
- quality assurance and audit arrangements.
ACCI is aware that the ACTU has taken a different view on the introduction 
        of 'user choice'. ACCI does not support the ACTU position. Earlier this 
        year a detailed study was undertaken by ANTA of ten selected user choice 
        pilot projects. The training outcomes from these projects have been much 
        richer than anticipated, even allowing for the short duration of most 
        pilots. Employers and community groups involved are strongly committed 
        to the user choice concept. Having a greater say has made them more active 
        participants in the training system.
      The pilots also indicate that user choice has the potential to improve 
        access and equity by encouraging greater responsiveness by training providers 
        to the needs of disadvantaged groups. Disadvantaged clients have more 
        opportunities to express their needs and have grater confidence that they 
        will be met.
      Third Party Access
      As the training market becomes more competitive providers come under 
        increasing pressure to deliver affordable and quality training. ACCI supports 
        measures which enable alternative training providers to have access to 
        publicly funded VET infrastructure (facilities and equipment). There are 
        situations in which it is not economical and in the interests of the VET 
        system to duplicate this infrastructure. Also, opening up access creates 
        more training opportunities, particularly in regional economies.
      Access by third parties is already being granted on commercial terms 
        in some cases but presently there is no general right of access. Competitors 
        in the training market have a right of access where: 
      
        - this right of access enables the training needs of employers to better 
          met;
- duplication of existing infrastructure is uneconomical;
- denial of access would unduly restrict entry to the market, limiting 
          contestability and competition; and
- fair and reasonable terms are established relating to price, terms 
          of access and related matters.
      
Third party access increases utilisation of facilities, maximises the 
        return on the public funded capital investment. A market based approach 
        for enabling access, as opposed to a regulatory approach, is important 
        in that it avoids complex bureaucratic rules and mechanisms which are 
        normally inherent in regulatory models. The market approach also encompasses 
        the need to separate the role of managing the public infrastructure from 
        the training and service delivery role. If there is separation, access 
        would be enhanced because of the asset managers need to maximise the rate 
        of return on the assets.
      In most cases, TAFE's technical facilities are collectively operated 
        and form part of major TAFE complex. Disaggregating them would make them 
        more accessible to other providers, thus maximising their use.
      The market based approach to third party access also: 
      
        - places emphasis on public providers to operate as business units;
- is consistent with user choice principles,
- maximises the return on public infrastructure; and
- reduces the potential of the public provider to forego some revenue 
          in order to maintain market advantage.
      
      
Third party access would potentially benefit public and private providers 
        wanting to deliver services within and across regions as well as those 
        schools involved in delivering VET services.
      Articulation Pathways and TAFE/University Relationships
      Articulation, credit transfers and recognition of prior learning are 
        important elements; however, they must be oriented towards nationally 
        consistent outcomes. Tradespeople who could reasonably expect to articulate 
        with technician type paraprofessional training often find themselves locked 
        out because of the pre-occupation of TAFE's with university transfer credits.
      Two fundamental strategies are important in order to achieve articulation 
        between TAFE's
      and Universities: 
      
        - acceptance of the Australian Qualifications Framework (AQF) levels 
          as a standard continuum; and
- alignment of credentials (qualifications) with AQF levels.
It is important that pathways between the TAFE and University sectors 
        be maximised to enable flexibility of access by students. Articulation 
        arrangements between TAFE Diploma offerings and University Bachelor degrees 
        are presently unclear.
      Partnership arrangements between Universities and TAFE should be established 
        to enable joint delivery of programs between the sectors. This maximises 
        articulation pathways particularly in terms of student access to opportunities 
        in both sectors. The development of positive relationships between the 
        two sectors, as opposed to a forced merger, is far more likely to be successful 
        in achieving effective and efficient outcomes.
      Universities should not increasingly assume responsibility for TAFE activities. 
        There is a perception within the business community that if TAFE activity 
        is to become the responsibility of Universities, the capacity of industry 
        to influence training development is diminished. Also, Universities should 
        not regard TAFE as primarily a feeder into its degree courses. This is 
        just one of the many pathways available to students.
      Positioning TAFE's
      ACCI encourages all organisations, including TAFE, to recognise that 
        there is an active vocational education and training market. The move 
        to open up this market has placed the delivery of training squarely in 
        the commercial sector. This makes it a demand driven system able to respond 
        to industry needs.
      Like other training providers, TAFE's must focus on a business culture 
        and operate within competitive neutrality principles. They must optimise 
        funding and operate as 'business units' with much more autonomy and control 
        over their activities. This will mean rationalising and modernising facilities 
        to meet training demands. As part of this, economies of scale must be 
        addressed. Efficiency in training delivery must be improved, achieving 
        maximum use of resources and at the same time not compromising the needs 
        of the business sector. TAFE's must be able to respond quickly to applied 
        skills training demands within the vocational education and training system.
      Summary
      ACCI supports the following initiatives: 
      
        - a demand driven training system focusing on full implementation of 
          'user choice';
- full and open competition within the training sector encompassing 
          competitive neutrality principles;
- introduction of a simple and flexible training procurement voucher 
          system;
 
        
- setting-up TAFE's as flexible and responsive 'business units' operating 
          within the vocational and education training market;
- third party access to TAFE infrastructure and facilities based on 
          a market approach;
- nationally consistent articulation outcomes which maximise articulation 
          pathways between the TAFE and University sectors; and
- partnership arrangements between Universities and TAFE Institutes 
          which maximise outcomes.
      
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