Labor Senators strongly oppose the recommendations in this report.
Vocational Education and Training
Privatisation and deregulation in the vocational education and training
(VET) sector has been a dismal failure.
Experience has repeatedly shown that rent-seeking, and access to
government funding in VET with limited regulation, has led to extreme outbreaks
of malfeasance by unscrupulous private, profit seeking providers.
VET FEE-HELP is the most recent, but not the only, example of the
runaway rorting by unscrupulous for-profit training providers putting profit
before the national interest.
As a consequence of rorting in the VET sector the reputation of the
sector has been marred by: dismal completion rates; increased course costs;
burgeoning and unfair student debt; insolvency of major private colleges; and
predatory behaviour by unscrupulous registered training organisations to enrol
students and access government funding.
VET FEE-HELP was introduced by the Coalition in 2008 and opened up in
2012. In the five years under Labor, loans totalled $1.4 billion. Under three
years of the Coalition loans skyrocketed by a further $5.8 billion.
The Australian National Audit Office has reported that the Government
Actuary assessed that $1.2 billion of loans were wrongly issued under VET FEE‑HELP.
The number of people misled and subjected to unfair debts is yet to be
It is estimated that close to 75 per cent of all VET FEE‑HELP
funding went to private providers. This included $600 million to just one
provider, Careers Australia, which subsequently went into receivership leaving
18 000 students stranded without qualifications and holding unfair debts, 1000
employees robbed of their entitlements, and money owing to suppliers.
In addition to the scandalous provider behaviour exhibited in the VET
sector, there is evidence that privatisation in VET has led to widespread and
persistent concerns relating to quality, and in particular the development of
low quality training markets driven by low-cost, high-profit provision. For
example the prevalence of low cost, short courses was reported in a series of
strategic reviews by Australian Skills Quality Authority of the aged and
community care, early childhood education and care, and the construction and
It is clear that sound and fit-for-purpose regulatory standards are
fundamental to ensuring quality delivery and for ensuring consumer protection
in vocational education and training.
If public money is to flow to educational organisations then those
organisations must be of the highest standards and the bar for entry must be
Labor recognises that the current design of the VET system is flawed.
The reliance on a market to deliver quality vocational education and
valued training qualifications is one of many factors that require close
examination and review.
As such, no amount of regulatory oversight and intervention will
adequately correct the current problems in the vocational education system.
Importantly, regulation reduction will simply promote reduced oversight and
increased exploitation of students.
In government Labor will establish an independent and comprehensive
inquiry into the post-secondary education system, ensuring that public TAFEs
and universities sit at the centre of the system as anchoring and publicly
That inquiry will make recommendations about regulation and consumer
protection, in light of the review of the whole post-secondary education
Australia has a well-established higher education system with a strong
public university sector and a number of quality private providers. Unlike VET,
public universities have not been subject to the same level of private
competition and they have benefited significantly from reforms put in place by
a number of Labor governments.
Labor's policy in 2009 to uncap university places (through the
demand-driven system) has been one of the greatest changes seen to higher
education in this country in a generation.
This reform, in conjunction with greater funding for access and equity
opened the door of university to more than 200 000 more Australians. Our
reforms also saw increased participation from traditionally underrepresented
groups. Between 2008 and 2016, we've seen:
Low SES undergraduate student enrolments increase by 55 per cent;
Indigenous undergraduate student enrolments grow by 89 per cent;
Enrolments of regional and remote students increase by 48 per
Enrolments of undergraduate students with a disability more than
Not only did we boost participation, the demand-driven system drove
innovation in modes of delivery and industry collaboration. This was noted by
the Liberals' 2014 review of the demand-driven system.
In 2011, Labor introduced a national system of regulation with the
creation of the Tertiary Education Quality and Standards Agency – fundamentally
streamlining regulation of the sector, reducing the number of jurisdictions
from nine to one. The regulatory system was also designed to be proportionate
Labor believes the national regulatory system in higher education needs
more time to mature. In order to ensure the settings continue to be
fit-for-purpose, we will examine regulation as part of our once-in-a-generation
national inquiry into post‑secondary education in Australia.
Senator Murray Watt
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