How do we get our Vocational and Educational Training (VET) back on track?

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(Image via @investinTAFE)

We need to stop thinking of education as a cost or our standards will tumble, as we've seen with the shonky, multi-billion dollar private training rip-off merchants, writes Aaron Tucker.

THERE WAS a time when we were happy with our training providers. A push to deregulate, privatise and streamline have seen our standards slip. In their place we have a multi-billion dollar sector extracting high fees for low valve. We need to nurture our populace into well trained and educated citizens, not plunge them into the murky world of profit maximisation and "race to the bottom" standards.

For many generations of Australians, the only knowledge of the education and training system they know is government backed and regulated.

Universities and TAFE’s have been the backbone of our country’s growing level of world class expertise. Yes, we have amazing doctors and lawyers, world beating biotechnology departments and cutting edge environmental research groups.

Did you also know that Australian qualified chefs are highly sought after? How about mechanics, welders and builders?

We are a country of people who put our minds to something and grind out success. Hard workers and innovative thinkers in many disciplines, renowned the world over, have been created in our lucky country.

So what do you do with a network that has created so many skilled citizens? Well it appears our federal government would like to privatise it.

Let’s avoid the tricky topics of university fee deregulation and funding cuts and instead sink our teeth firmly into the Vocational Education and Training or VET sector.

I know popular opinion pegs it as a tea and biscuit festival with sedate middle age employees grinding out their days wistfully thinking of their government-funded pension but let’s deal with an inconvenient truth.

Working for a government-funded and run organisation is very difficult to say the least.

If you or any member of your family has worked in these organisations then you know the employees are largely overworked and need to put in a great deal of effort to keep these underfunded organisations afloat amongst constant budget cuts and employee hiring freezes.

To add to the hard graft of government work, the introduction of defined contribution, in the place of defined benefit, retirement plans have seen any sweet government employee retirement dreams fade into oblivion.

So it was, with the mythical image of fat cat government employees wasting away precious Australian taxpayer dollars that the federal government announced that students attending privately run, although government approved, registered training organisations can now access VET FEE-HELP loans.

Now an economist might suggest that the increased competition in a market would lead to the provision of a higher quality product at a lower overall cost. A cynic might say the best way to kill a government department you can’t float onto the stock exchange in a way palatable to the public or disband altogether is to fund its direct rivals.

What has happened in the years since VET FEE-HELP loans were made more readily available you might ask? Has competition reigned supreme?

Well, no.

First off the recognised training organisations (RTO’s) grew in size. This is great as more and more people begin the journey to greater skills. As an example, payments made to Global Intellectual Holdings went from $1.7 million in 2013 to $35 million in 2014. By the close of calendar year 2015, that total had grown to just over $80 million.

Larger training groups have listed on the ASX to great fanfare. The training needs of our country seemed to be met with innovative thinking.  

It would appear however that the last 12 months have seen the industry hit critical mass. The headlines have been a little frightening. The ASX listed Australian Careers Network entered voluntary administration. Our fast growing friends at Global Intellectual Holdings, mentioned earlier, have collapsed but not before the founders could secure millions for themselves.

We’ve seen stories of these RTOs prowling the shopping malls of low socioeconomic areas selling courses to people who simply don’t understand what they are signing up for. Promises of free education, free laptop’s and iPad’s and guaranteed jobs are routinely made.

These people are never checked for suitability for any particular course. Previous studies or prerequisites such as mathematics knowledge for accounting courses are not required. The salespeople are highly paid and have very high quotas to meet.

Often these newly minted students do not understand that the VET FEE-HELP program is in fact a loan. Yes, it is income contingent but it is most certainly not free.

The ever growing spire of the training providers’ pyramid schemes are coming to an end. Organisations are being investigated for fraudulent behaviour and inconsistent marketing materials. They have to turn away customers.

The Ponzi schemes are starting to unwind.

So how do we get our VET system back on track?

Simply put, we need to fund our public VET system like it is turning out some of the most highly regarded men and women in their fields the world over.

7.30 Report: Training Colleges Corruption

We need to stop thinking of education as a cost we can shift from the public purse and onto our private citizens.

The upside for Australia is we gain a highly skilled workforce. These people work more efficiently, create new ways of working and importantly earn more, directly leading to higher income tax takes for the government.

Education and training will always cost money.

The great thing about growing up in Australia is, even if your family is poor, so long as you are smart/determined/hard working enough, we the country, will put you through any course you qualify for. The collective Australian voice for something like that would sound like: “Well done kid. Now study hard and you can pay us back later. We trust you’re a good sort. And one last thing; always pay it forward.”

That sounds like a pretty great country to me. 

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This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Australia License

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