Saving TAFE: The problem with privatising vocational education

A critique of the VET marketisation model.

As the national economy experiences another recession due to COVID-19 and the demand for reskilling grows, Australia’s largest and oldest vocational education and training (VET) provider, TAFE, hangs by a thread. It is hard to understand how the Federal Government can stand by continued funding cuts to vocational education while the very public institutes under fire are best positioned to re-skill and upskill Australian workers.

Despite TAFE injecting $92.5 billion per year into Australia’s economy, the Federal Government has slashed $3 billion in vocational education funding over the last decade. Industry advocates such as the Australian Education Union (AEU) have long expressed concern over the defunding of vocational education, claiming budget cuts have “demoralised” staff and narrowed education choices for students — with regional and rural communities hit the hardest.

But how did we get here? In 2008, under Labor Premier John Brumby, the Victorian government restructured TAFE funding from fixed allocations to a model based on student enrolments. This meant that TAFE had to compete directly with registered training organisations (RTOs) to attract students. Enrolment costs were shifted onto TAFE students, who would no longer be eligible for concessional fee rates, instead having to borrow from the Commonwealth VET FEE-HELP scheme.

Because VET FEE-HELP granted all VET providers virtually unregulated access to government subsidies for every student enrolled, private training providers exercised dubious marketing tactics to lead students away from TAFE. Suddenly, vocational education was made a cash grab. Private colleges offered inducements such as “free” iPads or laptops upon enrolment, or miraculously short courses where 600 hours of training were seemingly provided in 60 hours. 

This resulted in the allocation of substantial government funding to commercial training providers. Unsurprisingly, TAFE enrolments began steadily declining as the public provider could simply not compete with the offerings of private RTOs on a dwindling federal budget. This has been described as the “most disastrous education rort in Australian history”.

The marketisation of the vocational education sector ultimately led to a collapse in confidence of the public sector. Thus, while cash flowed in for private training providers, reaping in billions of taxpayer dollars through the VET FEE HELP scheme (replaced with VET Student Loans in 2017), TAFE was hit with some of the biggest funding cuts in its 130 year history. From 2007 to 2016, VET funding was cut by more than 15% and government expenditure declined by 31.5%. In 2012 alone, Brumby’s Liberal successor Ted Baillieu cut $300 million to Victorian TAFE campuses; a decision that sparked a rally of over 1500 protesters, and teachers and education workers to stage a 24-hour stop-work protest.

Yet despite decades-long protests to stop TAFE cuts and union calls to end VET marketisation, the Federal Government have stood strongly by their privatisation agenda. Most recently the Berejiklian Government proposed to slash nearly 700 frontline TAFE NSW jobs, leaving campuses across the state unworkable, despite Berejiklian explicitly ruling out that possibly just a year ago.

The impact of decades-long federal neglect of vocational education had recently been laid bare in an AEU survey last year. It found that 68% of TAFE staff were aware that their institution stopped providing particular courses, with a lack of funding cited as the most common reason for course closure, while 81% had departmental budgets slashed in the last three years. Additionally, more than three-quarters (76%) of respondents said that they had considered leaving the sector in the last three years, and 94% of those were currently working in the job they had considered leaving. Thus, with TAFE funding at a decade low, so is the morale of its practitioners.

However, the gross undervaluing of vocational education is only part of a larger nation-wide public education crisis. According to the Productivity Commission’s annual Report into Government Services (ROGS), in the ten years to 2017-18, funding for non-government schools rose by 33.9% per-student while funding for public schools only increased 13.2% in the same period. Despite the passage of Gonski 2.0 to the Senate in 2017, funding for non-government schools is still growing at a faster rate than their public counterpart. Over the past decade, it has become painfully clear that the Federal Government favours profit over public education.

A continuation of funding cuts to VET, and indeed the entire public education sector, will not only substantially hinder Australia’s economic recovery post-COVID-19, but will heighten barriers to affordable and accessible education for millions of Australians. Indeed, research from the Centre for Future Work has found that the TAFE system is critically important to addressing systematic inequalities in Australia, helping bridge the gap to further education and jobs pathways for those in regional areas and for special and at-risk youth groups. Without TAFE, such gaps are likely to increase. 

It’s time for the Federal Government to ditch its failed VET marketisation model and invest in rebuilding Australia’s vocational education sector. Public education is too valuable to gamble away.