30 Aug 2018


I acknowledge the traditional owners of the land on which we meet, and I pay my respects to elders past and present.
I would also like to acknowledge the Board of ACPET for bringing us together today.
Last week we witnessed a government in its death throes.
A government consumed by its inability to develop coherent economic or climate change policy.
A government incapable of delivering cohesive vocational education policy.
A government consumed by internal animosity and hatred.
A government focused on itself and not on the interests of our nation.
The sooner this rabble of a government submits itself to the judgement of the Australian people the better.
As the alternative government, I appreciate the opportunity to outline part of Labor’s vision for the future of vocational education.
The unfortunate truth is that Australia’s TAFE and vocational education system is broken as a result of poor and incoherent policy development; and a palpable lack of leadership from the government in the VET system.
As it stands we have seen:

  • An overall decline in outcomes for students with dropping enrolments and low completion rates;
  • Cost shifting to students via fee increases, growing limitations on access, and less government support relative to university students;
  • Growth in low quality courses putting pressure on public providers and high quality private providers trying to maintain high standards, resulting in a race to the bottom and the development of a market in low quality courses;
  • Employers voicing their dissatisfaction, reporting skill shortages and skill gaps;
  • Australian apprenticeships and on the job-training opportunities in a state of on-going decline;
  • A training framework that delivers qualifications that are narrow, rigid, slow to adapt, and not fit for purpose;
  • A proliferation of wasteful and rigid bureaucratic processes  - that have seen the development of 17,000 units of competence and 1,400 different qualifications, many of which remain unused;
  • Insufficient investment in the system including in infrastructure and  teacher qualifications and teaching resources; and
  • At its very worst, the defrauding and exploitation of citizens and vulnerable Australians trying to improve their lives through gaining education and qualifications.

The Abbott-Turnbull-Morrison government is incapable of developing policies to address these issues.
Instead they have served up tweaks, platitudes and ineffective policy.
After five long years the coalition’s leadership vacuum on VET remains intact.
Over the period there have been six Assistant Ministers responsible for vocational education and training.
This, from a government who claimed they were the grown-ups and would provide stability.
The previous Assistant Minister Karen Andrews has made the deluded claim that our VET system is better than Germany’s, despite all evidence to the contrary – and a litany of experts, such the Productivity Commission, the Chief Scientist, the OECD highlighting major deficiencies in the Australian system.
Andrews has lauded the market and micro credentials with no understanding of the implications of either on the system or on students. She stood by as Coalition senators launched a discredited and political attack on TAFE SA.
Her incompetence has been rewarded by a position in the Morrison cabinet. This beggar’s belief!
The latest in a long line of Ministers, the embattled and discredited Michaelia Cash, was responsible for banning any building employer who agreed to employ a minimum number of apprentices on government-funded construction projects.
We now have a Minister whose office engaged in illegal activities designed to attack her political opponents and following an AFP investigation the DPP is considering charges.
This chaos and policy failure is on top of their ongoing incapacity to convince all the States to sign up to their flagship policy piece - the deeply flawed, and ever diminishing - Skilling Australians Fund. Still not one cent has been paid out from the fund to engage an apprentice.
They are incapable of upgrading an IT platform for the management of apprenticeships.  They wasted $24 million of taxpayer’s money on a project originally slated to cost just $9.6 million – and they have to start from again with no public business case or estimate of costs.
In the meantime the OECD is reporting that Australia is at the bottom of the international leader charts when it comes to our capacity to engage in global value chains – and that the main barrier to that critical economic activity is our skill base.
The government continues to spruik the virtues of the market and abrogate any responsibility for the delivery of quality education and training.
There is an urgent need to deal with the real problems in the VET system – holistically, across the system and head-on.
There has not been a review of the system since Kangan in 1974 – despite the monumental changes that have taken place in our labour market, our society and our economy.
That is why Labor has committed to establishing a national inquiry into post-secondary education within the first 100 days of a Shorten government.
We will work with governments, students, experts, businesses, unions, TAFE, and community and other providers.
Labor is already working with ACPET as a member of the expert panel advising on the terms of reference for the inquiry – and we welcome your input.
We must build a post-school education system that delivers technical innovation, creativity, new knowledge and skills acquisition to support a fair, prosperous and competitive Australia.
For nearly three decades we have been operating a national vocational education system based on two main pillars:

  • A training market – to facilitate  competition and contestability amongst training providers, and
  • Competency based training packages - to closely tie vocational education and training to the needs of the labour market.

Given the on-going and widening cracks that have plagued the system it is time to reconsider those foundations.

We must assess, amongst other things, whether they continue to be the appropriate design principles for a modern vocational education system, in the context of post-secondary education and training.

The Australian training market and its evolution provides a salutatory lesson in how market competition and rent seeking in education can do enormous damage.

If quality is not a consideration, operating in the training market can be a very lucrative business. We saw the worst of that behaviour displayed under VET Fee HELP.

The commodification of education is summed up by the words of a capital investment adviser, as quoted by Dr Phil Toner, spruiking the money-making benefits of education:

‘Education is a beautiful business when it works. Fat fees, hefty annual increases, recurring income and high switching costs are just a few traits of high-performing education providers. Investors who have understood the sector’s potential have done exceptionally well...The sector has excellent long-term potential. Not-for-profit education providers...look like sitting ducks as technology eventually reshapes the sector’ (Featherstone 2014).

The investment adviser makes an important point –because most egregiously the training market and the commercial ascendency of for-profit training provision, has put at risk the viability of TAFE and other not-for-profit providers seeking to deliver quality.

Profiteering and exploitation is wrecking lives - but it is also responsible for dismantling quality and trust in our vocational education system.

Young people are uncertain of the future that vocational education provides.

Parents are less inclined to encourage their kids onto a vocational pathway.

Employers rely less and less on VET qualifications as markers of skill and competence.

Too many employers are failing to invest in training for their workforce - unfairly placing the responsibility on a shrinking number of employers who still recognise the importance to their businesses of investing in the skills of their workforce.

There are those RTOs that do not uphold the mission and commitment to education and vocation – but operate business models that are designed to extract profit with an inevitable lowering of standards.

Dr Phil Toner has also described the growth of what he has called “the low quality training market”, and the conditions that have created ‘perverse incentives’ for students and employers not to demand quality training and for providers to supply this low quality training.

These dynamics impact directly on the capacity of providers like TAFE, not-for-profit community colleges and decent private providers, to deliver high quality, sustainable vocational education and training.

I don’t have to tell you that. These are doubtless the pressures that you deal with daily.

As it stands it is a market that fails to assure quality – and undermines those values-based educators that seek to deliver it.

A fundamental flaw in the vocational education system is that it is a market.

It is right to criticise and condemn the rent-seekers and the rorters - but equally, the market is behaving the way that markets do.

If people cannot trust the qualifications they are getting; if employers cannot trust the qualifications of their workers; and if education and training organisations cannot sustain models of delivery predicated on quality, with students’ interests at the core; the system is broken.

Try as they might, ASQA cannot regulate away the problems in the training market.

Instead, we encounter the terrible paradox whereby the regulator tightens the screws to discipline the rogues, and in doing so further undermines the capacity to ensure responsiveness to students, communities and employers.
Labor is unequivocally committed to ensuring a robust and sustainable public TAFE network is put firmly at the centre of our vocational education and training system.
That is why we are guaranteeing that at least two thirds of government funding goes to TAFE, and the balance goes to not-for-profit community and adult educators, and only high quality private providers with demonstrated links to industry.
Without a strong institutional centre that upholds standards, and provides the full range of courses needed across Australia’s communities, for students with diverse needs, the VET system remains exposed to further decline.
There is an important role for non-TAFE providers in a high quality VET system complementing the role of TAFE, collaborating with each other – but if profit remains a driving and distorting force in the system, nothing will change for the better.
The second pillar of the current system, training packages and competency based training, also needs serious consideration.
The development of competency based training packages was designed to better align skill development with workplace needs and assist workers achieve the right skills for existing jobs, enable them to build upon and advance their skills, while having them formally recognised and rewarded.
A major deficiency associated with competency based training has been a lack of cohesion and depth in the learning that it supports, particularly in the absence of highly skilled and knowledgeable teachers and trainers.
As it stands the system is simultaneously rigid and fragmented.
We need to be asking whether the training market and training packages, as they have been developed and evolved in Australia, are operating for the public good.
We need to ask fundamental questions of the current design:

  • Is the system supporting the development of productive and flourishing citizens?
  • Does it effectively provide the connections to workplaces, work and careers, that has been assumed? and
  • Are its graduates enabled and supported to adapt to a changing world and a rapidly transforming world of work?

Technology is reshaping our societies and cultures in ways we cannot fully understand or effectively anticipate. It is also transforming the skills and jobs that are required in the labour market.

Outsourcing, off-shoring, importing skilled workers, the growth in contract, part time and casual employment - all contribute to reducing investment in skill formation by employers.

This necessarily impacts on our education and training institutions and systems.

This is not new – but the pace of change has accelerated with technologies such as automation, artificial intelligence, machine learning, and the internet of things, additive manufacturing and synthetic biology.

Not surprisingly, there has been an explosion of reports discussing the future of work - with a particular focus on skills and workforces[1].

Each of the reports also observe an increasing demand from employers for skills such as critical thinking, collaboration, communication and decision-making -  once known as generic skills, which have more recently been dubbed 21st century skills or ‘future skills’.

As a technically trained mechanical fitter, problem-solving and decision-making was an integral part of my job.

As a maintenance fitter at Garden Island dockyard, GMH at Pagewood, National Springs and Liddell power station my workmates and I were confronted on an almost daily basis with problems that required the application of technical expertise and decision-making.

Without my trade training, I would have had not have had the knowledge or technical skills to solve a problem, and no expertise with which to exercise my judgement.

Judgment and problem solving were not attributes, qualities or skills that were lifted off a shelf and ‘learnt’ out of context – they were inextricably linked to the knowledge and practice of my trade.

A simplistic characterization of the absence of such skills, as gaps that can be filled by an extra unit in a training course or as a stand-alone micro-credential– is misguided ant to my mind ludicrous.

It occurs to me that the source of the skills gaps employers are concerned about may be a result of, at least in part, poorly designed jobs and badly managed and organized work – rather than in the deficiencies of individual workers.

It is worth keeping in mind what Professor Willie Brown, Cambridge academic and former member of the UK low pay commission, has said about workplace productivity,
“Workers, by and large, are as productive as their employers allow them.’

One thing is for sure– further fragmenting and narrowing qualifications, is not the solution to a lack of critical thinking skills - and yet in the future of work literature from consultancies and employer associations, there is a frequent call for micro-credentialing and bizarrely, from the BCA for example, the capacity for ‘building your own qualifications’.

As it stands we have a system in place that lacks cohesion, facilitates fragmentation and adapts slowly.

NCVER data is showing a growth in students acquiring skill sets and a decline in full qualifications among the people enrolling in vocational education and training when compared to the three preceding years.

This should be seen as a red flag – not something to be uncritically welcomed. Relying on narrow occupational qualifications, pieces of qualifications and enterprise specific skills is not the answer to the growing need for new skills or the on-going calls for 21st century skills.

We need a skill formation system that equips the workforce with skills that are transferable - with high levels of technical capability underpinned by a strong foundation of broad-based vocational knowledge; that can be enhanced with the acquisition of additional skills over one's working life.

We’ve known for a long time that firms are inclined to train to the requirements of the enterprise and unless there is intervention, the advanced skills that provide the precondition for the ability of fast “retooling” to unpredictable changes can go unsupported by most firms.

In other words, left to their own devices firms are likely to only invest in skills that provide an immediate return to their own business. They are unlikely to recognise the nationwide productivity benefits of skilling across the economy.

A single foundational qualification will not set an individual up for a lifetime of work. But a regime of piecemeal, narrow, enterprise specific skills – will operate to de-skill and disempower Australian people – in their lives and in their work – to the detriment of our society and our economy.
If we are to deal with the problems in the existing VET system to build the skilled workforce of the future then it is essential that Labor wins government at the next election.
We have some very fundamental issues to resolve in the inquiry.
It will require us to have a strong vision of the future and then move towards it.
We are faced with choices - an impoverished version of the future – one that increases inequality, and facilitates low quality jobs and endlessly flexible labour swept along by the apparently inevitable force of the digital revolution – from which some large corporations will profit and ordinary people will not.
I don’t think that is a vision that Australians share.
The current design of the Australian vocational education system –an unhealthy market, with its increasing fragmentation and its narrow task-based reflection of the labour market – could very easily and quickly become the servant of that impoverished vision.
We have consensus that reform is critical – we need an independent, inclusive and comprehensive inquiry that will guide us to the best solutions, to rebuild trust and provide quality and certainty for students and employers.
It is part of the conversation we need to have as a community, as governments, as employers, as parents and as creators of a strong, fair society; and an economy that reduces inequality and operates in the service of that society.
The only way that conversation and vision will be realised is under a Federal Labor government.
I invite all of you to be a part of it.



[1] Including the OECD, the ILO and the World Bank, CSIRO and CEDA. Deloittes, McKinsey and Co and PwC, to name a few of the multi-national consultancies, as well as outfits like Alpha Beta here in Australia - are competing for ascendancy as experts in the future of work. They have all published their own contributions.

Authorised by Noah Carroll, ALP, Canberra.