The VET System and The Australian Economic Growth (Part 1)

The celebrated author, scientist and one of the founding fathers of the United States of America, Benjamin Franklin once said,” An investment in knowledge pays the best interest.” And it is true to this date. Governments across nations have researched and invested billions of dollars to design an education system that will prevail over unemployment, inequality, and poverty.

Likewise, the Australian government took the initiative to develop skills among its workforce through vocational education and training. In 1974, the state governments and the Commonwealth in Australia collaborated to fund the Vocational Education and Training (VET) System. With this system, they wanted to hike workforce involvement, production levels and economic and societal growth.

Since then, Australia has seen decades of steady growth and development. The Australian work industry heavily relies on the certification of qualifications from the VET system to find the right skill for their businesses. In this multi part (find Part 2 here- Insert Link of Part 2 here) blog, we will walk through the VET ‘Hall of Fame.’ We will learn about the challenges and success and the role the VET system plays in Australian economic growth.

Current Facts About the VET System

Before we learn more about the VET system and how it impacts the Australian economy. Let us see some current facts about it:

Total number of students in VET (2021)

Government funding in the VET system (2021)

Employer’s use of the VET system (2021)

(Source: NCVER database)

With such glorious figures, it would be a shame if we do not talk about the definition of VET and its key components.

Definition of VET and Key Components

VET (Vocational Education and Training) is an education system that prepares students for practical work in their chosen careers. It focuses on practical learning and developing skills relevant to specific occupations.

Accredited Australian educational institutions, like Technical and Further Education (TAFE) institutes and private colleges, called Registered Training Organisations (RTO), provide VET training. Some universities also offer VET courses alongside their higher education programs.

Leo Maglen defined VET something like this in his inaugural speech on the VET system:

“VET is taken to encompass all educational and instructional experiences—be they formal or informal, pre-employment or employment-related, off-the-job or on-the-job—that are designed to directly enhance the skills, knowledge, competencies, and capabilities of individuals, required in undertaking gainful employment, and irrespective of whether these experiences are designed and provided by schools, TAFE, or higher education institutions, by private training providers or by employers in industry and commerce.”

(Source- CEET’s stocktake the economics of vocational education and training in Australia)

Key Components of the VET System

a. National Qualifications

The VET system in Australia is supported by the Australian Qualifications Framework (AQF), the national policy governing regulated qualifications. The AQF brings together qualifications from different education sectors, including schools, VET, and higher education, into a comprehensive framework.

b. National Regulation

The VET system in Australia is regulated at a national level. Independent statutory agencies, also known as VET regulators, oversee every course and training organisation. These regulators include the Australian Skills Quality Authority (ASQA), the Victorian Registration & Qualifications Authority (VRQA), and the Training Accreditation Council (TAC) in Western Australia. Their role is to ensure that registered training organisations comply with a national quality framework.

c. Industry Engagement

The Australian VET system is built upon a strong collaboration between the government and industries. Federal, state, and territory governments provide funding and set policy directions, while employers actively shape the qualifications required in their respective industries.

d. Flexible Pathways

Flexibility is a key characteristic of the Australian VET system. The learning programs are contextualised to meet the needs of each learner. Students can enrol in qualifications, accredited courses, industry-recognised skill sets, and units of competency, enabling them to acquire the necessary skills at the right time.

e. Quality Outcomes

The Australian VET system focuses on competency-based learning. It prioritises outcomes and aims to deliver occupation-specific skills and knowledge-based competencies across a wide range of professions. This emphasis ensures that students achieve the best possible outcomes upon graduation, as their skills are valued by employers and directly applicable to employment opportunities.

Australian Skills Quality Authority: Ensuring Quality in Vocational Education

The Australian Skills Quality Authority (ASQA) is a relatively new regulator established on 1 July 2011 under the NVETR Act. ASQA monitors the compliance of Registered Training Organisations (RTOs) with the NVETR Act and the VET Quality Framework. Its main responsibilities include overseeing RTO entry into the market, accrediting courses, conducting compliance audits, and penalising non-compliance, which may include cancelling the registration of poor-quality providers.

ASQA regulates RTOs in all States and Territories except Victoria and Western Australia, which have their own regulators. It also oversees providers in non-referring States operating across state boundaries and those offering courses to overseas students. With over 4000 RTOs regulated nationwide, ASQA plays a significant role in ensuring quality in the VET sector.

Over the years, ASQA has focused on improving its audit practices. In 2016, it introduced a student-centred audit approach that evaluates RTO practices and behaviours throughout the student experience, from marketing and recruitment to training and assessment. This shift to a risk-based model received positive feedback from stakeholders.

ASQA operates under a partial cost recovery funding model, with fees placed on regulated entities, including RTOs and VET-accredited course owners, to support its operations. The government plans for ASQA to transition to a full cost recovery model by 2020-21.

To enhance its regulatory activities, ASQA received an additional $18.6 million in Commonwealth Government resources in the 2018-19 Budget. This funding will be utilised to increase audit activity, improve regulatory scrutiny, and manage reviews of ASQA’s regulatory decisions requested by RTOs.

While Victorian and Western Australian regulators have similar functions to ASQA, they operate under their own legislation and standards, which may differ from the national system. Nevertheless, these regulators collaborate regularly and share information to ensure consistency in regulatory practices.

Overall, ASQA and the state regulators play a crucial role in upholding quality standards in vocational education and training, working together to maintain the integrity and effectiveness of the VET system.