Report on Government Services 2021

The VET system provides training for entry level jobs through to highly technical occupations, but also provides training for non-employment related reasons. Nationally in 2020, the main reason graduates participated in VET was for:

• employment related reasons (75.2 per cent in total VET and 75.4 per cent in government-funded VET)¹
• personal development (14.2 per cent in total VET and 13.8 per cent in government-funded VET)
• pathways to further study (10.6 per cent in total VET and 10.8 per cent in government-funded VET) (NCVER 2021).

To achieve these aims, a student may choose to complete a single subject/unit of competency, module, skill set or VET qualification. VET qualifications range from Certificate level I to Graduate Diploma level, as determined by the Australian Qualifications Framework (AQF).

1. Total VET refers to nationally recognised vocational education and training activity delivered by Australian registered training organisations (RTOs) to students who undertook nationally recognised VET on a government funded or fee-for-service basis. All data for non-nationally recognised training and delivery from non-registered training providers have been excluded from reporting of total VET activity in this Report. Locate Footnote 1 above

VET is an area of shared responsibility between interlinked government, industry and individual stakeholders (figure 5.1).

Figure 5.1 VET roles and responsibilities, as at 30 June 2019

2 The Australian Government ministerial arrangement changed on 29 May 2019.

3 At its August 2019 meeting, COAG announced a new COAG Skills Council, which replaces the COAG Industry and Skills Council. COAG ceased in July 2020 and was replaced by the National Cabinet.

Federal governance arrangements

Government roles and responsibilities are outlined in the National Agreement for Skills and Workforce Development, and are summarised below:

• The Australian Government provides financial support to State and Territory governments to sustain national training systems and provides specific incentives, interventions and assistance for national priority areas.
• State and Territory governments manage VET delivery within their jurisdiction (including the effective operation of the training market).
• The Australian Government and State and Territory governments work together to progress and implement national policy priorities. For the period covered in this Report, the COAG Industry and Skills Council had responsibility for industry competitiveness, productivity and labour market pressures; and skills development and national training arrangements.

From 1 July 2018, the Commonwealth and six jurisdictions have signed up to the National Partnership on the Skilling Australians Fund.⁴ This National Partnership outlines arrangements for managing the Australian Government’s Skilling Australians Fund.

Industry liaison

The Australian Industry and Skills Committee (AISC) provides industry advice on the implementation of national VET policies, and approves nationally recognised training packages for implementation in the VET system.

The AISC draws on advice from its network of Industry Reference Committees (IRCs). IRCs are made up of people with experience, skills and knowledge of their particular industry sector and are responsible for developing training packages that meet the needs of Australian industry. IRCs are voluntary bodies that are supported by professional Skills Service Organisations in training package development work.

Regulation of VET

The Australian Skills Quality Authority (ASQA) accredits courses and regulates registered training organisations (RTOs) to ensure nationally approved quality standards are met. ASQA has jurisdiction over all RTOs, except for those that are state accredited and operate solely in Victoria or WA (and do not offer courses to interstate and overseas students).

Registered Training Organisations

Registered training organisations (RTOs) are those training providers registered by ASQA (or, in some cases, a state regulator) to deliver VET services, including:

• government VET providers — such as technical and further education (TAFE) institutes, agricultural colleges and multi-sector education institutions
• community education providers — such as adult and community education providers
• other registered providers — such as: private training businesses; industry and community bodies with an RTO arm; employers that have RTO status to train their own staff; Group Training Organisations or Apprenticeship Network Providers that also deliver VET services.

Nationally recognised training

Nationally recognised training leads to vocational qualifications and credentials that are recognised across Australia. It consists of the following components:

• Training packages specify the knowledge and skills (known as competencies) required by individuals to perform effectively in the workplace. Training packages detail how units of competency can be packaged into nationally recognised qualifications that align to the Australian Qualifications Framework (AQF). Training packages are approved for implementation by the AISC
• Accredited qualifications refer to nationally recognised courses that lead to a qualification outcome not specified in a national training package
• Accredited courses have been assessed by a VET regulator as compliant with the Standards for VET accredited courses 2012
• Training package skill sets are defined as single units of competency, or combinations of units of competency from an endorsed training package, which link to a licensing or regulatory requirement, or a defined industry need
• Units of competency and accredited modules defines the skills and knowledge to operate effectively in a workplace context. They are the smallest units/modules that can be assessed and recognised. Where a student enrolls in a unit/module not part of one of the categories above, they are reported as ‘subjects not delivered as part of a nationally recognised program’.

All nationally recognised training is listed on the National Training Register and only RTOs can deliver nationally recognised training and issue nationally recognised qualifications or statements of attainment on the full or partial completion of training. Apprenticeships/traineeships combine employment and competency-based training, including both formal nationally recognised training and on-the-job training.

4. The six jurisdictions are NSW, WA, SA, Tasmania, the ACT and the NT. The National Partnership Agreement on Skills Reform ceased on 30 June 2017. Locate Footnote 4 above

Figure 5.2 outlines the major funding flows within the VET system.

Figure 5.2 Major funding flows within the VET system

Government grants and competitive tendering

The main source of government recurrent funding of VET is via government grants and appropriations and/or competitive tendering/user choice mechanisms. Nationally in 2019, Australian, State and Territory government appropriations and program funding for VET was $5.3 billion (table 5A.5).

• State and Territory governments provided $3.6 billion (68.3 per cent of total funding).
• The Australian Government provided $1.7 billion to State and Territory governments, with the majority provided through specific purpose payments.

Government funding of VET is provided to a mixture of government RTOs (including TAFEs), and community education providers and other registered RTOs. Nationally, government payments to non-TAFE providers amounted to $1.1 billion in 2019, similar to 2018 (table 5A.4).

Nationally in 2019, $2.8 billion (53.8 per cent) of government appropriations and program funding was allocated on a competitive basis — a 3.6 per cent increase in real terms from 2018. The majority of funding allocated on a competitive basis was provided through entitlement funding programs (see sub-section 5.2 for a definition) (59.9 per cent of all contestable funding allocated to VET in 2019) (table 5A.5).

Other funding

Financial support to students, employers and industry from the Australian, State and Territory governments includes the following:

• Incentives and loans to individuals — such as incentive payments (for example, to support with the cost of learning during training) and program subsidies and government loans (for example, VET Student Loans — see sub-section 5.2 for a definition)
• Skills development and incentives to employers — including support with the cost of employing and training staff in the form of subsidies and incentive payments (such as for Australian Apprenticeships)
• Support for the National Training System — including funding to industry bodies to support the training system, and assist in the identification of skills needs and the development of skills programs (for example, Skills Service Organisations and the Australian Apprenticeship Support Network).

Governments provide for a number of specifically funded VET programs to provide support for target individuals or communities. For example, support for people with special needs to engage with training, or support for VET delivered in secondary schools.

Students

Nationally in 2019, around 4.2 million students participated in nationally recognised VET (total VET students) (table 5A.8). Around 2.0 million students were enrolled in qualifications, with the largest number of these students enrolled in Certificate level III or IV qualifications (1.3 million), followed by Certificate level I or II (0.5 million), and Diploma or above (0.4 million) qualifications. Other students were enrolled in subjects not delivered as part of a nationally recognised program (2.6 million) and in training package skill sets and accredited courses (0.2 million).

In 2019, around 1.2 million students participated in government-funded VET (table 5A.9). Around 1.0 million students were enrolled in government-funded qualifications, with the largest number of these students enrolled in Certificate level III or IV qualifications (0.7 million), followed by Diploma or above (0.2 million), and Certificate level I or II (135 600) qualifications. Other students were enrolled in other forms of government-funded nationally recognised and non-nationally recognised training.

Data on student participation in government-funded VET by target group (by Indigenous status, remoteness area and disability status) are available in tables 5A.10–12.

Training providers

In 2019, there were 3671 registered VET training organisations delivering nationally recognised training in Australia (table 5A.6), of which 1381 delivered nationally recognised government-funded VET through state and territory training departments (NCVER, unpublished). Around 1620 VET providers delivered government-funded nationally recognised, locally developed and non-nationally recognised training, at 32 568 locations in Australia (table 5A.7).

NCVER (National Centre for Vocational Education Research) 2021, Australian vocational education and training statistics: VET student outcomes 2020, Adelaide.