Opinion Piece
19 October
If colleges are dodgy, kick them out.
Australia's vocational education and training (VET) sector has long enjoyed a strong international reputation for quality that meets industry needs. Student satisfaction levels are, in the main, very strong and have been so for many years.
Equally, employer use of the accredited VET sector has been remarkably consistent –taking into account the ups and downs of the economy that underpin key elements of the sector, like apprenticeships and traineeships.
However, recently there has been some very well-deserved criticism. Hardly a week goes by without reports emerging of major failings to deliver the quality training that was previously the hallmark of the sector.
The so-called dodgy RTO (registered training organisation) has created a new nomenclature in the education industry. It causes considerable distress to the many high-quality public and private providers across the country.
The report on vocational education and training released on October15by a Senate committee catalogues many of the problems. While it uses unnecessarily political and emotive language, the recommendations are in the main in the right direction.
At the Australian Council of Private Education and Training (ACPET) we have already taken action by implementing a Code of Conduct for members and a Code of Practice for dealing with brokers and agents. We have also established an independently chaired National Quality and Ethics Committee to oversee the membership quality framework, including an overhaul of membership requirements and professional development.
I also applaud the efforts of Senator Simon Birmingham who, as Assistant Minister and now Minister for Education, has shown the willingness to stop unscrupulous marketing practices and enhance student outcomes. The VET FEE-HELP Reform Bill introduced toFederalParliament last Thursday makes some very real changes to this HECS-style income-contingent loan schemethatwill make a difference.
But even these changes may not be enough. The problems with poor delivery and outcomes, and the rise of brokers and agents who target vulnerable groups in the community with government backed VET FEE-HELP loans, risk long-term damage to the sector on a scale that is unprecedented.
Just two of the VET FEE-HELP program's key measures highlight the scale of the problem.
First, the average tuition fee for a diploma has increased from $3753 in 2010 to $9924 in 2013 – nearly trebling in three years. There is no doubt this trend has continued since.
So what do you get for your money? Not much. The three-year completion rate for VET FEE-HELP-assisted students was 23.6 per cent compared to 37.4 per cent for non-assisted VET FEE-HELP-eligible students.
More concerning is the completion rate of 7 per cent for VET FEE-HELP students undertaking study externally (that is, not on campus) compared to 23.5 per cent for non-assisted VET FEE-HELP-eligible students.
Unfortunately, these poor outcomes are not just the province of the private sector:they are evident in both public and private providers.
What drives failure
So what is driving this failure and why hasn't it been stopped?
We cannot deny that behind the poor providers are brokers"selling"qualifications to anyone with one focus – let's make hay while the sun shines. Super profits, staggering growth and incredibly poor outcomes are now the norm in a small, but damaging, group of providers and brokers. I am now hearing of brokers telling education providers they only have a few months left to maximise student numbers so the fees (paid to brokers) are on the way up.
Let's stop mucking around. How do we fix this for the students (and for Australia's economic future)? My view is very simple. We need action in several areas.
Brokers:The exploitation we have witnessed warrants the regulation or banning of brokers and agents. There are too many continuing examples of student exploitation and price gouging for this to be left to providers to manage. We've seen action taken in relation to financial advisers – it's time to take similar action with education and training brokers. If brokers continue to be used, their fees must also be capped, if not by government, then as a condition of ACPET membership. A tough call? I don't think so – we need this stopped.
Providers:If students, who enjoy the cushion of the VET FEE-HELP loan scheme, are not sensitive to price increases, then government needs to be. Government needs a strategy to oversight fair pricing, so is it time for a new independent pricing body to be created? While this may seem to run counter to the contestability agenda, or be seen as interfering in the market, the evidence is that we are now beyond that. Although I have long been an advocate of the importance of markets in tertiary education, my confidence has been dented.
Government:It is time to act and remove the education providers with very poor outcomes and unsustainable growth in student numbers, which are draining the public purse. Poorly performing providers or those without a solid track record should not get VET FEE-HELP loans – it's that simple. Recent events show government is warming to this task. But there will still be further pain before this is over.
Industryombudsman:Around 12 months ago I called for support in creating a national training ombudsman. It is fair to say that the federal government has shown little interest. However,ombudsman roles have been created in Queensland and Victoria and already exist in South Australia and in the international space, and I still believe it is sorely needed nationally.
I do not realise from my responsibility to lead change. The private training industry needs to use all of its capacity to implement the changes contemplated. It is time to lift the quality bar in vocational education.
Rod Camm is the CEO of the Australian Council of Private Education and Training, the peak body for private training providers