The development of Australia's national training system: a dynamic tension between consistency and flexibility

This paper reflects on the history of vocational education and training (VET) in Australia. A key focus is the development of the national training system, which has emerged over the last two decades. The authors also explore the dynamic tension, built into the system, to achieve both national consistency and sufficient flexibility to ensure that training meets specific local, industry and learner needs.

Key messages

• Since 1992 the aim of the national VET system has been to respond to industry, and to individual and community needs, all within a nationally agreed system to achieve portability of VET skills across the nation and therefore labour mobility. The end goals have been to realise measurable improvements in the national work skills pool and in employment among individual VET graduates.
• The national training system in Australia is underpinned by:
  • national frameworks for VET products aimed at achieving consistency in training outcomes but with flexibility in the way providers deliver and individuals realise their learning goals; and consistent nationally agreed VET provider standards for entry into the nationally recognised training market, but with flexibility to encourage providers to pursue higher standards
  • a national training market, initially using contestable funding approaches and then client demand-driven models with flexibility built in to allow jurisdictions to tailor their approaches.
• Overall, the implementation of national VET reform initiatives has followed a pattern of continuous improvements against the objectives of the national training system — responsiveness, equity, quality, efficiency and public value, financial sustainability and transparency — and then increasing harmonisation of practices across jurisdictions.
• The system is learning from its experience in adopting market principles and in implementing student entitlements.
• A set of clearly articulated principles for market design would assist further reform efforts.

Readers may be interested in two related reports Jurisdictional approaches to student training entitlements: commonalities and differences and Student entitlement models in Australia’s national training system: expert views. These are available from the NCVER portal <http://www.ncver.edu.au>, along with a research summary titled Balancing consistency and flexibility in student training entitlements: research overview.

This report traces the development of Australia’s national training system, identifying its rationale, objectives and key elements, and outlines the main reforms undertaken between 1992 and mid-2015 to shape the national vocational education and training (VET) system. In so doing, it explores one of the fundamentals of the system: the dynamic tension that exists between consistency and flexibility.

Approach

We revisit the history of VET to help to establish a clear understanding of what is meant by a national training system in Australia. This was necessary to aid consideration of the implications of jurisdictional approaches to a recent national reform, VET student entitlement funding. A robust literature review was undertaken, along with an analysis of how consistency and flexibility have been incorporated into various reforms.

Context

In 1992 all nine Australian governments took a landmark decision in relation to vocational education and training. They agreed to create a nationally coordinated training system. At the time, VET in Australia essentially comprised eight public TAFE (technical and further education) systems run by the various state and territory governments. This decision recognised that a more uniform approach to vocational education and training would assist Australia’s competitiveness in the global economy. It also acknowledged the need for the joint resources of the Commonwealth and state and territory governments to fund greater training efforts.

In the latest national agreement on VET, signed by the Council of Australian Governments (COAG) in April 2012 and known as the National Partnership Agreement on Skills Reform (NPASR) 2012—13 to 2016—17, one of the initiatives was the introduction of a national minimum training entitlement by 2015. The entitlement aims to create a more accessible and equitable training system by ensuring that all working-age Australians have access to a government-subsided training place up to their first certificate III level qualification. Students should also be able to choose any registered training organisation (RTO) from among those approved to deliver the training entitlement (Council of Australian Government 2012, p.7). The introduction of a national training entitlement is one of the jurisdictionally flexible reforms. How the states and territories have so far implemented the entitlement is mapped out in Jurisdictional approaches to student training entitlements: commonalities and differences (Bowman & McKenna 2016a), while the views of experts on the consistency and flexibility within the system are reported in Student entitlement models in Australia’s national training system: expert views (Bowman & McKenna 2016b).

The system’s purpose, objectives and key elements

We consulted the various national VET agreements and national VET strategies that have been developed since 1992, following the introduction of a national training system, and arrived at the following statements that help clarify its purpose, objectives and key elements.

Purpose

Since 1992 the aim of the national VET system has been to respond to industry and individual and community needs, all within a nationally agreed system to achieve portability of VET skills across the nation and therefore labour mobility. The end goals have been to achieve measurable improvements in the national work skills pool and in employment among individual VET graduates.

Objectives

The system’s objectives have been focused on its operation and have been used to gauge the performance of the various national training reform initiatives. They are:

• responsiveness: to the needs of industry, individuals and the community so that VET skills gained are used
• equity: of access and participation for individuals
• quality: in training delivery and learning outcomes
• efficiency and public value: for government-funded VET to be efficiently priced and steered to skills areas that support job outcomes when this may not take place if left entirely to enterprises and individuals
• financial sustainability: by funding the VET system with shared contributions from governments (where there is public value), enterprises (private value) and individuals (private value)
• transparency: to enable better understanding of the VET system among clients so they are able to navigate the system and make informed choices and decisions.

Key elements

We found two strategic elements that have been constant in the national training system:

• National standards for VET products and providers: these aim to ensure a large degree of consistency in training outcomes and the quality assurance of registered training providers to deliver the outcomes. National portability of training outcomes has been the dominant driver in terms of these standards.
• The development of a national training market: the reason for developing a training market has been to open up government funding to the full range of registered training organisations, both public and private, to stimulate the efficient allocation of the public training dollar. Flexibility has been the dominant driver in training market design to ensure that public funding achieves the right mix and quality of skills to meet industry needs nationally, regionally and locally, as well as assist graduates to obtain jobs and/or move to further learning. This has resulted in different calibrations of the entitlement across the nation.

Conclusion

Australia’s integrated model of national skills standards and the national framework for awarding qualifications is a major strength of its VET system. However, the varying student entitlement reforms have produced both successes and failures. Success is evident where students are commencing and completing training with high-quality providers, training which is delivered efficiency and effectively, hence achieving greater value for its public subsidy. On the flipside, the failures have exposed weaknesses in, for example, design ‘overreach’, whereby training is not achieving the desired goals as a result of not adequately understanding the needs of the market, or the existing private fee-for-service market, nor effectively managing the consequences of change. These factors are all the more challenging if available public funding is capped. This creates the necessity for a ‘managed demand-driven’ system. Critically, the differing models applied in the implementation of the student training entitlement reform have each coincided with reforms that have required public providers to operate in an environment of greater competition, and it is this that has been the trigger for much of the resulting disruption.

Responsiveness to local, regional and national supply and demand needs for VET skills, as well as equity of access to an entitlement, requires approaches and allocations that are sufficient and flexible. Greater national coherence can be achieved in student entitlements if nationally consistent principles are developed to determine eligibility for subsidies and loans, and aid market design and the provision of consumer information.