Be careful what you wish for – comment by CEO Craig Robertson

A federal takeover of VET was raised again this week, fuelled by submissions to the Joyce Review. To be fair, the call is for national VET coordination, and for harmonisation of funding and regulation for higher education and VET. I argue, be careful what you wish for.

If the national takeover is under consideration, let’s explore the issues. That makes this piece a little longer this week.

Federations have a purpose. They put checks and balance on power. The lack of coordination is frustrating, infuriating even, but the down side of a unitary system can be deep.

Let’s imagine the future of VET funding was reliant on the current federal government. Despite VET’s critical role in generating skilled workers to keep Australia at the forefront of productivity, helping workers jump across adjusting industries and offering pathways for some to catch-up on lost education the Abbott/Turnbull/Morrison government cut funding. Despite the obvious benefits to the Australian economy, it wavered. It’s not just this government. Malcolm Fraser, for example, squibbed on much of Myer Kangan’s recommendations.

Shared responsibility has its benefits. Observers of the sector would acknowledge that Victoria led the sector down the full-blown market pathway – but to its credit is showing other governments the way out. That TAFE (as the institution and as the representation of skills training) has featured as an issue in state elections has brought the issue to national prominence. That’s not necessarily guaranteed in a unitary system. I haven’t seen many first ministers criticise Senator Birmingham’s decision to cap funding on universities, for example.

If the VET takeover proposal were to proceed, two important principles of public policy would need to be reconciled – subsidiarity and community.

In the micro-economic playpen that has been the VET sector in recent years the notion of subsidiarity has been central. What is it? That best value in the supply and demand equation – the student and provider exchange – occurs at that level. Governments are notoriously bad, especially cloistered in Canberra, at dictating such decisions.

The whole point of the Bradley reforms was to move control from Canberra – or ‘Moscow on the Molonglo’ as it was once referred to – to higher education providers and students. It’s unfortunate that expanding access to Commonwealth Supported Places is unfinished Bradley business. With both sides of politics restricting demand-driven subsidy to universities, other higher education providers rely on student loans knowing when they offer this arrangement to students, they incur a 25 per cent loan fee. Despite this tax on choice and the clear intra-sector inequity the Government hasn’t budged.

Are proponents suggesting we move to the Moscow model? I’m sure they’re not. But when VET is so connected to jobs and industry and the question of regulation and public funding needs some arbitration, within and between sectors, then government planning and intervention surely follows.

Leaving one level of government to deal with the complexity needs some consideration. A tertiary commission has been suggested but let’s be clear, it still reports to a federal government and may rely on a federal Budget. Even though ANTA embodied industry and worked across governments, that didn’t stop a cock-a-hoop prime minister trading in his states-rights convictions to close it down in favour of centralised control.

And control is what we have. Exhibit 1 – VET Student Loans – the response to a laisse faire approach to VET FEE-HELP has resulted in control central. To put aside doubt over where it lies, the legislation enshrines all power on the Secretary of the Commonwealth department! Demand has plummeted and the Government refuses to budge, convinced its reform is working.

Community has been lost in the VET narrative. Thank goodness Community Colleges Australia reminds us of its importance. With extremes such as ours – from dense CBDs, sprawling suburbia, vibrant regions and acres of lonely scrub – we can’t afford to forget community. The Productivity Commission some years ago demonstrated that Australians are pretty-poor movers, even when there were high paying jobs available across the top of Australia.

With the economic transformation expected through digitisation and automation, the risk is even higher that communities without these capabilities, city and rural, will miss out. We have to accept that with the benefits that’ll flow through new technology, a necessary cost will need to be access to high grade tertiary education for all. Without this, communities are at risk of digital isolation and at risk of being left further behind.

Some may ask why the unitary funding and regulation approach works for universities. Universities are bestowed two key capabilities by governments – that’s right, subsidiarity and community. Subsidiarity is in the form of self-accrediting powers to adapt programs to meet local need and they are specifically commissioned under the Higher Education Provider standards to serve community.

For a national system to work, with balance across sectors, TAFEs and other capable providers need to be given these capabilities, otherwise students in inner Sydney, Broken Hill, Katherine and Bunbury are served the same course with little regard to local conditions, and service to community is put at risk.

Terry Moran is saying as much in his report on TAFE SA. South Australia is at risk of skills paralysis if the only options are served up from Canberra.

My point is that this is complex. The two sectors have been administered in the one Commonwealth Department for the last 15 years and the sense of cohesion seems even more distant.

What is the answer then? The first step is leadership! To the best of my knowledge, since the Hobart meeting of skills ministers in November 2015 there has not been a meeting of ministers where quorum has been reached. Higher Education policy resides in the Schools Council – go figure!

And does leadership rely solely on gifts from the public purse? No! Start with vision. Show a positive future and ministers will come, as will the sector(s).

While it’s tough for those who hold the VET sector dear to see the current malaise, there’s always hope. Our citizens can vote.

There’s a footnote. Apprenticeships and traineeships stand-out for national takeover. This formalised training arrangement, which is more work than training, should join with national workplace relations arrangements.