The Future of State Funding Models of VET in Australia

The uncertain future of VET funding in Australia.    The Victorian VET market has grown expediently with the introduction of a fully contestable funding model in 2009. Progressively the other Australian states and territories followed, as similar funding models were introduced in South Australia, Queensland, Western Australia, Tasmania, New South Wales and so on…. with partial funding models established in the ACT and NT.

Earlier this year after an election win, the South Australian Labor Government implemented major changes with almost no consultation or notice, causing a major fall out with the Federal Government and implementing changes that have caused many job losses and much damage to the private RTOs operating in South Australia.

The sector is now facing a sense of calm after the South Australian storm, not quite sure what comes next – although it seems that Victoria is next on the agenda of change with the Victorian VET Funding Review led by Bruce Mackenzie and Neil Coulson well and truly underway – with changes already on the table. [emaillocker id=6291]

It is worth mentioning that State Training Authorities have historically looked to Victoria as a leader in VET and the funding of VET in Australia – so the reach of whatever changes are made in Victoria will most likely reach wide and far.

Recently the Victorian Department of Education and Training released their ‘Review of Quality Assurance in Victoria’s VET System’; outlining 12 challenges and issues that the VET system is facing, along with 19 recommendations. The take away points from this document seem to be that the future regulation of VET funding in Victoria is likely to look at a number of quality indicators, including:

  • The overall quality and compliance of training providers seeking funding contracts / seeking to maintain existing funding contracts.
  • The suitability of owners, directors and management – are the fit & proper persons and suitable to be operating
  • Quality of Trainers and Assessors, are they suitably qualified and experienced to deliver the qualifications on the RTOs scope and list of funded qualifications
  • The overall quality of training and assessment products offered by the RTO
  • Establish a training provider classification system
  • A new provider classification system could be used to regulate


Mackenzie has also released an interim VET issues paper that provides a few hints about the focus of his review and what the likely outcomes might be. If you have not read this paper yet, I strongly encourage you to do so. VET funding reviewThe key points from the issues paper recommend that the Victorian VET System would be improved by:

  • Improving the training of VET teachers
  • Reducing the number of funded courses in the Victorian VET funding model
  • Funding courses based on the demands of the labour market and industry priorities
  • Reintroducing a compulsory or minimum student fee
  • Restrictions on the types of marketing activities that an RTO or TAFE can use
  • Implementing the Regulation or banning of brokers and aggregators
  • Tightly regulating subcontracting arrangements
  • Introduce protocols for online learning and work-based training
  • Encouraging training providers to specialise in specific industry training
  • Limit the funding of courses at Diploma level to skill shortage areas, meaning students would be required to access VET Fee Help to access funding support for many Diploma level programs
  • Reform the funding of Certificates I and II, due to concerns raised about the quality and learner outcomes for training that has been delivered at this level.

I suggest that you watch closely over the coming weeks and months, and that you listen to what is (and is not) said by the Victorian Minister, the Department and Mackenzie himself. The time to prepare your business for the changes that may come is now.

You can keep up to date with the Victorian VET Funding Review here >>>



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