Chapter 2 - Background and role


Chapter 2 - Background and role

Industry Skills Councils have achieved what neither the tertiary nor the secondary education sectors have managed to do – the development of national standards.[1]

2.1        Currently there are 11 Industry Skills Councils (ISCs) which operate as national bodies:

  • AgriFood Industry;
  • Community Services and Health Industry;
  • Construction and Property Services, which covers general construction, plumbing and property services industries;
  • ElectroComms and Energy Utilities Industry Skills Council;
  • Forest Works;
  • Government Skills;
  • Innovation and Business;
  • Manufacturing;
  • Skills DMC, which covers the civil construction industry (as well as drilling and mining);
  • Service Skills Australia; and
  • Transport and Logistics.

Background

2.2        ISCs were introduced under the Howard Government to establish a network of national advisory bodies to replace 29 existing industry advisory bodies. The coverage of ISCs and their responsibilities emerged from an independent evaluation by the Allen Consulting Group which recommended 'a smaller number of bodies representative of major groupings of a modern economy'. Prior to their establishment the constitution and governance of each ISC was reviewed by Mr Henry Bosch AO, a former Chairman of the National Companies and Securities Commission well known for his advocacy of sound corporate governance.[2]

2.3        The ISCs were created as new bodies, not mergers of previous industry advisory bodies. The use of the term ISC was a conscious shift 'to reflect the broadening and more strategic nature of required roles'.[3]

2.4        According to a joint submission by the 11 ISCs, 'the nationally endorsed qualifications and units of competency developed and continuously maintained by the ISCs cover 85 per cent of Australian jobs. In 2009, over 1.1 million students were enrolled in publicly funded Training Package qualifications, an increase of 6.7 per cent on the previous year.'[4]

Role and effectiveness

2.5        ISCs are not-for-profit companies governed by independent, industry-led boards. They bring together industry, educators, governments and other stakeholders on a common agenda to address skills and workforce development in the national VET training system.[5] Specifically, the formal roles of ISCs involve:

  • providing industry intelligence and advice to Skills Australia, government and enterprises on workforce development and skills needs;
  • development of training packages;
  • providing independent skills and training advice to enterprises, including matching identified training needs with appropriate training solutions; working with enterprises, employment service providers, Registered Training Organisations and government to allocate training places under the Productivity Places Program; and
  • engaging with State and Territory Governments, State and Territory industry advisory bodies and peak representative bodies in their area of industry coverage.[6]

The committee received a substantial number of submissions supporting the role and work of the ISCs and expressing broad satisfaction with their effectiveness, despite a number of issues—discussed later in this and subsequent chapters—being raised.[7]

2.6        Research being undertaken by Dr Robert Dalitz at the University of Western Sydney found that although the ISCs he investigated performed well, each one faced a completely different environment to operate in and fulfil its role. He cautioned that ISC policy should take this into consideration and provide sufficient flexibility so they can work with the complexities inherent in their sectors, and that ISCs should not be considered analogous.[8]

2.7        One feature all 11 ISCs do have in common, however, is their potential to inform and enrich the national skills development debate. Service Skills Australia (SSA) described the value of ISCs for the committee in this way:

As national bodies working within a national training system that is essentially state-based, ISCs are required to traverse and broker agreement on training packages across multiple jurisdictions, between employer and employee representatives, and often within or across industry sectors. Consequently, the intrinsic value of ISCs as independent, bi-partite advisory mechanisms is apparent in the depth of systemic engagement they achieve at the grassroots level – a feat that remains unmatched by any other organisations, inside or outside of the tertiary arena. Furthermore, ISCs demonstrate value through their historical knowledge of the VET system and their industries, and the intellectual capital they apply to these topic areas.[9]

2.8        The function of ISCs has evolved since they were established. They now play an increasing role in 'strategic advice and intelligence, policy formation, workforce planning and development'.[10] A joint ISC submission advised that one of the greatest strengths of the ISCs is their intrinsic value as independent brokers of agreed advice and directions for skills development:

When this is achieved collectively by the 11 ISCs – across sectors, jurisdictions and between employer and employee representatives – it delivers a level and breadth of grass roots 'buy-in' unable to be replicated by any other organisation inside or outside of the tertiary arena. The value and sure footedness this provides the system in going forward with large scale policy reform and initiatives, represents an incalculable return on investment in the ISC structure.[11]

2.9        SSA reported that the creation of the 11 ISCs has enabled:

...an unprecedented level of cross-industry collaboration and leadership on skills and workforce development. Not since the national Training System was conceived has this been possible. As singularly focussed organisations, without affiliation but with vast stakeholder networks, complemented by deep levels of expertise, ISCs are without parallel. [12]

2.10      Skills Australia submitted that the role of ISCs is well respected among stakeholders in the national training system. They play an important role in the areas of skills and workforce development:

Industry is a major stakeholder of the VET system, and firm reply on the VET sector to supply the skills they require to achieve productive workplaces. This is a distinctive role for VET, which is set apart from schools and universities because of the extent of industry engagement. The engagement of employers has been identified by the OECD as one of the strengths of the Australian VET sector, which was found to enjoy a high degree of confidence.[13]

2.11      AiG CEO Heather Ridout said the inquiry has provided an opportunity to emphasise the 'critical role ISCs play in identifying and developing the skills needs for the Australian economy, now and into the future.' She noted the support ISCs provide to the government to address areas of skill shortages. Ms Ridout advised that there is strong support from business for the ISCs as:

They are an important interface bringing together industry, educators and governments in order to promote an industry-led agenda for action on skills and workforce development. They are also the key organisations that deliver industry developed training standards and products, robust industry-based skills advice to government and identify important strategies forward in relation to workforce development.[14]

Specific areas for improvement

2.12      Skills Tasmania recognised the positive role ISCs play in building a modern vocational education and training system but pointed out that the lack of ISC presence in Tasmania, where only SkillsDMC and ForestWorks are active, limits the benefits available to that state. Environmental scans and training packages fail to reflect Tasmanian industry intelligence or address local issues.[15]

2.13      The Victorian Food Industry Training Board (VFITB) drew attention to AgriFood Skills Australia's annual report, which highlights the challenges inherent in finding appropriately experienced and industry-ready trainers to deliver training. VFITB also identifies the need for '...more fulsome and extensive communication of key training sector issues'. VFITB suggested that efficiency could be improved with a 'more formal national network of the ISC and the state Training Boards'.[16] This suggestion was not isolated to VFITB, and is discussed in detail in chapter 5.

2.14      The Housing Industry Association (HIA) pointed out that the role of the ISCs does not extend to ensuring the adoption of national training packages by Registered Training Organisations (RTOs) which remains a matter for each state and territory. It argued that the state veto on training package implementation remains 'a significant flaw preventing the development of a genuine Australian national vocational training system'.[17]

2.15      Areas for improvement for AgriFood include addressing governance difficulties regarding a conflict between ethical positions contained in industry training packages and those espoused by associated professional bodies, for example in veterinary nursing/animal care. The C.Y. O'Connor Institute argued that not addressing these issues put lecturers at risk of disbarment from working in the industry if they are found delivering training inconsistent with professional standards. It also argued that the board should reconsider the distribution of funding in light of industry output rather than population distribution and cited WA in this context as an area that justifies an increase in funding.[18]

2.16      The committee also heard that timeliness of training package reviews could be improved, an issue covered later in this chapter.

International perspective

2.17      The joint ISC submission reported that internationally, Australian ISCs:

...are considered a leading example of how industry skills needs can be independently identified, codified and articulated, and solutions subsequently brokered.[19]

2.18      Skills Australia reported that industry organisations such as ISCs are not unique to Australia and there are similar models, such as Sector Skills Councils in the UK. It noted that in New Zealand there are 39 Industry Training Organisations. Skills organisations in a number of countries have formed the International Network of Sector Skills Organisations. This supports the work of national sector skills organisations though the sharing of best practice.[20]

2.19      Australia's ISCs are a founding member of the International Network of Sector Skills Organisations (INSSO) formed in March 2010. INSSO aims to: share best practice; develop transnational occupational standards; undertake collective research and analysis; and identify labour market intelligence.[21] Manufacturing Skills Australia (MSA) submitted that the INSSO Board of Management has agreed a series of joint international activities which will benefit industry, VET systems and governments.[22]

2.20      AiG reported that the Australian ISC model has been studied internationally with the intention to replicate it. AiG cited, among others, the 2008 OECD Learning for Jobs report which referred to ISCs and the UK sector skills councils as successful models for industry engagement.[23]

2.21      Specifically, the Construction and Property Services Industry Skills Council (CPSISC) advised that India recently agreed to use the Australian Skills Council model and advised that other countries are adopting Australian standards and training strategies:

The CEO of CPSISC was sponsored by the Malaysian Government to assist in the introduction of standards to cover a revised Waste Management system in Malaysia. Similarly New Zealand has adopted many of our Australian Construction standards. The UK is adopting our Security Management qualifications and is trying to replicate the career pathways we have integrated into our package.[24]

Voice of industry?

2.22      AiG referred to a 2008 OECD study of national VET systems which noted that one of the strengths of the Australian system is the high degree of employer engagement.[25]However, the Australian Chamber of Commerce and Industry (ACCI) reminded the committee that ISCs are not the voice of industry but are an amalgamation of stakeholder interests. It explained that:

It is a subtle but important distinction between the important and valid role of ISCs as being at the forefront of the development of training products and identification of industry trends and what the voice of industry is through business and industry organisations.[26]

2.23      The Australian Automotive Industry Association (AAIA) supported this view and stated:

Industry Skills Councils do not represent Industry, Skills Councils are a mechanism to co-ordinate consultation with State ITABs and Industry Organisations to draw in the views and need of Industry, to provide Government with critical information, so the funding and policy can be determined according to Industry need. The practice of extending the scope of Skills Councils confuses their role and places them in situations where they attempt to represent Industry, to the dissatisfaction of Industry.[27]

2.24      ACCI supported ISCs having a leading role in the 'identification of skill benchmarks and industry intelligence' but emphasised the 'distinction between this role and the voice of industry in the way government engages with business and industry'.[28]

2.25      The Air conditioning and Mechanical Contractors' Association (AMCA) also questioned what it saw as some ISCs' 'claim to be the voice of industry on particular issues', arguing that this was not a view held by employers. AMCA instead suggested that industry and employer associations such as itself in fact spoke on behalf of their industry members.[29]

2.26      Government Skills Australia (GSA) explained that ISCs had an essential link between them and their industry constituents in the form of Industry Advisory Committees, through which the voice of industry is heard. Members of these committees are nominated by the industry peak bodies they represent and the committees are required to demonstrate how they represent a range of interests within their sector.[30]

2.27      The Tasmanian Chamber of Commerce and Industry contended that apart from SkillsDMC and ForestWorks, ISCs are 'not generally accessible for employers.'

Employers and stakeholders are often unfamiliar with ISC activities such as consultation, and projects being undertaken. A presence is not consistently felt within their respective industries. Ongoing change within the VET sector makes it difficult for employers to keep abreast of developments and opportunities within their industry. Constant change and the complexity of the VET sector requires ISCs to have a strong presence within industry to ensure products such as Training Packages are developed to meet their needs.[31]

2.28      Many stakeholder relationships with ISCs are still in their infancy. The Council of Rural Research and Development Corporations, the peak forum for fifteen rural research and development corporations, reported that its relationship with AgriFood is still at an early, developing phase. The submission identifies an urgent need for rural industries to invest in attracting and developing the current and future workforce, and considers it essential for AgriFood to continue to be 'maintained and well resourced'.[32]

Role of the National Quality Council

2.29      The National Quality Council (NQC) is a committee of the Ministerial Council for Vocational and Technical Education. It oversees quality assurance and ensures national consistency in the application of the Australian Quality Training Framework standards for the audit and registration of training providers. The NQC has policy development and implementation responsibility, as well as specific decision-making powers in relation to the endorsement of training packages under the National Skills Framework.[33]

2.30      When presenting the NQC with training packages, ISCs must provide a 'Case for Endorsement' which shows:

  • widespread support from industry for the changes;
  • that the Training Package meets NQC policy requirements and quality principles;
  • that the consultation and validation process has been rigorous and transparent; and
  • that the impact of changes has been considered.[34]

2.31      The relationship between the NQC and ISCs also works in the other direction:

COAG has been concerned about the quality and the complexity of training packages and has, first of all, established the VET Products for the 21st Century inquiry and report; and then, as a result of that report, has asked the NQC to ensure that the ISCs take on some of the requirements that COAG has mandated in relation to the improvement of training packages, which I think the VET Products for the 21st Century revealed had become a bit impenetrable, a bit hard to navigate and were a bit defective in a number of ways, particularly in relation to preparing those people who undertake the training packages for further training and a number of other aspects.[35]

2.32      The NQC will soon become the National Standards Council (NSC):[36]

As far as the arrangements for the future are concerned, with the national VET regulator the relationship between the NSC and the national VET regulator is going to be that the NSC is the standard setter. The states were keen to retain an involvement in that, so the NSC is going to be a committee of the ministerial council setting the standards for the regulation by the national VET regulator in those areas where the national VET regulator will have its scope in the participating states, and in some cases beyond, into the other states as well. The NSC will be a very important intermediary between the regulator and industry in the same way as the NQC attempts to be an intermediary and to some extent a regulator now.[37]

Is there too much red tape?

2.33      The Australian Hotels Association (AHA), although supportive of the role ISCs play in the ongoing development of quality national training packages, contended that this role was being 'undermined by red tape from the National Quality Council', and that 'in the hospitality industry the NQC has impacted on the training package to such an extent that it is moving away from what industry wants.'[38]

2.34      One submitter stated that ISCs are 'forced to modify training packages to suit the requirement of the NQC' and that this is 'one example of where there is a disconnect between industry needs and national training system requirements'. They also called for information to be more industry and user friendly.[39]

2.35      Restaurant and Catering Australia also felt that the role ISCs play in developing training packages is undermined by what has been a gradual imposition of system-wide constraints from the NQC, among others, and by the amalgamation of previous Industry Training and Advisory Boards (ITABs) into ISCs. The latter had 'broadened ISCs to a point where their contact with the individual industry is so limited that the industry context of the training package is undermined:[40]

In the case of the hospitality industry the system (as administered by the NQC) has stopped the training package and the associated products from being what industry wanted. As an example, the hospitality package was denied the opportunity to state that trainers should have industry experience, which has undermined the quality of the training package from the industry perspective.[41]

2.36      Responding to this in a supplementary submission, the NQC stated:

We ask that the Inquiry note that the National Quality Council changed its policy in December 2009 to allow Training Package developers to specify the vocational competence and experience for assessors, within the guidelines outlined in the Training Package Development Handbook.[42]

2.37      EE-Oz also stated that it would prefer to see a more efficient system:

There are package rules required by the National Training Council in relation to how you can structure a package and what has to be in there. Sometimes they are at odds with what industry would like. Sometimes industry wants a degree of flexibility; sometimes they want a degree of focus that the national training policy might be not able to meet. We have to work our way through that process. We have to submit our packages in line with their policies and procedures.

I think the biggest concern about industry is the delay. What we would like to see is a much more accelerated method of endorsement so, if you do have extreme need and you need to address it in a rather short turnaround period, you are able to do that. I must say we have had cooperation with the Commonwealth department. Sometimes it is the issue of state bureaucracies that believe that it has to go through their own processes, sometimes duplicating what we have already put in place in relation to state industry advisory bodies and stakeholders at a state level.[43]

2.38      On this, the NQC advised that its endorsement of training packages is '...contingent on there being evidence of stakeholder agreement with the new product'[44] and that:

...we should recognise that two things are happening at once. There is a continuing process of endorsement of the training packages that come through ISCs, which has regard to a number of criteria that have been there for some time. At the same time, in response to COAG requirements, the NQC is going through and changing some of those criteria against which training packages can be endorsed. So you have got a changing of the standards at the same time as the process is going on. That requires a degree of flexibility from the ISCs themselves.[45]

2.39      The NQC further explained:

The component which perhaps needs to be understood is that between government and industry is the student. Standards are set in part to ensure that the students get the qualifications which they are either paying for or being subsidised to undertake, and so there is a kind of consumer protection element to all of this to ensure that when the RTOs are dishing out the training that they are complying with some standards that are not only, to a large extent, set by industry, but also fit the person who receives the qualification not only to get the job for which they have been trained, but also hopefully progress with their training through the course of their career. Quite a lot of people who train for one particular job will find that in five years time that job is gone or has changed to the point where they need to undertake further training in order to be able to perform the new requirements of that occupation. These are quite legitimate standards which are set in order to protect, in a sense, the student, but also to ensure that Australian industry has the capability to progress as things change in an increasingly competitive world.[46]

ISC Training packages

2.40      Training packages form the basis for industry-endorsed national qualifications that reflect the needs of the labour market. They are, at least in theory, developed through a consultative process to reflect the needs of workplaces.[47]

2.41      The first training packages were endorsed in 1997. Since then packages have been developed with national qualifications. Units of competency now cover in excess of 85 per cent of the workforce.[48] ISCs also work with public and private training providers to assist with their implementation of these industry endorsed standards.[49]

2.42      Skills Australia noted that through the development of training packages:

The work of ISCs underpins a fundamental aspect of the vocational education and training system. As noted by the OECD, 'through the Industry Skills Councils (ISCs), industry has taken the lead in establishing the packages, and this has been vital in securing labour market recognition of the qualifications'. Training packages and accredited courses as a single national framework have strong support from businesses and industry.[50]

2.43      The number and scope of training packages varies. IBSA, for example, offers 274 qualifications across 11 training packages.[51] MSA has responsibility for 11 national training packages, which include 209 qualifications, 2776 units of competency developed by MSA and 1530 units of competency imported from packages maintained by other skills councils. [52]

Timeliness of training package reviews

2.44      The work of ISCs is focussed on ensuring the ongoing relevance and credibility of the training packages.[53] The Department of Defence reported that frequent changes to the training system and training packages present challenges even for a large enterprise RTO. It explained:

In attempting to be responsive to change, the ISCs amend training packages too frequently, in some cases yearly; this is a major resource impost on Defence and other enterprise RTO. As a result of these changes enterprise RTO must amend training documentation to reflect ISC updates. Currency is not normally an issue as Defence RTO routinely review their training on a four to five year cycle, which provides stability in the development, delivery and accreditation of vocational education and training.[54]

2.45      Asked whether ISC data could be integrated and made more user friendly so that responding to the frequency of training package reviews did not consume excessive amounts of employer and industry time, GSA stated:

I suggest that it is an enormous task. The collection of data occurs in an ad hoc manner across the various industry sectors. I suggest to you that there are some timeliness factors around the collection of data. There are some data-collection activities that are not well synchronised. For example, in the public sector domain public sector RTOs—your TAFEs etc—all report, as you know, on a calendar year basis. So they collect their data and report it that way. For us in the government sector the majority of our entities collect data and report on a financial year basis. So there are issues such as that.[55]

[T]here is also a design issue about what a national collection of data might look like. In the past the ABS data—the ANSCO codes and what have you—have not been sufficiently finely tuned for our needs. Each state and territory also has its own take on these things. It is no easy task to come up with a common framework. It is a need, however.[56]

2.46      Mr Robert Paton, Chief Executive Officer of MSA, also addressed the frequency of training package reviews:

We review at an absolute minimum every three years, but the cycle is usually more frequent than that. We are constantly building new areas where we might review some new technology or a work area that has changed its practices, or whatever, on that basis, as well as going through the forced review process of making sure we look at something to see that it is still current.[57]

2.47      He added that stakeholders could examine the relevance of a particular training package through mechanisms established by the ISC:

It comes through to the skills council, and it can be through any medium or any communication. We make a judgment on the scope, the extent and the potential impact of that request. If it is one person saying it, and we do not have that reflected by other people asking the same question, obviously we would question that. But if there is reasonable evidence to show that it needs a change then we will address that. The organisation produces a continuous improvement plan. A draft of that goes to the board. They consider it and sign it off and we commence work. That plan changes frequently because the rate of changes is longer than the duration of the plan. The plan is basically 12 months with a longer-term view, but sometimes the changes come in two to three months.[58]

2.48      SSA acknowledged the burden on industry in training package reviews and approvals, and added that the process, although complicated and time consuming, is required for quality assurance purposes.[59]

2.49      The committee heard from the NQC that the latter was working on a process of streamlining training packages which were deemed to be excessively complex, as a result of a Council of Australian Governments (COAG) request to that effect:

In effect, when COAG said, ‘Make the training packages more navigable, more simple and include in them a couple of clearer elements relating to knowledge in relation to competency,’ that was the trigger for going through and saying, ‘How do you redesign the architecture of the training packages?’ That effectively has been that NQC work. [60]

Quality of training packages

2.50      The committee received a number of submissions questioning the quality of particular training packages. These, although not in the majority, suggested that some fine-tuning of training packages might be warranted.

2.51      Notwithstanding some irritation with the frequency of reviews and the resource implications of that process, the Institution of Surveyors NSW (ISNSW) considered that reviews were qualitatively inadequate. It concluded that despite representations to CPSISC, the NQC has approved 'what appears to be a seriously flawed Training Package based on support letters provided by CPSISC to State bodies without the relevant Training Package documents'.[61] ISNSW also submitted that there has been a failure of the training packages to address the different state laws and regulations which affect surveying practice in each state.[62]

2.52      The NSW Aboriginal Land Council (NSWALC) examined existing training packages for equity considerations and content relevant to Indigenous workers and learners. It reported that:

Our concerns are confirmed and supported by the growing body of evidence demonstrating a lack of regard and consultation with industry stakeholders by AgriFood Skills Australia in offering sub-standard Training Package.[63]

2.53      To address these issues NSWALC recommended that the endorsement process for the training package in question be suspended and that it be transformed into the Indigenous Land Management training package. NSWALC also proposed the formation of an Indigenous Industry Skills Council to manage the development and maintenance of the new training package.[64]

2.54      AgriFood advised the committee that it had taken steps to respond to criticism from NSWALC:

[The Executive Officer] is now designing a program for us and we are waiting to get that scoped exercise in to look at. We have met him two or three times since then. Certainly on the Indigenous front we put a lot of effort in but to national programs and he is looking for obviously programs in his own state and we are happy to look at that. As I said, he is designing something that we can negotiate and develop jointly.[65]

2.55      Recognition Australia raised similar issues concerning AgriFood, describing the ISC's work on meeting deadlines for training package development as 'woeful', and its merger of three training packages—RTD02 Conservation and Land Management, RTE03 Rural Production and RTF03 Amenity Horticulture—a 'disaster zone' under the AHC10 Training Package umbrella. Recognition Australia also pointed out that completion rates for AgriFood qualifications have fallen to 26 per cent, attributing that to the poor quality of the product, which is 'largely irrelevant to the current needs of students and businesses.'[66]

2.56      In a supplementary submission, AgriFood addressed Recognition Australia's submission, calling it 'extraordinary' and 'damaging', and refuting its claims:

AgriFood Skills Australia's only contact with Recognition Australia was the brief engagement in 2009 of their consultant, Mr Richard Lynch, to assist with documentation work associated with the preparation of the AHC10 Agriculture, Horticulture and Conservation and Land Management Training Package. Neither Recognition Australia nor Mr Lynch has been re-engaged since.[67]

2.57      The Australian Veterinary Association (AVA) advised the committee that AgriFood had been tasked by the Department of Education, Employment and Workplace Relations (DEEWR) to develop a proposed national training package in equine dentistry for non-veterinarians. AVA has been dissatisfied with the consultation to date. It believes there is not a demonstrated need for this course as the training is well established within the veterinary degree curriculum at undergraduate and postgraduate levels.[68]

2.58      This training package is the subject of considerable concern for the Equine Dental Association of Australia (EDAA):

There has been no "environmental scan" carried out which would normally be the starting point for any training package development. This scan establishes the needs, current employment levels and projected employment potential of an industry... ...This is one industry where there is clearly no skills shortage. Therefore it is our view that development of this qualification represents a questionable use of public funds.

The package development so far is neither collaborative nor inclusive and anything that has been developed shows a lack of thorough industry consultation.

Our concerns over some of the proposed content of the Training Package especially in relation to performing quasi-veterinary procedures and potentially compromising horse welfare and longevity have been ignored.

This has been a long winded and undoubtedly very costly process with no anticipated agreed outcome for the association, which also questions the contribution of the qualification to animal welfare issues. Many of the proposed competencies in the Training Package are procedures which are already regulated by existing State Acts, Regulation and Codes of Practice yet the proposed document gives lip service to the claim of observing existing State Acts of Parliament. The document is contradictory, poorly written and although it will exist in an "animal Welfare" package there are several proposed procedures which have no scientific basis. The main purpose of routine dental care for horses is to improve their longevity and wellbeing. The implementation of the proposed Training Package would create an oversupply of equine dental technicians with a skills set that would not necessarily improve the wellbeing of the horse.[69]

2.59      In response, AgriFood stated:

It was actually put to us by the New South Wales government back in 2006 that there was no endorsed training program for equine dentists. So we progressed that. It was supported at that stage by the equine dentists themselves and indeed the AVA at that stage also considered it was a reasonable thing to do. Our role in life is particularly to develop training that meets industry needs and delivers a product that is validated nationally. We have had intense negotiations, by the way, for about 12 or 18 months around this and now it has become a clear that the Australian Veterinary Association wants a fully professional delivery of equine dentistry services. Our view is in the middle of that. We are talking about a certificate IV equine dentist accredited training package that would validate the training of people treating horses and importantly get through a lot of that. There is no doubt that when horses have got an infection or they have something else, you need to bring in a vet.

...There are 800,000 working horses in Australia and all of them potentially have equine issues. The issue is that there is no way that you can deliver that through veterinarians alone. Importantly we believe that a lot of those agencies have told us that a lot of their horses have traditionally been treated by well-skilled equine dentists. But now we are looking to have an endorsed qualification that validates that in the national system.

It is a difficult argument for us. It is to some extent almost unwinnable because it is a professional/paraprofessional issue, which has come up in other sectors... At the end of the day it comes down to regulation, which is not our patch. That is a state issue and we have to work within that. We certainly cannot impact on regulatory requirements.[70]

2.60      The committee also received a submission in response to the matter raised by the EDAA from the Australasian Association for Equine Dentistry (AAED), which disputed statements made by EDAA. The AAED has '...no complaints regarding the management or handling of the development process by AgriFood Skills Australia to date. We can only commend the staff involved so far.'[71]

2.61      The racing industry's experience with AgriFood, conversely, appears positive. The Australian Racing Board considers AgriFood effective.[72] Lindsay Park Racing stated that:

[T]he Racing industry and enterprises are well served by the advice and expertise of AgriFood Skills Australia and commend its support of training package and related skills and workforce development initiatives in support of our industry.[73]

2.62      Racing Queensland also submitted in support of AgriFood:

The most critical factor...has been the success of Agrifood Skills Australia in establishing itself and operating as the driver of critical issues, advice to Government and implementation of solutions by coordinating this advice through the committees and the annual environmental scan. It has an excellent record of technical and administrative success in the review of training packages as shown by the very successful and extensive changes to the racing industry training package RGR08.

Despite the vast range of challenges encompassed by the 5 major industry groups within Agrifoods, ASA support for the work of the standing committees and willingness to take up issues and engage governments at all levels across Australia has been impressive.[74]

2.63      One submitter reported on the UEE07 Electrotechnology training package produced by EE-Oz, which they use every day but find unhelpful. There are thousands of pages and supporting documents requiring 'tedious extraction' of information. In trying to distil the useful information the submitter estimates they will have reduced it to around 160 pages which will be about 4 per cent of the current package.[75]

Committee view

2.64      The committee has clearly received conflicting claims relating to the equine dentistry training package. At heart is an industry-specific professional versus paraprofessional issue which stakeholders are in significant disagreement about, and which the committee is not in a position to arbitrate. The committee recognises and wishes to stress that a number of industry development, animal welfare and occupational health and safety issues hinge on a successful resolution to this impasse which all parties involved can be satisfied with.

2.65      The committee further recognises that AgriFood is obliged to act within state regulatory requirements, which it does not determine or have the capacity to change, and which may well benefit from a review.

Sufficient expertise in the development of packages?

2.66      One submitter alleged that in their experience ISCs have focused on feedback from large training providers and spent insufficient time with industry subject matter experts. The submitter did not oppose consultation with training providers per se, but suggested that more time with industry specialists was required.[76]

2.67      The Queensland Tourism and Industry Council urged ISCs to seek more industry feedback on current training packages in order to boost implementation efficiency, but emphasised that 'it would be prudent for this feedback to come from business rather than training providers.'[77]

2.68      Other submitters, such as the Motor Trades Association of Australia (MTAA), make their own training arrangements due to what they believe is inadequate industry expertise on the part of relevant ISCs.[78]

2.69      MTAA explained that, until recently and under an arrangement which preceded the establishment of ISCs, responsibility for training package administration for the Australian automotive industry was with Automotive Training Australia (ATA). When ISCs were established 'the industry as a whole expressed its dissatisfaction with the proposals with respect to the training arrangements for the industry under that new structure' and lobbied for an independent automotive ISC.[79] As a result of this lobbying, the ATA continued to administer its training packages. This arrangement was terminated in 2009 when the government shifted responsibility for the packages to MSA against the wishes of major industry stakeholders.

2.70      The MTAA believes that the Australian retail motor trades are on the verge of crisis, and the skills demands of the manufacturing and retail service and repair sectors are being treated as one and the same when in fact they diverge, and will increasingly continue to do so. Required skills sets are different despite some similarity in core knowledge, and this is being ignored at the expense of the retail sector:

Synchronisation of the family of all automotive training arrangements with the smallest sibling of domestic manufacturing represents none of those crucial realisations and admissions. Rather, it is a misguided contrivance that disproportionally places the imperatives of the many at the mercy of the interests of the few.[80]

2.71      MSA explained that it was handed responsibility for the automotive industry by the federal government 'through an interim governance arrangement of specialised committees' and is now 'engaged in the process of forming a wholly owned subsidiary company that will soon take on the coverage of the automotive industry.' MSA explained that this step was in response to key industry stakeholders seeking a greater degree of independence and autonomy.[81]

2.72      The Queensland Automotive Skills Alliance (QASA) submitted that MSA had been proactive and consultative since the ISC took over responsibility for the Automotive Industry Retail, Service and Repair (AUR) Training Package from ATA in 2009. The shift of responsibility has led to some delay in the review of the training package, and as a result ' the training package is not as responsive to industry needs as it should be.' However, 'MSA have done extremely well in updating relevant stakeholders through this process considering the circumstances they face during this transition.'[82]

2.73      Another stakeholder in the automotive industry, the Australian Automotive Industry Association, offered the view that the role of ISCs should be to develop national principles and guides. It believes that as most employers in the automotive industry are small operators 'no ISC would have the capacity to deliver [workforce development products and services] nationally on an enterprise level'.[83]

2.74      More generally, the  committee heard evidence suggesting that ISCs are aware of the importance of industry expertise and actively seek to address any shortcomings:

In the last five years we have restructured ourselves. We now have four specialist general managers who have come in from industry and government. We also spend a lot of time briefing our staff. In fact, some of the peaks have moved out of the space to allow us to take over that role. I think that reflects that we understand what we are doing very well and we are indeed regarded as an authority around that.

Generally, you have to go on doing it. As I mentioned right upfront, the key to our job is understanding what industry needs. We can all come to solutions, but you need to understand the needs quite precisely. Our industry is quite different and often demands some reform of systems, and I think that is where we are heading. We are very well experienced. Most of us have been around the industry for a while and we have very good coverage of training packages—skills and workforce development. Also, we use specialist consultants and advisers to help us develop our training packages. I think the mix of that is quite sound.[84]

Production of training and assessment materials by ISCs

2.75      Software Publications argued that ISCs develop training and assessment materials that duplicate and directly compete with quality training materials produced by publishing companies and training organisations. It alleged that as ISCs are publicly subsidised, they compete unfairly in the market with subsidised products. It was also submitted that there is an oversupply of training materials in popular areas, which results in public money being wasted duplicating design and production in these areas.[85]

2.76      Another submission went further, arguing that ISCs were exhibiting signs of anti-competitive behaviour which would ultimately weaken private training material developers:

[M]aterials produced by the Industry Skills Councils' commercial divisions should support areas of training where limited resources currently exist...This is simply not taking place...The Industry Skills Councils must use their Commonwealth provided tax payer dollars and any surplus from other activities on supporting the industry in which they are representing by picking up the slack, not muscling out existing...organisations such as the large publishers.[86]

2.77      In response to this, DEEWR told the committee that training package materials developed by ISCs under the DEEWR contract are always made freely available before any other materials produced for commercial purposes can be released:

The training packages themselves are up on a public website and can be downloaded by private individuals...The actual training package components, and the training materials that they produce as a result of our contract and which would be in their annual business plan to us, are freely available. Some ISCs, if they provide a published document or a paper document, a disc or something, may charge some small cost recovery but they are certainly not allowed to make profits or surpluses or whatever from anything published under our contract. Things published under our contract will also have the Australian government crest on them. There is a requirement that those things that are funded under our contract are freely available and clearly delineated by branding as part of the Commonwealth funding.[87]

2.78      DEEWR further informed the committee that while the department was not in a position to comment on any particular ISC's alleged intent to concentrate training products in areas of high commercial interest, to the best of its knowledge ISCs were publishing material in areas where a need has been identified.[88]

2.79      IBSA confirmed for the committee that ISCs produce materials in sectors where private organisations operate, but did not support the view that ISCs hold some form of market advantage over private competitors:[89]

It is a valid statement that we do produce materials. We have had a longstanding arrangement with a number of publishers whereby we sell and distribute their products. But we have also had quite a lot of feedback from RTOs over the years saying that, in many cases, the products do not exactly match the training package requirements. We have also had the consideration brought to us that, in some cases, when using generic products or products from publishers a lot of work has to be done to tailor those to meet the requirements of a training package. The RTOs do not always feel that they comply with the audit regime. So on the basis of the feedback that we have received we have developed a suite of support materials in the business services area, some in the financial services area and also in the training and education area. We believe those products support our training package. They ensure that an RTO will be delivering in a highly compliant fashion and they seem to fill a niche in the market. They also incorporate quite new ways of teaching by using social media. In dealing with students we have tried to make them very modern in that way and very interactive. They have found a place in the market.

The training packages on which we base our products are available publicly. They are on the website. We have very consciously, at the direction of the board, separated the two elements of our business so that the development of products that support the training packages are quite separate from the training package development. We would never start the development of support materials until the training package was on the website and that has been a conscious decision.[90]

2.80      Separately, the NSW PSITAB suggested that ISCs should be responsible for managing the development of training support materials where there is a demonstrated need and demand in a market that may struggle to attract training providers. It argued that a lack of support material often deters RTOs from offering some qualifications and units 'particularly if the market is small and regionally dispersed'. It recommended that 'funding for the continuous improvement of training packages should be expanded to include the provision of non-endorsed components, particularly if there is evidence that such products would facilitate the delivery of training to a thin market'.[91]

2.81      Mr Robin Shreeve, CEO of Skills Australia, told the committee that Skills Australia did not object to ISCs broadening their range of activities beyond their original objectives, but only if this does not impede core business or result in a conflict of interest.

Committee view

2.82      The committee is strongly of the view that ISCs should use their government funding to pursue their core activities. The production of training materials should only be considered where there is a demonstrated, unmet need and any conflict of interest is avoided.

Recommendation 1

2.83             The committee recommends that all 11 ISCs review their activities to ensure that their primary focus is directed at training package oversight and strategy, and that this work remain separated from the work of RTOs in product development and training delivery.

Environmental scans

2.84      Every year, each ISC researches and drafts an environmental scan of its industries. The scans use industry intelligence to provide an understanding of the factors shaping and affecting the workforce. The scans provide input for the NQC, state and territory training plans and Skills Australia.[92]

2.85      Skills Australia noted that the scans cover existing and emerging issues in relation to workforce development as well as responses from the training sector. Skills Australia stated that it considers environmental scans to be a valuable supplement to labour market data produced by government sources.[93]

2.86      SSA, for example, has produced an environmental scan for their industries since 2008. In 2009 they developed sector specific scans to allow the industries to reflect their issues and needs. It described the objectives of the environmental scan:

These scans seek to describe the key workforce development issues facing our industries as provide recommendations to government on occupations in demand as well as solutions to achieve better national productivity and participation outcomes.[94]

2.87      The Victorian Food Industry Training Board submitted that these scans raise systemic issues every year, citing AgriFood's 2010 report which drew attention to the challenge present in identifying industry experienced and available trainers. The Board also found that a more formal process for information sharing could be useful, suggesting that each state's reports could be shared and compared at a forum designed to present findings of the scans.[95]

2.88      However, ACCI advised that:

While of value to government in receiving industry advice, the environmental scans tend to be too generalised to be of value to small and medium sized businesses.[96]

2.89      ACCI added that the type of information obtained is driven by government contractual requirements and not how well the information in the scans can be used by industry. ACCI also noted that the scans are written broadly and lack the detail to assist industry with workforce development strategies. ACCI recommended that the consultation process for gathering industry intelligence be improved, validated and tested with industry groups and all types and sizes of business.[97]

2.90      The MUA stated that while the environmental scan is useful 'it nevertheless lacks the level of detail that is essential for both aggregated resource allocation by the Commonwealth and for industry/sectoral workforce planning', due to the importance of the scan function in future workforce planning not rating sufficiently highly in the Commonwealth's funding allocation.[98]

2.91      This sentiment was not universal. The Department of Defence reported that it uses a number of the ISC environmental scans to inform Defence workforce planning, but conceded that limited standardisation of the material makes it difficult to use. Defence indicated that the environmental scans provide an opportunity to 'further assist DEEWR to develop an overall data base of occupation supply and demand profiles to activate a national level of workforce planning. This would in turn assist organisations such as Defence, where detailed long-term workforce planning is critical'. Defence suggested ISCs engage more closely with enterprise RTOs in relation to the development of environmental scans, the transfer of skills information and workforce intelligence.[99]

2.92      NCVER drew the committee's attention to the fact that the 11 ISCs each undertake environmental scans from their individual, divergent, perspectives:

One would have to say that therefore the scans are not particularly consistent across the board—that is, every industry skills council tends to think that their industry is rather more important than all the other industries, and there is a national natural tendency to put an optimistic face on things. So one of the problems you have with this type of work is that, if you added up all the needs from the various industries, you would get a number larger than the number of people in the workforce.[100]

2.93      This can result in stakeholders spending excessive periods scanning information contained in each of the 11 ISCs' environmental scans to inform their training and development needs.

Recommendation 2

2.94             The committee recommends that the ISC CEO Forum examine the prospect of developing a template for environmental scans to foster greater consistency in the timing and reporting, and to encourage better utility of the scans for affected stakeholders.

New policy directions

2.95      The productivity agenda has seen the broadening of emphasis from training and skills to workforce development. ISCs have engaged with this broader agenda and are working with enterprises and industry associations to progress understanding and action around this broader remit.[101]

2.96      In noting this change, Skills Australia pointed out that AgriFood has developed a draft regional skills utilisation strategy to assist business to identify links between productivity and skills utilisation, CPSISC employs a team of workforce development advisers that can provide advice to business, and MSA has developed a workforce development tool to assist enterprises build and manage workforce capability. Skills Australia supports this direction and would to see like further development in this area.[102]

2.97      Skills Australia further submitted that ISCs have, by and large, been active and responsive when tasked with implementing new policy directions:

Arising out of the Green Skills Agreement (December 2009), ISCs have reviewed all relevant Training Packages to identify units and qualifications that require the addition of skills for sustainability. This was a large task, completed in a relatively short period of time. The next phase is for ISCs to make necessary amendments to Training Packages and submit them to the National Quality Council for endorsement. The revised Training Packages are expected to become available to learners from mid-2011.[103]

2.98      ISCs have also been active in progressing research on potential productivity gains. In 2010, for example, SSA commissioned the Centre for Economics in Education and Training to produce a report that would provide forecasts on the service industries workforce for the next five years.[104]

2.99      GSA also outlined its approach to integrating new initiatives, including reviews of training areas in need of improvement, extensive desktop auditing of current training content and ensuring industry involvement.[105]  

2.100         Notably, AgriFood Skills Australia reported on its role in advising the Primary Industries Ministerial Council (PIMC) on addressing chronic skills and workforce shortages in regional areas, and informed the committee that it had, in consultation with SkillsDMC, developed an integrated Regional Skills and Workforce Development Strategy. The PIMC subsequently:

  • supported the development of the Strategy, which runs over the period 2010 to 2014, and is designed to increase workforce training participation in regional areas;
  • supported the reform and extension of the National Training System for regional skills and workforce development.[106]

2.101         AgriFood added that:

We are driving now some policy change with the National Quality Council looking at a more flexible approach to training where you can do skill sets, if you like, small chunks of training that head you towards a pathway. That currently is not funded by the federal government. We are seeking to do that, and there has been some good progress in developing that initiative.[107]

Sustainability

2.102         The Green Skills plan was announced in October 2009 and is aimed at incorporating environmental sustainability into all levels of vocational training and industry practices. In November 2009 the Ministerial Council for Tertiary Education and Employment (MCTEE) endorsed a new National Green Skills Agreement. The agreement will give businesses and individuals an opportunity to contribute to a sustainable, low-carbon economy in their workplaces and communities. MCTEE recommended the agreement to COAG for consideration at its December 2009 meeting.[108]

2.103         COAG endorsed the Agreement, which commits the Commonwealth and state and territory governments to working with training organisations and business to ensure skills for sustainability are an integral part of all vocational education and training (VET) and are relevant to the needs of industry. The commitment will be achieved by:

  • including skills for sustainability practice and teaching in vocational education and training, within the requirements of the national regulatory framework;
  • upgrading the skills of VET instructors and teachers to deliver skills for sustainability;
  • the strategic review of training packages to embed sustainability knowledge, skills and principles; and
  • implementing a transition strategy to re-skill vulnerable workers.[109]

2.104         In early­ 2010, a National Action Group was convened, with a view to developing the National Green Skills Action Plan by June 2010.[110] Submissions on the draft Green Skills Agreement Implementation Plan were invited from organisations operating in or working with the VET sector from April 22 to May 7, 2010.[111]

2.105         MSA published a report titled Sustainable Manufacturing – Manufacturing for Sustainability to illustrate how workforce skills development can contribute towards environmental and enterprise sustainability.[112] MSA was one of three ISCs approached by DEEWR for a trial roll-out of a program designed to develop workers' sustainability skills.[113]

2.106         The Community Services and Health ISC (CS&HISC) reported that it undertook an audit of the community services and health work roles which revealed limited explicit coverage of principles of environmental sustainability. Seven recommendations were agreed by DEEWR for enhancing the health and community services work roles described in the training packages. Draft versions of the training packages with proposed enhancement are available.[114]

2.107         ForestWorks, the Transport and Logistics ISC, and SSA were among other ISCs who were active in advancing the adoption of green skills as a key part of their role.[115]

Productivity Places and Enterprise Based Productivity Places Programs

2.108         The Productivity Places Program (PPP) is in place to provide targeted training to support skills development to meet current and future industry demands.[116] The Enterprise Based Productivity Places Program (EBPPP) forms part of the PPP and provides opportunities for employees in participating enterprises to gain new skills and qualifications. The EBPPP is a partnership between the federal government and ISCs, which promote the program within the industries they cover, and work with enterprises to develop funding applications.[117]

2.109         The work ISCs do to effectively implement the EBPPPs is complementary to their core duties, according to EE-Oz, and results in even greater engagement with industry:

The administrative role for the EBPPP is directly related to the training needs of enterprise and represents a significant symbiotic benefit for ISCs, allowing the Government to ma[x]imise benefit and minimise cost. This collaboration enhances the voice of industry in the national training system.

The insinuation that the funding for administrative work conducted by ISCs in relation to the EBPPP was unaccountable is irresponsibly misleading. ISCs are directly accountable for their work on behalf of the government through their key performance indicators and failure to effectively and efficiently administer the EBPPP program would jeopardise their Funding Agreement. Work associated with the core duties of ISCs is effectively tendered at the start of each funding period through the process of application for funding as an ISC and is reported on regularly.[118]

2.110         AgriFood also reported a good response to the opportunities offered by the Enterprise Based Productivity Places Program (EBPPP), despite a 'light touch' marketing campaign:

A key attraction has been the perceived advantages and greater simplicity through dealing with AgriFood, rather than with individual States and Territory governments. The financial inducement (up to 90% of course costs) to enterprises with less than 100 employees has also been well received. From AgriFood's perspective, the EBPPP is providing new and more frequent opportunities to engage directly with the full range of enterprises which make up the industry.[119]

2.111         AgriFood considered the high uptake of the EBPPP program '...testimony to the high demand for this style of program.'[120]

2.112         CS&HISC reported that the combined round one and two funding under the EBPPP for the community services and health industries was $4 million which represents close to 800 training places across 500 individual organisations covering 25 priority community services and health qualifications and 13 sectors. Of these, 52 per cent have been allocated to small enterprises.[121]

2.113         The Tasmanian Chamber of Commerce and Industry added that SkillsDMC and ForestWorks have enabled employers to benefit from the PPP and EBPPP funding. It added that Tasmanian employers have been well informed by these ISCs and have effective working relationships with them.[122]

2.114         When asked by the committee to judge how effective the programs have been for both the ISC and for industry, CPSISC replied:

Terrific...We have a database that we put together on the EBPPP, where all of the participants can look up information....It has been a roaring success to the extent that the employer bodies came back to us after the first round and we then went to Skills Australia and asked that there be a second round because of how successful it had been.[123]

To the end of December we had 825 people on board, with another 400 since then...It has been an outstanding success for us. There are 1,400 places in total that we are supposed to have, and about 1,200 of those are filled already. Just to give you an idea of how good it is, the HIA is putting over 300 people through the Certificate IV in Building and Construction, which actually covers off on building licensing in most states and territories, so it has been a great success for us. As you can see from our database, we can tell you where people are, what qualifications they are in, whether the employers are small, medium, large—anything else. We have put a lot of effort into that database.[124]

Conclusion

2.115         Recognising that a general, definitive assessment of the effectiveness of the ISCs is difficult given the variety of feedback received, the committee is broadly satisfied with the operation of ISCs as they continue to evolve.

2.116         Isolated difficulties within certain sectors are clearly present, and some are highlighted in this report. The committee considers that most of these problems will be resolved between the parties concerned using existing channels of communication.

2.117         Some improvement would also be beneficial in the ISCs' relationship with state and territory advisory bodies in order to increase RTO uptake of ISC training packages. However, stakeholders are clearly mindful of the deficiencies where they exist in this area, and efforts are being made to address them. This is further discussed in chapter 5.

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