This quick guide provides an overview of
the vocational education and training (VET) sector including:
Links are also provided to further
information.
What
the sector covers
Students
In 2022,
an estimated 4.5 million students were enrolled in VET with an Australian
training provider, representing almost a quarter of the Australian population
aged 15–64 years.
In the same year, 4.0 million students were enrolled in
Australian schools,
while 1.6 million students were enrolled at higher
education institutions in 2021 (the latest data available).
Of those VET students for whom the relevant information is
recorded:
- 51.8%
were male
- 3.9%
identified as Indigenous
- 4.5%
reported having a disability
- 5.0%
were international students.
For domestic students, where remoteness region was
recorded, 67.6% came from major cities, 29.9% from regional areas, and 2.5%
from remote areas. Australian Bureau of Statistics population figures for 2022
showed that 72.2% of the population lived in major cities, 25.9% in regional
areas and 1.9% in remote locations (Parliamentary Library calculations based on
Table 3 of Population
estimates by LGA, Significant Urban Area, Remoteness Area and electoral
division, 2001 to 2022 - Revised
Qualification levels and courses
Accredited VET programs cover a wide range of activities,
including part-day employer-specific training, general use courses such as
first aid training, year-long employment-related certificates, multi-year apprenticeships,
and postgraduate diplomas. Courses include those provided at Australian
Qualifications Framework (AQF) levels 1 to 6, and level 8, as well as
non-award courses. The proportion of nationally recognised program enrolments
at each level in 2022 is shown in Table 1 below.
Table 1 The proportion of program enrolments at each
Australian Quality Framework level, 2022
Australian Quality Framework level |
Proportion of program enrolments |
Level 1—Certificate I |
3.7% |
Level 2—Certificate II |
16.2% |
Level 3—Certificate III |
39.8% |
Level 4—Certificate IV |
19.1% |
Level 5—Diploma |
10.5% |
Level 6—Advanced Diploma |
0.8% |
Level 8—Graduate Certificate/Graduate Diploma |
0.3% |
Other recognised and non-award courses |
9.6% |
Source:
Parliamentary Library calculations from National Centre for Vocational
Education Research (NCVER), ‘Databuilder’, Total VET students and courses:
program enrolments, NCVER website. Filtered by level of education and nationally recognised
enrolment type.
Of the 2.1
million students enrolled in nationally recognised programs in 2022, most (1.8
million) were in training
package qualifications, while 157,400 were in accredited qualifications, 104,185
in training package skill sets, and 107,105 in accredited courses.
The three fields
of study with the highest proportion of program enrolments were management
and commerce (20.5%), society and culture (18.3%), and engineering and related
technologies (17.5%).
In addition to program enrolments, there were some 3.0
million students studying subjects not delivered as part of a nationally
recognised program. These included courses such as first aid training, responsible
service of alcohol accreditation and licence to operate a forklift.
Providers
There are some 4,000 registered
training organisations (RTOs) in Australia. Providers must be registered in
order to deliver nationally recognised courses and AQF-accredited VET
qualifications, or to receive government funding for the provision of VET courses.
Those providers who are not RTOs would typically be delivering non-award
courses.
In 2022,
of the students enrolled in nationally recognised training:
- 3.4
million (76.2%) were enrolled at private training providers
- 717,760
(15.9%) at Technical and Further Education (TAFE) institutes
- 493,480
(10.9%) at community education providers
- 106,380
(2.3%) at enterprise providers
- 103,475
(2.3%) at schools
- 67,695
(1.5%) at universities.
Note that these percentages add up to more than 100% as
students may have enrolled in training with multiple provider types.
Policy
and regulatory responsibilities
The VET sector is a joint responsibility of the Australian
and state and territory governments, with Commonwealth funding provided under
the Federation
Funding Agreements Framework. This Framework replaced the former Council of
Australian Government (COAG) arrangements in August 2020.
Payments to the states are facilitated through the Federation
Funding Agreement—Education and Skills. The only program currently funded
in the VET area under this Agreement is Fee-Free TAFE (officially the 12-Month
Skills Agreement).
Under this Agreement, from January 2023, the Australian
Government and state and territory governments are funding 180,000 Fee-Free TAFE
and vocational education places. A further 300,000 places are to be made
fee-free from January 2024 under the 5-year National
Skills Agreement (NSA) being negotiated with the states and territories.
The places are to address skills shortages in areas of national priority and
will target priority groups.
The NSA, which is due to commence in January 2024, also provides
additional Commonwealth funding to the states and territories to:
- deliver
high-quality, responsive and accessible education and training to boost productivity
- support
Australians to obtain the skills they need to participate in rewarding work
- ensure
Australia has the skilled workforce needed for critical industries and the
delivery of high-quality services.
The NSA replaces the
former National
Agreement for Skills and Workforce Development agreement.
The Skills and
Workforce Ministerial Council (SWMC) was launched in 2023 to support skills
reform including:
- delivering
on the shared Vision of the VET sector through a long-term National Skills
Agreement
- positioning
the VET sector to support a fair and productive economy
- improving
the quality and relevance of VET through delivery of reforms underway
- enhancing
VET delivery and outcomes for Australians by strengthening collaboration with
other portfolios on key intersections.
Under the Federal Relations Architecture, the SWMC
reports to National Cabinet regularly on its priorities, as well as annually on
its workplan.
Federal government VET policy and programs are primarily
the responsibility of the Department
of Employment and Workplace Relations (DEWR).
However, the Department of Industry,
Science and Resources advises on industry policy, which can shape
investment in VET.
State and territory policy responsibility rests either with
the relevant Department of Education (such as in New South Wales) or
with employment or economic-focused agencies (such as the Queensland Department of Youth Justice, Employment, Small
Business and Training and the Tasmanian Department of State Growth). The Parliamentary Library publication Tertiary
education: a quick guide to key internet links lists the
relevant agency for each state and territory.
The Australian Skills Quality Authority (ASQA)
is the national regulator for Australia’s VET sector, with responsibility for
the registration of training providers and accreditation of courses. It also
manages the registration of VET and English language course providers who wish
to offer courses to overseas students studying in Australia (CRICOS). Providers who only
offer courses in Victoria or Western Australia, and who do not intend to enrol
overseas students, can register with their relevant state regulator instead
(the Victorian
Registration and Qualifications Authority and the Western Australian Training Accreditation
Council).
Jobs and Skills
Australia (JSA) was established in
2022, and replaced the National Skills
Commission (website soon to be archived). JSA is a statutory body within
DEWR. JSA’s role is to provide independent advice, data and analysis on the
Australian skills and labour market, and the effectiveness of the skills system
to meet national current and future skills needs.
There have been recent changes to industry
engagement arrangements. Jobs
and Skills Councils (JSCs) are being established to facilitate industry perspectives
in the VET sector. Previously known as Industry Clusters, JSCs will have 4
broad functions and responsibilities:
- workforce
planning
- training
product development
- implementation,
promotion and monitoring
- industry
stewardship.
JSCs will work with JSA to identify skills gaps. JSCs
replaced the previous industry engagement arrangements, which included 67
Industry Reference Committees and 6 Skills Service Organisations.
Funding
Government funding
Unlike the school and higher education sectors, a
significant proportion of VET activity is undertaken by non-government
providers on a fee-for-service basis without any government funding. The cost
for this activity is borne by the student or their employer. Of the 4.5 million
students undertaking VET activity in 2022, only 1.3
million were enrolled in courses outside the school system that were
directly government funded (that is, were ‘government-funded students’).
Federal and state/territory government funding is provided
through multiple channels, including:
- Commonwealth
funding to the states and territories targeted to particular outcomes, such as
through Federation Funding Agreements, often spent on training subsidies
- general
funding of government-supported providers such as TAFE institutes, schools and
universities, including capital funding
- fee-for-service
arrangements for the provision of designated programs (such as the Adult
Migrant English Program)
- VET
Student Loans, which are paid by the Australian Government to providers on
behalf of students in designated courses.
Total
government funding provided through VET appropriations and VET
intergovernmental funding agreements in 2021 (the latest data available) was $10.5
billion, of which the Australian Government contributed $6.3 billion (59.8%).
The Australian Government also provided $257.4
million for VET Student Loans.
As can be seen in Figure 1 below, nearly 85% of Australian
Government direct VET expenditure is on employer incentives, whereas state and
territory government expenditure is primarily directed to VET delivery.
Figure 1 Government expenditure on VET by activity,
2021
Source: Parliamentary
Library calculations derived from NCVER,
Government funding of VET 2021: data
tables, Table 4.
State and territory governments directly operate some VET
providers, such as the TAFE institutes and government schools, while both
levels of government subsidise certain courses or programs operated by private
providers, and directly contract fee-for-service provision of others.
In 2021,
TAFE providers received 70.7% of total government VET delivery and capital
funding, and 19.9% went to private providers. TAFE received 34.5% of VET
Student Loan distributions, while private providers received 51.7%.
In addition, some federal government funding is provided
directly to students, such as through Trade
Support Loans (some $199.7
million in 2021) and Living
Away From Home Allowance for apprentices, and student
income support arrangements. There are also incentive
payments available to employers of apprentices.
Fees
In general,
providers set their own fees for each course or unit. This can vary from less
than $100 for a part-day course or unit (for example, $45 for a two-hour CPR
- Provide Cardiopulmonary Resuscitation course conducted by
the Australian Training Institute) up to thousands of dollars for
multi-year technical training (for example, $102,500 for the Diploma of
Aviation (Commercial Pilot Licence - Aeroplane) conducted by Western
Australian Aviation College).
In most states, different providers may charge different
fees for the same course, even within the same state TAFE system. For example,
in Victoria, the full fee for the Certificate IV in Engineering course
at Wodonga TAFE is $16,320, with no additional cost for
materials, while for the same qualification GOTAFE (based in north-east Victoria) charges $27,580 and $2,520 for course materials. In
both cases, fees are significantly less for subsidised students.
Different course costs can reflect a range of factors. The Productivity
Commission (p. 5.7) cites differences in training-related factors (such as
class sizes, contact hours, and teaching salaries), jurisdictional factors
(such as the characteristics of students and scale of delivery), and policy factors
(such as the level of fees allowed to be charged to students), as cost drivers,
but these are not always easily compared between providers. The National Skills
Commission’s Average
Price Benchmarking Report (2021) provided an overview of the
variability in VET qualification pricing nationally, with a view to developing
more nationally consistent prices for VET.
For government-subsidised training, there are a range of
approaches to subsidies. For example, a maximum student contribution may be set
(such as in New
South Wales), or an hourly rate of subsidy may be set (as in Victoria).
Further
information