Proposed changes to Skills for All funding based on demand?

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Note: this blog post is quite long and the headings should help you get to the bits you are interested in.  Please let me know what you think, do you agree, disagree or have you got an entirely different perspective?

On the back of the South Australian State Government 2012-13 Mid-Year Budget Review outlining major employment, training and skills savings,consultation about the composition of Skills for All Funded Training List in Feb 2013 is underway from 19 December 2012 to 21 January 2013.

The main activity for the consultation is by completing the Funded Training List Consultation Survey but first you must read the proposed changes to Funded Training document.

Read this blog post in conjunction with Skills for All Funded Training List – Views on the Consultation Survey.

Proposed Changes to Funded Training

55 qualifications (referred to as courses) and accredited courses are proposed to be ‘capped’.  I don’t think this is the right word as its proposed enrolments will cease as of a specific date and be removed from the Skills for All Funded List.

What’s not clear is the logic behind ‘capping’.  It’s seems from the Consultation on proposed changes to Funded Training List in Feb 2013 what’s on the list relates to qualifications where:

Disability

  • Skills for All enrolment growth has been significant;
  • Skills for All growth is expected to be minimal;
  • There is a mismatch with the Estimated annual job openings vs. total 2012/13 course enrolments to date; and/or
  • Where the estimated change in fee for service enrolments is a significant – or +

Qualifications highlighted in bold italics throughout this blog post are the ones that as a priority shouldn’t be capped in my opinion.  There are other qualifications where specific industry examples of skills profiles and training needs could be presented to demonstrate why they shouldn’t be capped particularly at entry level and for job seekers or new workers.

Courses do not equal Occupations

The formula of a job role = 1 qualification or course is flawed, out of date and simply not what happens in reality with enterprises and industry sectors.

An occupations or job role skills profile = Common/Core Skills + Functional Skills + Job Specific Skills = 2-4 Qualifications from multiple Training Packages and across multiple Australian Qualification Framework levels.

When building a job skills profile and undertaking a training needs analysis you identify:

  • Common/core skills that are needed for all job roles plus
  • Functional Skills (like Occupational Health and Safety, Management, Training and Assessment), plus
  • Job Specific Skills (technical skills, often a group of narrower skills and/or qualification).

Estimated annual job openings

Job openings could be partly used as evidence towards determining demand although given the above information 1 job opening/role generally also equals a requirement for multiple qualifications per person.  Using estimated annual job openings doesn’t account for the skills requirements and demand for skills development for existing workers which far exceeds the numbers in the proposed changes to Funded Training document.

Based upon practical experience in workforce development and workforce planning including demand and supply forecasting with South Australian enterprises, organisations and industries, I don’t agree with the methodology used as it makes a job opening = to an occupation and = to a course.

Skills for All funded qualifications should be based upon what actual job roles need starting with core/common skills.

Core/common skills – don’t cap

Often core/common skills (some would call these Employability or Foundation Skills) are required to be built before next level technical skills can be developed.  Across multiple industry sectors, when core/common skills are mapped to units of competency from Training Packages, say for the purpose of an enterprise or industry competency framework, units from the Certificate I-III in Business level are always the most commonly selected such as:

  • Communication
  • Compliance (basic)
  • Customer Service (basic)
  • Information and Knowledge Management
  • Innovation
  • Learning
  • Occupational Health and Safety
  • Quality (basic)
  • Sustainability
  • Team Work
  • Technology (basic)

The skills above are complimented with industry specific skills that are required at this foundation level from qualifications such as Certificate I-II in Retail, Hospitality, Tourism, Hairdressing, Cleaning Operations, Driving Operations, Warehousing, and so on.

Functional skills – don’t’ cap

Functional skills are required by multiple job roles and typically include:

  • Administration
  • Customer Service
  • Information Technology
  • Leadership
  • Management
  • Occupational Health and Safety
  • Project Management
  • Quality and Compliance
  • Self-Development
  • Training and Assessment

Functional skills that are in demand, that is those that appear in the majority of training or skills needs analysis and workforce plans are from:

  • Certificate IV in Frontline Management
  • Certificate IV in Project Management
  • Diploma of Project Management
  • Diploma of Management
  • Certificate IV in Occupational Health and Safety
  • Certificate IV in Training and Assessment

Job Specific Skills – get evidence to cap or not

Job specific skills make a job role different to another job role and may include units of competency from more than 1 qualification however this is where we generally find the more technical skills.  This is an area where industry and professional peak bodies should be consulted to determine whether qualifications should be capped.

Get evidence on:

  • Current workforce skills profile
  • Critical job roles – what are they?  Now and into the future?
  • Demand and supply forecasting for critical job roles
  • Future workforce skills required
  • Emerging and new skills requirements including NBN enabled, clean energy, regional skills needs and Asian Century capabilities

As an example, Workforce BluePrint has developed a skills profile for small and medium sized enterprises to be NBN enabled and this maps to units of competency from 11 different Training Packages.

How does Skills for All deal with ‘emerging’ needs such as the NBN?

Skills for All and demand

To consider the notion that Skills for All is demand driven, the following questions should be answered:

  • Is Skills for All, skills for now or skills for the future?
  • Is Skills for All or everyone or some?  With proposed changes what impact will it have from an equity perspective particularly in relation to job seekers and new workers vs. existing workers or 1 job seeker who can access a subsidised place vs. another who can’t?
  • Is Skills for All based upon workforce development and planning scenarios, underpinned by evidence of skills needs with financial forecasting to match?
  • Is Skills for All based upon demand?  Where demand has increased or settled at a particular level, how have specific qualifications made it onto the proposed changes to funded Training List?

As an example the Advanced Diploma of Dental Prosthetics is proposed to be capped.  Why?  Using the table with assumed logic [and remembering I don’t agree with this approach but I’ll use it for the purposes of this example] there are estimated annual job openings of less than 50, only 16 enrolments so a seeming mismatch, but a 100% transference from estimated fee for service to Skills for All funding.

Demand is not what’s represented in the proposed changes to Funded Training document.  What’s outlined in the document are those qualifications that have had too many enrolments, not enough enrolments so not a priority, or where a funding source prior to Skills for All implementation has now been substituted with Skills for All funding.

Subsidy rates

A quick note on subsidy rates as one of the biggest mysteries in Vocational Education and Training (VET) is how input costings relate to outputs and what appropriate funding levels are.

With Skills for All, providers had a funding increase for some qualifications and a drastic reduction in funding for others, especially higher level qualifications.

The change in fee for service enrolments into Skills for All isn’t as simple as it looks i.e. 1 doesn’t equal the other.  Unless you can compare actual fee for service amounts for qualifications (prior to Skills for All) with the subsidies paid through Skills for All for the same providers you can’t tell if this transfer is because:

  • The providers offering the qualifications have changed including who has been approved as a Skills for All provider
  • Delivery and assessment models have changed
  • Fee for service is being offered at all or as an alternative
  • Clients (and the public more generally) expect a subsidised Skills for All place

Suggestions

As submitted via the Funded Training List Consultation Survey here’s my suggestions:

  • skills and/or training needs analysis should be undertaken to determine skills requirements and demand
  • undertake future skills profiling in the forecasting process to understand the multiple qualifications required for job roles particularly for critical/priority job roles and therefore identify the numbers of specific qualifications required annually (with the flexibility to change based upon external factors and drivers such as the economy and legislation)
  • differential subsidies for job seekers, new and existing workers including business owners
  •  validation and support for functional skills required by multiple job roles including occupational health and safety, management, training and assessment and reflection in maintain related qualifications on the Skills for All funded list
  • sharing of information from our work with practical examples of skills demand and job skills profiles where 1 job role does not = 1 qualification
  • redesign of the survey to be more user friendly with explanatory notes and the opportunity to make further comments
  • making transparent the definition of ‘demand’, Skills for All financial forecasting with scenarios and the logic behind the proposed changes
  • independent review and analysis of Skills for All, based upon evidence and implementation identifying areas for improvement

The final concept that I would like to highlight is the notion of priority or risk rating.  When identifying workforce gaps through the workforce planning process and designing workforce development strategies we take the approach of separating out issues and solutions for the general workforce and critical job roles.

I’d like to see this approach, evidence based of course, taken with the Skills for All Funded List so the way I’d design the table would be as follows:

  1. Strategic objectives (state plan, policy directions, industry priorities etc.)
  2. Workforce skills gap/issue
  3. Priority number/risk rating
  4. Relevant job roles and demand forecast (including estimated annual job openings as 1 piece of contributing evidence)
  5. Relevant qualifications and skill sets based upon demand and future orientated (including total 2012-13 course enrolments to date and Skills for All enrolment growth as 1 piece of contributing evidence for current demand)
  6. Places for Skills for All providers
  7. Potential differential funding for job seekers, new workers and existing workers including business owners

At least three scenarios, perhaps more, to determine budget implications in light of recent state budget cuts, would include a high growth scenario, maintenance scenario and a low growth scenario.  Implications for each scenario would help the next stages of Skills for All implementation to be more realistic, efficient and demand driven.

Written by: Wendy Perry, Head Workforce Planner, Workforce BluePrint and VET Specialist, WPAA

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