The long awaited announcement from New South Wales – an open VET market from 2014

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It’s been a long time coming with Adrian Piccoli MP, Deputy Leader of The Nationals NSW and Minister for Education announcing New South Wales Smart and Skilled, reform of the VET system – read the media release.

NSW Education Minister Adrian Piccoli: “We’ve had the advantage of seeing how things went in Victoria and we’ve learnt lessons from that.” Source: The Daily Telegraph.



From 2014 Smart and Skilled will deliver:

  • an entitlement for entry level training up to and including Certificate III
  • support for higher level qualifications
  • informed choice with improved quality measures
  • recognition of the role and function of TAFE NSW as the public provider
  • greater support for regions and equity groups
  • better information for consumers.





In summary this means:

  • an entitlement for individuals covering:

–          select foundation courses and full qualifications up to and including Certificate III qualifications, and

–          funding for higher level training and skill sets in priority areas.

People aged 15 years and over who have left school, do not have a Certificate IV or higher qualification and who live or work in New South Wales will be eligible for the entitlement.

A skills list will define which courses will be subsidised by Government. It will be based on industry consultation and labour market research.

Apprentices, new entrant trainees and VET in schools students will continue under existing arrangements. The main change will be that rather than paying an annual fee, apprentices and new-entrant trainees will pay a set fee per qualification.

If you are eligible for the entitlement you will be able to choose to go to TAFE NSW or an approved private or community training organisation that best meets your needs.

  • for employers and industry:

–          choice of TAFE NSW or an approved private or community training organisation that best meets their needs.  This will encourage training organisations to tailor their services and explore innovative ways to deliver training.

–          a new information service will be developed to help employers identify training opportunities and compare training organisations.

–          input into the skills list and which courses will be subsidised

–          employers may also be able to up-skill existing workers through targeted funding for skill sets and high level training.

  • for Registered Training Organisations:

To be eligible to offer government subsidised training under Smart and Skilled, approved training organisations will need to be based in NSW.  They will also need to meet stringent quality and performance measures. These will include [read criteria for your application to become an approved provider, Wendy’s note*]:

–          Strong regulation – working closely with the national regulator to improve regulation and monitoring of quality and outcomes

–          Effective contracting – strict criteria for training organisations to deliver government subsidised training, including sanctions for non-performance

–          Performance monitoring – regular monitoring of performance

–          Validation of assessment – independent validation of training organisation assessment practices that will involve industry

–          Consumer protection – consumers will have clear avenues for complaint

–          Teaching and leadership – training organisations will be required to train staff so as to build capability and capacity

–          Evaluation – feedback from students and employers on satisfaction with training and training outcomes.

Note: as a comparison look at the evaluation criteria and the application process required by Skills for All providers in South Australia.

Briefings on tendering for Smart and Skilled will be conducted prior to implementation. Further information will be available in the coming months.

  • for TAFE NSW:

–          While students and employers will have greater choice of provider under the entitlement, training outside the entitlement will continue to be available through TAFE NSW [for how long?].

–          Governance changes will be progressively introduced to ensure TAFE NSW can continue to meet the Government’s priorities and succeed in a more contestable training environment – Separation of purchaser and provider roles; Separate and distinct budget for TAFE NSW; Greater autonomy and accountability for TAFE NSW Institutes; Stronger partnerships with industry; and Improved workforce productivity.

In rural and remote areas, the level of competition will be restricted to make sure that these communities have ongoing access to reliable and high quality training organisations.

To deliver training in regional areas, training organisations will need to demonstrate a good track record of servicing the needs of regional students and employers.

Both TAFE NSW and approved ACE providers will receive community service obligation payments to deliver training in rural and remote areas.

The Independent Pricing and Regulatory Tribunal will be commissioned to provide advice on price and fee arrangements prior to implementation. The amount of fees and subsidies will be published in 2013.

To sum up [and this is my personal view], the NSW VET reforms will:

–          Be similar to the South Australian Skills for All approach but with a much more restricted skills and qualification list

–          Ask providers to meet criteria and apply to become a provider with significant competition

–          Encourage Recognition of Prior Learning (RPL) especially with the eligible target group

–          See a market adjustment of the VET sector [read reduction of the number of RTO’s in NSW]

–          Enable the NSW government to set prices for qualifications and skills sets for government funding in turn having an effect on pricing in the state VET market beyond subsidised funding

–          Encourage TAFE NSW and ACE providers to offer services in rural and remote areas

–          Mean major changes for TAFE NSW industrially, structurally and with product and service offerings.

As I’ve been presenting on National, State and Territory VET reforms and funding for a while now and predicting what will happen in New South Wales it’s great to finally have a sense of direction and to know the key parts of the reform – now it’s will all be down to the implementation and if you are ready!

Written by Wendy Perry, Managing Director, Wendy Perry and Associates Pty Ltd.

PS. Interested in the Opposition and Greens view of the announcement?  You may also be interested in the Green’s view of view expressed at the ACPET 2012 National Conference.

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