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Speech to AEU national TAFE council annual general meeting: 13 April 2018: Melbourne

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I'd like to acknowledge the traditional owners of land upon which we meet and pay my

respects to elders both past and present.

I would like to acknowledge the union leadership, Federal TAFE President, Michelle

Purdy, and thank Pat Forward for her tireless work as Secretary of your TAFE division.

I would also like to thank each of you for providing leadership on the critical importance

of TAFE and the problems arising from the overzealous application of competition policy

and privatisation.

Despite the enormous challenges and set-backs and the considerable attacks on the

iconic institution of TAFE, your union have been unequivocal in its advocacy for the

public provision of quality vocational education and training, and for the future of TAFE.

Your long running Stop TAFE Cuts campaign is something to be proud of and

something that all Australians should be thankful for.

The importance of TAFE

TAFE is an iconic public institution that sits at the centre of Australian life.

The contribution it has made, from its establishment as workman’s colleges and

mechanics institutes in the 19th century and its evolution through to the modern TAFE

network, has been immense.

It has educated and trained millions of our citizens.

It supports students who thrive in adult learning environments.

It delivers critical education and training services to regional and rural Australia.

It is the backbone of technical and trades training in this country.

It provides quality vocational training to the growing services and knowledge industries.

It delivers English language, literacy and numeracy teaching, smoothing the way for

further education.

It plays a vital role in our skill formation system - sitting at the forefront of 21st century


It plays these multiple roles across the network, reaching into diverse communities, in

hundreds of towns and suburbs across Australia.

It is essential to Australia’s future prospects and our domestic and international


It is more than the sum of its parts.

The importance of TAFE teachers

Teachers lie at the heart of the success of TAFE.

There is no job like teaching.

It is highly skilled, demanding, intellectually exacting work.

It requires deep content knowledge as well as the mastery of specific occupations and

crafts - to then be imparted to a diverse range of students - across all ages, from every

type of background, each with their own aspirations for a fulfilling future.

Good teachers are smart, inventive, and down to earth; they cajole, mentor and inspire.

They have earned and deserve the recognition, social status, and financial security that

other trained, skilled and responsible professionals enjoy.

The problem

The unfortunate truth is that policies that have driven competency based training,

marketization and unhealthy competition in the VET sector, have diminished TAFE.

The system undervalues and degrades the role of teaching and pedagogy.

This is no more starkly represented than in the acceptance that a Certificate IV in

training and assessment (delivered by a system with failing quality), is regarded as an

adequate qualification for teaching excellence.

While the poor results of marketisation have primarily been in the for-profit part of the

system - the pressures have also been applied to TAFEs.

This has led to TAFE campus and course closures and the loss of jobs. For students

enrolling in VET, it’s meant cost shifting to them, fee increases, limitations on access,

and unequal treatment across the post-school sector.

The critical role of TAFE as the public provider, and the professional role TAFE teachers

play, is not recognised and supported in the current system.

My story

All of you would know that I am a trade unionist.

I am also a product of trade and technical training which I received at the equivalent of

Australian TAFE in Scotland.

My highest qualification is a City and Guilds certificate as a fitter and machinist.

I was one of those distracted young people at school and I didn’t have the patience for

abstract, classroom learning. I had great teachers at school but it was not the right place

for me.

It wasn’t until I went to Tech, when I understood what algebra and equations could be

used for, that I settled into the rigours of formal learning.

I am not sure what my life would have been without the discipline of my trade and the

structure and focus my apprenticeship gave my education from the age of 15.

My personal experience of TAFE, and the education and lessons I drew from it, was far

from unique - but I think it is fast becoming a more exceptional story. I am increasingly

concerned that the 15 year old I was then would not have those same opportunities


When I commenced my apprenticeship in 1966, my employer had an obligation to

release me for formal off the job technical training and they were responsible for the

costs of that training.

Fifty years later and the terms and conditions for apprentices have declined instead of

improving. The commitment and investment from employers to train their workforce has

declined instead of grown.

Young people, while being fed rhetoric about choice, are having their opportunities

constrained by poor policies.

High rates of youth unemployment, growing rates of underemployment, and dropping

numbers of apprenticeships, are just the headline evidence of the barriers to the labour

market being faced today.

What lies beneath the aggregate figures are the increasing numbers of contingent and

precarious jobs people are compelled to work in; and growing uncertainty about what

work in the future will look like.

The current vocational education and training system is flawed and it needs to be fixed

- but the problems in VET are a manifestation of deeper ideological trends that have

shaped policy development in Australia for far too long.

Inequality is growing. Trickle-down economics - and relying on the good agencies of rich

corporations to share wealth - always a delusion - has now been comprehensively


It is my view that the rise in inequality has been exacerbated by the misuse and

misapplication of competition policy - the slavish adherence to increasing competition,

privatisation and outsourcing has done considerable damage.

Competition policy in the TAFE System

Competition policy has developed an almost religious quality whereby pro-competition

activity is regarded as socially beneficial and anti-competition is automatically seen as

detrimental conduct.

While competition policy is beneficial in dealing with the anti-competitive behaviour of

business and in particular monopolies, competition should not be mindlessly imposed

on non-commercial activities, such as TAFE that are needed to promote social causes

and social benefits.

Despite compelling evidence to the contrary, the myth that competition is always good

has been an incredibly resilient idea in modern Australian mainstream policy making.

This is despite the evidence of competition policy having negative impacts on the TAFE


Does competition always benefit society?

The Australian training market provides a three decade long salutatory lesson in how

market competition in education has failed us as a society.

The proponents of competition policy in VET say that it drives down prices. They argue

that consumers, in exercising their choice, put pressure on producers and providers to

become more efficient and improve quality.

Economic theory doesn’t distinguish between price and value. Regulating for the

cheapest petrol is light years away from regulating for the best quality education and

training system that is possible.

It is not choice when the best providers are de-funded and the worst are rent-seekers.

In developing the training market, simple principles were applied to a complex system.

Consequently, even by the logic of orthodox economics, and Transaction Cost

Economics in particular, the application of a competitive market system in vocational

education and training has been a failure.

The evidence shows that the training market in Australia has led to:

 an overall decline in the outcomes for students - the latest official annual survey

of VET students taken in mid-2017 found that of students who graduated during

2016 and were employed, just 30% were in an occupation group related to their


 a decline in quality- the government’s own regulator has called the training

market “a race to bottom” - which has placed enormous pressure on providers

like TAFE working to maintain quality

 the proliferation of wasteful and rigid bureaucratic processes - that have seen

the development of 17,000 units of competence and 1,400 different

qualifications, many of which remain unused

 dissatisfied employers continuing to complain of skill shortages and gaps -

despite being given the authority to lead the system

 cherry-picking and rent seeking by for-profit providers

 insufficient investment in infrastructure and in teacher qualifications and


 money wasted on marketing, promotion and advertising

 the development of a market for low quality courses

 and, at its very worst, the defrauding and exploitation of citizens trying to improve

their lives through gaining education and qualifications.

Our minds invariably turn to VET FEE HELP when we think about rorting - Careers

Australia and its $600 million dollars of government funding, 1,000 sacked workers and

thousands of students saddled with debt and nothing to show for it.

It is important to remember that rent-seeking and rorting in the VET market pre-dates

VET FEE HELP and has outlasted it.

There is a line of people coming to me as a Shadow Minister with stories of poor quality

training, and equating this to the business models that are operating in the sector.

Operating in the training market is a lucrative business if you don’t care about quality.

Dr Phil Toner has meticulously described the growth of what he has called “the low

quality training market”, and the conditions that have created ‘perverse incentives’ for

students and employers not to demand quality training and for providers to supply this

low quality training.

As we meet here today there are private for-profit RTOs forging qualifications, taking

large sums of money for training they don’t deliver, turning out untrained people, and

destroying trust in VET qualifications.

The ramifications of this can be dire in high-risk sectors. Dangerous to workers and to

the communities they serve.

Even when ASQA closes low quality or shonky RTOs - after the couple of years it takes

to catch up with them - there is nothing to stop another such provider taking their place.

In the five years to 2015 the annual combined rate of provider exits and entry was 13% -

so barriers to entry are low.

Low quality provision is a pervasive problem in the system if RTO compliance measures

are anything to go by. According to ASQA’s last annual report only 1 in 4 RTOs are

compliant after their initial audit. Even more troubling, after RTOs are given the time and

information to rectify the problems, half of them are still non-compliant.

The problems in the system have not been fixed by changes to the student loans

regime; the problems have not been addressed by the endless tweaking of regulations

- arguably they have exacerbated them; because the problems are written in to the

design of the system.

It is a system that fails to assure quality.

As Phil Toner concludes,

“…the training market created both the opportunities and incentives for malfeasance

and quality diminution on a grand scale.”

The whole system needs reform. This idea will meet opposition - including from the

greedy vested interests that are free to make extraordinary profits.

The commodification of education is summed up by the words of a capital investment

adviser spruiking the money-making benefits of education, as quoted by Phil Toner:

‘Education is a beautiful business when it works. Fat fees, hefty annual increases,

recurring income and high switching costs are just a few traits of high-performing

education providers. Investors who have understood the sector’s potential have done

exceptionally well...The sector has excellent long-term potential. Not-for-profit education

providers...look like sitting ducks as technology eventually reshapes the sector’

(Featherstone 2014).

The investment adviser makes an important point -because most egregiously the

training market has undermined the viability of the public provider, TAFE.

The flow of funding to the VET sector has reduced in real terms - and within that

shrinking envelope, a much lower proportion is going to the public provider.

In 2015 a total of $4 billion, or 42 per cent of total operating expenses for publicly

funded VET, went to non-TAFE providers. (NCVER 2017b: 6).

In 1996 98 per cent of students receiving publicly funded VET were in TAFE (with 83

per cent) or not-for-profit community education providers (with15 per cent) but, by 2016

this had fallen to 52 per cent and 6 per cent respectively. (NCVER 2017: Table 11).

Labor Policy

TAFE is the anchor for a quality vocational education and training system.

Once you lose a critical social institution like TAFE it is very hard and very costly to get

it back.

We cannot afford for TAFE to be a ‘sitting duck’ while private firms make their profits of

between 30-50 percent.

There is an immediate and urgent need to protect, stablise and rebuild TAFE.

That is why Labor have already announced we will return the $637 million the coalition

stripped from VET in the last budget and why we have committed that at least two thirds

of all government funding for vocational education will go to TAFE.

The balance will go to not-for-profit community educators and only the very best of the

private providers with demonstrable links to specific industry requirements.

In every Labor VET delivery program TAFE will be given a key role.

The vocational education and training gravy train will end under a Labor government.

We have also committed $100 million to the Building TAFE for the Future Fund to

commence a program of revitalising campuses across Australia.

Post-secondary commission of review

It is also abundantly clear that we cannot afford for the education and training market to

continue as it is currently designed.

That is why Tanya Plibersek, Terry Butler and myself have announced a once in a

generation commission of review into the post-secondary education system to

commence within the first 100 days of a Shorten Labor government.

There hasn’t been a national inquiry into TAFE since the Kangan Review in 1974. It is

well overdue.

There has never been a national review that considers the full gamut of post-school

education. It is time to have one.

The terms of reference are currently under consideration - your union has already

made a very thoughtful submission outlining views on the scope and focus of the


Without pre-empting the specific terms of reference, I do want to say something about

some key matters the commission should be charged with.

In its consideration of how quality and trust can be returned to the vocational education

system it should start by examining the critical role TAFE plays as an educational and

social institution - in our communities and in local, national and global economies.

The review must seriously and rigorously consider alternatives to the competitive

training market model.

And it must also consider alternatives to the current pedagogical framework being

delivered under the auspices of competency based training.

We are living in a time of rapid change driven by globalization, artificial intelligence,

robotics and digital transformation and the Internet of things. It is impacting on all

aspects of our lives.

Now more than ever we need a post-school education and training system that

responds to those changes, and works for every Australian.

We need a system built on quality, collaboration, depth, reliability and transferability


 equips people with knowledge and education for good working lives;

 skills the workforce for existing and emerging jobs;

 produces skills that power innovation and good jobs;

 provides greater social engagement and inclusion by guaranteeing access to

quality lifelong learning and further education;

 in apprenticeships, provides a contract for employment and a contract for training

with nationally recognised portable skills; and

 recognises the importance of highly skilled TAFE teaching professionals.

While the progress we need isn’t being delivered in the system that is operating we

have a great opportunity before us to change that - not for the sake of change but in the

national interest.

Finding the best way forward will be complex. It will be both intellectually and practically

challenging - but it needs to be done.

It is also abundantly clear that the only way it will happen in under a Labor government.

TAFE and its people

I would like to pay tribute to the people who make up the TAFE Network - all of the

dedicated educators and teachers.

Your professionalism - your capacity and willingness to collaborate and innovate - will

continue to help students and communities navigate the challenges that lie ahead.

Just as you always have done.

You deserve our unreserved and enduring gratitude for enriching the lives of so many


You have been the custodians of the idea of TAFE - and its great potential - as well as

the practitioners of TAFE - and all it can and should be.

I look forward to working with you to make sure Australians get the education and

training system that they need.



(2017a) Australian Vocational Education and Training Management Information Statistical Standard. Data element definitions Edition 2.3

(2017b), Australian vocational education and training statistics: government-funded students and courses 2016, NCVER, Adelaide.

(2018) Historical time series of government-funded vocational education and training in Australia, from 1981, NCVER


Authorised by Noah Carroll ALP Canberra