Support wanes for open training markets

contest-markets

John Ross, THE AUSTRALIAN, APRIL 22, 2015

John Barilaro, NSW’s new Skills Minister, says that TAFE cannot compete on an equal footing with private colleges.

New NSW Skills Minister John Barilaro has come out against a fully contestable approach to skills funding, in a further sign that support for completely open training markets is cracking.

Mr Barilaro told The Australian he did not support 100 per cent contestability, citing impacts on TAFE colleges and his pre-politics experience as a manufacturing proprietor in the regional centre of Queanbeyan. Mr Baril­aro said TAFE’s infrastructure and salary costs made it impos­sible for it to compete on an equal footing with private colleges.

“They might be able to in 10 years, but they can’t now,” he said. “While I hesitate to use the word, a degree of protectionism may be in order so we don’t put a valuable public asset at risk.”

NSW was among the last jurisdictions to launch an open training market in line with the National Partnership Agreement on Skills Reform, signed at the Council of Australian Governments meeting in 2012. While the agreement is loosely worded, states and territories have interpreted it as a requirement to open their training funds to full private competition. But Mr Barilaro said there was nothing in the agreement that mandated 100 per cent contestability.

Queensland’s new Labor government has also backed away from the previous government’s decision to make public training funds 100 per cent contestable, although Skills Minister Yvette D’Ath has yet to release specifics.

Mr Barilaro said he had not made up his mind about what level of contestability was appropriate. The 30 per cent level advocated by the NSW opposition could see TAFEs worse off, he said, with the public providers presently attracting 81 per cent of the training funds.

“That could send a message to the private sector that they’re going to get another 10 per cent.

“And the right mix in metropolitan areas might not be right in the regions. We need to be flexible about these things.”

Mr Barilaro is also Regional Development Minister and Small Business Minister in a rejigged industry portfolio.

The skills reshuffle has yet to be bedded down, with the government still determining where State Training Services — a former arm of the Education Department, which oversees training funding and policy — will sit.

Mr Barilaro said NSW had avoided problems experienced in other states by moving cautiously in introducing its open training market, known as Smart and Skilled. He foreshadowed several reviews of the scheme, which began in January.

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