Market models of education won’t fix aims of voc. ed. & training


Address at the 17th annual conference of Monash University’s Centre for the Economics of Education and Training , 4/11/13

Ged Kearney, President of the Australian Council of Trade Unions

‘Where to now with VET and social inclusion?’ is a great topic to delve into, as social inclusion is in many ways what VET is all about. Each year close to two million students and workers are enrolled in the VET system. The student profile is incredibly diverse as is the type and level of training and skills development that is delivered.

Increasingly today, for example, we see the VET system operating at the higher end of the labour market with advanced skills training for existing, qualified workers. But at its core, the VET system—particularly through TAFE as the public provider—very much continues to play its historic role in promoting social inclusion; a concept which the previous Government defined as building a nation in which all Australians have the opportunity and support to participate fully in our community. VET does this for example by:

  1. providing quality, entry level training to, predominantly, working class kids through apprenticeships, traineeships, and other structured training opportunities
  2. providing that crucial, ‘second chance’ learning for the disadvantaged and less fortunate in our community
  3. ensuring that students and workers in regional and rural communities do not miss out.

It’s also true that the VET system continues to take more than its fair share of students from groups most at risk of being marginalised or excluded from economic and social life in Australia. For example, of the total VET student intake of 1.9 million in 2011, there were:

  1. 87,700 Indigenous students, or 4.7 per cent of the total VET student population
  2. 119,400 students with a disability, or 8.4 per cent
  3. 287,600 students of non-English speaking background or 15.3 per cent.

We also know that low-paid workers make up a large proportion of VET students, with two thirds of 2007 graduates being in low paid occupations (defined as those earning less than two thirds of median earnings).

With this proud record, it is clear then why VET, and particularly TAFE, is synonymous with social inclusion. However, we can’t just assume that this has all just occurred by chance and that it will continue this way forever more. Conscious policy choices are required to support the ongoing role of the VET sector in promoting social inclusion. This means looking seriously at the overall policy settings for the VET sector, the funding and regulatory models, the future of TAFE as the public provider.

At a more micro-level perhaps, we also need to look more closely at the barriers that stand in the way of greater VET participation from low-paid workers as well at various at-risk segments of the population and find mechanisms to address such barriers.

These are some of the issues I’d like to explore with you further in my time today, both the broader ‘system’ issues and then how these impact on the practical, day-to-day experience of students and workers who rely on the VET system.

First of all to the systemic issues, my contention today is that the VET system is not doing the best it can to promote social inclusion because of flawed policy and funding models. Of particular concern to the ACTU and our affiliated unions is that the capacity for TAFE to continue to deliver high quality vocational education and training continues to be undermined by current policy directions and funding cuts.

Over much of the past two decades, there has been a fundamental neglect of TAFE by successive state and federal Governments, despite the crucial role it plays in developing Australian industry, addressing skill shortage, and building communities and social cohesion. This has seen recurrent funding per student contact hour decline by 25 per cent since 1997.

Pressures are particularly acute at present with the combined impact of budget cuts in a number of states and the loss of market share as a result of market-driven policies of contestability. TAFE in Victoria is doing it particularly tough with course cuts, campus closures, and mass job losses, as $300 million was ripped out of the TAFE budget and market share fell from 75 per cent in 2008 to 45 per cent in 2012.

This has grave implications for services that are provided by TAFE and which support social inclusion. For instance, I spoke before about ‘second chance education’, a tradition which is particularly strong in TAFE. TAFE provides this second chance education through a range of programs and support services that operate in conjunction with vocational courses and qualifications – things like literacy and numeracy support, libraries, counselling, career support and job search assistance; the types of programs and services that private providers in the market are generally not delivering. Programs such as these have been savagely affected by budget cuts.

The combined operation of contestability and entitlement funding models has in many respects failed those individuals who have traditionally relied on the VET system as a means to build their confidence, improve their skills and knowledge, and get a job and start a career.

First, in terms of entitlement funding, the promise of a guaranteed entitlement to a training place up to Certificate III all sounds ok on the face of it. The line has been that this will produce the boost in skills and qualification levels that Australia needs to meet its future skill needs and improve access and equity in the VET system. However, it is unclear whether this model has really given students greater access to public VET. As the AEU has pointed out, Australian students have had an entitlement to a place at a publicly funded TAFE Institute for more than 30 years at modest upfront costs to themselves and their families. Furthermore, the guaranteed entitlement under the National Partnership Agreement is only for a first qualification only at the certificate III level. States can provide more than that, but the experience, at least in Victoria, has been that students are given only one chance and any further qualification has to be done on a full fee-paying basis.

This has had the effect of denying access to publicly funded training for those looking to re-enter the workforce, change career, or develop new skills, by virtue of the fact they have existing qualifications at that same level—hardly compatible with the idea of promoting social inclusion.

The rationale may have been to prevent individuals churning through a number of different lower level qualifications—which is a legitimate concern—but there are a range of circumstances outlined above that can justify doing a qualification at the same level.

The related proliferation of private providers under a competitive training market has also been a retrograde step in our view, in terms of how VET provides for social inclusion. Many of these private providers were attracted into the training market for the first time by the availability of government funding for high-volume, low-cost training. This access to government funding has encouraged training providers to focus more on the marketing of courses to attract new students, rather than serious attention to the quality and rigor of the training being provided.

With the market still poorly regulated, unfortunately the impact in many cases has fallen on those students who received inadequate, poor quality training (or no genuine training at all) and essentially wasted their once-only entitlement to government funding for training, ending up with a qualification that has little value in the labour market. Some of these students are among the most vulnerable in society, and their experience in poor quality, government funded vocational education could mean they are reluctant to gain qualifications for work in the future, particularly if they are required to pay for it themselves.

So, if we are to do anything in the medium to longer term to preserve and improve the traditional role that VET plays in social inclusion, these systemic issues need to be addressed. In our view, this requires the following measures to support TAFE in particular and to ensure that quality is promoted across the VET system:

  1. First of all, the public TAFE system needs to have adequate levels of guaranteed funding, with a funding model that supports a strong and increased funding base for capital works, maintenance, infrastructure, and equipment, and which properly recognises the important role of TAFE as the public provider in providing access to training and re-training in areas of high and low demand, and, particularly, in rural and remote areas and in support of improved access and participation for disadvantaged learners.
  2. A full and immediate reinstatement of TAFE funding cuts in Victoria.
  3. The new federal Government must enforce the provisions of the national partnership funding agreement and ensure no further Commonwealth funding flows to states or territories, unless they have met conditions of that funding agreement to develop and implement strategies to enable public providers to operate effectively in an environment of greater competition. Just on this point, one of the few bright spots in the election campaign just gone was the commitment by Labor at its campaign launch to securing the future of TAFE and to ensure states and territories at least maintained their current VET funding levels. At this stage, we don’t have any indication of where the new Government stands on any of these issues, and I have written to Minister McFarlane seeking a meeting to clarify their position. There should also be at least a second chance at a guaranteed entitlement.
  4. There should be a single, high standard of entry for providers into the training ‘market’ and rigorous enforcement of those standards – we note that some progress is being made in this area with the work of the National Skills Standards Council and ASQA, although we share the ongoing concerns over whether ASQA has the resources it needs to effectively audit and regulate the performance of 5000 plus training providers.
  5. A full and proper public examination and review of the consequences of full competition on TAFE and VET, including the impact on educational quality of VET, levels of student support and teaching infrastructure, and a reassessment of the case and justification for a competitive training market.

So, these are measures we think will improve the overall quality of the system and in doing so promote social inclusion. But having looked at the broader VET system issues, I think we need to ‘drill a bit deeper’ and look at some of the specific challenges which are facing low-paid workers, and other disadvantaged and marginalised groups, and how the VET system can better meet their needs and promote social inclusion.

It perhaps goes without saying that the opportunity the VET system provides for workers to gain new skills and receive nationally-recognised, portable qualifications is a critical element in promoting social inclusion. This applies whether you’re a school leaver looking for that first job, an existing worker looking to upgrade their skills and move into a new and better-paid job, or if you’re someone who’s been in and out of jobs and only marginally attached to the labour market.

Training and the portable, nationally-recognised skills and qualifications that go with it, is what helps people find not only that initial job, but it also up opens up future employment opportunities across an industry or occupation.

Our Working Australia survey of over 40 000 workers across the country pointed to the importance of skills. Of those respondents who had experienced difficulty finding a job in the past five years, nearly one in four (23.7 per cent) attributed this to not having the required education, training or skills.

However, it is not always a simple case that ‘more VET’ will do the trick. This was an important insight contained in a piece of research by Barbara Pocock and others at the Centre for Work and Life at the University of South Australia in 2010. Their report for the NCVER was the culmination of a three year study to look at how VET can help low-paid workers improve their circumstances. In it, they challenged the ‘easy assumption’ that more VET will automatically enhance the position of lower-paid workers. In fact when training increases the time and financial pressures on workers without generating genuine skills or better prospects it can even make things worse.

Training can lead to new skills that are rewarded in the labour market, but not necessarily so. It found that over two thirds of VET graduates don’t move into a different occupational skill level or income level after training and the outcome for those who complete modules, rather than full qualifications, is even worse—something perhaps to keep in mind during the perennial debate about funding of skill sets. The research also pointed to the many barriers that we know faced by low-paid workers and other disadvantaged and marginalised individuals who are undertaking VET or would like to do so.

These include the time and money involved in undertaking training, particularly when it is not supported by their employer or by appropriate workplace arrangements in awards and agreements, or even by their own family (unfortunately, the anecdotal example you often hear is of men not supporting their female partner in their desire to undertake training). Language, literacy and numeracy issues are another common barrier reported.

To take the example of costs associated with training, we know this is a key issue for low-paid apprentices and trainees, as highlighted in recent cases that have come before the courts. In one particular case, an apprentice was travelling from Whyalla to Elizabeth, a trip of almost 400km, to attend off-the-job training. Apart from some limited financial assistance that was available under state government programs, the apprentice was left to find the money for all costs involved.

In another case, a trainee was attending block release training over a number of weeks. The trainee had to travel a distance of 760 km each way to go to training, driving 10 hours in his own vehicle. The trainee then had to pay for accommodation costs while training. To attend a second block of training, the trainee had to borrow his girlfriend’s car, as he had to sell his own car to pay for the travel and accommodation associated with earlier training. In total the costs to the trainee were in excess of $8000.

In both cases, the decision of the court went against the apprentice or trainee, not because the court didn’t appreciate the unfairness of the situation, but because of arcane legal distinction between what is training and work.

In our view, it is simply untenable and unsustainable to have a situation where apprentices and trainees already on low wages are then expected to also meet the costs of their off-the-job training. Effectively, this acts as a ‘double-whammy’ where it is not only low wages but also the costs of participating in an apprenticeship or traineeship that can affect both take-up and completion rates and the quality of the overall apprenticeship or traineeship experience.

This might not be such an issue in metropolitan areas and in sectors where most ‘off-the-job’ training is done on-site, but elsewhere travel for off-the-job training may become increasingly prevalent as the trend of ‘thin markets’ continue and ongoing cuts to TAFE funding lead to courses being abolished and campuses being closed. If these trends continue, no longer will there be a TAFE or other training provider on every corner able to provide the required off-the-job training.

At the same time, we see course fees rising, concessional payments for disadvantaged students being removed, and policy initiatives such as income contingent loans which are presented as a benefit for students but in our view are part of a further shifting of training costs and risks to individuals.

Given the sorts of barriers and disincentives that exist, it becomes more important than ever that training for those who might otherwise be socially excluded is of high quality and genuinely relevant to their needs. This goes back to the systemic issues I discussed earlier and ensuring that training opportunities are not wasted because of poor quality providers.

It’s easy to see why—if the training itself is seen to be of little value, and it is creating pressure on the individual in terms of time and cost—a person would be inclined to think ‘why bother’. Therefore, we need then to think creatively about how we overcome some of these barriers and ensure that VET can continue its traditional role in support of social inclusion. While there are no easy answers, there are a number of potential approaches which I’d like to leave for your consideration.

First, as I went to earlier, the broader VET system issues need to be part of the discussion because the overall policy settings help shape a range of key factors such as the role that TAFE is able to play, the funding that is available to provide ‘wrap-around’ support services, the quality and relevance of training that is on offer, the accessibility of training, and the costs of training in terms of course fees and the like.

In the end, what is important is the quality of skills and training that our members and the workforce and community at large are receiving from this thing we call the VET sector. We need to be confident that VET qualifications are giving people what they need to get a job, to change jobs, to get a better job, to perform productively in the workplace and that more broadly it allows them to participate fully in society.

Second, it is also important that we view this question of VET and social inclusion as a broader quality of work issue about decent, secure jobs. Some of the barriers to VET participation for low-paid workers or workers in precarious employment are about lack of support for training, whether in terms of supportive workplace culture or formal workplace entitlements that provide time and financial support for training to be undertaken.

Unions have sought to address some of these issues with some success in the recent Full Bench Apprentices decision. That decision has resulted in new entitlements that recognise training as work time, that cover reasonable costs associated with attending training, and which provide for reimbursement of course fees and textbooks provided there is evidence of satisfactory progress.

The availability of decent secure jobs is fundamental to a strong and supportive training culture. Unfortunately, the reality today is that up to 40 per cent of Australians are in some kind of insecure work. This means they have no paid sick leave, no annual or long service leave and no right to ongoing work, or fixed and predictable hours. Many might have worked the same shifts for years but can still be sacked at short notice, with no entitlement to redundancy pay. Where is the incentive for workers to undertake the training they need to further their careers when there is no certainty around their jobs?

By contrast, if workers are being paid well, if they have a reasonable degree of job security, some control over their hours of work, if their skills are being developed and recognised and put to good use in the workplace, if they are consulted and fully involved in any change processes occurring in the workplace, including the introduction of new technology, then you are far more likely to have a productive and engaged workforce.

And it is not just unions that are saying this. A recent report from Ernst and Young—hardly ‘fellow travellers with the union movement’—made the point that job security goes hand in hand with productivity, as do skills development and training, family-friendly working conditions, and safety at work.

Third, another key barrier that we can work to address is that of poor language, literacy and numeracy and the barriers this can create to greater and more successful VET participation. The ACTU supports the increased emphasis being given to foundation skills and the need to improve language, literacy and numeracy. Efforts to increase workforce participation and productivity rely on these foundation skills, and when 4.5 million Australians need additional training in literacy and numeracy this is a challenge of major proportion.

The danger that needs to be guarded against is that students will be churned through endless foundation programs which are not linked to work and vocational outcomes. There is overwhelming evidence that learning in context works and a priority for unions is to ensure that foundation skills training is closely tied with vocational learning.

An initiative we think could really help in this regard is to develop a network of Workplace Learning Representatives. A program of Workplace Learner Representatives has operated successfully in both the UK and New Zealand for some years. They have helped in driving worker demand for skills and workforce development generally, but have proved particularly useful in assisting workers who required additional help with language, literacy and numeracy issues. This has involved identifying literacy and numeracy requirements, and providing employees with individual support, including help in overcoming initial reluctance to learning and subsequent learning problems caused by a lack of confidence.

A good case study of the benefits of Workplace Learning Reps (or Union Learning Reps as they’re known in the UK) is the example of the VT Shipbuilding company, one of the last remaining major shipyards in the UK, with an ageing workforce confronting new technologies in shipbuilding. A learning needs survey conducted by the ULRs found that a large number of the workforce had left school without qualifications and had not received any training since then.

A key part of the response was the development of individual learning plans which included opportunities for improving adult literacy, language and numeracy skills. The initiative was particularly successful in reducing the stigma workers can experience in requesting basic skills training, with the process kept at arm’s length from company involvement. For example, employees were encouraged to respond to the learning needs survey with a commitment that the information provided would not be available to the employer to use in any way in relation to pay, performance appraisal or redundancy selection.

The role of union learning representatives allowed employees to talk in confidence with their work colleagues and discuss what sort of training they needed and the relevant union ran the learning centre where the training was provided. The company HR director endorsed this approach, saying ‘The good thing about the learning centre is that workers feel there’s no manager or foreman watching over them.’ As a result, a number of employees voluntarily sat national tests in literacy and numeracy and completed IT courses. The company reported that productivity increased by 20 per cent and rates of accidents and sickness were reduced.

These positive findings were replicated across the board with key findings from a 2005 report including that 83.3 per cent of respondents reported that ULRs encouraged colleagues to continue learning, and 60.5 per cent stated they encouraged colleagues with little or no experience [of learning] to access courses and 37.8 per cent revealed that they ‘helped colleagues improve their LLN skills.

The role of Workplace Learning Representatives doesn’t have to be limited to training with a LLN focus. They would be responsible generally for raising the profile of training and assisting workers understand the need for skills development, for undertaking skills analysis for workers and groups of workers, and helping workers access RPL and training.

It’s all about ensuring workers are given the opportunity and encouragement to identify their skill needs, see what’s available to them in terms of their training and skills development, and importantly, to give them a voice in how they can best build their skills and make use of those skills. For a variety of reasons, it’s often not easy for workers to do all these things themselves, and some employers may not adequately assist their employees in this regard.

Workplace Learning Representatives could be elected union representatives employed directly in an individual workplace or on a project site, or be employed through Industry Skills Councils to service a number of employers in an industry or region. It is a proposal that has been bubbling away for some time and we were pleased to see the previous Government pick up a similar idea of Workplace Champions as part of its National Foundation Skills Strategy.

In the end, we’re not fussed about the name—the important thing is that workers have someone to act as their voice on training issues. This is something union delegates and organisers already do, but this initiative would ensure there is someone with that dedicated role and support to do that job. Consideration could be given to pilot programs in selected workplaces and industries, possibly through the National Workforce Development Fund.

Fourth, we believe it is time for a renewed focus on the use and application of RPL. When looking at ways to promote VET as a vehicle for greater social inclusion, it should not always be a question of identifying skills gaps and deficits. In this regard, a proposal that unions support is to expand recognition of prior learning strategies as a way of capturing the existing skills profiles of those people who are marginally attached to the labour market.

The thinking behind this is that the effort associated with re-engaging injured workers, people with disabilities, recently retrenched workers, and those out of work and marginally attached to the labour market, is usually aimed at what those people can’t do and overcoming the difficulties in employing these groups. This prompts a range of remedial training in literacy and numeracy, as well as ‘employability skills’. However, while this training is important, it can overshadow the skills these people have already.

Skills profiling and proper recognition of prior learning and, where appropriate, credentialing of skills can build confidence, identify latent capabilities and streamline training effort. This should form the basis of an entitlement for those who are currently disengaged from the workforce, together with improved linkages between VET and the employment services system and training linked to jobs.

The benefits of this would include improved workforce participation from a range of equity groups, and the ability to match the skills of individuals with skilled vacancies. A renewed focus on the use and application of RPL should therefore be a part of the ongoing VET and social inclusion agenda.

Fifth, another potential way to address issues of social inclusion is the idea of individual learner accounts. The ACTU doesn’t have a formal considered position on learner accounts but it is an option worth further exploring, perhaps in conjunction with Workplace Learner representatives. Learning accounts was an idea floated by Brian Howe In his report for the ACTU on insecure work and there are examples of them operating in European countries.

They are based on the idea that a lifelong focus is required; that skills are needed right across people’s working lives—not just at the entry level. In this sense, the concept of learner accounts seems to have more utility than entitlement models based on a single point in time entry—level qualification. Some of the research from Europe indicates they have been successful in increasing motivation and interest in training from low-skilled workers, including a focus on both professional and personal development.

The risk perhaps is that under the guise of a matching co-contribution model they are actually used to shift costs onto the employee that would otherwise be met by the employer or government—but as I said it an option worth further consideration. Learning accounts could be helpful in dealing with peaks and troughs associated with insecure work.

Sixth, if we are serious about promoting social inclusion through VET there is an urgent need to address the lack of training opportunities for groups like casual employees, and others in precarious employment. The National Workforce Development Fund should be used for this purpose, with its guidelines amended to explicitly encourage training and workforce development initiatives for casuals and other groups that have traditionally missed out on such opportunities. It shouldn’t be the case that casual workers are left responsible for organising and financing their own training, as if often the case at present—staff in TAFE itself being a prime example of this.

As outlined earlier above, access to training and career development is an integral part of what it means to have secure work. To help facilitate this, AWPA should be requesting a total workforce profile from each funding applicant which includes a breakdown of permanent versus casual staff. If the training being proposed is going only to permanent staff, then questions should be asked as to why it isn’t being extended to casuals and other non-permanent staff.

Workforce developments plans under the NWDF should demonstrate how the skills development needs of casuals and others in precarious employment are being dealt with. Our understanding is that currently when NWDF funding applications are assessed and approved, there is no such information captured.

This is one relatively simple measure which may help to identify and tackle the current neglect of training and skills development for casual and non-permanent employees – although a more fundamental question that always needs to be asked is whether there is any genuine need for a person to be employed on a casual basis if their employment otherwise has all the features of permanent, ongoing employment.

Seventh, a point that is often made is that students in a competitive market and entitlement system will need to have adequate information to inform their choices about providers and the course and qualifications they offer. We would endorse this view—students should of course have necessary information to help them make decisions—but we would also note that creating websites to give students more information about providers will not solve the types of problems experienced in Victoria. Far more importantly students should be able to have confidence in the quality of the providers they are enrolling with and the course and the qualification they are undertaking.

Responsibility for this lies squarely with the relevant standard-setting bodies, regulatory agencies, the providers themselves and the governments that fund them; the responsibility should not be shifted to individuals on the basis of ‘buyer beware’.

The choices students make are often driven by the fact these private providers are government funded (and the offers of ‘free training’ that come with that). Private providers use their government funded status prominently in their advertising and students are entitled to assume that if the provider is accessing government funds (and is registered in the first place) then they must be of high quality.

Instead, what has happened in Victoria is that students are being held responsible for choosing a poorly performing government funded provider and being told that the solution is that the government will put more information about these providers on a My Skills Website. This unfairly put the focus on students to come up with the right decisions, when the onus and accountability should be on providers and regulators to improve standards and improve quality.

Eighth, and finally (I think Eight is Enough, as did the makers of that US TV series of the late 70s), management capability and management responsibilities should also be central to the debate about VET and social inclusion.

On one hand, VET is about the job readiness of individuals and ensuring they have the skills they need to enter the labour market and/or move into higher skilled jobs. However, our concern is that the burden should not be placed solely on the individual worker or job-seeker to source and finance their own skills development.

Increased employer support and investment in training is critical, both in monetary terms and by providing time off to attend training and, more generally, in fostering a supportive training culture, As with any training, it is vital then that the employer is willing and able to put those new skills to productive use and reward them accordingly. This is a question that again goes to management capability.

Management capability is critical in identifying skill needs and making use of skills in the workplace. On this note I would refer to a recent paper from Roy Green at UTS in Sydney that was prepared for a SCOTESE industry forum where he drew out the wealth of international and national evidence to demonstrate the importance of management capability to the use of skills in the workplace.

There is scope we see for a much improved general capability in skills analysis, workplace planning and development from employers, including supervisors and frontline management. Our affiliates report to us that there is a serious capability deficiency in these areas at present.

Time I’m sure is up, so just to finish up. We should celebrate the role that VET plays with social inclusion, but it is not something we can take for granted. The role of VET in social inclusion must be vigorously defended and promoted, and supported by concrete measures and initiatives along the lines I have put forward today.



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