Thank you for the invitation to join you today at the 27th National Vocational Education and Training Research – NCVER – Conference.
Firstly, can I acknowledge the participants who are here today, representatives of NCVER and our New Zealand co-hosts, Industry Training Federation and Ako Aotearoa—as well as those from AVETRA and TAFE NSW.
We have a wealth of knowledge and experience here at this conference, and vocational education and training in this country will benefit from your discussions.
I thank you for coming together to share your expertise.
Skills for the future open new opportunities
As we look to the future, our VET sector will play a critical role in ensuring people have the skills they need to navigate increasingly complex careers.
The many strengths of VET means it stands ready to meet those challenges.
It is the largest education sector in Australia, internationally recognised and sought after, and very accessible to people of all backgrounds, interests and ages, at all points in their lives.
Our VET sector has many strengths.
It’s closely aligned with the needs of industry.
There are excellent outcomes for students: nearly 80 per cent of VET graduates secure a job soon after completing training, and graduates in fulltime employment earn a median annual income of about $55,000.
And it has an outstanding international reputation with many nations considering Australia best practice and seeking our expertise – with an estimated export value of $4.8 billion (ABS, 2016-17).
There is no question that our VET system is world-class, and has underpinned Australia’s economic prosperity and growth for more than a century and a half.
The skilled workforce produced through our education system—from universal primary education through our strong school system, world-class universities and our VET system across the nation—is and has always been one of the pillars of our economy.
This places us in a great position to take advantage of the challenges and opportunities before us.
Important research work underway
As always, it is important to be equipped with current data and research.
How well we recognise and respond to change will determine how effectively we can take advantage of those new opportunities.
My department has been supporting the National Centre for Vocational Education Research and others to work with labour market experts and data analysts to determine how vocational education and training can help individuals meet future skills needs.
For example, a recent report from NCVER, by Chandra Shah and Janine Dixon of Victoria University, confirms that employment will continue to shift towards higher skills, but also highlights the importance of replacement demand, particularly among trades.
This helps in our planning and thinking – not only are we going to need more apprentices in these professions—but we’re going to have to develop strategies to retain as many of the experienced tradies as we can, so they can pass on expertise and mentor new tradies.
We’ve also been working with the Department of Jobs and Small Business on a project to create a repository of jobs and skills data that can inform individuals, employers, industry and educational institutions about the changing nature of work and the training that can help people adapt.
We’ve used information from 6 million job ads, tax data, student outcome data and unit text descriptions to classify the core skills, experience and education required for each occupation, and now have a prototype ‘career recommendation engine’ called JEDI – the Jobs and Education Data Integration.
It uses a person’s current or previous employment to understand their current skills before providing recommendations for new jobs which use similar skills.
The project also identifies a user’s skill gap between various recommended jobs before identifying VET courses which will fill the gap.
The future of work in a time of rapid change – the importance of a globally focused VET sector
We know that the workforce is changing because of the increasing use of technology and changing demographics. But strong research is essential to ensuring policy development is effective and focused.
With all the talk of digital platforms, scientific discoveries, rapidly advancing technology and the Fourth Industrial Revolution, we know the future of work is at its heart about people—making sure our people have the skills they need to succeed in this changing environment.
And VET will continue to play a fundamental role in putting people first, and supporting them to thrive.
The Prime Minister established the Industry 4.0 Taskforce to provide guidance and advice in this space.
This taskforce has since become the Industry 4.0 Advanced Manufacturing Forum and is led by the Australian Industry Group.
The Government has also recently created the Digital Transformation Industry Reference Committee – IRC – to oversee efforts across the training sector to adopt future focused skills in response to greater automation and digitalisation of work practices.
The Digital Transformation IRC will work closely with the Industry 4.0 Advanced Manufacturing Forum and include subject matter experts in areas such as advanced manufacturing, cyber, ICT and transport.
It is just another step we are taking to help future-proof the national training system.
The concept of Industry 4.0 came from Germany, and like Australia, Germany has a strong vocational education and training sector.
I was able to visit Germany in my role as Assistant Minister for Vocational Education and Skills and I was impressed by how they operate—living up to the German reputation for efficiency, industriousness and innovation.
I think there is a lot that we can learn from each other and as researchers I’m sure that you will be paying a lot of attention to how they’re managing this period of change.
Our international engagement as a sector is also strong and growing stronger.
Many Australian VET providers are already active in delivering Australian VET qualifications overseas, as well as a growing range of non-formal qualifications.
Many countries in the Asia-Pacific region, and increasingly across Latin America, are looking to develop their workforces with skills that industry needs to drive innovation and productivity, and respond to changes that come with technology disruption and advances.
Leveraging the strengths of our VET system to build capacity in partner countries to develop training systems aligned with the needs of local industry creates further demand for Australian VET expertise and market opportunities for Australian VET stakeholders, including industry experts and training providers.
For these reasons, the Australian Government has been pursuing a comprehensive agenda—both bilaterally and through multilateral fora, to better align training systems in partner countries with those of Australia to facilitate international mobility and trade in services.
This work has focused on capacity building and the development of regional occupational standards in particular industry sectors and regional policy frameworks to support skills recognition and labour mobility, involving a number of countries including China, Indonesia, Peru, the Philippines and Vietnam.
Australia’s work also involves the promotion and development of innovative training products to meet local labour market demands.
We’ll continue to work with the sector to ensure flexible policy frameworks are in place that create a positive and enabling operating environment to support international VET activities.
VET and Universities – complementary strengths in our tertiary education sector
My vision for the VET sector is to see it restored to its traditional status as one of the pillars of our tertiary education system.
Now while I believe Australians have always understood the critical role of VET, in particular the opportunities that training institutions can provide Australian kids—good jobs in trades, business and industry; real skills which lead to real careers.
The higher education sector has done extremely well over many years now to sell the dream that a degree is the best, if not the only, pathway to a job and employment security.
And the success that unis have been able to achieve in selling this message has often come at the expense of the VET sector.
But I want to restore Australian’s faith in the VET sector, as an educational pathway that has served communities, businesses, industry and our economy for decades.
In fact, it is imperative that VET is restored to its traditional status as an equivalent pathway to qualifications and employment—so that we can start the transformative process of reimaging the tertiary education sector as a whole.
We must consider how we integrate the strengths of universities and VET to deliver the best outcomes for students, for business and industry, and our future economy.
The Real Skills for Real Careers initiative was devised to raise awareness, unify and promote the VET sector.
We’ve also addressed a number of other key problems, especially putting an end to the shonky providers who roped in students, saddled them with debt and then offered very little in return, sometimes handing them worthless qualifications.
The VET Student Loans program, in place since 1 January last year, is also building that confidence.
We’ve seen a rising rate of VET program completions—jumping five percentage points for programs commencing in 2016 compared with programs commencing in 2015.
And today I am very pleased to announce further change to better protect VET Student Loans students.
The Government is extending the Tuition Protection Service that currently supports international students when their provider ceases their course, across VET Student Loans and non-university higher education FEE-HELP providers.
Pending the passage of legislation, from 2019 onward, if a provider closes or ceases a course, the expanded tuition protection service will support students to continue their study with another entitled provider.
Consistent with the current Tuition Protection Service, the new arrangements will see providers pay levies—held in sector-specific quarantined accounts—to be used to support students and providers.
The expanded tuition protection service will also fund an incentive payment, which will be paid to VET Student Loans providers and non-university higher education providers who are enrolling students as a replacement provider.
This reform is to strengthen protections for students, and the credibility of the system—all part of rebuilding confidence in the VET sector.
As a government we’re also keenly aware there is more work still to be done to clean up the mess the previous Government left in vocational education with their disastrous VET FEE-HELP scheme.
As I mentioned, we’ve seen strong increases in student course completion rates—well up from the single digit numbers we saw under Labor’s scheme.
But there were thousands of students ripped off and rorted by providers Labor let into VET FEE-HELP. Students who could barely read let alone sign their own name were signed up for courses with nearly no job prospects—sometimes on the promise of inducements like free laptops just to end up with debts they never knew they’d need to pay.
The work of the VET Student Loans Ombudsman, the Department of Education and Training, and the actions of agencies like the ACCC who have taken four operators to court, has resulted in over 2,000 students having $20 million re-credited in HELP debts; and 18 students having their VET FEE-HELP debts re-credited to the value of $263,400.
I look forward to working closely with the fantastic training providers we have in this room and across the country to rebuild the reputation of the sector.
We will also pursue every opportunity and avenue we have to bring some justice to the students who were ripped off.
The other huge body of work is our Skilling Australians Fund.
Together with states and territories, we will create an additional 300,000 apprenticeships and traineeships through $1.5 billion of funding under the Skilling Australians Fund over a five year period.
This federal investment is going to be matched dollar for dollar by the states putting a total of around $3 billion into new programs in the sector—targeted at areas of need, skills in demand and emerging fields.
These are the green shoots of recovery that we will continue to foster together.
Australia’s education system plays a critical role in ensuring our economy continues to grow and thrive.
And our place in the world, as a stable, high-functioning, inclusive nation, built on liberal democratic values and the rule of law, is as much a product of our education system as it is out natural resource wealth and the historical legacy of our Westminster institutions.
Our education system is one built on values of equality and excellence.
And it is those values that will take us into the future—internationally competitive and respected, highly skilled, well-educated and resourceful citizens, ready to make a contribution to the global market, and to communities and business across the country.
The VET sector is a critical part of that.
One of the cornerstones of our economy—and of future growth.
We are in a unique position to consolidate our position, to capitalise on opportunities, using our natural advantages and being able to respond with new training, new skills, a strong workforce.
High quality research to inform our decisions is essential.
Industry, government, business, VET providers, universities, researchers, students – we are all stakeholders in this very important mission, to build the workforce of the future and equip people with the skills to make the most of the future of work.