This paper reports on research commissioned by Service Skills Victoria and undertaken by a research team drawn from Victoria and Federation Universities. It examines the effects of funding changes in Victoria on the range of industries covered by Service Skills Training Packages and qualifications over the period 2008 to 2013. Broadly, the industries in the Service Skills profile cover wholesale, retail and personal services; tourism, travel and hospitality and sport, fitness and recreation. The research approach included quantitative analysis of time-series data from the National Centre for Vocational Education Research (NCVER) and other sources, and a qualitative approach involving invitational forums with employer bodies, private and public providers, and targeted interviews with a range of industry associations, employers, and private and public providers. Submissions were also sought. Victoria was the first jurisdiction to introduce contestable funding and an entitlement scheme. The Victorian approach, implemented over the past five years, is the first and most radical of the jurisdictional approaches and has attracted much criticism. Recognising the controversial nature of the reforms, the paper presents views on the reforms, using a critique of contracted training (Toner 2014) as an analytical framework.
The research found that growth in Service Skills student load, already relatively high in 2008, grew very rapidly and then fell significantly in 2013. This was due to the relative ease with which many of these qualifications could be offered by a wide range of providers, including those that are less than scrupulous. In addition, growth in Service Skills enrolments was higher than the overall rate of enrolment growth in Victoria from 2009 to 2011. It fell back in 2012 and crashed in 2013. In contrast, the rest of Australia was characterised by a far greater stability in the provision of Service Skills qualifications than Victoria from 2008 to 2013. Thus the funding arrangements can be said to have significantly distorted Service Skills training provision in Victoria. Vocational education and training (VET) providers were significantly affected by the (then) Victorian Government's approaches to market control by using 'price' as a major and blunt control leaver. Evidence suggests that providers had to use a variety of coping mechanisms to maintain provision which, in turn, affected the quality of provision. The research concludes that an urgent rethink of the Victorian VET funding model was needed if the system was not to collapse, and if the confidence of both the Service Skills industries and training providers in the Service Skills market were to be restored. Such a review is now taking place.
Published abstract.
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