June 26, 2025 • 30 mins
🎙 In this episode of the RTO Superhero Podcast, Angela Connell-Richards, with Lauren Hollows, dives into one of the biggest funding battles in Australia’s VET sector—the growing inequality between TAFE NSW and private RTOs.
Private RTOs are under increasing pressure as TAFE NSW now receives 80% of all Smart and Skilled funding—despite data showing private providers deliver better outcomes at lower costs.
🚨 Here’s what’s at stake:
- 📊 Private RTOs boast higher completion rates (54%) vs. TAFE’s 43%
- đź’° For every $1 spent on a private RTO, $3.34 is spent on TAFE
- âś… Student and employer satisfaction consistently favours private providers
Angela explores the real impact of this funding imbalance, from regional RTO closures to TAFE’s capacity crisis—outdated facilities, digital access issues, and staff shortages.
She also uncovers the hidden flaw in “fee-free” training: ❗️low student commitment and poor completion rates, leading to wasted resources and skills shortages.
✅ What you’ll learn in this episode:
- Why the “dodgy RTO” myth doesn’t hold up to the data
- How current funding decisions risk collapsing the support ecosystem for quality training
- The unintended consequences of centralising training delivery
- What we must do now to protect student choice, innovation, and training diversity in Australia
🎧 Tune in to join the fight for fair, equitable funding—and learn how you can take action.
✍️ Sign the petition: change.org/save_private_rtos
Join host Angela Connell-Richards as she opens each episode with a burst of insight and inspiration. Discover why compliance is your launchpad to success, not a limitation.
Connect with fellow RTO professionals in our free Facebook groups: the RTO Community and RTO Job Board. Visit rtosuperhero.au/groups to join today.
Wrap up with gratitude and guidance. Subscribe, leave a review, and join our community as we continue supporting your compliance journey in vocational education.
Thank you for tuning in to the RTO Superhero Podcast!
We’re excited to have you join us as we focus on the Revised Standards for RTOs in 2025. Together, we’ll explore key changes, compliance strategies, and actionable insights to help your RTO thrive under the new standards.
Stay connected with the RTO Community:
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✔ Share this episode with your RTO network—compliance is a team effort!
🎙 Listen now and get ahead of the compliance changes before it’s too late!
📢 Want even more compliance insights? Subscribe to our EduStream YouTube Channel for our FAQ series on the New Standards for RTOs 2025! 🎥
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✉️ Email us at hello@vivacity.com.au
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:12):
Welcome to the RTO Superhero Podcast with me Angela
Connell-Richards and co-hostLauren Hollows.
Welcome, lauren, hey, hey.
So we've got a hot topic todayand Lauren's going to be
interviewing me.
With regards to the hot topicthat's going around is
(00:32):
government funding and whetherit's fair that majority of the
funding is going to TAFE andwhat the impacts are being on
private RTOs.
Let's dive into it, Lauren.
Love to have you back on theshow.
Speaker 2 (00:48):
Yeah, very exciting.
So obviously, as many peoplewill now be aware, the new smart
and skilled contracts have comeout.
New South Wales allocatedapproximately 80% of its total
smart and skilled funding toTAFE New South Wales, leaving
about 20 percent for the otherproviders combined.
Angela, you've been leading alot of discussions in and around
(01:12):
this topic, so I guess thefirst question I'll ask you is
it's just do you think thathaving that really heavy
concentration of funding on oneprovider is going to be
sustainable, or are we missingan opportunity here, you know,
to innovate through morebalanced models?
Speaker 1 (01:31):
I think it's very hard to say that any system can
be sustainable when 80% of thesmart and skilled funding is
funneled into a singleinstitution being the public
sector.
In particular, when we look atthe outcomes that TAFE have had
and it's clearly on the recordsof NCVER with regards to the
(01:54):
amount of money and we've workedout that the average is, for
each dollar that you spend withthe private sector, you're
spending $3.34 in the publicsector.
So it's a lot more expensive torun government-funded programs
through TAFE.
And we've just found out thatTAFE have also just had a
(02:16):
payroll increase as well, sothat's going to now even cost
even more.
So that's not just an imbalance, it's a bottleneck.
While TAFE plays a criticalrole, innovation thrives in
ecosystems where there iscompetition and, in particular,
when you've got the diversity ofprivate providers who can
(02:39):
easily respond to industrychanges and deliver training
that is specific to the industryneeds.
Private RTOs often specialiseand regionalise and pivot faster
to meet emerging workforceneeds.
So if we want a VET sectorthat's future fit, we need a
(02:59):
funding model that supports abroad ecosystem, not just one
giant.
Speaker 2 (03:05):
So you know you brought up a couple of
interesting points there thatsupports a broad ecosystem, not
just one giant.
So you know, you brought up acouple of interesting points
there and obviously you know theoutcomes that we get from that
is something that you know a lotof people do like to focus on.
Tafe New South Wales has aroundabout a completion rate of
about 43% and that's obviouslybased on sort of NCVR data,
which can you know?
(03:25):
Look, it can be a little bit,and private providers average
closer to 54% across AQF levels.
Again, look, it can be a littlebit hard to track that through
NCVER data.
But if private providers aredelivering higher completion
rates at lower costs, right,what is the argument for
(03:47):
supporting more through TAFEs?
You know what do you believethe rationale is behind that?
Speaker 1 (03:56):
I think the rationale is the government just want to
look good.
I think it was a politicalpromise that they made that
there will be fee-free placesand I think most ministers don't
(04:21):
understand what thefree placesin TAFE, not understanding the
impact that that's going to haveon private RTOs and the fact
that private RTOs not only costless per course or training that
they're delivering, they alsohave a much higher satisfaction
(04:42):
rating when it comes to thedelivery of that training by
both the students and employersthe employers actually.
They actually prefer theoutcomes that they get from
private training organisationsand that has come up in the
NCVER reporting as well, thatthere is a much higher
(05:03):
satisfaction rating.
Speaker 2 (05:10):
Yeah, so we actually did pull that data.
So that's the vet studentoutcomes.
For anybody that's interested,you can go into the data builder
.
And so when we look at thecomparison of TAFE institutes
versus private trainingproviders, what we see there,
for example, is they do trackthings like you know how they
would recommend the trainingprovider.
Now, I think overall, the datais pretty positive for our
industry.
But if we look at just a coupleof the different points
(05:32):
recommend the training provider,I think it's, you know, around
about between 85% and 86% acrossproviders.
When we look at things likesatisfied with the support
services, 77% of students weresatisfied with TAFE institutes
and 82% with private providers.
Satisfied with the learningresources 82% with TAFE and 85%
(05:57):
with private providers.
And satisfied with the training, overall, 89 and 90%.
So I mean it does say that you,that you know, broadly, I think
, students are happy with thetraining that they're receiving
in our industry.
There's definitely an argumentout there that, um, you know
private providers and we've seenthe terminology over and over
(06:17):
again this year privateproviders are dodgy, uh, they're
providing less quality, they'reproviding less quality, they're
providing, you know, lessquality training, shorter
timeframes.
You know, we've all heard thearguments.
This data doesn't back that up,so do you think that there
really is?
It's a you know?
(06:40):
Is it a problem for our privateproviders that we have not been
able to escape that stigma ofyou know the dodgy private
provider?
Speaker 1 (06:50):
And you know what.
So I've got two sides to this.
Tafe don't get called dodgy.
However, they are often verynon-compliant and we've seen on
a number of occasions like SouthAustralian TAFE it had major
non-compliances a few years backand those non-compliances were
(07:15):
identified as criticalnon-compliances and they were
given an extra three months torectify those non-compliances,
whereas if it had been a privateRTO, it would have been very,
very different.
They would have most probablyhad face cancellation.
So it's unfair how ASQA areeven that are the private RTOs
(07:45):
that hit the headlines and notthe TAFE providers that are also
non-compliant.
So I think it's unfair whathits the headlines.
But also, yes, there have beendodgy providers in the private
sector, but why are theyhighlighted over the outstanding
providers that we do have inthe private sector?
But why are they highlightedover the outstanding providers
(08:07):
that we do have in the privatesector?
Speaker 2 (08:10):
Yeah, yeah, I do think that is a big issue for us
is we don't spend enough timehighlighting the amazing work
that is done in our sector.
You know, like I, work withsome great organizations that
you know deliver regionaltraining out in the Pilbara, or
you know have spent, you know, ahuge amount of money investing
(08:33):
in million dollar technicalfacilities to be able to deliver
telecommunications training.
You know so, and a lot of thesethings don't go, they don't get
highlighted and quite often isbecause the business owners are
in the process of, you know,delivering training and running
a massive business, so you knowthat takes up their time as
(08:53):
opposed to going out andself-promoting themselves or
promoting the industry andthings like that.
so yeah focus on deliveringquality education.
Yeah, absolutely so.
You know, as you said, the datasupports the fact that you know
, there is a lot of qualityoutcomes being delivered in the
private market and, as we'vesaid, the average price per
(09:13):
qualification to completion issitting at a lot lower with a
private provider than a fundedprovider.
This is now going to lead usinto the fact that we've got a
huge amount of training that'sgoing to be diverted supposedly
diverted to TAFE, and I guessone of the questions that I will
ask is whether or not you thinkTAFE is actually going to have
(09:37):
the capacity to deliver on this,because we've certainly seen it
in the past.
We saw it in South Australia ithappened about five years ago
where all the funding wasdiverted to SA TAFE.
It lasted for about a year andthen the government had to reel
in reverse course because theTAFE just simply didn't have the
capacity to be able to deliver.
(09:58):
You know, do you think we'regoing to see something similar
here, whereby you know thatthey're just not going to be
able to, or are we going to seesomething like what we saw in
Victoria, whereby the VictorianTAFEs just basically went out,
set up a huge amount of thirdparty agreements with private
RTOs, and so the training lookedlike it was being done on the
books by the TAFEs, but I wouldsay there was a good solid
(10:20):
proportion of that that wasactually being done by private
RTOs via third-partyarrangements.
Speaker 1 (10:25):
And I think well done , victoria for doing that.
That makes it a lot more evenplaying field.
But let's be honest, TAFE can'tdo it all.
They don't have theinfrastructure, they don't have
the team, they don't have thetech technology.
They've got staff shortages.
They don't have the facilities,for example, for age care,
(10:49):
delivering age care and digitalaccess issues.
They also don't have theinfrastructure, in particular,
when it comes to deliveringtraining in regional areas,
which is where a lot of thesmall RTOs are being impacted,
because in regional, they're notgetting the government funding
either and they're out theredelivering in those smaller
(11:13):
regional areas.
So I think, in a snapshot, no,I don't think TAFE has the
infrastructure there when itcomes to the delivery of
training.
And then the other side of thisand this is something I've been
pointing out with our petitionis with the reduction.
(11:33):
Yes, it could be.
You know, private providersthey need to lay off staff or
they'll be laying off trainers,they'll be laying off admin
staff.
They're not all suitable forTAFE.
So, even moving over to TAFEand there are some providers
that will need to shut downthose owners of the RTOs they're
not going to work for TAFE,like you can't have people,
(11:57):
entrepreneurs working in agovernment-framed system.
I know this personally becauseI've done it myself and it
didn't work.
So we and that's the thing withentrepreneurs they're a lot
more innovative, they're a lotmore flexible, they can change
and meet industry needs a lotquicker than TAFE can, and where
(12:20):
TAFE are right now, theydefinitely don't have the
infrastructure to be able to dothis.
Speaker 2 (12:26):
So you know it's interesting because, like the
New South Wales 2024-2025 budgetis $2.5 billion for TAFE and
further expands out fee-freetraining under, you know, joint
state and federal initiativesthat's come out in the New South
Wales budget.
For those that want to followup on the source, and there is
obviously look, there isobviously the political, as you
(12:48):
mentioned, of this sort of like,you know, fee-free TAFE.
I guess I'm interested to kindof get your thoughts on.
You know, okay, I guess we wantto promote, we want to promote
the vet sector.
There is a massive, you know,amount of the public that you
know, even when I'm explainingwhat I do, I have to, I often
(13:10):
have to go.
You know I provide supportservices to, you know, tafes and
private providers who are likeprivate TAFEs.
You know I provide supportservices to, you know, tafes and
private providers who are likeprivate TAFEs.
You know to sometimes get itacross the line.
But how do we balance that withone, I guess, a need for more
equitable funding.
But also, is the fee-freereally the way to go about
(13:32):
marketing and advertising andbringing more people in?
Because you know part of melooks at it as well and goes
well in certain states.
There's a reason why studentshave to pay something, because
if you're not willing to pay adollar for your course, right,
what's the value that you see init?
And therefore you know quiteoften when we do see these
(13:52):
fee-free courses, we seecompletion rates bloody tank
through the floor.
So you know sort of what's yourthought on.
You know, quite often when wedo see these fee-free courses,
we see completion rates bloodytank through the floor.
So you know sort of what's yourthought on.
You know the sort of thepolitical appeal, the fee-free
TAFEs, and then also you knowgiving some value to the
training that we're providing aswell.
Speaker 1 (14:08):
Yeah, and I've seen this myself If there's no buy-in
by the student, they tend to,oh, I'll just sign up for this
course because I don't have topay for it, and then they don't
even turn up, not even on dayone.
So, yes, 100,000 fee-freeplaces, but are we actually
(14:30):
completing that training?
Are the students actually goingto fulfil all the training and
then get the certificate at theend?
And often not, because theydon't have that buy-in.
And unfortunately, I've seen itmany, many times over my 30
years of experience within thistraining industry is where a
student doesn't have buy-in,they tend to not be fully
(14:54):
committed to that training anddo not complete it.
And then you've got the otherside, where they're going to job
network providers or job activeproviders who are trying to get
them into work and they're justplacing them into course after
course after course because theycan't get the student to
complete the training.
So once again, the student isnot getting the buy-in.
(15:16):
I think there should be anon-animal admin fee for them to
commence the training, or evensomething like where, if there's
an incentive if they completethe training, what's that
incentive when they get to theend of the training?
But you know, then we need tolook at it.
(15:37):
On the other side, privateproviders have a much more
successful completion rating,and maybe that's because they
may even have full fees paidthrough government funding, but
they've got the staff there thatare keeping those students
(15:58):
going and getting them tocomplete the training.
So you know, maybe TAFE needsto look at how private providers
do that or maybe engage morewith the private providers.
I don't know what makes thedifference, but yes, I certainly
believe that the buy-in is onevery good strategy.
Speaker 2 (16:19):
And I mean, I think it's going to be interesting to
see, obviously with the newstandards that come into effect
from the 1st of July courseprogression is.
You know, is now part of the,you know, usual standards and
we've seen it in a lot ofgovernment funding contracts.
Obviously it sits in ESOS aswell, but you know, it's going
to be interesting to see.
There are obviously also a lotof private, like there's a lot
(16:42):
of providers out there, privateand public alike, that are not
used to having you know like yousign up for a course and
there's no tracking that occursafter that.
Um, so it's, it is going to bevery interesting to see.
You know, like, having gonethrough so many RTOs data and
I'll go into it you know someone, someone's bought new RTO and I
(17:05):
sit there and I go, you've gotyou know, oh, but we bought
4,000 students.
No, you've got 4,000 enrolled,but know, actually you've got
500 students that are regularlycompleting a unit of competency.
You've got three and a halfthousand students in there that
have been enrolled for more than12 months and haven't even
logged into the system once.
(17:25):
So you know, I think thatprogression component is going
to be an interesting part of thenew standards and that's then
going to tie into, you know,your support services and you
know your systematic monitoringof the courses and things like
that as well.
Speaker 1 (17:40):
And I think that applies for both private and
public.
I think TAFE are also going tostruggle with that because, as
we already have seen, completionratings are not that high when
it comes to TAFE.
How are they going to managethat as well?
And I've been doing a lot ofwebinars and workshops exactly
on this topic and also buildingour new system, comply Hub,
(18:04):
where we manage the continuousimprovement and risk assessment
through this system, becausewhat I've seen is there is a lot
more requirements on thattracking and the focus is on
completion ratings.
We want to get a highercompletion rating, so how are
RTOs going to manage that?
(18:24):
And I've looked at differentstrategies that our clients can
put into place for managing that.
I just can't see TAFE would beable to do that.
Not with their current model,that is for sure.
Speaker 2 (18:38):
I think, with their current systems as well.
So I mean, unfortunately, a lotof the tastes are limited in
that they're not allowed to goout and buy commercial systems.
They have to build their ownsystems, which means you know a
huge IT infrastructure cost thatis then associated with setting
up the system and maintainingthe system and you know all of
the sorts of things that comealong with it, and so you often
(19:01):
get into a really difficultposition whereby you're
constantly having to maintain anolder system rather than being
able to utilize that same amountof money for a commercially
available system whereby they'vegot multiple clients and
therefore they can invest infuture-proofing and improving
and all these sorts of things.
(19:21):
So it's definitely a lot ofgovernment.
There's definitely a lot oflimitations that you know occur
when you've got such a largeinfrastructure.
And I've been talking to youknow ministers for years and
I've always said the same thingwhy don't you guys have a
centralised curriculumdevelopment department for all
of the TAFEs?
You currently pay every singleTAFE to create.
(19:42):
They've got their owncurriculum that they create for
the same qualifications.
If you centralize that, itwould save billions a year, like
legitimately, and then youcould send it out to everyone
and they can contextualize itfor their cohort or their thing.
But they've got a base there.
For I mean there should bewithin TAFE a database, a base
(20:05):
training product and a basecompliant assessment for every
single unit of competency andtraining package.
They don't have that becauseit's outsourced to every TAFE
individually, like it's justsome of those sorts of things
where, like from a businessperspective, you and I would go.
Speaker 1 (20:20):
This is business 101, right and yeah, that's
something I didn't know.
I didn't know that they didthat.
That's crazy as a as anentrepreneur.
Uh, there's no way I would dothat.
You you'd want it.
Like when I had my RTO.
Um, so I, I had a smaller RTOand I took over another site and
(20:43):
I didn't.
I took over the students andthe trainers and assessors.
I didn't take over the RTO, butwhat I did was, when I went in,
the first thing I did I didn'tkeep their systems.
I implemented all of ourexisting systems into that RTO.
Like why run different systemswhen you've got a system that
(21:04):
works really well?
Like you should have one reallygood system that works well and
everyone works on that.
Like all of the different TAFEsshould be working on that same
system.
And maybe you should have thesame curriculum, because it's a
national curriculum.
But you may have adjustmentswhen it comes to different
(21:25):
states with what are the statefunding requirements in those
individual sectors.
But yeah, that's crazy.
Yeah, it's crazy right.
Speaker 2 (21:33):
It's crazy.
So, like you know, I guess onthat point, you know
infrastructure and staffinglimitations.
So there has literally justbeen $190 million in allocation
for repairs and IT upgrades.
But according to the New SouthWales budget and some media
coverage, you know, tafe NewSouth Wales campuses continue to
(21:56):
face equipment shortages,digital access issues and casual
staff turnover.
And I think look the casualstaff turnover I think that's
probably more of an industryepidemic.
Again, we've got the new RTOstandards.
So anyone that's got just theirTAA.
They don't have to have the ASSand the LLN unit anymore.
That may bring a bit more ofsome of our, you know, trainers
(22:16):
in their like late 50s, 60s and70s back into that trainer pool
to kind of go look, all right,I'll do a couple of days here
and there, but you know, can welike if they can't absorb the
system's training load andprivate RTOs are edged out?
You know what is the option forbusinesses and I know that you
(22:38):
know, as you said, you've gotthis.
You've got a petition that Ithink you said has raised about
800 so far.
So talk to us a little bitabout sort of how, what then
happens with training in NewSouth Wales and what you guys
are doing on that particularpoint?
Speaker 1 (22:56):
Yeah, so we've had a major impact on vivacity.
So we've had a number of ourclients who have had to.
They haven't left theirmembership, but they've dropped
down in their level ofmembership and that is due to
lack of funds.
So there's been like, not onlyare we dealing with all of these
(23:20):
cuts to government funding whenit comes to the private sector,
we're also dealing with majorlegislative change and there's
more to come.
We've still got the AustralianQualifications Framework.
That's still to come, thosechanges in that area.
But so we've got all of theseRTOs who are struggling to
update all of their policies,procedures, forms and
(23:41):
documentation to meet the newrequirements of the Standards
2025, as well as having allthese government funding cuts.
So what I see is I'm going tosee I'm sure we're going to see
over the next year, massiveexodus out of the sector because
of both of these areas, like,how can they afford to update
(24:04):
all of their policies,procedures, forms and documents
and whether they're puttingtheir own time in or paying
someone else to do it, whenthey're struggling to get
students or struggling to dofee-for-service, or they haven't
got the government funding, inparticular, those RTOs that have
been running on governmentfunding for a very, very long
time and we've got one suchclient who has said that I can
(24:26):
state who they are.
This is New South WalesFisheries.
They lost 60% of theirgovernment funding and their
core is government funding.
That's what they do.
They do boat licensing and it'sa requirement in New South
Wales to have a boat licence andthey need this government
funding to be able to do this.
And I don't know where thefunding is going because there's
(24:48):
no TAFE equivalent to the boatlicensing that they do and the
equipment that they have inplace.
So we started this survey.
It'll be a week tomorrow, soSaturday, so it's been a week
that we've had the survey going.
We've now got over 100 on thesurvey and the whole point of
(25:11):
the survey is to supportequitable funding for private
RTOs in Australia's VET sectorand we're looking at the impact
that it's having on the privatesector and not just private RTOs
.
It's all of the supportservices that align with that,
such as student managementsystems, databases, training
(25:34):
resources, resource developers,training rooms where they're
hiring the training rooms, likeit's not just impacting on the
private RTOs, it's all of thoseservices that connect with that
and, as you already stated,lauren, tafe do all of that
(25:54):
internally, so it's going tohave an impact.
So you know all of thistraining that they're providing
to help, you know, australia,they're putting all these people
out of work who are then goingto need to go to TAFE and maybe
retrain into something else, sothey're really going to be
impacting.
This.
Government funding is impactingmore than just RTO private
(26:18):
providers and some of thefeedback that I've been getting,
because I've been sharing thissurvey around on social media
and through emails, and some ofthe feedback that I've been
getting because I've beensharing this survey around on
social media and through emailsand some of the feedback I'm
getting is well, why should itall go to private providers and
money hungry private providersand I'm like New South Wales
fisheries is a not-for-profitthere are a lot of
(26:40):
not-for-profits that are alsobeing affected, not just
money-hungry RTOs.
And I tell you, what if therewere money-hungry RTOs, I don't
think there are very many outthere that are actually
surviving on just what they'redelivering in for as a training
(27:02):
provider.
They're surviving because ofthe other services that they
offer outside of being an RTO.
There is not a lot of money inRTOs right now unless you're
really, really niche and you'redelivering training that is
specifically meeting industryneeds, and that's because of the
culture we have in Australia.
In Australia, unfortunately,australians see education and
(27:28):
training is a right and theyshouldn't have to pay for it,
and that's because we haveschools that they go to.
So they're brought up inschools where the government
pays for you to go to school.
So their expectation is thatyou should pay for their
education ongoing and then yougo to university and you can get
a HECS loan and you pay it offthrough your tax.
(27:50):
But we don't have that same inthe VET sector, so the
expectation is we should get itfor free.
So we're going to go to TAFEand we'll get our fee-free
training at TAFE instead offocused on what is the quality
outcomes that we've got.
So if anybody wants to sign upto our survey, so go to
(28:12):
changeorgau backslash, saveunderscore, private underscore,
rtos and that's the survey thatyou can go to and the link will
be in the show notes for thepodcast today as well.
Speaker 2 (28:29):
Well, I think that's a really great place to break.
I do want to bed down a littlebit more and get into the
conversation about whatequitable funding could look
like.
We'll talk a little bit aboutthe other states as well, but we
might take a break here andwe'll see everybody back at the
next episode.
Speaker 1 (28:46):
Great.
Thank you very much, lauren.
As you can hear, I'm verypassionate about what is
happening currently in thetraining sector.
So until next time, we'll seeyou on the next episode of the
RTO Superhero Podcast.
Thanks, guys, excellent.
Welcome to the RTO Superhero Podcast with me Angela
Connell-Richards and co-hostLauren Hollows.
Welcome, lauren, hey, hey.
So we've got a hot topic todayand Lauren's going to be
interviewing me.
With regards to the hot topicthat's going around is
(00:32):
government funding and whetherit's fair that majority of the
funding is going to TAFE andwhat the impacts are being on
private RTOs.
Let's dive into it, Lauren.
Love to have you back on theshow.
Speaker 2 (00:48):
Yeah, very exciting.
So obviously, as many peoplewill now be aware, the new smart
and skilled contracts have comeout.
New South Wales allocatedapproximately 80% of its total
smart and skilled funding toTAFE New South Wales, leaving
about 20 percent for the otherproviders combined.
Angela, you've been leading alot of discussions in and around
(01:12):
this topic, so I guess thefirst question I'll ask you is
it's just do you think thathaving that really heavy
concentration of funding on oneprovider is going to be
sustainable, or are we missingan opportunity here, you know,
to innovate through morebalanced models?
Speaker 1 (01:31):
I think it's very hard to say that any system can
be sustainable when 80% of thesmart and skilled funding is
funneled into a singleinstitution being the public
sector.
In particular, when we look atthe outcomes that TAFE have had
and it's clearly on the recordsof NCVER with regards to the
(01:54):
amount of money and we've workedout that the average is, for
each dollar that you spend withthe private sector, you're
spending $3.34 in the publicsector.
So it's a lot more expensive torun government-funded programs
through TAFE.
And we've just found out thatTAFE have also just had a
(02:16):
payroll increase as well, sothat's going to now even cost
even more.
So that's not just an imbalance, it's a bottleneck.
While TAFE plays a criticalrole, innovation thrives in
ecosystems where there iscompetition and, in particular,
when you've got the diversity ofprivate providers who can
(02:39):
easily respond to industrychanges and deliver training
that is specific to the industryneeds.
Private RTOs often specialiseand regionalise and pivot faster
to meet emerging workforceneeds.
So if we want a VET sectorthat's future fit, we need a
(02:59):
funding model that supports abroad ecosystem, not just one
giant.
Speaker 2 (03:05):
So you know you brought up a couple of
interesting points there thatsupports a broad ecosystem, not
just one giant.
So you know, you brought up acouple of interesting points
there and obviously you know theoutcomes that we get from that
is something that you know a lotof people do like to focus on.
Tafe New South Wales has aroundabout a completion rate of
about 43% and that's obviouslybased on sort of NCVR data,
which can you know?
(03:25):
Look, it can be a little bit,and private providers average
closer to 54% across AQF levels.
Again, look, it can be a littlebit hard to track that through
NCVER data.
But if private providers aredelivering higher completion
rates at lower costs, right,what is the argument for
(03:47):
supporting more through TAFEs?
You know what do you believethe rationale is behind that?
Speaker 1 (03:56):
I think the rationale is the government just want to
look good.
I think it was a politicalpromise that they made that
there will be fee-free placesand I think most ministers don't
(04:21):
understand what thefree placesin TAFE, not understanding the
impact that that's going to haveon private RTOs and the fact
that private RTOs not only costless per course or training that
they're delivering, they alsohave a much higher satisfaction
(04:42):
rating when it comes to thedelivery of that training by
both the students and employersthe employers actually.
They actually prefer theoutcomes that they get from
private training organisationsand that has come up in the
NCVER reporting as well, thatthere is a much higher
(05:03):
satisfaction rating.
Speaker 2 (05:10):
Yeah, so we actually did pull that data.
So that's the vet studentoutcomes.
For anybody that's interested,you can go into the data builder
.
And so when we look at thecomparison of TAFE institutes
versus private trainingproviders, what we see there,
for example, is they do trackthings like you know how they
would recommend the trainingprovider.
Now, I think overall, the datais pretty positive for our
industry.
But if we look at just a coupleof the different points
(05:32):
recommend the training provider,I think it's, you know, around
about between 85% and 86% acrossproviders.
When we look at things likesatisfied with the support
services, 77% of students weresatisfied with TAFE institutes
and 82% with private providers.
Satisfied with the learningresources 82% with TAFE and 85%
(05:57):
with private providers.
And satisfied with the training, overall, 89 and 90%.
So I mean it does say that you,that you know, broadly, I think
, students are happy with thetraining that they're receiving
in our industry.
There's definitely an argumentout there that, um, you know
private providers and we've seenthe terminology over and over
(06:17):
again this year privateproviders are dodgy, uh, they're
providing less quality, they'reproviding less quality, they're
providing, you know, lessquality training, shorter
timeframes.
You know, we've all heard thearguments.
This data doesn't back that up,so do you think that there
really is?
It's a you know?
(06:40):
Is it a problem for our privateproviders that we have not been
able to escape that stigma ofyou know the dodgy private
provider?
Speaker 1 (06:50):
And you know what.
So I've got two sides to this.
Tafe don't get called dodgy.
However, they are often verynon-compliant and we've seen on
a number of occasions like SouthAustralian TAFE it had major
non-compliances a few years backand those non-compliances were
(07:15):
identified as criticalnon-compliances and they were
given an extra three months torectify those non-compliances,
whereas if it had been a privateRTO, it would have been very,
very different.
They would have most probablyhad face cancellation.
So it's unfair how ASQA areeven that are the private RTOs
(07:45):
that hit the headlines and notthe TAFE providers that are also
non-compliant.
So I think it's unfair whathits the headlines.
But also, yes, there have beendodgy providers in the private
sector, but why are theyhighlighted over the outstanding
providers that we do have inthe private sector?
But why are they highlightedover the outstanding providers
(08:07):
that we do have in the privatesector?
Speaker 2 (08:10):
Yeah, yeah, I do think that is a big issue for us
is we don't spend enough timehighlighting the amazing work
that is done in our sector.
You know, like I, work withsome great organizations that
you know deliver regionaltraining out in the Pilbara, or
you know have spent, you know, ahuge amount of money investing
(08:33):
in million dollar technicalfacilities to be able to deliver
telecommunications training.
You know so, and a lot of thesethings don't go, they don't get
highlighted and quite often isbecause the business owners are
in the process of, you know,delivering training and running
a massive business, so you knowthat takes up their time as
(08:53):
opposed to going out andself-promoting themselves or
promoting the industry andthings like that.
so yeah focus on deliveringquality education.
Yeah, absolutely so.
You know, as you said, the datasupports the fact that you know
, there is a lot of qualityoutcomes being delivered in the
private market and, as we'vesaid, the average price per
(09:13):
qualification to completion issitting at a lot lower with a
private provider than a fundedprovider.
This is now going to lead usinto the fact that we've got a
huge amount of training that'sgoing to be diverted supposedly
diverted to TAFE, and I guessone of the questions that I will
ask is whether or not you thinkTAFE is actually going to have
(09:37):
the capacity to deliver on this,because we've certainly seen it
in the past.
We saw it in South Australia ithappened about five years ago
where all the funding wasdiverted to SA TAFE.
It lasted for about a year andthen the government had to reel
in reverse course because theTAFE just simply didn't have the
capacity to be able to deliver.
(09:58):
You know, do you think we'regoing to see something similar
here, whereby you know thatthey're just not going to be
able to, or are we going to seesomething like what we saw in
Victoria, whereby the VictorianTAFEs just basically went out,
set up a huge amount of thirdparty agreements with private
RTOs, and so the training lookedlike it was being done on the
books by the TAFEs, but I wouldsay there was a good solid
(10:20):
proportion of that that wasactually being done by private
RTOs via third-partyarrangements.
Speaker 1 (10:25):
And I think well done , victoria for doing that.
That makes it a lot more evenplaying field.
But let's be honest, TAFE can'tdo it all.
They don't have theinfrastructure, they don't have
the team, they don't have thetech technology.
They've got staff shortages.
They don't have the facilities,for example, for age care,
(10:49):
delivering age care and digitalaccess issues.
They also don't have theinfrastructure, in particular,
when it comes to deliveringtraining in regional areas,
which is where a lot of thesmall RTOs are being impacted,
because in regional, they're notgetting the government funding
either and they're out theredelivering in those smaller
(11:13):
regional areas.
So I think, in a snapshot, no,I don't think TAFE has the
infrastructure there when itcomes to the delivery of
training.
And then the other side of thisand this is something I've been
pointing out with our petitionis with the reduction.
(11:33):
Yes, it could be.
You know, private providersthey need to lay off staff or
they'll be laying off trainers,they'll be laying off admin
staff.
They're not all suitable forTAFE.
So, even moving over to TAFEand there are some providers
that will need to shut downthose owners of the RTOs they're
not going to work for TAFE,like you can't have people,
(11:57):
entrepreneurs working in agovernment-framed system.
I know this personally becauseI've done it myself and it
didn't work.
So we and that's the thing withentrepreneurs they're a lot
more innovative, they're a lotmore flexible, they can change
and meet industry needs a lotquicker than TAFE can, and where
(12:20):
TAFE are right now, theydefinitely don't have the
infrastructure to be able to dothis.
Speaker 2 (12:26):
So you know it's interesting because, like the
New South Wales 2024-2025 budgetis $2.5 billion for TAFE and
further expands out fee-freetraining under, you know, joint
state and federal initiativesthat's come out in the New South
Wales budget.
For those that want to followup on the source, and there is
obviously look, there isobviously the political, as you
(12:48):
mentioned, of this sort of like,you know, fee-free TAFE.
I guess I'm interested to kindof get your thoughts on.
You know, okay, I guess we wantto promote, we want to promote
the vet sector.
There is a massive, you know,amount of the public that you
know, even when I'm explainingwhat I do, I have to, I often
(13:10):
have to go.
You know I provide supportservices to, you know, tafes and
private providers who are likeprivate TAFEs.
You know I provide supportservices to, you know, tafes and
private providers who are likeprivate TAFEs.
You know to sometimes get itacross the line.
But how do we balance that withone, I guess, a need for more
equitable funding.
But also, is the fee-freereally the way to go about
(13:32):
marketing and advertising andbringing more people in?
Because you know part of melooks at it as well and goes
well in certain states.
There's a reason why studentshave to pay something, because
if you're not willing to pay adollar for your course, right,
what's the value that you see init?
And therefore you know quiteoften when we do see these
(13:52):
fee-free courses, we seecompletion rates bloody tank
through the floor.
So you know sort of what's yourthought on.
You know, quite often when wedo see these fee-free courses,
we see completion rates bloodytank through the floor.
So you know sort of what's yourthought on.
You know the sort of thepolitical appeal, the fee-free
TAFEs, and then also you knowgiving some value to the
training that we're providing aswell.
Speaker 1 (14:08):
Yeah, and I've seen this myself If there's no buy-in
by the student, they tend to,oh, I'll just sign up for this
course because I don't have topay for it, and then they don't
even turn up, not even on dayone.
So, yes, 100,000 fee-freeplaces, but are we actually
(14:30):
completing that training?
Are the students actually goingto fulfil all the training and
then get the certificate at theend?
And often not, because theydon't have that buy-in.
And unfortunately, I've seen itmany, many times over my 30
years of experience within thistraining industry is where a
student doesn't have buy-in,they tend to not be fully
(14:54):
committed to that training anddo not complete it.
And then you've got the otherside, where they're going to job
network providers or job activeproviders who are trying to get
them into work and they're justplacing them into course after
course after course because theycan't get the student to
complete the training.
So once again, the student isnot getting the buy-in.
(15:16):
I think there should be anon-animal admin fee for them to
commence the training, or evensomething like where, if there's
an incentive if they completethe training, what's that
incentive when they get to theend of the training?
But you know, then we need tolook at it.
(15:37):
On the other side, privateproviders have a much more
successful completion rating,and maybe that's because they
may even have full fees paidthrough government funding, but
they've got the staff there thatare keeping those students
(15:58):
going and getting them tocomplete the training.
So you know, maybe TAFE needsto look at how private providers
do that or maybe engage morewith the private providers.
I don't know what makes thedifference, but yes, I certainly
believe that the buy-in is onevery good strategy.
Speaker 2 (16:19):
And I mean, I think it's going to be interesting to
see, obviously with the newstandards that come into effect
from the 1st of July courseprogression is.
You know, is now part of the,you know, usual standards and
we've seen it in a lot ofgovernment funding contracts.
Obviously it sits in ESOS aswell, but you know, it's going
to be interesting to see.
There are obviously also a lotof private, like there's a lot
(16:42):
of providers out there, privateand public alike, that are not
used to having you know like yousign up for a course and
there's no tracking that occursafter that.
Um, so it's, it is going to bevery interesting to see.
You know, like, having gonethrough so many RTOs data and
I'll go into it you know someone, someone's bought new RTO and I
(17:05):
sit there and I go, you've gotyou know, oh, but we bought
4,000 students.
No, you've got 4,000 enrolled,but know, actually you've got
500 students that are regularlycompleting a unit of competency.
You've got three and a halfthousand students in there that
have been enrolled for more than12 months and haven't even
logged into the system once.
(17:25):
So you know, I think thatprogression component is going
to be an interesting part of thenew standards and that's then
going to tie into, you know,your support services and you
know your systematic monitoringof the courses and things like
that as well.
Speaker 1 (17:40):
And I think that applies for both private and
public.
I think TAFE are also going tostruggle with that because, as
we already have seen, completionratings are not that high when
it comes to TAFE.
How are they going to managethat as well?
And I've been doing a lot ofwebinars and workshops exactly
on this topic and also buildingour new system, comply Hub,
(18:04):
where we manage the continuousimprovement and risk assessment
through this system, becausewhat I've seen is there is a lot
more requirements on thattracking and the focus is on
completion ratings.
We want to get a highercompletion rating, so how are
RTOs going to manage that?
(18:24):
And I've looked at differentstrategies that our clients can
put into place for managing that.
I just can't see TAFE would beable to do that.
Not with their current model,that is for sure.
Speaker 2 (18:38):
I think, with their current systems as well.
So I mean, unfortunately, a lotof the tastes are limited in
that they're not allowed to goout and buy commercial systems.
They have to build their ownsystems, which means you know a
huge IT infrastructure cost thatis then associated with setting
up the system and maintainingthe system and you know all of
the sorts of things that comealong with it, and so you often
(19:01):
get into a really difficultposition whereby you're
constantly having to maintain anolder system rather than being
able to utilize that same amountof money for a commercially
available system whereby they'vegot multiple clients and
therefore they can invest infuture-proofing and improving
and all these sorts of things.
(19:21):
So it's definitely a lot ofgovernment.
There's definitely a lot oflimitations that you know occur
when you've got such a largeinfrastructure.
And I've been talking to youknow ministers for years and
I've always said the same thingwhy don't you guys have a
centralised curriculumdevelopment department for all
of the TAFEs?
You currently pay every singleTAFE to create.
(19:42):
They've got their owncurriculum that they create for
the same qualifications.
If you centralize that, itwould save billions a year, like
legitimately, and then youcould send it out to everyone
and they can contextualize itfor their cohort or their thing.
But they've got a base there.
For I mean there should bewithin TAFE a database, a base
(20:05):
training product and a basecompliant assessment for every
single unit of competency andtraining package.
They don't have that becauseit's outsourced to every TAFE
individually, like it's justsome of those sorts of things
where, like from a businessperspective, you and I would go.
Speaker 1 (20:20):
This is business 101, right and yeah, that's
something I didn't know.
I didn't know that they didthat.
That's crazy as a as anentrepreneur.
Uh, there's no way I would dothat.
You you'd want it.
Like when I had my RTO.
Um, so I, I had a smaller RTOand I took over another site and
(20:43):
I didn't.
I took over the students andthe trainers and assessors.
I didn't take over the RTO, butwhat I did was, when I went in,
the first thing I did I didn'tkeep their systems.
I implemented all of ourexisting systems into that RTO.
Like why run different systemswhen you've got a system that
(21:04):
works really well?
Like you should have one reallygood system that works well and
everyone works on that.
Like all of the different TAFEsshould be working on that same
system.
And maybe you should have thesame curriculum, because it's a
national curriculum.
But you may have adjustmentswhen it comes to different
(21:25):
states with what are the statefunding requirements in those
individual sectors.
But yeah, that's crazy.
Yeah, it's crazy right.
Speaker 2 (21:33):
It's crazy.
So, like you know, I guess onthat point, you know
infrastructure and staffinglimitations.
So there has literally justbeen $190 million in allocation
for repairs and IT upgrades.
But according to the New SouthWales budget and some media
coverage, you know, tafe NewSouth Wales campuses continue to
(21:56):
face equipment shortages,digital access issues and casual
staff turnover.
And I think look the casualstaff turnover I think that's
probably more of an industryepidemic.
Again, we've got the new RTOstandards.
So anyone that's got just theirTAA.
They don't have to have the ASSand the LLN unit anymore.
That may bring a bit more ofsome of our, you know, trainers
(22:16):
in their like late 50s, 60s and70s back into that trainer pool
to kind of go look, all right,I'll do a couple of days here
and there, but you know, can welike if they can't absorb the
system's training load andprivate RTOs are edged out?
You know what is the option forbusinesses and I know that you
(22:38):
know, as you said, you've gotthis.
You've got a petition that Ithink you said has raised about
800 so far.
So talk to us a little bitabout sort of how, what then
happens with training in NewSouth Wales and what you guys
are doing on that particularpoint?
Speaker 1 (22:56):
Yeah, so we've had a major impact on vivacity.
So we've had a number of ourclients who have had to.
They haven't left theirmembership, but they've dropped
down in their level ofmembership and that is due to
lack of funds.
So there's been like, not onlyare we dealing with all of these
(23:20):
cuts to government funding whenit comes to the private sector,
we're also dealing with majorlegislative change and there's
more to come.
We've still got the AustralianQualifications Framework.
That's still to come, thosechanges in that area.
But so we've got all of theseRTOs who are struggling to
update all of their policies,procedures, forms and
(23:41):
documentation to meet the newrequirements of the Standards
2025, as well as having allthese government funding cuts.
So what I see is I'm going tosee I'm sure we're going to see
over the next year, massiveexodus out of the sector because
of both of these areas, like,how can they afford to update
(24:04):
all of their policies,procedures, forms and documents
and whether they're puttingtheir own time in or paying
someone else to do it, whenthey're struggling to get
students or struggling to dofee-for-service, or they haven't
got the government funding, inparticular, those RTOs that have
been running on governmentfunding for a very, very long
time and we've got one suchclient who has said that I can
(24:26):
state who they are.
This is New South WalesFisheries.
They lost 60% of theirgovernment funding and their
core is government funding.
That's what they do.
They do boat licensing and it'sa requirement in New South
Wales to have a boat licence andthey need this government
funding to be able to do this.
And I don't know where thefunding is going because there's
(24:48):
no TAFE equivalent to the boatlicensing that they do and the
equipment that they have inplace.
So we started this survey.
It'll be a week tomorrow, soSaturday, so it's been a week
that we've had the survey going.
We've now got over 100 on thesurvey and the whole point of
(25:11):
the survey is to supportequitable funding for private
RTOs in Australia's VET sectorand we're looking at the impact
that it's having on the privatesector and not just private RTOs
.
It's all of the supportservices that align with that,
such as student managementsystems, databases, training
(25:34):
resources, resource developers,training rooms where they're
hiring the training rooms, likeit's not just impacting on the
private RTOs, it's all of thoseservices that connect with that
and, as you already stated,lauren, tafe do all of that
(25:54):
internally, so it's going tohave an impact.
So you know all of thistraining that they're providing
to help, you know, australia,they're putting all these people
out of work who are then goingto need to go to TAFE and maybe
retrain into something else, sothey're really going to be
impacting.
This.
Government funding is impactingmore than just RTO private
(26:18):
providers and some of thefeedback that I've been getting,
because I've been sharing thissurvey around on social media
and through emails, and some ofthe feedback that I've been
getting because I've beensharing this survey around on
social media and through emailsand some of the feedback I'm
getting is well, why should itall go to private providers and
money hungry private providersand I'm like New South Wales
fisheries is a not-for-profitthere are a lot of
(26:40):
not-for-profits that are alsobeing affected, not just
money-hungry RTOs.
And I tell you, what if therewere money-hungry RTOs, I don't
think there are very many outthere that are actually
surviving on just what they'redelivering in for as a training
(27:02):
provider.
They're surviving because ofthe other services that they
offer outside of being an RTO.
There is not a lot of money inRTOs right now unless you're
really, really niche and you'redelivering training that is
specifically meeting industryneeds, and that's because of the
culture we have in Australia.
In Australia, unfortunately,australians see education and
(27:28):
training is a right and theyshouldn't have to pay for it,
and that's because we haveschools that they go to.
So they're brought up inschools where the government
pays for you to go to school.
So their expectation is thatyou should pay for their
education ongoing and then yougo to university and you can get
a HECS loan and you pay it offthrough your tax.
(27:50):
But we don't have that same inthe VET sector, so the
expectation is we should get itfor free.
So we're going to go to TAFEand we'll get our fee-free
training at TAFE instead offocused on what is the quality
outcomes that we've got.
So if anybody wants to sign upto our survey, so go to
(28:12):
changeorgau backslash, saveunderscore, private underscore,
rtos and that's the survey thatyou can go to and the link will
be in the show notes for thepodcast today as well.
Speaker 2 (28:29):
Well, I think that's a really great place to break.
I do want to bed down a littlebit more and get into the
conversation about whatequitable funding could look
like.
We'll talk a little bit aboutthe other states as well, but we
might take a break here andwe'll see everybody back at the
next episode.
Speaker 1 (28:46):
Great.
Thank you very much, lauren.
As you can hear, I'm verypassionate about what is
happening currently in thetraining sector.
So until next time, we'll seeyou on the next episode of the
RTO Superhero Podcast.
Thanks, guys, excellent.
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