TAFE NSW to save $80 million on consultants after market-driven VET model overhauled

TAFE NSW will quit the competitive funding market in 2026, saving taxpayers $80 million and freeing teachers from hours of paperwork each semester.

TAFE New South Wales is off the market. Picture: Tim Dodd/The Australian

Australia’s largest vocational education and training provider is officially off the market, saving the state government more than $80 million in curriculum consultant fees over four years in the process.

TAFE NSW will be removed from the ‘contestable market’ from 2026 and will instead be funded through its own recurrent NSW Department of Education budget allocation, in line with recommendations from a 2024 review of the sector.

Since 2015, TAFE has competed against other registered training organisations (RTOs) to access the department’s “Smart and Skilled” funding pool, which allows both public and for-profit providers to offer courses fee-free or at a low cost.

The system meant teachers were required to constantly update student training information so that TAFE could plan how much money it would apply for each year.

The 2024 VET review, led by former federal Department of Education secretary Michelle Bruniges, found “financial caps … had inadvertently impacted provider responsiveness through an overly prescriptive approach that requires constant monitoring and adjustments”.

The 2024 VET review commissioned by the NSW government was led by former Secretary of the Australian Department of Education Michelle Bruniges. Picture: AAP Image/Lukas Coch

Meanwhile TAFE has been spending upwards of $20 million a year outsourcing curriculum design to consultants, money that the Minns government believes can be saved by freeing up TAFE teachers to spend more of their time designing curriculum instead.

Business and Legal Services head teacher at TAFE’s Granville campus Debbie Ferguson said the move will save each teacher at least twelve hours a semester per class, with her colleagues currently spending at least 30 minutes per student “duplicating” compliance documents.

TAFE Granville Business and Legal Services Head Teacher Debbie Ferguson said the move will save each teacher at least twelve hours a semester per class. Picture: Supplied

“We were involved in a pilot (student) ‘training plan’ which in itself is useful, but it’s time consuming to pull it together,” she explained.

“It takes time for the student, for their teacher, and their head teacher, plus time for the admin staff to upload it, but at the end of the day that information is already contained in other TAFE systems.”

Reducing such requirements “could be just the beginning” of timesaving measures for teachers as a result of the guaranteed funding, she said.

NSW Teachers Federation acting president Amber Flohm said the union has long fought for the Smart and Skilled model to be scrapped, after it resulted in campuses being mothballed and educators “diverted away from teaching and learning”.

NSW Teachers Federation deputy president Amber Flohm at the union’s Surry Hills HQ. Picture: Julian Andrews

“The most devastating impact has been on regional and disadvantaged communities, depriving students of the courses they needed to build the skills that both they and the broader community need,” she said.

“The restoration of TAFE NSW as a public asset serving the public good is long overdue.”

In its submission to the VET review, union members described the existing funding model as a “snake consuming its own tail” and “a slow trainwreck”, calling on the government to “trust (teachers) for our expertise in actually creating training for these people that come to us”.

Originally published as TAFE NSW to save $80 million on consultants after market-driven VET model overhauled