O’Connor flags $3.7bn injection into vocational education

Skills Minister Brendan O’Connor has flagged a $3.7bn federal injection into vocational education over five years, saying the sector needed to be overhauled to ensure students were being equipped with the right skills.

Skills and Training Minister Brendan O'Connor. Picture:NCA NewsWire/Andrew Taylor

Skills Minister Brendan O’Connor has flagged a $3.7bn federal injection into vocational education over five years, saying the sector needed to be overhauled to ensure students were being equipped with the right skills.

Mr O’Connor on Sunday said the VET system had a high number of qualifications and micro-credentials “with significant duplication”. There were 5000 units with more than 70 per cent overlap with at least one other unit.

“Australia’s qualifications system has been largely unchanged since the 1990s and is no longer fit-for-purpose,” he said. “Due to transferable skills being poorly recognised, students may need to undertake duplicate additional training that delivers similar skills to those they already have in order to move into a new job.

“In fact, to move from their first occupation, into a new specialisation, then into management role and into a new industry, they could need to undertake four qualifications, which would take 10 years.

“The Albanese government will work with states and territories, unions and industry to make the qualifications system easier to understand, and focused on giving Australians transferable and relevant skills they need now and in the future.”

A signature announcement of the jobs summit was a $1bn joint commitment from federal Labor and the states to fund 180,000 free TAFE places next year.

Mr O’Connor said the Albanese government wanted to invest an extra $3.7bn into the sector from January 2024 as part of a five-year agreement with the states, but state governments would need to commit to a funding injection and agree to reform the sector. “The state and territory ministers agree in principle with me (that) we need to reform the sector so we’re providing the skills necessary,” Mr O’Connor told the ABC’s Insiders program.

“Frankly, this is one of the biggest, most important areas of public policy in relation to feeding the labour market, providing the skills employers are crying out for. In terms of secure employment, what more important thing could be for a worker to have than the skills in demand?

“If we don’t get the skill-set right, we don’t provide security of employment, skills that employers need and a growing economy, improved productivity, which of course places downward pressure on prices at a time of high inflation – these are critical areas.”

Mr O’Connor said the $3.7bn figure was “subject to negotiation” and he was having discussions with Jim Chalmers.

“Those discussions have been had but remember, it is predicated on agreement with the states and territories to ensure that we have the reforms so it’s fit-for-purpose for students, current workers and the labour market that needs the skills now and the skills in demand in the future.”