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ITP Reforms – the Australian Experience

Tertiary Talk - April 2019

In February, Education Minister Chris Hipkins released a proposal to reform the vocational education sector. These promise a once in a generation transformational change to meet current and future challenges, and deliver better outcomes for New Zealand.

The reforms comprises three main proposals:

  • Redefined roles for education providers and industry bodies;
  • An institution, New Zealand Institute of Skills and Technology, bringing together the 16 existing Institutes of Technology and Polytechnics (ITP’s) as a single entity;
  • A unified vocational education funding system.

Similar vocational education reforms have been implemented in Australia, with the States of New South Wales (NSW) and Victoria providing an interesting contrast.

New South Wales

  • The NSW model implemented in 2015/2016, comprised the combination of the ten Government-run vocational institutions into one, united under a single governance, management, and curriculum framework.
  • Key drivers of the NSW reforms were increased competition in the sector, digital disruption, and a need to equip students with skills for the future. This necessitated a need to focus on realising economies of scale, and aligning under a common strategy. The institutions consolidated under a single brand (‘TAFE NSW’) to facilitate collective and effective competition with private providers, limit inefficiencies and drive synergies.
  • What this has achieved in practise is cost efficiencies, reduced duplication and streamlined operation of the TAFE and its associated campuses. Another advantage is unified strategy and branding to drive future growth in students and invest in skills delivery and industry-relevant courses. Recent evidence has suggested that after an initial drop in enrolments at the combined institution, numbers have returned to pre-reform levels and that further growth is promising.
  • Conversely though, there have been concerns raised in NSW that the system may lack the flexibility to respond to local conditions, and that the reforms have benefited Sydney and major towns at the expense of smaller regional centres.

Victoria

  • The Victorian model, with its autonomous governance by institutes, is arguably more responsive to local industry and community needs, conditions, and issues, and evidence there suggests it is better at effectively serving regional communities.
  • Anecdotal evidence has implied that diversity is retained within the sector, as individual institutions retain the ability to mould their own identity and specialisations, ensuring that courses are delivered in partnership with specific local businesses and industry. Broad spread and diversity are said to facilitate, drive, and encourage innovation, different, and strategic thinking.
  • With no common strategic objectives, collaboration is challenging, and each institution pursues its own strategy and competes with one another for students and funding. There is significant duplication across institutes, making cost reductions difficult, and there are no restrictions on scale, size and scope, leading to potential inefficiencies.

The New Zealand reforms present our vocational education sector with unique challenges of how to stabilise the sector, protect regional provision all whilst improving the relevance and responsiveness to current and future changes of skills for learning and work.

Deloitte’s insights from looking at the Australian models is that the details matter in areas such as regional engagement, funding models, centralised vs decentralised services and decision-making, and how those choices play out into the experience that students, staff, employers, industry and other stakeholders have of the education system.

Our future pathway is not yet clear with the reform proposal currently out for consultation with the sector.

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