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Govt wants to smash dodgy VET trainers

AAP logoAAP 24/08/2016

Dodgy training companies who rip off students and taxpayers face having their business model smashed by the federal government

Education Minister Simon Birmingham wants to overhaul the vocational education and training sector, starting in 2017 - though he acknowledges the government will have to get its skates on to change things so quickly.

But things can't continue as they are.

"Nothing can hide that the unethical behaviour of some training providers and their agents has tainted the reputation of the industry as a whole," Senator Birmingham told the Australian Council for Private Education and Training conference in Hobart on Thursday.

The government, regulators and the industry would have to work doubly hard to overcome the reputational damage.

"Our redesign of Labor's flawed VET FEE-HELP scheme will seek to smash the business models of anyone ripping off taxpayers or targeting vulnerable people, whether they be VET providers, brokers or data miners," Senator Birmingham said.

Soaring student numbers and course fees that have tripled on average have led to a blow-out in loans from $325 million in 2012 to $2.9 billion in 2015.

At the same time completion rates have dropped - to fewer than one in 10 at some providers - so students find themselves saddled with debt but no qualifications to help them get a job.

The government will soon announce its full plan to overhaul the sector and Senator Birmingham indicated on Thursday that would likely include caps on how much the government will lend students to cover fees.

"We're confident that if we set ... loan amounts that actually reflect what we believe a reasonable cost of delivery is, that we'll see courses offered within those loan caps," he told ABC radio.

It is also considering which providers can be trusted with government loans, which courses are likely to lead to improved employment outcomes, what course costs are reasonable, and what are acceptable completion rates.

"Vocational education in Australia should never be viewed as a 'second best' option, or anything less than a high quality education and training experience," Senator Birmingham told the conference.

"It is incumbent on us all to ensure that is the case."

Teachers want the government to suspend the VET FEE-HELP loans scheme while it does a complete review of the sector.

"Tinkering at the edges has done nothing to stop the massive rorting that has gone on, and the drop in the quality of training being delivered to students," Australian Education Union federal TAFE secretary Pat Forward said.

"We need to immediately cut off supply of funds to for-profit providers, because they are the ones who are driving the practices which are lowering the quality of training, ripping off taxpayers and damaging the reputation of VET as a whole."

Labor accused the government of further undermining confidence in the VET system and leaving students vulnerable to shonky trainers.

"Problems in the sector have exploded because this government couldn't get its act together," opposition vocational education spokeswoman Kate Ellis said.

"They have let shonky providers off the hook for too long and students and taxpayers are paying a massive price."

Labor had proposed to cap VET loans at $8000 per student, a level that was criticised as not being sufficient to cover the costs of some courses such as agriculture.

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