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Business Community Rejects Government’s Free TAFE Legislation

Business Community Rejects Government’s Free TAFE Legislation
By Jeff Gibbs
The Australian Government’s Free TAFE Bill 2024 (Cth) has faced widespread criticism from the business community, with peak employer organisations and industry groups voicing concerns over its emphasis on public TAFE funding at the expense of independent Registered Training Organisations (RTOs).
The bill proposes permanent funding for at least 100,000 fee-free TAFE places across Australia, positioning TAFE at the core of the vocational training system. However, the Independent Tertiary Education Council Australia (ITECA) and employer groups argue that the policy undermines the critical role of independent RTOs, which train the majority of the country’s skills workforce.
Independent RTOs Deliver Majority of Skills Training
According to the National Centre for Vocational Education Research (NCVER), around 91% of the 5.1 million students in vocational training are enrolled with independent RTOs, which offer specialised, industry-focused training. Despite their proven success, the Free TAFE Bill 2024 would restrict government funding to public TAFE colleges, limiting student choice and access to training.
ITECA Chief Executive Troy Williams highlighted the imbalance in the proposed policy.
“TAFE plays an important role, but it lacks the broad industry coverage and geographic reach of independent RTOs. Government policy should support the complementarity of these providers rather than prioritising one over the other,” he said.
Business Groups Raise Concerns
In submissions to the Senate inquiry reviewing the bill, business organisations have raised concerns about the potential impacts on skills training and workforce development.
- Business Council of Australia (BCA): “Private RTOs deliver most higher-level and complex qualifications and achieve better completion rates and employment outcomes than TAFE.”
- Australian Chamber of Commerce and Industry (ACCI): “By limiting students to free training through TAFE, the government exacerbates skills shortages, as capacity constraints within TAFE limit the system’s ability to scale training.”
- Council of Small Business Organisations Australia (COSBOA): “The Free TAFE Bill prioritises public TAFE colleges at the expense of independent RTOs, undermining small businesses and limiting the vocational education system’s capacity to meet diverse needs.”
Proven Success of Independent RTOs
Submissions also highlighted the advantages of independent RTOs, including their agility, industry alignment, and superior outcomes.
“Independent RTOs consistently deliver higher student and employer satisfaction, better completion rates, and stronger employment outcomes,” COSBOA stated.
ITECA and business groups argue that funding should focus on students rather than systems, allowing individuals to choose providers that best meet their needs.
Call to Reject the Legislation
ITECA has called on the Senate to reject the Free TAFE Bill 2024 (Cth), arguing that it fails to address the realities of Australia’s skills training system and undermines the proven effectiveness of independent RTOs.
“It’s unfair and inefficient to force students into TAFE when independent RTOs are better equipped to meet their needs,” Mr. Williams said.
The organisation advocates for a policy framework that supports diversity in training providers, ensuring students and employers benefit from high-quality and tailored skills training solutions.
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