TAFE organisation and funding in NSW: past and present

21 Nov 2014

This paper illustrates the role that post-school/non-university education occupies, and highlights the decisions that have set recent policy changes in motion.


Technical and further education (TAFE) is important for the development of an economy. Hector Sala and Jose Silva, in their 2011 research paper Labour Productivity and Vocational Training: Evidence from Europe, write that:

the more dynamic is the technological pace of an economy, the more human capital is required relative to physical capital. . .Our central finding is that 1 extra hour of vocational training per employee. . .generates 0.55 additional percentage points of productivity growth.

In the particular case of Australia, Innes Willox (chief executive of the Australian Industry Group) has written that TAFE institutes “are more than the sum of their courses – they are an important part of our economic. . .infrastructure.” The Centre for the Economics of Education and Training (CEET), based at Monash University, estimated that:

In the 10 year period from 2006 to 2016 a total of four million people will need to acquire higher education or vocational education and training qualifications to meet expected skill needs arising from employment growth, retirements and skill deepening. . .primarily due to an overall rise in the level of skill and qualifications within occupations. . .Of the four million. . . 2.474 million will be vocational education and training qualifications. . .That is, on average, each year there will be a need for. . .247,000 vocational education and training completions. . .

The introduction of the new Smart and Skilled policy has elicited a considerable degree of commentary about the nature of training delivery in the years to come, and about the changes to the fee structure that the new approach will introduce. At the heart of the debate over the new policy is the evolving change in delivery mode for technical and further education. In the second half of the twentieth century, post-school non-university education was delivered by the public sector. By the end of the first decade of the twenty-first century, delivery has increasingly become the province of commercial providers. This has occurred in the context of an overall change in the provision of a number of government services.

This e-brief not only sets out to illustrate the role that post-school/non-university education occupies, but highlights the decisions that have set in motion the recent changes. It also looks at the development of funding for technical and further education.

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