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The effectiveness of all vocational education and training (VET) systems is in the main dependent on the quality and dynamic nature of policymaking and governance arrangements. Policies are developed by relevant government agencies and private sector governing bodies, either working unilaterally or in partnership with industry, and other private sector parties. If these policies are responsive to the changing political and organisational cultures in which they are embedded, they can enable governments and private sector governing bodies to respond appropriately to the changing needs of different groups and industry sectors. Policy in VET provides some key guidelines for action for both the regulated and the regulator, while governance arrangements describe the specific mechanisms required to put these into practice. Both policy and governance in VET are concerned with: appropriate standards, legislation, quality of training and assessment; funding, financing and resourcing; client information; information management systems; and compliance and accountability.