Redesigning VET FEE-HELP: discussion paper

The VET FEE-HELP scheme commenced in 2009, and provides income contingent loans to students studying higher level vocational education and training (VET) qualifications. Its original intent was to remove financial barriers to study and to encourage students to pursue pathways to further or higher skilled qualifications in the higher education sector. In 2012 the then Australian Government removed the requirement for a link to higher education in an effort to open up state and territory training markets. Whilst this has led to benefits including competition and agility to respond to...  [+] Show more

The VET FEE-HELP scheme commenced in 2009, and provides income contingent loans to students studying higher level vocational education and training (VET) qualifications. Its original intent was to remove financial barriers to study and to encourage students to pursue pathways to further or higher skilled qualifications in the higher education sector. In 2012 the then Australian Government removed the requirement for a link to higher education in an effort to open up state and territory training markets. Whilst this has led to benefits including competition and agility to respond to changing consumer and economic needs, these changes also created serious weaknesses in the scheme and exposed it to abuse. In particular, the application of a system designed for universities to VET, without taking into account the differences in the sectors and low barriers to entry, is the key cause of the future problems with VET FEE-HELP. The Commonwealth Government is committed to introducing a new scheme in 2017 which is robust, sustainable and high quality. This discussion paper details a range of issues with the current VET FEE-HELP scheme and outlines options to address these as part of the 2017 redesign. It seeks to promote public discussion and inform the redesign of the VET FEE-HELP scheme.

Edited excerpts from publication.