Evaluation of the VET Student Loans program: final report

The VET Student Loans (VSL) program provides income contingent loans designed to reduce financial barriers faced by students wishing to undertake vocational education and training (VET). VSL provides financial support to students to undertake high quality training for skills that are aligned to workplace needs at the diploma level and above, to be repaid by the student when their income exceeds the repayment threshold. The program replaced the VET FEE-HELP (VFH) program and has been in operation for almost three years. The aim of this evaluation is to provide insights to assist with...  [+] Show more

The VET Student Loans (VSL) program provides income contingent loans designed to reduce financial barriers faced by students wishing to undertake vocational education and training (VET). VSL provides financial support to students to undertake high quality training for skills that are aligned to workplace needs at the diploma level and above, to be repaid by the student when their income exceeds the repayment threshold. The program replaced the VET FEE-HELP (VFH) program and has been in operation for almost three years. The aim of this evaluation is to provide insights to assist with future administration of the VSL program and to contribute to the evidence base to help inform future policy decisions. This evaluation has involved exploring the key objectives of the program through its direct outputs and the associated effects and changes of the VET market. The key objectives of the program are: fiscal sustainability and contribution to economic growth; quality and affordability; access and equity; student centred; industry need, employment outcomes and student choice; and integrity and confidence.

In summary, the VSL program is largely effective in achieving its objectives. Findings indicate that VSL makes a positive contribution to the Australian economy, and students are incurring less fees and overall debt compared to VFH. Student satisfaction and training quality has increased, although the impact of the program on access rates for disadvantaged students has not been strong. Additionally, there may be unintended adverse impacts for current providers from program design changes, and there may be benefits in reducing administrative requirements for compliant providers. Evidence suggests that there may be increased outcomes for students and industry if the course list was expanded, evidence also suggests that course fees should be reviewed to increase access for low income students. Despite these findings, the program is more financially sustainable and performing more effectively than VFH, although monitoring of the program should continue as it matures. On balance, the VSL program is accomplishing better outcomes for students compared to VFH, and should be expanded to increase impact, while maintaining program integrity.

Edited excerpts from publication.