Submission - Current and future skills needs

Submission no: 94

Received: 23 May 2003









SENATE EMPLOYMENT, WORKPLACE

RELATIONS AND EDUCATION REFERENCES

COMMITTEE



INQUIRY INTO CURRENT AND FUTURE

SKILLS NEEDS









VICTORIAN GOVERNMENT SUBMISSION









MARCH 2003

Victorian Government Submission - Current and Future Skills Needs



Table of Contents

References and Glossary .............................................................................................. 4



Executive Summary ...................................................................................................... 6



Responses to the Terms of Reference .......................................................................... 8



Part 1 – Term of Reference (a) areas of skills shortage and labour demand in different

areas and locations, with particular emphasis on projecting future skills requirements

................................................................................................................................................ 8

1.1 The Challenge of Projecting Skills Requirements in the Innovation Economy ..... 8

1.2 Vocational Education and Training: The Research and Planning Framework ...... 9

Part 2 – Term of Reference (b) the effectiveness of current Commonwealth, State and

Territory education, training and employment policies, and programs and

mechanisms for meeting current and future skills needs, and any recommended

improvements ..................................................................................................................... 13

2.1 The Victorian VET Policy and Program Framework for Meeting Current and

Future Skill Needs ............................................................................................................ 13

2.2 Effectiveness of Victorian Employment Programs and Services ......................... 16

2.3 Employment Programs and Services - The Roles of Commonwealth and State

and Territory Governments .............................................................................................. 21

2.4 Effectiveness of Commonwealth Employment Programs and Services .............. 21

2.5 Proposed Improvements to Meet Current and Future Skills Needs - Vocational

Education and Training .................................................................................................... 22

2.6 Higher Education.................................................................................................. 25

Part 3 – Term of Reference (c) the effectiveness of industry strategies to meet current

and emerging skill needs .................................................................................................... 28

3.1 VET and Industry Engagement ............................................................................ 28

Part 4 – Term of Reference (d) the performance and capacity of Job Network to

match skills availability with labour-market needs on a regional basis and the need

for improvements ............................................................................................................... 29

Part 5 – Term of Reference (e) strategies to anticipate the vocational education and

training needs flowing from industry restructuring and redundancies, and any

recommended improvements ............................................................................................ 30

5.1 Retraining and Employment Programs ................................................................ 30







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Victorian Government Submission - Current and Future Skills Needs

Part 6 – Term of Reference (f) consultation arrangements with industry, unions and

the community on labour-market trends and skills demand in particular, and any

recommended appropriate changes .................................................................................. 32

6.1 Industry Advisory Arrangements in Victoria ....................................................... 32

6.2 Education, Training and Employment Programs ................................................. 33









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Victorian Government Submission - Current and Future Skills Needs



References and Glossary



Victorian Government Policy Statements

Growing Victoria Together – Innovative State. Caring Communities, Department of Premier

and Cabinet (2002)

Victorians. Bright Ideas. Brilliant Future, Victorian Government Innovation Statement (2002)

Knowledge and Skills for the Innovation Economy - A Ministerial Statement on the Future

Directions for the Victorian Vocational Education and Training System, Department of

Education & Training (2002)

Knowledge and Skills for the Innovation Economy - A Ministerial Statement on Future

Directions for Victorian Higher Education, Department of Education & Training (2002)

Growing Tomorrow’s Industries Today, Information and Communications Technologies

Industry Plan, Multimedia Victoria (2001)

Outcomes and Completions of New Apprenticeships, National Centre for Vocational

Education Research (2002)

Skilling Victoria for the Information Age, A Strategy for Post Compulsory Information and

Communications Technologies, Department of Education & Training (2000)

Skills x Knowledge = Growth, A Statement by the Victorian Government on ICT Skills,

Department of Education & Training and Multimedia Victoria (2000)



Glossary

ACFE – Adult, Community and Further Education

ALGA – Australian Local Government Authority

ANTA – Australian National Training Authority

AQF – Australian Qualifications Framework

CBE - Community Business Employment Program

CJP – Community Jobs Program

COAG – Council of Australian Governments

CRISP – Community Regional Industry Skills Program

DE&T – Department of Education & Training, Victoria

DEWR – Department of Employment and Workplace Relations, Commonwealth

DVC – Department for Victorian Communities

EACU - Employment Attraction and Communications Unit

ENTER – Equivalent National Tertiary Entrance Rank

FWCAP - Forest Worker and Contractor Assistance Programs

ILAs - Industry Liaison Agents

IIRD – Department of Innovation, Industry and Regional Development, Victoria

ITABs – Industry Training Advisory Bodies

LLEN – Local Learning and Employment Network

MCEETYA – Ministerial Council on Education, Employment, Training and Youth Affairs

NCVER - National Centre for Vocational Education Research

OECD – Organisation for Economic Cooperation and Development

OQPP - Overseas Qualified Professionals Program

OQU - Overseas Qualifications Unit





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Victorian Government Submission - Current and Future Skills Needs

OTTE – Office of Training and Tertiary Education, DE&T

RWJPP - Retrenched Worker Job Placement Program

SMU - Skilled Migration Unit

VCAL – Victorian Certificate of Applied Learning

VCE – Victorian Certificate of Education

VETiS – Vocational Education and Training in Schools

VBC - Victorian Business Centres

VLESC – Victorian Learning and Employment Skills Commission

YEL - Youth Employment Link

YES - Youth Employment Scheme









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Victorian Government Submission - Current and Future Skills Needs





Executive Summary

The challenge of meeting current and future skills needs is a major priority for the Victorian

Government. In its 2002 social policy centrepiece Growing Victoria Together, the

Government emphasised the critical importance of education and lifelong learning to

Australia’s future prosperity and the need for government to strive to:

 support a strong mix of innovative businesses and industries

 build a skilled and creative workforce

 ensure high quality schools, TAFE Institutes and universities

 support outstanding scientific and research centres

 create new jobs by promoting new ideas and technology

 strengthen rural, regional and urban communities.



To meet these challenges, the Victorian Government unveiled major policy initiatives both in

Innovation and Education & Training. The Government’s 2002 Innovation Statement,

Victorians. Bright Ideas. Brilliant Future highlights the benefits of innovation and delivered a

$310 million investment to science, technology and innovation across Victoria. Bright Ideas.

Brilliant Future prioritises five strategic areas to accelerate Victoria’s push towards becoming

a leader in innovation:

 ICT

 biotechnology

 new manufacturing technologies

 design

 environmental technologies.



The Victorian Government recognises that the realisation of a successful Innovation Economy

depends on the creation of an educated and highly skilled workforce, supported by a high

quality and flexible education and training system. The Government’s 2002 Ministerial

Statement on future directions for Victoria’s vocational education and training (VET) and

higher education systems, Knowledge and Skills for the Innovation Economy outlines the key

steps to creating an innovative education and training system.



It is vital that funding issues relating to education and training are addressed in the immediate

future, so that growing participation in education and training can be supported. Resources

need to be directed carefully to priority areas, the training needs of existing workers must be

met and innovation, specialisation and flexibility need to be supported.



At present there are major funding constraints on the growth of VET and higher education.

There is an urgent need to address how growing participation in post-school education and

training can be resourced. There is also a need to address the cost-shifting of training for

unemployed people from the Commonwealth to the States and Territories that has occurred

since 1996.



Governments make strategic funding decisions when allocating public funds for training. The

rise of the Innovation Economy makes the development of new strengths in fast-growing

industries that build on traditional strengths imperative. Government funding needs to

achieve a balance between broad access for individuals across all community sectors and







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Victorian Government Submission - Current and Future Skills Needs

regions, and investment in skill development in areas of high economic and social importance

to meet the needs of diverse local labour markets and different regions.



There are specific issues that must be addressed to meet the current and future skills needs of

Australia. These include:

 the reinvigoration of TAFE as the public provider of VET

 enhancing post-compulsory pathways for 15 - 19 year olds

 recognising the importance of education and training in developing healthy

communities.



Skill development priorities need to support key economic and social objectives, target skill

shortages and gaps, and support restructuring, emerging industries and priority groups. Most

of all these priorities must facilitate the development of an Innovation Economy, which

ensures Victoria and Australia are able to maximise the benefits of participating in the global

economy. These priorities must be developed on the basis of wide-ranging research and

analysis, as well as strategic dialogue with stakeholders.



The ageing of Australia’s workforce and rapid industry change means that the education and

training needs of existing workers are intensifying. Modern production methods, new

technologies and changes to job designs are changing the skills that existing workers require.

There is a need to recognise that the needs of entry-level apprentices and existing workers are

different and that they require substantially different types of support. Government funding

and incentive arrangements need to reflect these differences.



While Australia’s training system must support a broad range of training options to guarantee

industry skill needs and equitable access to training opportunities, a standard training service

will no longer suffice. VET providers now need to be able to contribute to specialised and

innovative skill development in particular fields, and at the highest levels. They need long-

term partnerships with innovative companies and industry sectors to develop training

capability within broader business development processes.



Finally, it is critical that governments and stakeholders work together to ensure that

planning, reporting and accountability requirements under the Australian National Training

Authority (ANTA) Agreement will foster innovation and specialisation in the Australian

VET system.









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Victorian Government Submission - Current and Future Skills Needs



Responses to the Terms of Reference

Part 1 – Term of Reference (a) areas of skills shortage and labour demand in different

areas and locations, with particular emphasis on projecting future skills requirements



Patterns of demand for labour and skills vary between States and Territories, regions, markets

and industries. They are also subject to rapid change according to industry developments and

the decisions of individual employers. The capacity to anticipate and identify emerging skill

needs and shifts in labour demand in local communities and industries is essential to the

effectiveness of State and Commonwealth Government education, training and employment

programs and services.



For this reason the Victorian Government has developed extensive links with local

community and business stakeholders concerning the design and delivery of education,

training and employment programs and services. Further details of these programs and

services are outlined later in this submission, in relation to Term of Reference (f) on pp. 32 –

33 of this submission.



1.1 The Challenge of Projecting Skills Requirements in the Innovation

Economy

The world economy is changing. New information and communications technologies (ICT)

are leading to a more connected and integrated global economy. Skilled people and capital

are moving more freely around the world. Economic growth is being driven increasingly by

the application of knowledge and ideas, rather than the production and trade of physical

goods. Companies are increasingly choosing to locate in places with strengths in knowledge,

skills, research and technology. In this changing world, the successful and wealthy

economies are those that seek a competitive edge through knowledge and skills, rather than

the exploitation of raw materials and the physical movement of goods.



Too frequently in the past, Australia has failed to capitalise on the ideas, skills and talent of its

people, and has under-invested in the critical areas of research and development, science,

technology and innovation.



The Victorian Government recognises the importance of innovation to Australia’s future. In

its first term in office, the Bracks Government committed more than $900 million to

innovation initiatives, the largest investment in science, technology and innovation made by

an Australian State Government. In 2002, the Government strengthened its commitment to

innovation, announcing the $310 million Science, Technology and Innovation Initiative (STI)

Second Generation program. STI is supporting five strategic capabilities:

 Information and Communications Technologies

 Biotechnology

 New Manufacturing Technologies

 Design

 Environment Technologies



To develop an innovation economy, Australia must build and attract an educated and highly

skilled workforce, supported by a high quality and flexible education and training system. It

must foster high levels of enterprise formation and business growth and encourage business





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Victorian Government Submission - Current and Future Skills Needs

investment in future in skills, research and development, production equipment and processes.

And it must develop a more integrated and networked local economy, building critical mass

in key areas and marketing ideas through these networks.



In the context of the Innovation Economy, mechanisms of assessing and projecting skills

needs must recognise that skill shortages may be found among diverse groups of employers

and industries, and be particular to local communities and local labour markets across the

State. The Victorian Government is currently developing more thorough, regular analysis of

skill needs and shortages. The design and implementation of a methodical, multi-tiered

analytical system to quantify skills shortages and needs has begun. As the State becomes

more systematic in its assessment of skills shortages, it will look to the Commonwealth to

align resources to meet emergent needs.



The Victorian Government has continued to assess skill needs and shortages, most recently in

August 2002, with the input of Victorian Industry Training Advisory Bodies (ITABs).



ITABs will remain a crucial source of information and support for the Government’s VET

sector planning processes and for the Australian National Training Authority (ANTA)

Agreement. The importance of ITABs and the consequences of the Commonwealth’s

unexplained recent withdrawal of funding support to State ITABs are discussed further in

relation to Term of Reference (f) on page 32 of this submission. A review of the Victorian

ITAB network was undertaken in 2002 and changes are currently being implemented. Their

role will focus on priority high-level intelligence from industry to assist with policy

development and resource allocation.



1.2 Vocational Education and Training: The Research and Planning

Framework

To help Victoria advance as an Innovation Economy, the Government is using collaborative

approaches to identify skills needs and deliver tailored programs in the provision of education

and training services. In June 2002, the Minister for Education and Training in Victoria, the

Hon. Lynne Kosky MP, released Knowledge and Skills for the Innovation Economy - A

Ministerial Statement on the Future Directions for the Victorian Vocational Education and

Training System (Attachment 1/http://www.otte.vic.gov.au/index.htm). The Statement

announced the development of a new, broadly-based framework for assessing demand and

establishing priorities for skills development in Victoria.



This new framework will help to anticipate VET needs flowing from industry restructuring

and redundancies, and will aim to:

 ensure that there is a sufficient flow of new and replacement workers to address future

skill needs resulting from structural change in the economy and from an ageing

workforce

 overcome skills gaps and upgrade the skills of the existing workforce to boost

productivity and support industry restructuring

 address future skill needs in key areas including biotechnology, advanced

manufacturing, design, ICT and environmental technologies

 address the new skill sets needed for new and emerging industries and for innovation

and knowledge creation in industry









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Victorian Government Submission - Current and Future Skills Needs

 address the skill needs of priority groups including young people, unemployed and

underemployed workers, people with disabilities, Indigenous people and those in

disadvantaged communities.



The new framework integrates a comprehensive range of quantitative and qualitative

information sources and key relationships. The framework has three specific elements:

 the research program, which incorporates a range of data and intelligence input and

analysis

 strategic planning and priority setting processes, that include strong relationships and

continuous strategic dialogues with industry the community and other Government

Departments

 resource allocation processes and a dialogue with training providers.



The strategic planning process will also reveal key strategic questions requiring further

investigation, and address changes to internal and external circumstances facing the Victorian

economy. The framework research and planning processes will be conducted annually to

respond to changing conditions.



The framework process will be implemented during 2003. Initial data on projected skill

needs is expected to be available in April 2003.



1.2.1 Equal Opportunity in Skills Development

An inquiry into current and future skills needs cannot afford to ignore the social and

economic costs of barriers to participation in education and training for disadvantaged

members of the community. The Victorian Government is committed to increasing broad

community access to education and training for Victorians:

 living in rural and regional areas

 from culturally and linguistically diverse backgrounds, including newly arrived

migrants

 with family and carer commitments

 with a disability

 of all ages

 from Indigenous backgrounds.



The Government believes that consideration needs to be given to the development of

returning to work grants and other schemes to help remove barriers, particularly for women,

to skills development. In its 2002 election Financial Statement, the Government outlined its

planned response to adult transition to work. The Parents Returning to the Workforce

initiative establishes grants to help parents who want to return to the workforce after caring

full time for their children, to undertake training. The Government undertook to provide $11

million to this program over four years.



The Commonwealth’s Transition to Work program (begun in 2002), which helps eligible

people who have been out of the workforce for over two years, or who have never worked,

prepare for employment, is a positive development in this area.









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Victorian Government Submission - Current and Future Skills Needs

1.2.2 Information and Communications Technologies (ICT) Skills

The development of ICT skills are of ongoing, critical concern for Victoria. While ICT skills

shortages have been temporarily alleviated since 2000 by the global downturn in the ICT

industry, a number of high-end skills specialisations remain difficult to staff and can be

expected to become more difficult without appropriate policy and program responses (a full

list of in-demand high-end skills specialisations in Victoria is provided in Attachment 2).



In general terms, the ICT industry is also reporting difficulty finding required skills sets for

many jobs. As companies become more considered in their ICT purchasing, they are looking

increasingly for individuals with a combination of business and technical skills. Business

skills that are particularly sought after comprise project management, customer relationship

management and strategic competence. Multi-skilled individuals able to maintain the

currency of their skills will be the most highly sought after in the ICT labour marketplace.



The Victorian Government maintains a close watch on developments and requirements of the

ICT industry. The Government’s ICT Skills Snapshot sources biannual industry intelligence

to project future ICT labour and skills demand. The latest demand predictions of the

Snapshot are also included in Attachment 2.



The Government also offers postgraduate scholarships in ICT to attract and retain the highest

quality researchers in Victoria. The scholarships are offered as a “top-up” to Commonwealth

or University scholarships and specifically target women in the ICT research sector and

students from or undertaking:

 ICT research in regional areas

 researching in areas and applications of ICT with clear links to Victorian industries.



1.2.3 Rural and Regional Economies

The shortage of and demand for skills in rural and regional areas represents a major challenge

for policy makers across Australia. While longer term demographic and economic changes

have an impact on the availability of labour in rural and regional areas, a range of contributing

factors or impediments affect the capacity of regional labour markets to respond to the

demand for labour. Higher wages and salaries will not necessarily overcome these actual or

perceived impediments, which include:

 limited or lack of local training and retraining opportunities

 limited professional development opportunities

 inflexible or lack of intra-regional public transport, especially for tertiary students

 additional costs for interviewing and recruiting people outside of a region

 little or no support for newcomers to a region

 shortages of appropriate housing stock for either rental or purchase

 limited social and cultural activities and facilities

 lack of childcare facilities

 limited or lack of work opportunities for partners

 perceptions that career paths are not available in regional industries and businesses

 negative perceptions about living and working in rural and regional areas.



Many regions are starting to grapple with skill shortages with a variety of approaches,

including community forums and skills audits, attracting young people to their businesses,

bridging the information gap about their regions and industries, attracting skilled migrants





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Victorian Government Submission - Current and Future Skills Needs

from overseas and developing new housing. They are seeking assistance and guidance from

government on this matter.



In response to these concerns, eleven forums were held around rural and regional Victoria in

2002 (including five undertaken by Eureka Regional Services). The forums were designed to

help the Government to better understand the aspirations of regions and identify opportunities

for revitalising regional economies. A total of around 1,000 people, including business,

community and local government representatives attended the forums, raising well over a

hundred issues for investigation.



Skills shortages were identified as one of the key issues facing rural and regional Victoria.

They are widespread, whether a region is growing strongly or not and there is demand for a

wide range of skilled, semi-skilled and unskilled labour.



The Government is meeting these concerns and recently announced the Community Regional

Industry Skills Program and the expansion of its Skilled and Business Migration programs,

including encouraging the settlement of skilled migrants in rural and regional Victoria (these

programs are outlined in relation to Term of Reference (b) on pp. 19 - 21 of this submission).



A vital aspect in responding to regional skills needs is for the three spheres of government to

work together collaboratively. Under the auspices of the Regional Development Council, the

COAG Ministerial body for Federal, State and Territory Regional Development Ministers and

the Australian Local Government Association (ALGA), the Standing Committee on Regional

Development (comprised of CEOs of State, Territory and Federal Regional Development

Departments and the ALGA) has considered an initial paper examining this issue and has

committed to developing initiatives to address the issue.









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Victorian Government Submission - Current and Future Skills Needs



Part 2 – Term of Reference (b) the effectiveness of current Commonwealth, State and

Territory education, training and employment policies, and programs and mechanisms

for meeting current and future skills needs, and any recommended improvements



Victoria’s VET and higher education Ministerial Statements (2002) outline the need for post-

compulsory education and training to be responsive to the needs of existing and emerging

industries, with a focus on innovation, specialisation, and the economic and social

development of communities.



In building stronger partnerships with industry, the Victorian post-compulsory sector will

focus on lifelong learning to develop pathways for complementary and ongoing skill

development. In particular, a strong focus needs to be directed to strengthening and

supporting the 15 - 19 year age group in accessing more appropriate programs and transitional

pathways.



2.1 The Victorian VET Policy and Program Framework for Meeting

Current and Future Skill Needs

The Victorian Government’s strategic Ministerial statement Future Directions for the

Victorian Vocational Education and Training System (2002) outlines how vocational

education and training in Victoria will meet the challenges of the Innovation Economy. The

statement focuses on changing the way training is delivered in Victoria and pays particular

attention to specialisation and innovation.



The reinvigoration of TAFE is critical to moving forward and responding to the challenge of

the Innovation Economy. As the public provider, TAFE needs new freedoms to innovate, to

be flexible enough to move with rapid changes in industry, and to build new relationships

with other educational institutions, industries and local communities. In particular, TAFE

Institutes need a highly skilled workforce that can maintain its quality over time.



While our training system must support a broad range of training options to guarantee

industry skill needs and equitable access to training opportunities, a standard training service

is no longer enough.



VET providers can now contribute at the highest levels to specialised and innovative skill

development in particular fields. They have established long-term partnerships with

innovative companies and industry sectors to develop training capability within broader

business development processes. TAFE providers are also specialising in responding to the

diverse needs of different communities in Victoria, customising content and delivery to cater

for local needs.



All these advances in VET provision need to be consolidated and expanded.



Future Directions for the Victorian Vocational Education and Training System highlights a

number of initiatives aimed at changing the way training is delivered in Victoria. These

initiatives, which will better prepare the State for current and emerging skill needs, include:

 $5 million in seed funding to enable TAFE Institutes and other providers to be

recognised as Specialist Centres in specific industry, skill or program areas. Fifteen

Specialist Centres were established in 2002 to enable providers to work more closely





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Victorian Government Submission - Current and Future Skills Needs

with industries and communities, develop more flexible training products and increase

the confidence of employers in training provision.

 the establishment of an Emerging Skills Unit in the Department of Education &

Training, Victoria to identify and define new and emerging skills needs and

recommend ways to respond to these needs

 funding to establish Industry Liaison Agents (ILAs) in six Victorian manufacturing

industry sectors. ILAs will set up networks of Small to Medium Enterprises to

identify training needs and stimulate demand for workplace training

 new product development initiatives aimed at encouraging innovative curriculum

proposals

 three funds of $10 million each for TAFE Institutes to trial new initiatives in

innovation, emerging skills and industries, and flexible delivery initiatives jointly

funded by industry

 $4 million in funding (over two years) for specialist design centres, as part of $9.2

million allocation to develop Victoria’s design centres (the first centres will be in

digital and automotive/aerospace design)

 encouraging TAFE Institutes to offer degrees in niche areas such as viticulture,

aquaculture, ICT and biotechnology

 an additional $1.5 million in funding to increase the number of students doing school-

based apprenticeships or traineeships (see Part-Time Apprenticeships and

Traineeships for Secondary School Students overleaf)

 $2 million increase in recurrent funding for the Adult and Community Education

sector.



The initiatives outlined in Future Directions for the Victorian Vocational Education and

Training System build on important policies announced in Skilling Victoria for the

Information Age (2000) and the Government’s ICT skills statement Skills x Knowledge =

Growth (2000), which aims to:

 change perceptions about ICT skills

 encourage entrepreneurship and specialist skills

 foster innovation and industry growth

 build an e-learning environment

 develop ICT skills across the community.



2.1.2 Vocational Education and Training in Schools

Education and training is a leading priority of the Victorian Government and this is reflected

in the Government’s commitment to goals and targets. The Government’s goals are to:

 improve the standards of literacy and numeracy in primary schooling

 increase the percentage of young people successfully completing Year 12 or the

equivalent

 increase the percentage of adults taking up education and training and so increase the

overall level of educational attainment and literacy levels in Victoria

 increase the level of participation and achievement in education and training in rural

and regional Victoria and among groups where it is presently low

 make near-universal participation in post-school education and training the norm in

our society.









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Victorian Government Submission - Current and Future Skills Needs

The Government’s targets are that:

 Victoria will be at or above national benchmark levels for reading, writing and

numeracy as they apply to primary students, by 2005

 ninety per cent of young people in Victoria will complete Year 12 or its equivalent, by

2010

 the percentage of young people aged 15 – 19 engaged in education and training in

rural and regional Victoria will rise by six per cent, by 2005.



To achieve the goals and targets, the Government has developed initiatives to effectively

engage and retain young people in learning, build pathways across sectors and better support

students in transition.



The expansion and enhancement of vocational education in both the compulsory and post-

compulsory years of schooling is critical to achieving the goals and targets, particularly in

regard to successful Year 12 completion.



The rapid growth of knowledge-based service industries and ICT has placed pressure on

education systems to design courses to meet new skill requirements. Vocational education

and training in schools plays an important role in encouraging and developing these skills and

in engaging students to complete their post-compulsory education.



Vocational education programs in Victorian schools include:

 VET in Schools (includes VET in the Victorian Certificate of Education (VCE) and

Part-Time Apprenticeships and Traineeships for School Students)

 block credit

 Victorian Certificate of Applied Learning (VCAL).



2.1.3 VET in the VCE

VET in the VCE allows students to undertake dual awards that combine work placements,

training and school study. Thirty-two different programs cover emerging and traditional

areas, including primary industries, automotive, engineering, hospitality, ITC, multimedia,

music, dance, community services, business and sport and recreation.



2.1.4 Part-Time Apprenticeships and Traineeships for Secondary School Students

In a school based new apprenticeship or traineeship program, students undertake their VCE or

VCAL concurrently with an apprenticeship or traineeship.

Students participate in a negotiated, structured training program delivered in partnership with

the employer and a Registered Training Organisation (RTO). Students generally spend one or

two days per week in employment and training, and the remainder of the week studying for

their VCE or VCAL. Depending on the number of days in employment or training, a VCE or

VCAL pathway can be undertaken over two to three years.



2.1.5 Block Credit

Block credit arrangements, introduced into the VCE and VCAL in 2003, are designed to

complement existing VET in School arrangements. Block credit will provide students with

credit towards the VCE, for completion of units of competence/modules in VET

qualifications at AQF 2 level and above, that are not in the suite of approved VET in the VCE

programs. The introduction of block credit will enable schools to better meet the needs of





15

Victorian Government Submission - Current and Future Skills Needs

students, local employers and communities by delivering programs in areas of specific skill

shortages.



2.1.6 Victorian Certificate of Applied Learning (VCAL)

The VCAL is designed to increase the number of available pathways for young people in the

post-compulsory years. VCAL is accredited at three award levels: Foundation, Intermediate

and Senior. Based on applied learning, VCAL provides new pathways for young people who

do not wish to pursue an academically-focused pathway using VCE as the sole qualification.

VCAL students will also be able to undertake VET and Part-time Apprenticeships and

Traineeships for School Students. In 2003, nineteen VCAL Further Development pilots are

being trialled. The Themed VCAL pilot program is for students seeking a range of

experiences within a particular industry sector, to inform their future pathways choices and to

develop employability skills.



2.1.7 Equal Opportunity

As noted on page 10 in relation to Term of Reference (a), the Victorian Government considers

that schemes and programs to address barriers to participation in education and training for

disadvantaged members of the community are of integral importance to the construction of a

VET policy and program framework to meet current and future skills needs.



2.2 Effectiveness of Victorian Employment Programs and Services

The Commonwealth Government has primary responsibility for the provision of employment

services to unemployed job seekers. The Victorian Government’s employment programs and

services complement those of the Commonwealth Government, helping to address the current

and future skill needs of eligible Victorian job seekers in local industries and communities

across the State. Victorian programs and services:

 support eligible job seekers to access employment opportunities and develop skills

needed to gain employment. While eligibility requirements vary from program to

program, Victorian Government employment programs target disadvantaged job

seekers that include: long-term unemployed (12 months or more); mature aged,

Indigenous Victorians; people from culturally and linguistically diverse backgrounds;

young people; women and sole parents returning to work; people with disabilities; and

retrenched workers and contractors

 attract skilled migrants to Victoria and link them to employers, industries and regions

with skill needs

 facilitate the entry of overseas qualified professionals into the Victorian workforce

 assist employers to recognize apprenticeships and traineeships as viable opportunities

to employ and train young people

 inform young people about career opportunities within Victorian industry sectors and

related education and training pathways

 help to ensure that the investment decisions of firms (and the investment attraction

efforts of State and local governments) are informed by an understanding of skill

availability, employment patterns and training opportunities in particular areas across

the State

 anticipate and respond to changes in demand for labour and employment needs within

local industries and labour markets.









16

Victorian Government Submission - Current and Future Skills Needs

The effectiveness of Victorian Government employment programs and services in

complementing national efforts is evidenced by their contribution to:

 increasing the skill and employment opportunities afforded to eligible Victorian job

seekers. The Victorian Government is particularly focused on filling gaps in assistance

for priority target groups who are not adequately serviced by the Commonwealth

Government

 boosting Victoria’s share of Australia’s skilled migrants and the entry of overseas

qualified professionals into the Victorian workforce

 broadening access to information on careers and education and training pathways for

young people

 increasing the uptake of apprenticeships and traineeships by industry and young

people

 labour market development, particularly in regional Victoria and communities

experiencing structural adjustment.



Victoria’s extensive range of training and employment policies and programs is outlined

below.



2.2.1 Community Business Employment Program

The Community Business Employment Program (CBE) aims to improve the employment

prospects of disadvantaged job seekers through the provision of employment placement

services and recruitment support to local employers. Services to eligible job seekers not in

receipt of Commonwealth Government assistance include vocational guidance as well as job

searching, job placement and post-placement support.



Through CBE:

 22,637 job seekers were placed into employment during the period April 2000 – June

2002. Placements were in a range of industry sectors, with 21.5 per cent in

manufacturing and a further 19 per cent in retail trade

 78 per cent of job seekers placed into employment remained with their employer for

13 weeks or more.



2.2.2 Community Jobs Program

The Community Jobs Program (CJP), established in July 2000, aims to improve the

employment prospects of long-term unemployed and other disadvantaged job seekers through

the provision of up to 16 weeks award-wage employment and nationally accredited training.



CJP is the only employment scheme in Australia that pays an award level wage.



CJP funds government and not-for-profit community organizations in local communities to

develop projects that provide employment and skills development. Future CJP projects will

complement the Victorian Government’s Neighbourhood Renewal Program to benefit

disadvantaged communities.



Participation in the CJP is voluntary and open to job seekers who have been out of work for at

least 6 months out of the last 12 months or are at risk of long-term unemployment.



Sixty-two per cent of program graduates progress to employment or education and training.







17

Victorian Government Submission - Current and Future Skills Needs

2.2.3 Government Youth Employment Scheme

The Youth Employment Scheme (YES) aims to improve the skills and employment prospects

of disadvantaged young people (aged 15 - 24) through the provision of apprenticeships or

traineeships within the Victorian public sector. From July 2000 to June 2002, YES

successfully placed 1,322 young people in apprenticeships and traineeships (with 47.7 per

cent of all placements in business traineeships). Eighty-six per cent of YES participants

remain in employment, education or training three months after completion.



2.2.4 Jobs for Young People

The Victorian Government has recently announced a commitment to create 1,100 new jobs

and traineeships in local government over four years. Jobs for Young People will provide a

wage incentive to local governments that will encourage the creation of traineeships and

apprenticeships, providing opportunities for young people to obtain training and employment

in their local communities. The program is currently being developed for implementation in

the 2003 - 04 financial year.



2.2.5 Go For IT

Established in July 2001, Go for IT is designed to encourage the IT industry to recognise and

take up IT, communications or multimedia traineeships as a viable means to employ and train

new staff. Occupations covered include computer and software sales, web design, software

applications, network and database support, program and system design, equipment

installation and helpdesk support.



Go for IT placed 387 young people into traineeships and apprenticeships by end June 2002.



An ICT cadetships program is being developed to build on this success and will be considered

for implementation.



2.2.6 Multicultural Economic Development Unit

Multicultural Employment initiatives are designed to improve the skills base of the Victorian

workforce through the facilitated entry of overseas-qualified professionals into the Victorian

workforce. Relevant initiatives include the:

 Overseas Qualifications Unit

 Overseas Qualified Professionals Program

 Skilled Migration Unit.



2.2.7 Overseas Qualifications Unit

The Overseas Qualifications Unit (OQU) aims to facilitate the entry of overseas-qualified

professionals into the Victorian workforce. The OQU provides a range of free services to

overseas-qualified professionals living in Victoria, including:

 assessment of overseas qualifications

 vocational advice

 referral to professional bodies and agencies that can assist with further education,

training or employment.









18

Victorian Government Submission - Current and Future Skills Needs

From October 1999 to the end of June 2002, the OQU provided 11,682 services to overseas-

qualified professionals, with a client satisfaction rate of 90.7 per cent in 2000, 91.4 per cent in

2001 and 87 per cent in 2002.



A survey in 2001 indicated that the top five overseas-qualifications held by OQU clients were

in the skilled areas of engineering, health, teaching, arts/law and computer/technical.



2.2.8 Overseas Qualified Professionals Program

The Overseas Qualified Professionals Program (OQPP) helps to improve the efficient

utilisation of skills by providing training, work experience placements and employment

assistance to overseas-qualified professionals who live permanently in Victoria and are

unemployed or not working in a field using their qualifications and experience. The program

commenced in February 2001 and is on track to achieve its target to assist 200 professionals

by the end of June 2003.



The Government has committed to continuing the OQPP beyond June 2003. The program

will be evaluated before that time, when design recommendations for a new program cycle

will be considered.



2.2.9 Skilled Migration Unit

The Skilled Migration Unit (SMU) aims to attract skilled migrants to Victoria and connect

them with employers, industries and regions with skills needs. Free services to migrants

include information, referrals to employers and nominations for skilled migrants with in-

demand skills to settle in Victoria. For employers, SMU can provide resumes and contact

details of skilled migrants around the world who have satisfied migration requirements and

will shortly arrive in and seek work in Victoria.



From the time of its establishment in October 1999 until the end of June 2002, the SMU

provided 15,236 services to people wishing to migrate to Victoria and a further 1,318 services

to 421 Victorian employers. A survey in 2002 indicated that 92 per cent of clients were

satisfied with the service.



The SMU plays a significant role in attracting skilled migrants to regional Victoria to fill skill

needs. The SMU has participated in various business and community forums to address

population decline and skill needs in regional areas. In 2001 - 02, approximately 35 per cent

of employers who had registered skill needs with the SMU were based in regional Victoria.



The Victorian Government recently announced an expansion of its skilled and business

migration programs, committing an additional $6 million over four years to:

 increase Victoria’s share of Australia’s skilled and business migrants to 25 per cent by

2006-07 (providing incentives to increase migration to Victoria in the following visa

categories: State Government sponsored migration, temporary skilled, business

migrant and overseas students)

 encourage increased numbers of skilled migrants to settle in regional areas with skill

needs.



Future initiatives to encourage the settlement of skilled migrants in regional and rural Victoria

will include:









19

Victorian Government Submission - Current and Future Skills Needs

 assistance for the production of “Community Settlement Kits” for skilled migrants and

employers by local governments

 regionally-based support for local councils, employers and migrants

 additional English language training and bridging skills programs in key skill shortage

areas

 housing assistance for new migrants (which could provide the matching of subsidies

and bridging costs between arrival and commencement of employment)

 support for the Ethnic Communities Council of Victoria (ECCV) to work with local

governments to better meet the settlement needs of newly arrived migrants in rural

communities.



2.2.10 Youth Employment Link (YEL)

Via a website (www.yel.vic.gov.au) and telephone helpline (1800 15 20 25), the Youth

Employment Link (YEL) provides young people aged 15 – 24 with information and referrals

to careers, training and employment organizations and resources.



From the time of its establishment in July 2001 up to 30 June 2002, YEL recorded

approximately 214,000 page impressions and calls. A recent review showed that 88 per cent

of the target group was satisfied with the service.



2.2.11 Employment Attraction and Communication Services

The Employment Attraction and Communications Unit (EACU) of Victoria’s Employment

Programs Division, Department for Victorian Communities (DVC), works to ensure that the

investment decisions of firms, and the investment attraction efforts of State and local

governments, are informed by up-to-date information on labour supply and employment

matters within local labour markets.



The Unit provides a range of information to local government, business and other

stakeholders, comprising:

 strategic employment and labour supply advice to businesses looking to invest in

Victoria. Companies looking to invest or expand their workforce in Victoria can

access information on skill availability, employment and training data, as well as

market salary rates

 Employment Profiles tailored to specific industries, regions, companies and locations.

From October 1999 to 30 June 2002, the EACU provided over 600 employment

profiles, detailing workforce information for companies seeking to expand or locate

within Victoria

 facilitation of the Victorian Government’s suite of employment services including

recruitment assistance, skilled migration and traineeship information

 links to other Government organisations including the Department of Education and

Training (DE&T) and the Department of Innovation, Industry and Regional

Development (IIRD).



2.2.12 Community Regional Industry Skills Program

The Victorian Government has recently announced a Community Regional Industry Skills

Program (CRISP) program. Beginning in 2003 - 04, CRISP will address labour supply gaps

or skill mismatches in local labour markets, targeting regional communities and areas

experiencing industry restructuring through the supply of skilled, semi-skilled and unskilled

labour at an industry and/or enterprise/cluster-specific level. Project proposals will be





20

Victorian Government Submission - Current and Future Skills Needs

developed by local stakeholders, and have the capacity to respond quickly to local labour

market needs.



2.2.13 Targeted Assistance for Retrenched Workers and Contractors

In late 2002, the Victorian Government established a Retrenched Worker Job Placement

Program (RWJPP) and Forest Worker and Contractor Assistance Programs (FWCAP). These

programs are outlined in relation to Term of Reference (e) on page 30 of this submission.



2.3 Employment Programs and Services - The Roles of Commonwealth

and State and Territory Governments

By supporting unemployed and disadvantaged job seekers into work, employment programs

and services can and do help to meet the current and future skill needs of individuals and

employers.



The Commonwealth Government has primary responsibility for the delivery of employment

services through the Job Network and other related employment programs.



State and Territory governments have an important role to play in monitoring the impact of

Commonwealth employment services at a State, regional and local level and identifying and

responding to gaps in service delivery.



2.4 Effectiveness of Commonwealth Employment Programs and Services

To date, the Commonwealth Government has not reported transparently on the composite

effect of its employment services in aligning labour supply and demand at State and local

levels. Knowledge of the effectiveness of the Commonwealth’s programs, in terms of this

core indicator, has therefore been hampered.



While the Victorian Government acknowledges the recent reforms to the Commonwealth’s

employment programs, through the Job Network, and its expanded coverage of regional

Victoria (which should improve assistance for many job seekers), serious gaps and limitations

in program provision remain. Commonwealth employment services continue to be:

 generic and aligned to macroeconomic policies with a focus on lowering the national

incidence of unemployment. A national operating framework challenges the ability of

Commonwealth employment services to influence local markets and respond

flexibility to local labour market circumstances. For this reason, State Governments

need to be given a greater voice in the development of strategic and practical measures

for local labour markets

 too focused on intensive assistance for long-term unemployed job seekers, with

eligibility largely limited to those in receipt of Commonwealth income support. As a

result, significant numbers of marginalised disadvantaged Victorian job seekers

continue to receive inadequate assistance from the Commonwealth Government.



The Victorian Government is concerned that marginalised Victorian job seekers remain

inadequately supported by the Commonwealth Government. Marginalised job seekers

include:

 migrants who have been in Australia for less than two years







21

Victorian Government Submission - Current and Future Skills Needs

 young people aged 15 - 24 (particularly those deemed ineligible for Commonwealth

Government income support and those, who for a range of reasons, do not access Job

Network services)

 retrenched job seekers who, despite having received their full employee entitlements,

struggle to regain employment

 unemployed persons aged 45 years and over whose income or assets make them

ineligible for more than a very basic level of assistance from the Commonwealth

Government.



The effectiveness of Job Network is outlined in relation to Term of Reference (d) on page 29

of this submission.



2.5 Proposed Improvements to Meet Current and Future Skills Needs -

Vocational Education and Training

2.5.1 ANTA Agreement

Commonwealth/State arrangements for VET are governed by the Australian National

Training Authority (ANTA) Agreement. The current three-year Agreement will expire at the

end of 2003 and negotiations will take place this year on a new Agreement.



The current agreement includes a planning, reporting and accountability regime that drives

funding and policy development.



There are several key issues that need to be addressed in the next ANTA Agreement to ensure

it addresses current and future skill needs for Australia. These are:

 how the expected increase in demand for vocational education and training will be

resourced from government and non-government sources. The quality of training

provision will be compromised if overall investment is not increased

 whether the planning, reporting and accountability requirements under the Agreement

foster innovation and specialisation for the Australian VET system

 how to address the cost-shifting of training for unemployed people from the

Commonwealth to the States and Territories which has occurred since 1996. The

abolition of most Commonwealth training programs for unemployed people and the

introduction of the Common Youth Allowance and mutual obligation policies may

have increased demand for State-funded training. The number of unemployed

students in the state training system receiving a fee exemption due to receipt of

Centrelink payments increased from 11,100 in 1996 to 19,000 in 2001, a rise of 71%.



2.5.2 Group Training Companies

Group training has been very effective in increasing the opportunities for small to medium

size enterprises to participate in training apprentices and trainees. However, the cap on

funding for purchase of group training outcomes is substantially limiting the growth of group

training.



The implementation of the 2001 national review of group training is expected to exacerbate

funding issues, as there is likely to be a larger pool of eligible providers competing for the

available funds, and this could threaten the financial viability of some providers if not

managed carefully. There needs to be a limit on the quantum of funds available for new

entrants to the group training funding program.





22

Victorian Government Submission - Current and Future Skills Needs

2.5.3 Commonwealth New Apprenticeships Incentives Program

The model for Commonwealth employer incentives was first developed in the 1970s and has

been amended to reflect a range of changes to the training system that have occurred over this

time. Given the substantial and continuing changes in the nature of work and the skill sets

and skill renewal required by workers, it is now time for a fundamental reconsideration of

how governments can maximise incentive and subsidy arrangements to support employer

investment in skill development. Australia’s education and employment-based training

system needs to respond to the new economic environment.



As part of its contribution to the Commonwealth New Apprenticeships Incentive Programme

review undertaken in 2002, Victoria provided recommendations with respect to the following

key concerns:



 the need to re-evaluate the objectives of the Commonwealth’s employer incentives

 the capping of incentives at Certificate IV, which overlooks fundamental shifts in the

demand for skills and changes in the labour market

 the distortions in employer decision-making created by making incentives available, in

some cases, for existing workers to undertake apprenticeships/traineeships.



These concerns are outlined in detail below.



2.5.4 New Apprenticeships – The Need for Reform

A significant element in Victoria’s Ministerial Statement, Knowledge and Skills for the

Innovation Economy is the recognition that skills enhancement for existing workers will

become an increasingly important component of publicly-funded training. It is important to

recognise that the needs of entry level apprentices and existing workers are different and that

they require substantially different types of support. Government funding and incentive

arrangements need to reflect this difference. However, under current arrangements incentives

for existing workers are tied to New Apprenticeship delivery only.



Victoria recommended that for the review to be effective, the objectives of the

Commonwealth’s employer incentives need to be reassessed in the context of the Innovation

Economy. Only then can it be determined what proportion of funding should be directed at

New Apprenticeships and what proportion should go toward incentives to support the skill

development needs of the existing workforce.



2.5.5 Capping of Incentives at Certificate IV

The exclusion of Associate Diploma and Diploma level New Apprenticeships from eligibility

for employer incentive payments is becoming increasingly outdated. Such

apprenticeships/traineeships are included in training packages and are being demanded by

employers in some sectors.



Victoria recommended that the eligibility for employer incentives be extended to Associate

Diploma and Diploma level New Apprenticeships. However, this should not be at the

expense of moving resources away from the existing AQF 2 - 4 qualifications.



2.5.6 Incentives for Training of Existing Workers

There are legitimate policy reasons for expanding training, including publicly-funded training,

for existing workers. However, the decision to tie Commonwealth funding to those





23

Victorian Government Submission - Current and Future Skills Needs

undertaking an apprenticeship/traineeship creates distortions in employer decision making

and generates additional costs, particularly fee-for-service payments to New Apprenticeship

Centres and monitoring costs for States. These costs are generally not necessary for people

who are mature and already employed, or transferring from one job to another.



Additionally there may be instances where, if recognition of prior learning were correctly

applied, then a qualification could be obtained, either inside or outside a training contract, in a

relatively short space of time. The current system encourages Registered Training

Organisations to favour full course delivery, which has cost implications for either employers

or States, depending on who is funding the training delivery.



Victoria recommended that the Commonwealth consider:

 the appropriateness of employer incentives for existing workers undertaking

apprenticeships/traineeships

 removing the link between these incentives from training contract duration but

mandating recognition of prior learning assessments for participants with extensive

experience in the particular industry or occupation.



2.5.7 Increasing Apprenticeship/Traineeship Completions in Victoria



In Victoria over the past six years, overall numbers of apprentices and trainees successfully

completing their contracts of training have grown strongly. Absolute numbers of completions

have more than doubled from 12,454 in 1999 to reach 27,231 by the end of 2002.



The overall numbers of apprentices and trainees in training have also doubled over the 1999

to 2002 period, rising from 76,147 in 1999 to 142,798 by 2002. However, there has been no

significant increase in completion rates during that period.



Recent national studies (using longitudinal data) have established that:

 apprenticeship completions are in the order of 70-77%

 completions in the shorter traineeships are lower at around 55%1



National Centre for Vocational Education Research data on completions in Victoria clearly

identifies the occupations where the distribution of non-completers is disproportionately high.

Victoria’s completion rates in some occupations (including the Clerical, Sales and Service

Worker sectors) are only 45% in the most recent studies.

In 2003 the total budget for apprenticeship and traineeship training in Victoria is $181.7

million. This investment has increased by 66% from the 1999 budget of $109 million.



Given the Victorian Government’s substantial investment it expects that apprenticeship and

traineeship activity will make a significant contribution to the achievement of the

Government’s completion target for young people, that by 2010, 90 per cent of young people

in Victoria will successfully complete Year 12 or its equivalent.



Apprenticeship and traineeship qualifications (at Australian Qualifications Framework

Certificate II and above) count towards the target as they are an equivalent level to Year 12.





1

National Centre for Vocational Education Research (NCVER) 2002, Outcomes and completions of New

Apprenticeships.





24

Victorian Government Submission - Current and Future Skills Needs

During 2003 Victoria will consider measures to improve apprentice and trainee completion

rates to maximize outcomes for this client group.



2.6 Higher Education

2.6.1 Allocation of University Places

State and Territory Governments have a strong interest in ensuring university responsiveness

to industry and community workforce needs, especially in relation to emerging technology

fields, and areas of community need such as teaching and nursing. The Commonwealth needs

to take account of industry and community skill needs in determining an appropriate

allocation of university places to universities, yet the present Commonwealth funding

arrangements do not provide sufficient flexibility with which universities can fully and

appropriately respond to workforce demands as identified and communicated by State and

Territory governments. Last year, the Victorian Minister for Education and Training

proposed to MCEETYA the creation of a national pool of priority university places with

which to assist States and Territories to strategically respond to identified shortfalls in

graduate supply in key skill areas. This approach, or a similar partnership between State

Governments and the Commonwealth, should be developed to inform the Commonwealth’s

allocation of higher education places, in accord with industry workforce needs.



2.6.2 Unmet Demand

In its major policy statement, Growing Victoria Together (2002), the Victorian Government

set a target of 90 per cent of young people in Victoria successfully completing Year 12 or its

equivalent by 2010. The achievement of this target will raise the aspirations of school

leavers, considerably increasing the number of students prepared to undertake post-

compulsory education. To build on the Victorian Government’s commitment to near

universal completion in post-compulsory school education, the Victorian and Commonwealth

Governments need to determine an appropriate mix of tertiary education and training to meet

this increased demand.



There is a significantly higher level of unmet demand for university places in Victoria than in

any other State. In 2002, 21,500 Victorian students were eligible to enter a university but

could not gain a place, leaving Victoria with 40 per cent of national unmet demand. Yet since

1996, the Commonwealth has cut almost 6,000 funded student places in Victoria. This

compares unfavourably with the national increase of 420 funded places from 1996 - 2003.



In order to determine an appropriate response to unmet demand, the Victorian Government

proposes that:



 Commonwealth, State and Territory Governments seek agreement on what proportion

of the workforce will require tertiary education and on this basis consider strategies,

including participation and completion targets, to improve levels of attainment in post-

school education and training.



2.6.3 Linking Higher Education and TAFE Sectors

Many industries and enterprises require broad skill development strategies encompassing

VET and higher education outcomes, and there is a clear need to build upon and extend

pathways between the TAFE and higher education sectors, to support students’ and

employees’ knowledge and skills development. The 2002 Ministerial Statement Future







25

Victorian Government Submission - Current and Future Skills Needs

Directions for Victorian Higher Education, the Victorian Government emphasises the need

for strengthened interaction between the higher education and VET sectors. The two sectors

are complementary in that they can deliver awards that contribute jointly towards the

employability of students. The Victorian Government will seek to significantly improve

cooperative arrangements in multi-sector institutions.



The Commonwealth, in its 2002 discussion paper Varieties of Learning: the Interface

between Higher Education and Vocational Education and Training has similarly recognised

the need to develop the interaction between these sectors and opportunities for student

transfer between them. The Victorian Government would be supportive of initiatives in the

Commonwealth’s review of higher education which seek to strengthen links between the two

sectors.



2.6.4 Alternative Tertiary Entrance Pathways

The Victorian Government is committed to promoting lifelong learning. A highly skilled,

adaptable workforce is needed so that the Innovation Economy will provide prosperity to

individuals and to the community. Universities will need to cater for the increased learning

needs of a broader spectrum of the population, specifically our ageing population and

workforce.



Decades of low school retention and transfer rates to post-secondary education have denied

many capable mature Australians the opportunity to participate in higher education.

Increasing higher education participation rates in mature-age groups, most of who will be in

the workforce and already dealing with the pressures of balancing work and family

responsibilities, represents a major challenge for higher education institutions in terms of

course entry criteria, program structures and the flexibility of delivery.



The current means of determining eligibility for entrance to higher education relies

predominantly on students’ Equivalent National Tertiary Entrance Rank (ENTER) scores.

Victoria believes universities need to broaden their participation base to encompass mature-

age students seeking to enhance their skills and knowledge, or a “second-start”. Universities

need to promote alternative means of selection to the ENTER score that recognise capability

or commitment to engage in study.



The Victorian Government will work with universities to promote options for the further

development and expansion of alternative tertiary entrance pathways.



In addition, lifelong learning is critical in opening up alternative pathways through post-

compulsory education and training. The adult, community and further education (ACFE)

sector aims to strengthen “second-chance” learning opportunities through initiatives such as

ACFE Clusters, and Learning Towns. These programs build and strengthen organisational

capacity by establishing partnerships between education providers, business, local

government and other community bodies.



2.6.5 Industry Engagement

It is essential that universities continue to develop consultation and feedback mechanisms

with industry to ensure that their course provision remains relevant and responsive to

changing workforce skill needs. Universities’ engagement with industry workforce skill

needs could also be further improved through the promotion of industry-based learning that

ensures “work ready” graduates and the flow of ideas between companies and universities.





26

Victorian Government Submission - Current and Future Skills Needs

Commonwealth and State Governments can play a key role in supporting the creation of

university-industry linkages by facilitating networks, promoting emerging industry skill areas

to students, and through the provision of undergraduate and postgraduate scholarships to

encourage study in areas of key industry skill need. The Victorian Government is

establishing regular meetings with university deans of priority disciplines to discuss the

knowledge and skills required by Victorian communities and industries.



2.6.6 Regional and Rural Higher Education

Universities are major contributors to regional economies and industries. Their presence in

regional and rural areas has an employment multiplier effect and the links between education

and industry drive innovation and development in the regions. It is vital that regional and rural

university campuses engage closely with local industries to provide the knowledge and skills

required to support their development and retain graduates within regional and rural areas. The

Victorian Government is committed to ensuring that, as far as is possible, regional and rural

institutions provide higher education that meets the needs of nearby industries and their

employees unable to readily travel to undertake study.



The Victorian Government supports initiatives and targets to increase rural and regional higher

education participation to levels comparable with those in metropolitan areas. It will seek a

commitment from universities to coordinate higher education provision in regional and rural

Victoria to maximise the diversity of course offerings. A working party will be convened to

develop a long-term strategy for the cooperative provision of higher education in regional and

rural Victoria that is responsive to industry growth. This working party will include

representatives from State and Commonwealth Governments, Victorian universities and

regional industries.



The capacity of our regional and rural university campuses to attract and retain local students

and respond fully to the needs of regional industries would be significantly improved through

changes to Commonwealth Government funding arrangements. The Victorian Government

would be supportive of the Commonwealth’s development of funding incentives to universities

that encourage cooperative delivery, the ongoing provision of high-priority courses in areas of

low demand, and the development of new specialist programs in regional institutions and

campuses.









27

Victorian Government Submission - Current and Future Skills Needs



Part 3 – Term of Reference (c) the effectiveness of industry strategies to meet current

and emerging skill needs



3.1 VET and Industry Engagement

ANTA is leading the development of a national VET strategy for 2004 - 2010. This strategy

must include a focus on promoting greater engagement with industry on training issues.



The quality of vocational education and training in Australia is dependant on the continuation

of an industry-led VET system. In an Innovation Economy, knowledge and skills are of

increasing importance and industry’s role is more complex. Industry advisory arrangements

need to be:

 more flexible to accommodate new and emerging skill needs and industry sectors

 better able to cope with cross industry skill issues as generic and employability skills

become more relevant

 capable of identifying future trends in a rapidly changing economic environment.



In 2002, the Victorian Learning and Employment Skills Commission undertook A Review of

Industry Advice on Training. The review sought to identify if current mechanisms that

provide advice on skill formation in Victoria required adjusting and, if so, how improvements

might be achieved to ensure an effective industry advisory system. The recommendations

from this review are outlined under Term of Reference (f) on page 32 of this submission.



3.1.1 ICT

In its 10-year ICT Industry Plan, Growing Tomorrow’s Industries Today (2001), the Victorian

Government has outlined its commitment to developing people as a fundamental element of

the ICT Economy. The Plan integrates skill development strategies with other industry

development strategies including fostering innovation, building the ICT business base and

developing an internationally competitive communications infrastructure.



The plan recognises universities as a key source of innovation, and includes strategies to

facilitate links between educational institutions, industry and government to further develop

the ICT skill base in Victoria. Key initiatives of the strategy include Team Victoria, which

will foster business skills and teamwork in small and medium ICT enterprises and Linking

Students with Industry, to encourage overseas students to remain in the ICT industry in

Victoria.



Increasingly, strategies need to be targeted to the specific needs of an industry sector or

geographic location. An example of this is the University of Ballarat/IBM “Earn As You

Learn” program, in which technology students at the University of Ballarat will undertake

paid work at a custom-built IBM software development facility. The program addresses the

needs of IBM in attracting and retaining highly skilled people at their Ballarat location, and

provides participating students with valuable on-the-job experience to enhance their future

employment prospects.



Another example of effective industry strategies to meet emerging skill needs is the Chipskills

program. The Victorian Government, in partnership with four Victorian universities and the

ICT industry, has developed the first industry-backed Master of Engineering (Microelectronic

Engineering) to specifically meet the skill needs of the growing microelectronics sector.





28

Victorian Government Submission - Current and Future Skills Needs



Part 4 – Term of Reference (d) the performance and capacity of Job Network to match

skills availability with labour-market needs on a regional basis and the need for

improvements



The Victorian Government is committed to working collaboratively with the Commonwealth

Government to improve the capacity of Job Network to match available skills with the needs

of Victorian labour markets.



Anecdotal evidence available to the Victorian Government suggests that the performance and

capacity of Job Network to match skills availability with labour market needs on a regional

basis is constrained by:

 inadequate assistance afforded to many job seekers while in receipt of “Intensive

Assistance”. As reported in the Productivity Commission’s Job Network Evaluation

Effectiveness Report (September 2002), only five per cent of participants in Intensive

Assistance receive any form of work experience, and only 14 per cent receive

vocational training. While the introduction of the JobSeeker Account is welcome,

available funding may be insufficient to provide adequate paid work and training for

disadvantaged job seekers.

 challenges in effectively engaging young people aged 15 - 24. The Victorian

Government recognises the challenges experienced by Job Network providers seeking

to effectively engage young people, particularly those aged 15 - 20 and those deemed

ineligible for Commonwealth Government income support.

 identification issues. In a basic, practical sense, Job Network providers do not have

the “public face” held by the former Commonwealth Employment Services. Job

Network providers may therefore be less readily known within local communities.



The Victorian Government acknowledges that there is significant scope to collaborate with

the Commonwealth Government to facilitate timely responses to the needs of Victorian labour

markets. To this end, the Employment Programs Division of the Department for Victorian

Communities is currently seeking to establish a Memorandum of Understanding with the

Commonwealth Department of Employment and Workplace Relations (DEWR). Such an

arrangement would serve to strengthen current efforts to ensure:

 strategic information sharing, enabling Commonwealth employment services to be

informed by local information on skill needs and emerging local labour market

developments

 strategic alignment of Commonwealth and State employment programs to achieve

enhanced outcomes for local labour markets.









29

Victorian Government Submission - Current and Future Skills Needs



Part 5 – Term of Reference (e) strategies to anticipate the vocational education and

training needs flowing from industry restructuring and redundancies, and any

recommended improvements



As highlighted in the section of this submission relating to the Victorian Government’s

Research and Planning Framework for Vocational Education and Training (see pp. 9 - 10, in

relation to Term of Reference (a)), Victoria has established a new, comprehensive framework

for assessing demand and establishing priorities for skills development. The Government is

also developing additional measures to assist workers who have been made redundant or been

retrenched. The recent collapse of Ansett Airlines and other high-profile, large organisations

has highlighted the need for governments to respond to company insolvency and large scale

restructuring in a timely manner.



5.1 Retraining and Employment Programs

In late 2002, the Victorian Government established two employment programs to respond

proactively to company closures and meet the needs of retrenched workers and contractors:

the Retrenched Worker Job Placement Program and the Forest Worker and Contractor

Assistance Program.



5.1.1 Retrenched Worker Job Placement Program

The pilot Retrenched Worker Job Placement Program (RWJPP) provides eligible retrenched

workers with access to:

 funding to cover retraining and relocation expenses. The RWJPP enables jobseekers

with incomplete/outdated skills to pursue training in line with Victorian industry

requirements. It also allows skilled workers to move to areas where their skills are in

demand

 referral to financial counsellors, Community Business Employment (CBE) Program

providers and other Victorian Government employment services.



The RWJPP is delivered via a telephone helpline (1800 620 623) and is administered through

the CBE Program. In delivering the CBE Program, Victoria’s Employment Programs

Division utilises local information to anticipate future company closures and or large-scale

retrenchments. This proactive approach enables the Government to provide targeted and early

assistance for affected workers.



5.1.2 Forest Worker and Contractor Assistance Programs

Through Forest Worker and Contractor Assistance Programs FWCAP, the Victorian

Government is fulfilling its commitment to assist workers and contractors who are displaced

from the Victorian native forest timber industry as a direct result of forest industry reform.

Available assistance includes:

 individual case management

 counseling and advice

 financial support for training, job search activities and relocation to a new job

 industry restructure repayments to eligible workers and contractors

 wage subsidies to future employers.









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Victorian Government Submission - Current and Future Skills Needs

5.1.3 Skill Up

Skill Up is a planned new program for addressing the needs of workers who have been made

redundant. Skill Up will provide retraining for workers who are made redundant as a result of

major industry downturns or workplace closures.



The specific details and implementation arrangements for this initiative are currently being

developed and will be announced later in 2003.









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Victorian Government Submission - Current and Future Skills Needs



Part 6 – Term of Reference (f) consultation arrangements with industry, unions and the

community on labour-market trends and skills demand in particular, and any

recommended appropriate changes



6.1 Industry Advisory Arrangements in Victoria

The Victorian Government believes that it is critical that industry remains a primary influence

on decisions about the type and quantity of training provided through the training system.



The Victorian Review of Industry Advice on Training, undertaken by the Victorian Learning

and Employment Skills Commission (VLESC) in 2002, made a series of recommendations

which are now being implemented by the Government. These include:

 the establishment of an Industry Advisory Committee, a small high-level group

reporting to the VLESC, comprising prominent representatives of key stakeholders to

provide guidance on the strategic directions of the future industry advisory system and

advice on training and funding priorities

 a restructured network of Industry Training Advisory Bodies (ITABs), to provide

independent information that will support the directions outlined in Knowledge and

Skills for the Innovation Economy

 a Research Program, coordinated by the Office of Training and Tertiary Education

(OTTE), which identifies skill shortages and forecasts future skill needs. This

research will validated by the ITABs

 an Industry Relations Unit, located within OTTE, to manage all aspects of VLESC

and government involvement with ITABs and coordinates a whole-of-government

approach.



6.1.1 Commonwealth Funding

The removal of $1.74 million of Commonwealth funding to State ITABs (announced in May

2002) has damaged collaborative approaches to industry advisory arrangements. As a result,

it has undermined the ANTA Agreement, which is underpinned by the provision of robust

industry advice to inform State and national planning.



Until this time, the Commonwealth has recognised the importance of the role played by State

ITABs in providing industry advice to the national system, and has been prepared to make a

contribution in the overall interests of the system. It is not clear why the Commonwealth has

changed its policy position and funding.



The withdrawal of Commonwealth Government funding of State ITABs has necessitated a

need to find cost efficiencies in the system. Coupled with this reduced funding, the current

review of national ITABs has further exacerbated the uncertainty in the system.



6.1.2 Other Mechanisms for Industry Advice

In addition to ITABs, industry and other stakeholder groups are also represented on a range of

advisory bodies that provide advice to the Government on skill development priorities in

Victoria, including:

 the VLESC, as the State Training Agency for Victoria, which comprises leading

representatives from industry, unions and other community stakeholders







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Victorian Government Submission - Current and Future Skills Needs

 TAFE Institute Councils, which include industry, employer and community

representatives to assist institutes planning for local and industry specific skill

requirements

 memberships of Local Learning and Employment Networks (LLENs), which include

individuals or organisations with an interest in post-compulsory education, training

and employment in the regional area covered by a LLEN

 the ACFE Board and ACFE regional councils, which include community and

stakeholder representatives.



6.1.3 ICT

The Victorian Government, through Multimedia Victoria, has contracted the IT Skills Hub to

develop and maintain the ICT Skills Tracking and Monitoring System, a database collating all

known sources of ICT skills information. Sources include industry surveys, recruitment data,

education and government data. The Hub also reports biannually on demand for ICT skills,

by undertaking workshops with senior Human Resource Managers from over 50 companies

who are key users of ICT skills (representing a workforce of approximately 70,000). The

findings on both the demand for and supply of ICT skills are then reported in the Victorian

Government’s biannual ICT Skills Snapshot. This model, adopted for the ICT industry in

Victoria, ensures wide stakeholder input through the comprehensive range of data sources and

the industry workshops.



6.2 Education, Training and Employment Programs

The Victorian Government engages in regular dialogue and consultation with local industry

and community stakeholders to ensure that its education, training and employment programs

and services are informed by local knowledge of emerging labour market trends and skill

needs.



The Government’s employment programs and services are delivered in partnership with

community and industry stakeholders in local labour markets across the State. This delivery

method ensures timely access to local labour market information. For example:

 the Community Business Employment Program is delivered via a network of community-

based agencies operating from more than 90 sites throughout Victoria

 industry is closely engaged via CBE; the Victorian Government’s Youth Employment

Programs; services of the Employment Attraction and Communications Unit; the

Government’s Multicultural Employment Programs and links with Office of Rural

Communities’ Rural Community Development Officers and Victorian Business Centres

(VBCs) across the State (VBCs are a network of 11 offices across regional Victoria and

metropolitan Melbourne that provide an initial contact point for businesses seeking to

access Victorian Government services)

 local governments are involved in the Community Jobs Program and regularly engage

with the Employment Attraction and Communications Unit and the Government’s

Multicultural Employment Programs

 in future, local governments will have increasing involvement in the Government’s youth

employment programs and the Community Regional Industry Skills Program.



State Governments play a critical role in communicating information about local labour

market conditions to the Commonwealth Government, to encourage national services that are

responsive to local needs. The Employment Programs Division, DVC consults with DEWR

regarding emerging and immediate issues (including, for example, the impacts of drought) to





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Victorian Government Submission - Current and Future Skills Needs

encourage coordinated, timely and appropriate responses by State and Commonwealth

Governments. As noted in relation to Term of Reference (d) on page 29 of this submission,

the Employment Programs Division is currently seeking to establish a Memorandum of

Understanding with DEWR.









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