The federal government has announced the commencement of a new Vocational Education and Training (VET) student loans program, to replace the VET FEE-HELP program from January 2017, subject to legislative passage.

Minister for education and training, Simon Birmingham’s reforms to strengthen the VET sector include:

• Course eligibility to be based on industry needs where students completing courses have a high likelihood of gaining employment.
• Student enrolment requirements to prove active and legitimate engagement.
• Setting of higher standards for education providers including the assessing of an institution’s track record of relationships with industry, student completion rates and subsequent employment outcomes.
• Stronger legislative, compliance and payment arrangements with the capping of student numbers and provider loans to limit course scope and greater powers to stamp out or cancel the payments and operations of poorly performing providers.
• Prohibiting the use of brokers to solicit students with offers of free loans and laptops.

The minister, has argued the new program, will “return integrity to the VET sector and deliver a win-win for students and taxpayers through stronger protections.”

NECA chief executive Suresh Manickam praised the announcement and has called on the senate to support the reforms.

“The VET sector’s reputation has been damaged by the behaviour of rogue operators, operating within a poorly thought through loan fee program,” he said.

“NECA has been a long-term advocate for VET sector reform and we welcome changes that assist to deliver more rigorous standards and accountability for providers with a stronger focus on industry needs and future employment outcomes. These changes, support our calls to assist with the rebuilding and enhancement of the sector and we look forward to working with the minister to ensure these reforms come to fruition.”

“I call upon the senate to ratify the new legislation, given the critical need to restore confidence and long-term credibility across the VET sector.”