January 21, 2021

Productivity Commission, National Agreement for Skills and Workforce Development Review, Study Report.

A skilled workforce is fundamental to Australia’s future. As a pillar of our post-school education system, the vocational education and training (VET) system enables people to develop and maintain the skills needed to participate effectively in society and the economy.

Millions of Australians with diverse educational needs, capabilities and aspirations have obtained or honed their workplace skills through Australia’s formal (nationally accredited) VET system.

VET is a shared area of responsibility between the Australian and State and Territory governments. The National Agreement for Skills and Workforce Development (NASWD) — which commenced in 2009 and was updated in 2012 — defines the framework for intergovernmental collaboration in VET. It sets out governments’ roles, policy aspirations, performance measures, and reform directions for the formal VET system.

The Australian Government has asked the Commission to review progress against the targets, outcomes and performance indicators in the NASWD and to assess whether it is still an effective long-term framework for intergovernmental cooperation on VET policy.

Intertwined with that assessment, the Commission has also been asked to consider options:

During this review, there have been major skills policy developments. In November 2019, the COAG Skills Council released a Draft VET Reform Roadmap which set out three priority areas for improvement — the relevance, quality and accessibility of the VET system. In

response to the 2019 Joyce Review, the Australian Government established a National Skills Commission (NSC) and a National Careers Institute (NCI). And in August 2020, all governments signed a Heads of Agreement for Skills Reform setting out high-level directions

for a new National Skills Agreement to replace the NASWD. The Commission has taken this evolving policy landscape into account in its assessment and recommendations.

The review has also coincided with the COVID-19 pandemic. Beyond the immediate disruption for students, employers and VET providers, the pandemic may lead to substantial structural changes in the VET sector. VET policy announcements have been at the centre of

government responses to the pandemic and, where possible, the Commission has incorporated these announcements in its assessments. The pandemic has highlighted the importance of VET and why ‘getting the system right’ is critical to meeting Australia’s changing skills needs.

Productivity Commission 2020, National Agreement for Skills and Workforce Development Review, Study Report, Canberra.