"TAFE tells me there is an increase in private providers for VET education, that they’re offering low-quality courses and ripping off students," said Katter.
Katter called for an urgent inquiry after claiming 75% of VET FEE-HELP payments were being made to for-profit private providers. There is currently no fee regulation in VET, unlike the higher education sector.
He added that loans via private providers increased from just over $200m in 2012 to $6bn this year. However, more than $3bn of that has gone to only six private providers, with the rest going to 200 providers, including TAFE.
Katter also cited an ABC report which revealed late last year that six of the top 10 private vocational training colleges were facing regulatory sanction, prosecution or threatened legal action by students.
With VET-FEE HELP, students don’t pay upfront for courses but obtain a debt which they are only required to pay off when their income reaches a certain level.
The private providers are using the VET-FEE HELP scheme to expand their operations to the detriment of students and TAFEs, said Katter.
“They get paid by the government whether the students complete the course or not,” added Katter.
“Basically, these for-profit providers can charge what they like; the government is allowing it and it’s the poor students who are carrying the debt load.”
Katter said VET FEE-HELP debt has grown massively since 2012, when the Federal Government weakened the regulations around the scheme to give private VET providers easier access to government funding.
“VET FEE-HELP has let the states stop funding higher level VET qualifications and has shifted the costs onto students via federal government loans. I see it as part of a broader privatisation and de-regulation agenda, which has also seen TAFE budgets slashed,” he said.
“Furthermore, the federal government has failed to monitor the exponential growth in VET FEE-HELP loans, especially to colleges that have sprung up in the last few years and are now garnering billions of dollars in tax payers’ money."
Katter is supported by the Queensland Teachers’ Union president, Kevin Bates, whom he met with recently.
“I’ll be writing to the federal education minister, asking for an urgent enquiry into VET FEE-HELP,” Katter said.
Private training providers are rorting the loan scheme VET FEE-HELP at the expense of the public TAFE system and students, according to the Federal Member for Kennedy, Bob Katter.