Event: Jennifer Westacott interview with Robbie Buck, ABC 702 Sydney  
Speaker: Jennifer Westacott
Date: 11 October 2017
Topics: Education
E&OE

Robbie Buck, host: To shift the focus for school leavers from being pushed towards university and to reintroduce them to vocational training, have we gone too far when it comes to that bias? That you have to go to university, you have to get that degree, when in fact, perhaps you might be better off going and doing vocational training. Believe it or not, the chief executive of the business council of Australia no less, Jennifer Westacott is pushing for just that. She will be addressing the Press Club and you will hear from her in just a moment.

Robbie: Do we need to have a shift in the focus? Some interesting detail statistics, which are out this morning, this job search site, Adzuna, claims that there are now 22 university graduates competing for every new graduate position. So, do we need to shift that balance? The Business Council of Australia chief executive, Jennifer Westacott, will today unveil a plan aimed at handing control to individuals over their education through their working lives. In a speech at the National Press Club in Canberra, she will argue that the vocational education training system or VET has been neglected with students receiving less government support than those attending universities and she joins us this morning. Good morning.

Jennifer Westacott, Business Council chief executive: Good morning.

Robbie: This is interesting coming from your organisations, from the business council, saying that there is too much of the university education and we should be shifting back to vocational.

Jennifer: What we are calling for is an overhaul of the tertiary system and why is business calling for it? Robbie, we employ 10 million of the 12 million working Australians. We can see these big forces coming down the track in terms of artificial intelligence, robotics, things like that – we need to prepare Australians for that and we need a better skills system to do that and a better education system to do that. And the bottom line is, to your point, we have too many people doing university degrees, we’ve let the VET system fall, I guess away as a second-class option for people, we’ve got the apprenticeship system in decline. We need to get a system that puts them all on the same playing field. And what we’re calling for is each Australian to have a Lifelong Skills Account and they would decide the provider they go to, they would decide the cases they undertake, and they could do that not just as an undergraduate but for the whole of their lives. We want to see the right incentives for people to do the right course at the right time in their life, so, to your statistic, they’re not spending four years at study only to find the jobs aren’t there.

Robbie: Yeah, give us a little bit more detail on how this plan would work. Are you talking about credits, financial credits from the Government?

Jennifer: Yeah, a combination of both. What each person would get is a subsidy from government and an income-contingent loan, and the account would be made up of those two things. And, they would do their undergraduate degree, and then existing workers in the system could then purchase a module from a TAFE or a module from a VET provider or purchase a module from a university and assemble, if you like, their own credentials. Because, what’s going to happen with big changes in technology is people will have to upskill very quickly, and they’ll have to upskill in very specific areas, and they will not be able to go back and start a university degree – or a VET qualification for that matter – from scratch. The second thing we are calling for is better market information. Now to the example you’ve just given, we need to make sure people understand what course costs, what’s the likely prospect of them getting a job, what does the labour market look like for that job, what are they likely to earn, what will their loan be, what will their repayments be, and giving them information about who are the providers, who are the best providers? Some kind of quality assurance there. Then people can start making the right decisions, and it’s clear that people are not making the right decisions and it’s clear from that data you have just talked about that people are not making the right decision – they’re spending a lot of time at university only to come out and find they can’t get the job they wanted.

Robbie: I’d love a few calls on this, this morning 1300 222 702 is the number here, do you feel the pendulum has swung too far towards university education if you are a school leaver as opposed to more vocational training and, I guess, Jennifer where the problem arises, if you want to lay some blame, how has it swung out of balance like that? Is it the universities are becoming more business-like in the way they have to attract students to maintain income.

Jennifer: It’s the way the funding system works. Let me give you the example of nurses – it’s a great example. If I’m a registered nurse, I go to university. I can get a subsidy of $40,000 – I’m guaranteed that – and I can access a loan of $99,000. If I’m an enrolled nurse, I go to VET. I can’t be guaranteed a subsidy, and I can only borrow $15,000. So, what course am I going to do? People will choose university nursing, and that’s the problem because you think about the aged care system, we need to make sure we have both registered nurses and enrolled nurses. And it’s just a great example of the distortions that have been put into the system to go to university because the subsidy is higher, the loan they’re entitled to is higher, and we need to correct that imbalance. The second thing, and I talk about this in my speech today, that I think is happening, is that career counsellors, we need to reinvigorate the art of career counselling to make sure that young people are aware that sometimes a vocational path is the best path for them, an apprenticeship is the best path. A lot of this is cultural – parents want their kids to go to university, I can understand that, but then they find two years into that degree that they’re not suited to university, they’re not doing something they enjoy or like, and they should be doing something else. We have to do a lot better with young people in schools to help them find the right pathway, and we want to see a reinvigoration of career counselling and businesses want to work with them to do that.

Robbie: Okay, Jennifer Westacott is here with you this morning. She’s the chief executive of the Business Council of Australia and will be delivering this speech at the Press Club in Canberra later on today on this topic. The number here is 1300 222 702. If you are somebody who works in the education, higher education sector, what you make of it, if you are somebody has gone through vocational training yourself and maybe you have your own kids who are making those steps or the considerations that you make. I remember, Jennifer, you’ll have to forgive me as I cannot remember her name, but we had the head of a group of 8 universities, the sandstone universities, and she was saying, earlier this year or late last year, and she was saying look there are too many people going through universities.

Jennifer: Yeah, there’s a million people going through university at the moment and that’s because we have a funding distortion. Let’s be clear, our universities are fantastic and they’re a great pride to our nation, but we’ve really dropped the ball on TAFE and our vocational system.

Robbie: But that must be a funding thing as well. We’ve seen that whenever we talk about TAFE we get a lot of calls from people saying who have worked in the TAFE sector saying it’s been dismantled essentially in some ways.

Jennifer: We’ve spent a lot of money on schools, a lot of money on universities – VET has less funding than it did 10 years ago – so that just tells the story, doesn’t it? It’s interesting, I’ve been overseas talking to very senior businesspeople in the US who are worried about the change that’s going to happen in the way we work with artificial intelligence and robotics, and they all say it’s the vocational system we should be looking at.

Robbie: It’s really interesting isn’t it?

Jennifer: You know, these are very senior people who work in technology companies and they all say it’s the vocational system we should focus on.

Robbie: We’ve also introduced a cold war on education, haven’t we? With higher education, with people who once upon a time might have had a vocational course under their belt, gone in and done the extra training in the field and then developed their skills as they’ve gone along. Now, just to get that first step in the door, you’ve got to have a masters or an MBA in some professions, maybe not quite to that extremity.

Jennifer: I think that’s a really good point that you are making. I’m not sure that employers want everyone to come in with a masters. Part of the problem now is that you’ve got young people being at university until they are 23 or 24. By the time they get into the workforce the world has moved on pretty quickly. I mean we are living through a very very rapid period of change. So we’ve got to make it easier for people to work and learn at the same time and we’ve got to really think about structuring qualifications. We’ve got to also think about giving young people, giving all workers actually, more generic skills like problem-solving, computational thinking – those sorts of skills – because we don’t really know what some of the jobs of the future are going to be, but people are going to need those skills of resilience so they can adapt. The other thing we’ve got to make sure we do is, you know, if you’re a worker and you’re in an industry, let’s say the finance industry, that’s going to be automated and you’re 50, you need to be able to upskill very fast and we want people to be able to do that, and that’s not going to be go back to do a masters or a new undergraduate. You’ve got to be able to access, either from university or vocational, a module, a specific course, and that’s why we’ve proposed a Lifelong Skills Account so people can assemble their own qualifications, effectively, have them credentialed but the learner is in control.

Robbie: Okay, it’s a really interesting proposition, we look forward to the speech at the Press Club later on today. Thanks very much for your time this morning.

Jennifer: You’re very welcome.

Robbie: Jennifer Westacott there, the chief executive of the Business Council of Australia. What do you make of it? 1300 222 702.