This speech was delivered by Business Council Chief Executive Jennifer Westacott at the Australian Davos Connection Forum in Melbourne on 11 August 2016. 

Check against delivery.

Distinguished guests. Ladies and gentlemen.

I would like to acknowledge the traditional owners of the land on which we are gathered, the Wurundjeri people of the Kulin Nation, and pay my respect to their Elders—past and present.

I would also like to thank the Australian Davos Connection Forum for inviting me to speak tonight.

Education is something I’m passionate about, and I’m thrilled to talk to you tonight about the future of education.

Education is dear to my heart because it changed my life.

I grew up in public housing and my grandmother believed education was my opportunity. She was right.

Education was the game-changer for me, as well as my siblings.

My education is why I’m standing here tonight and why I have had remarkable opportunities throughout my life.

Don’t get me wrong, there was a lot of hard work along the way, and I wouldn’t be here if I hadn’t worked hard.

But there are many people who spend their lives working 10 hours a day, sometimes in back-breaking labour, who don’t get the same opportunities I’ve had.

My grandmother taught me that education was the key to my future.

It’s the key to our children’s future.

It’s the key to every working Australian’s future.

And it’s the key to our country’s future.

But, if education is truly the key to our future, what do we need from education?

To answer that question, there are four main topics I’d like to cover tonight.

• First, going back to basics on what we want from education.
• Second, why we educate, and why government invests in education.
• Third, I want to reflect on the future of work, and the future of social interaction, and what they mean for education.
• And finally I’d like to conclude on what needs to be changed in our education systems.

What we want from education 

So to my first topic, what is it that we want from education?

As someone who once ran the Education Department here in Victoria, I find that most people have an opinion about education.

They also care a lot about education. For themselves, their families, and the community.

We saw that play out in our recent election campaign.

We heard about the Gonski funding model. We heard about TAFEs failing. And we heard about 100, 000 dollar degrees.

But what we didn’t hear, and what we didn’t talk about, is what we want from education.

We’ve known for a long time that education is important for a good and decent society.

Aristotle believed that education’s primary mission was to produce good and virtuous citizens.

Eleanor Roosevelt argued that the first objective of education is informed and intelligent citizens.

Martin Luther King Jr said the goal of true education is intelligence plus character.

I agree with them all.

We educate to give people the capacity to think as well as absorb knowledge.

We educate to provide community wide values.

The values of citizenship – honesty, compassion, respect, responsibility, and courage.

And to transfer the knowledge we should have as good citizens. To know our history, and our place in the world.

We also educate so that people are equipped for work.

After all, work is what we spend most of our lives doing.

And we’re going to be working longer.

Work is how we put food on our tables, pay for our homes, and pay for the interests in our lives.

People working is also what drives the economy.

It creates the revenue that allows us to re-invest in a better and stronger society.

But make no mistake, we don’t educate only for people to work.

We also educate so people are enlightened and can get satisfaction from their lives.

Why mass education 

So we know what we want our education system to deliver, but why does government fund it?

I believe the greatest achievement of education reform in this country, is that we have bipartisan and community support for education for all.

As a result, Australia has a mass education system.

Between them, governments in Australia invest over 67 billion dollars each year in education.

Why?

Because a mass education system can deliver four key things.

First, education is the great equaliser.

In my view, education and all the things that flow from it, creates the single biggest platform to reduce inequality.

Second, education helps people to adapt and is a form of protection in times of change.

When people fall out of society through family violence, job loss, homelessness, or illness, they often can’t find a way to get back in.

Education is the way back in.

Education gives everyone the opportunity, at all stages of their lives, to adapt and change.

Third, education can be catalytic for society.

Some of the greatest advances in science, maths, and philosophy come from the simple statement: I do not know.

And seeking that answer can propel societies into a new era of progress and prosperity.

And finally, education is how we build cohesive societies.

Knowledge replaces superstitions, ignorance, and prejudice. It helps us deal with the fear of the unknown, and the fear of change.

Malala, one of the great modern inspirations on the importance of education has talked about her father’s belief in education.

He taught her that ignorance allowed politicians to fool people and bad administrators to be re-elected.

Fundamentally then, we invest in education because it builds a better and more decent society.

The future of education 

That then leads me to the key issue tonight of the future of education.

How do we get the best value from a mass education system in the face of rapid change?

We know that our economy and our society are facing significant disruption.

Let’s start with the world of work.

We are seeing report after report saying that somewhere between 20 and 60 percent of jobs will be replaced by robots.

Some traditional industries are in decline, and traditional business models are transforming.

Our businesses and workers are having to compete on a global stage.

Jobs that people trained for 20 years ago have been offshored.

 A global marketplace also means greater opportunities for specialisation.

• Final products will no longer be made in one country.
• Production will be increasingly reliant on skills, not cheap labour.
• And this means skills and capabilities become the tradeable commodities.

The nature of the employment relationship is also changing.

• People are quickly signing up to new business models like Uber where they can be masters of their own destinies.

If I turn to social interaction, and the way we communicate. This has also fundamentally altered.

We have world leaders communicating via apps on smart phones, and our kids have an intuitive understanding of technology.

There are fast becoming no jobs in our economy, and no interactions in our society that don’t demand a grouping of skills.

The skills of literacy, numeracy, technology, communication, customer service.

• And perhaps most importantly the ability to adapt and work as part of a team.

The thing we need to remember is that we’ve had big disruptions in our society before.

But this time, for the first time in our history, we have a tool to achieve progress for all.

A tool that smooths out the bumps of the transition.

That tool is our mass education system.

Which is why it is imperative we get our education system right.

What getting it right look like

So, what does getting it right look like?

To begin with, I’d like to make some observations about the need for an overall culture change in our education systems.

And then I want to talk about some specific ideas for VET and higher education, and finish with schools.

Culture change 

In my opinion, if education is to be the game changer for our nation we need a culture change.

We often overlook how crucial culture change is, and then wonder why reform fails.

Culture change creates a new environment.

• One that makes it easier for subsequent reforms to succeed.

So, I think we need to see eight fundamental changes.

First, we need to shift from a provider–centred education system to a learner–centred one.

Second, consistent with being more learner–centred, we need to embrace multiple styles of learning, not limit ourselves to an academic style of learning.

And by that, I mean moving beyond a teacher standing up in a classroom and imparting their knowledge.

We need to embrace other methods of learning like coaching, design thinking, and inquiry based learning.

Third, we need to stop the culture where kids are told they are not smart unless they are academically successful.

Practical, creative and emotional intelligence need to be equally valued alongside academic intelligence.

This is particularly true in schools, where we need to be clear that success is not limited to people who excel academically.

Fourth, we need to stop thinking that university is the pinnacle of success.

This drives people into university who don’t always benefit from it.

It also drives the fifth cultural issue that VET is a second–rate option behind universities.

The place for the so called less intelligent people.

This is despite the fact that our VET graduates, including our tradespeople, are big economic contributors.

They are the people who start small businesses, take risks, employ people, and are often the backbone of regional communities.

The sixth cultural shift we need to make is to once and for all give up on creeping credentialism.

By that I mean making a degree an entry requirement for a job, so the job becomes more prestigious.

Instead of valuing the qualification that leads to the job, we should value the role.

And most importantly, value the attributes a person needs to do the job well.

For example, childcare and aged-care are important roles and ones we should value as a society.

But that doesn’t mean those workers should have to complete a university qualification.

The seventh change we need is to allow multiple pathways within qualifications, and not limit them to a single occupation.

After all, very few people have one occupation across their working life.

The final culture change is to move away from the idea that our main domain for learning is an institutional setting.

By the age of 21, most kids today have spent 17 years of their lives in formal learning in an institution.

And with the rise of double degrees and graduate entry courses, we’ve got people still studying when they’re 23 and 24.

Or young people moving into Masters level courses without ever having worked.

We need to give people more avenues to work and learn at the same time, and an option to do so at an earlier stage.

Otherwise, by the time they graduate the world will have moved passed them.

These eight culture changes will allow us to start heading towards a fundamentally different system.

If we skip this step of culture change, and have a narrow focus on technical reforms only, we will continue to waste time and money.

VET and higher education changes 

So turning to the specific reforms, I’d like to start with VET and higher education.

Let’s start with what’s common for both sectors, and then I’ll move to VET.

The most important thing we need to do is to place the learner at the centre of VET and higher education.

Let’s begin by giving them information so they can make informed choices.

• And by information I mean telling them about where jobs will be.
• The potential earning capacity they will have.
• How long it will take for them to pay off their HELP debt.

Next, we need to get demand-driven funding models right.

Funding has to be about the learner, and the model has to incentivise the right behaviours by learners and providers.

So let’s think about replacing all the demand–driven funding models with something like a Virtual Learning Account for everyone.

• The learner would choose their provider, and the funding would follow them.
• The Learning Account would be available to them at all stages of their lives, but would have a cap.
• They would get a government subsidy and access to an income-contingent loan.
• And the rate of government support would be based on the potential private benefit a learner would receive.

A Virtual Learning Account or something like it, is the best way to operationalise an education market.

And it’s far preferable to returning to a world of capped places.

Finally, we need to build our qualifications and skill sets around the needs of learners and the needs of industry.

We need Training Packages and higher education qualifications to do the same thing.

• They need to be more modular. They should let people build on a base qualification throughout their working lives.
• They need to develop the whole person. Their technical, functional, cognitive, and behavioural skills.
• They need to keep pace with labour market changes.
• And they need to deliver graduates who are work-ready. Ones that have a core set of values, behaviours and skills that employers need. 
• And whether its Training Packages or qualifications, we need a permanent and continuous process of broad industry engagement.

VET

Margaret will spend some time talking about higher education later, so I’d like to focus on VET.

I talk a lot about VET, and I’m passionate about it, and people often ask why.

It’s because I believe VET will be the place where most workers will be prepared for the new world of work.

But to do that, our VET sector needs much greater attention from governments.

The most urgent thing we need to do, is to repair the damage done to the reputation of the sector.

We do this by removing the small group of providers who have acted irresponsibly.

They are rorting the system.

And they are preying on the most vulnerable.

We need to withdraw all government funding from these providers.

And we need to shut them down.

We also need to redesign VET FEE-HELP.

The Business Council recently put in a submission to the government and proposed the following:

• All learners remain eligible for VET FEE-HELP
• A lifetime loan cap is applied
• Government funding is restricted for courses with poor employment outcomes, and
• Contract management is strengthened, including requiring providers to publish market information.

Dealing with the reputational issue, and fixing VET FEE-HELP are essential to underpin more fundamental reform of VET.

We can pursue other reforms simultaneously, but the VET sector will not survive without these fixes.

The other top priority in VET is the role of TAFE.

Starting with a proposition that there is no role for TAFE is a nonsense.

We cannot allow TAFE to die a death of a thousand cuts.

It cannot become a residual provider.

TAFEs are often the lifeblood of regional communities, and are often the only pathway for disadvantaged people.

State governments need to be clear about the role they want TAFEs to play, and fund them appropriately.

But TAFEs themselves must improve their business models. They need to ensure the taxpayer is getting value for money from their investment.

I believe there is a big appetite amongst the Premiers to fix VET.

Over the next 12 months and before the National Partnership expires, the Commonwealth and States need to sit down together and map out a plan for VET.

We also need a long term reform agenda for the apprenticeship system.

But that is a speech in and of itself, and I want to turn now to schools.

Schools

I’m concluding with schools because they are so important.

I’d like to see 4 key actions in schools covering our approach to learning, teacher quality, curriculum, and funding models.

I’ve already talked about the need for a culture change to embrace all styles of learning, and I want to push for a broader take-up of inquiry based learning.

In simple terms, that means a focus on being able to find and use information, not just remember and repeat it.

Inquiry-based learning is widely acknowledged to be an effective teaching method for maths, an area where we have gone backwards.

The Khan Academy is a great example of teaching maths in a different way.

But inquiry-based learning is relatively new and under-utilised in Australian schools.

Now I’m not advocating for one style of teaching only. Improvement won’t come from one style. A combination of approaches is needed.

But, in moving beyond a traditional model, the role of the teacher becomes paramount.

It has always been important, but never more so than today.

In a system of mass education, with diverse learning styles and diverse learners, the quality of the teacher will make all the difference.

This is confirmed by the OECD. They have said inquiry, design, and coaching approaches to learning are highly dependent on the knowledge and skills of the teacher.

We’ve spent far too long talking about class sizes, when an initiative on teacher quality should be at the top of COAG’s agenda.

But we also need to look at the curriculum we’re offering, not just how we teach it.

We have numerous reports that tell us students find maths difficult, and irrelevant to real life.

And no matter how good the teacher standing in front of them is, those kids will not be engaged if the teacher is limited by boring curriculum.

The final area that needs a national focus is the schools funding model.

Recently, we’ve had a very confused debate in Australia about my friend and colleague David Gonski’s funding model for schools.

I think it’s clear that David’s basic model was right.

He advocated for a needs-based funding model, and that’s what we should have in this country.

But let’s define what needs-based funding means.

It means that a dollar amount is assigned to a learner, based on their disadvantage.

The dollar amount follows the learner, it is not assigned to a specific school.

So a school’s funding starts with the number of learners and their needs. Not the funding the school got last year.

That means, over time some schools will get more money and some will get less.

That is what a true needs based funding model would do.

David’s terms of reference did not allow for that. They required no school be worse off.

And in requiring that no school be worse off, a false perception of a so-called shortfall was created.

We can’t go into another election with this false perception that there is a funding shortfall preventing us from implementing a needs-based approach.

Now is the time to properly implement David’s model.

And we can do that by the Commonwealth urgently phasing out all the side deals that were done to keep in place the promise that no school would be worse off.

Transition will of course be important, but it can be done more quickly.

Schools need to plan and can’t have their funding changed without notice and time to adjust.

But the transition needs to start now.

We also need for States to be given incentives, through productivity style payments, to adopt a true needs based funding model quickly.

 And growth money, beyond the needs based funding, should be devoted to improving outcomes, based on evidence of what works.

• As Minister Birmingham has started to do with his school reforms.

Starting this process will finally allow us to put this issue to bed so we can get on with teacher quality, new approaches to learning, and a more engaging curriculum.

Conclusion 

To conclude, our education system will be the most important tool to equip us as a society and an economy.

But it won’t be fit for purpose without purposeful policy change.

And it won’t be paid for without a robust, growing economy.

We talk a lot about fairness in education.

And I don’t think it’s fair to allow education policy and debate to be driven by ideology and not evidence.

By politics and not good policy.

And the greatest unfairness is to embrace a mass education system for all, but not deliver one.

So deliver one, we must.

Because education is the great force for enlightenment.

It is the great enabler. The great force for civilisation.

And education should never be the domain of the elites.

It should be available for all Australians to fulfil their potential.

So like me, all Australians get the opportunity my grandmother knew would change my life.

Thank you.