Media Release

The student loan scheme, VET FEE-HELP is being rorted by private providers, at the expense of our public TAFE system, says the Member for Kennedy, Hon Bob Katter.

VET-FEE Help is a student loan scheme introduced into the Vocational Education and Training (VET) sector in 2008, similar to the HECS scheme for universities. Students don’t pay upfront for courses but acquire a debt which they are only required to pay off when their income reaches a certain level.

However, Mr Katter says, unlike the higher education sector, there is no fee regulation in VET and more than 75% of VET FEE-HELP now goes to the private for-profit VET sector to the tune of $6b of taxpayers’ money.

“So the private providers are using the VET-FEE HELP scheme to expand their operations at the expense of students and TAFEs. They get paid by the government whether the students complete the course or not.

“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.”

Mr Katter said VET FEE-HELP debt has grown exponentially 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 loans via private providers increased from just over $200m in 2012 to $6b to date. Over half of that money, more than $3b has gone to only six private providers, with the other half going to 200 providers, including TAFE.

“VET FEE-HELP has let the states stop funding higher level VET qualifications and has shifted the costs onto students via federal government loan. I see it as part of a broader privatization and de-regulation agenda, which has also seen TAFE budgets slashed. 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.”

Mr Katter said the ABC journalist, Paddy Manning, has revealed that at the end of last year, six of the top 10 private vocational training colleges were under a cloud, facing regulatory sanction, prosecution or threatened legal action by angry students.

“TAFE tells me there is an increase in private providers for VET education, that they’re offering low-quality courses and ripping off students,” Mr Katter said.

Mr Katter met with Queensland Teachers Union representatives recently and said he is keen to help.

“I’ll be writing to the federal education minister, asking for an urgent enquiry into VET FEE-HELP.”

ENDS