Angela Connell-richards: 0:27

Welcome to the RTO Superhero Podcast, where compliance becomes collective action. I'm your host, Angela Connell-Richards. Today we're confronting a perfect storm significant funding cuts to private RTOs and, from 1 July 2025, a comprehensive overhaul of national standards by the Department of Employment and Workplace Relations. If we don't act within the next 12 months, we risk losing thousands of quality providers and their expert teams. Let's delve into what's happening, hear real stories and chart a path forward.

Angela Connell-richards: 1:10

Australia's vocational education landscape has dramatically shifted over the past two years. Governments at both state level and federal have heavily invested in fee-free TAFE initiatives, expanding subsidised places by tens of thousands. However, this has come at the expense of private RTOs, leading to fewer funded places, squeeze operating margins and growing calls for a performance-based funding model. Let's break down the major funding developments across various jurisdictions. Victoria In late 2023, the Victorian Government awarded Skills First contracts for 2024 to just 78 providers, effectively removing 22 private RTOs from the program, despite ongoing skill shortages in sectors like manufacturing. Western Australia the 2025-26 state budget committed $100 million to freeze TAFE fees in 2026 and $21.9 million to expand fee-free building and construction courses. While fee-free courses are available across WA TAFE colleges and private training providers, the emphasis was overwhelmingly flavoured by TAFE delivery. New South Wales the Smart and Skilled Program maintains eligibility for private RTOs if they meet all requirements for private RTOs if they meet all requirements. Yet antimonial reports indicate funded places have plateaued and many RTOs feel squeezed as more places are earmarked for TAFE.

Angela Connell-richards: 2:56

New South Wales. Queensland under the national commitment to 300,000 fee-free TAFE places by 2026. Queenslanders gained access to 14,500 fee-free places in 2024. While some providers may access these places, the scale of fee-free enrolments has placed private RTOs under financial pressure. South Australia Skills SA lists a growing number of fee-free TAFE courses, but private RTOs report difficulty in securing subsidised enrolments amid an expanding TAFE share of the skills list.

Angela Connell-richards: 3:39

Tasmania TasTAFE's fee-free TAFE initiatives covers tuition for over a dozen Certificate 2 to 4 courses. Private RTOs express concern that their funded cohorts are shrinking as students opt for free options. Northern Territory, charles Darwin University and the Northern Territory TAFE jointly offer fee-free TAFE places. However, private RTOs note that eligibility rules exclude many provider types, concentrating government support within the public system. The key takeaway here is, across every state and territory, fee-free TAFE expansions have prioritised government institutions, tafes and ACE colleges, often at the expense of private RTOs. This policy shift has coincided with wholesale funding reallocations, leaving private providers to compete for a shrinking pool of places, despite delivering demonstrably superior outcomes. Superior outcomes Australia's private RTOs face not only crippling funding cuts, but also the most significant regulatory reform in the decade.

Angela Connell-richards: 4:55

In May 2024, the Skills and Workforce Ministerial Council approved a complete redesign of the RTO standards, now administered by the Department of Workforce Relations, dewa, effective from 1 July 2025. Let's have a look at a timeline and sector consultation. In 2019 to 2024, dewa conducted four years of public consultation with states, territories, asqa, peak Bodies and RTOs to draft revisions to the Standards for RTOs 2015. 1 October 2024, dewa released the policy version of the revised standards and opened a public survey, receiving over 100 sector submissions by month end. Early 2025, draft regulatory guidelines are scheduled to be progressively published by ASQA to support the transition. 14 March 2025, dewa last modified its Outcome Standards Policy Guidance document, signalling final tweaks ahead of legislative enactment. April 2025, the National Vocational Education and Training Regulator instruments were tabled on the Federal Register. 1 July 2025, full regulatory effect of the revised standards All RTOs must comply from this date forward.

Angela Connell-richards: 6:22

So let's have a look at the key components of the revised standards. The new framework comprises three separate instruments designed to sharpen focus on quality outcomes and streamline compliance. We've got the outcome standards. Define the essential quality outcomes RTOs must consistently achieve, structured into six domains, placing the 2015 standards mixed compliance outcome approach, compliance requirements. Outline administrative and governance obligations, including governance checks, reporting and record keeping. And third party arrangements. And then we have the credential policy that standardises qualification issuance and assessment validation requirements.

Angela Connell-richards: 7:06

As an RTO, there are many burdens when it comes to the new revised standards. One such is policy rewrites. Rtos must update all policies and procedures to align with each separate instrument. Dua estimates an average RTO will need to rewrite 50 to 70 documents. Risk management systems Every provider must implement a formal risk framework and register Staff training All personnel must be familiarised and trained on the new standards, requiring 10 to 15 hours of professional development per staff member on average. No additional funding DWER has provided no dedicated grants or subsidies to assist RTOs with these reforms. Why does this matter? With core funding down by 80% in recent contract rounds, many private RTOs lack the cash reserves to cover these compliance costs, risking further closures Without proper resourcing. Some providers may struggle to fully embed the new standards, potentially affecting training quality and triggering non-compliance sanctions. Struggle to fully embed the new standards, potentially affecting training quality and triggering non-compliance sanctions.

Angela Connell-richards: 8:22

Between 1 July 2024 and 16 June 2025, australia faced a surge in business failures that rippled straight into the VET sector. The 2023-24 financial year marked a record 11,053 companies entering external administration, the highest since the global financial crisis. This trend accelerated in 2024-25, with 12,405 businesses collapsing between January and November 2024. Ghost college shutdowns August 2024.

Angela Connell-richards: 9:00

The Albanese government closed over 150 dormant ghost colleges and issued warning notices to 140 more, aiming to curb providers enrolling students for visas without genuine training, to curb providers enrolling students for visas without genuine training. However, this sweep risked catching reputable RTOs in the net. The collateral damages that many RTOs caught up in the Ghost College crackdown were genuine providers who had paused delivery due to lack of international students or government funding. And then there was the Automatic policy 1 July 2024. Asqa implemented a rule automatically lapsing the registration of the RTO that hadn't delivered training for 12 consecutive months.

Angela Connell-richards: 9:49

Now let's have a look at some real stories, or some of our clients. We have a client that's a not-for-profit provider in New South Wales and, as of 1 July 2025, this community-focused provider experienced a 60% reduction in its Martins Guild funding, forcing it to halve all of its training and cut back on all of its staff cutback on all of its staff. In Victoria, we have an RTO that earlier this year experienced up to 80% cut in state contract funding. That led to cancellation of training and courses and the redundancy of trainers. There's also been a number of liquidations in our industry a number of liquidations in our industry. One such is EduWorks, which is an RTO consulting organisation that's been around for around 16 years and the liquidator was appointed on the 17th of March 2025. This is partially due to RTOs not being able to pay their bills, not having sufficient funds to be able to cover all of the compliance risks that they need to cover, which has forced a well-known consulting organisation going into liquidation and all of their staff being made redundant. There's also been examples of books and stationery companies. There was one in Brisbane, a supplier that entered into voluntary liquidation on the 18th of March 2024, owing over $5 million to creditors. Another such is a venue where they hold training venues, so they were liquidated on the 29th of April 2025 with over $1.4 million owed to the ATO. These frontline accounts show that, beyond the statistics, real organisations and livelihoods are unravelling.

Angela Connell-richards: 12:08

In the next section, we'll examine the superior outcomes private RTOs deliver and why shifting to a performance-based funding model is critical to preserving choice, quality and jobs in Australia's VET sector. Despite navigating severe funding cuts and looming compliance reforms, private RTOs continue to deliver superior student and employer outcomes across multiple metrics completion rates, graduate employment, employer satisfaction and cost effectiveness. This section outlines the hard data demonstrating private providers' strength, underscoring why performance-based funding is essential to sustain quality and choice in Australia's vet ecosystem. Ncver's 2023 report shows private RTOs achieved an overall of 54.2% qualification completion rate, compared with 43% at TAFE Institute a gap of 11.2 percentage points, demonstrating private providers' effectiveness in guiding students to the finish line. Breaking it down by level Certificate 1, private providers 38.5% versus 22.5%. For TAFE. Certificate 2, 50.8% versus 33.8%. Certificate 2, 50.8% versus 33.8%. Certificate 3, 57.9% versus 51.9%. Certificate 4, 51.9% versus 44%. Ncver notes these completion advantages have persisted over the last five years, reflecting private RTOs' consistent performance amid sector upheaval.

Angela Connell-richards: 13:59

The VET Student Outcomes 2023 survey reports that 50.6% of graduates who were unemployed before training found employment after completing their qualification and 37.8% of those already employed moved to higher skilled jobs, highlighting VET's transformative impact. Two-thirds of Certificate I or above graduates experience improved employment status post-training up to 2.6% from the prior year. Private RTOs outshine TAFE in employer ratings across key dimensions Relevance of skills taught 85.7% for private versus 80.1. Flex% Trainer industry currency 86.3% versus 76.8%. Standard of assessment 87.8% versus 72.9%. These figures confirm businesses trust private providers to deliver job-ready graduates tailored to industry requirements. According to the 2023 National Student Outcome Survey, 90% of private RTO graduates expressed satisfaction with their training, compared to 85% at TAFE, reflecting stronger engagement and support in private settings. Moreover, 92% of private alumni would recommend their course to others, underscoring the perceived value of their experience. These statistics have been taken from ncvereduau Industry body.

Angela Connell-richards: 15:54

Iteca highlights that private RTOs deliver equivalent outcomes at a fraction of the cost. Deliver equivalent outcomes at a fraction of the cost. A dollar of a taxpayer funding in private RTOs generates the same training outcomes that would cost $3.73 in TAFE, demonstrating efficient use of public dollars without sacrificing quality. A recent NCVER study reports 94.5% of trade apprentices were employed six months post-completion in 2023, outpacing the 88.9% employment rate for university graduates and showcasing VET's direct link to work-ready outcomes. Professions such as electrotechnology both starting wages at $82,900, nearly on par with commencing doctors, further affirming VET's market relevance. Vet enrolments exceeded $1.26 million in 2023, a 5% increase from 2022, with TAFE enrolments rising by 8.3% thanks to fee-free initiatives. Yet private RTOs remain crucial in servicing niche and regional demands, maintaining program diversity, critical for skills gaps. Ncver's Employer Views Report confirms a sustained high level of engagement, with 84% of employers using accredited training and reporting satisfaction across both private and public providers. This data underlines that private RTOs not only match public providers in scale, but exceed them in quality and efficiency, strengths that funding models must reward rather than penalise.

Angela Connell-richards: 17:47

Here's the critical juncture. The 2026 funding allocations are being finalised right now. If private RTOs don't secure performance-based and transparent funding in this round, we will see the steepest wave of closures ever recorded. Entire programs hospitality, aged care, health support, it trades could vanish, trainers will be laid off, classrooms will be closed, students will have nowhere to go, in particular in regional areas. And let's be clear this is political, not technical. We know how to run compliance. We know how to measure outcomes. We have evidence NCVER data, asqa audits, employer surveys, student feedback that private RTOs deliver.

Angela Connell-richards: 18:41

The question is will our decision makers listen? Remember, compliance doesn't have to be a burden. It can be your superpower, but only if we use it as a foundation for collective action. Right now, private RTOs are facing more than just funding cuts. We're facing the possible dismantling of the most agile, high-performing part of Australia's vocational education system. We know the value we bring. We know our data backs us. The only question left is will we raise our voices before it's too late? Australia's private RTO sector survives on real collective voices. Mere LinkedIn posts won't move the needle To secure performance-based, transparent funding and preserve vocational choice. We must transform slacketivism into practical action.

Angela Connell-richards: 19:40

I'm going to give you some essential steps, backed by evidence, on what makes petitions and grassroots mobilisation effective. Social media likes and shares feel empowering, but without concrete follow-through they amount to slacketivism. Low-effort activism that rarely produces policy change. Research shows that e-petitions combined with direct pressure low-effort activism that rarely produces policy change. Research shows that e-petitions combined with direct pressure on decision-makers significantly increase the likelihood of a response.

Angela Connell-richards: 20:11

Signatures alone isn't enough unless accompanied by calls, emails and meetings. Thousands of successful Australian campaigns, from saving public parks to wiping out HECS debt, began with petitions that surpassed critical signature thresholds. Nearly 300,000 signatures led to the HECS reform. Add your name now. Go to https://changeorg_ Save_ Private_rtos

Angela Connell-richards: 20:47

Encourage supporters to email, call or meet their local MP. Decision makers rank direct, consistent contract emails 32.7%, phone 19.2% and in-person 23.1% as more persuasive than social media tagging 11.5%. Provide pre-written templates and scripts to make their outreach simple and effective. Petitions that include authentic narratives of impact resonate more deeply. Describe your RTO's funding, cut staff layoffs or student delays. These first-hand accounts compel MPs to act and act now. Host a local RTO day of action, virtual town halls or small group meetings with MPs of action virtual town halls or small group meetings with MPs. Collective events demonstrate community strength far beyond isolated social posts. And watch this space. We have a lot coming forward. Evidence for sector-wide mobilisation Petition victories Change. org Australia reports 3,256 victories since 2011, with 906 formal responses from decision makers, showing that organised petitions can reshape when combined with follow-up actions.

Angela Connell-richards: 22:18

Your next steps Sign and share. Put your name on our petition the links are in the show notes or go to changeorg backslash, save underscore private underscore rtos and ask five colleagues to do the same for the email template that I've provided in the show notes to your local MP and follow up within a week. Post your story in our Facebook group and tag three peers. Then post a short video calling on your network to take the petition further. Stand up now, not just with social media posts, but with clear, measurable actions when 3,000 plus sector voices unite, we will transform policy, secure fair funding and ensure private RTOs continue to deliver the quality training Australia needs.

Angela Connell-richards: 23:16

Sign the petition. Go to https://change. org/ Save_ private_ RTOs. Share your story on Facebook and LinkedIn. Contact your local MP. Thank you for joining me on this urgent, essential episode of the RTO Superhero Podcast. The next 12 months will define the future of private vocational training in Australia. If you believe in choice, quality and innovation, sign, share and contact. Let's turn compliance into collective action and ensure our sector not only survives but thrives for generations to come. I'm Angela Cornel Richards, ceo and CEO and founder of Vivacity Coaching and Consulting. Stay compliant, stay empowered and I'll see you next time.