New Apprenticeships and User Choice in Australia

Transcription

1 New Apprenticeships and User Choice in Australia Richard Curtain Curtain Consulting, Melbourne April, 2000 User Choice is a mechanism for giving end users of services in the training market a more direct choice in the quality and type of services available. User choice needs to be understood The New against the background of the new flexible arrangements for structured entry-level training referred as New Apprenticeships. Apprenticeship scheme was established in It provides competency-based qualifications that are nationally recognized. New Apprenticeships are based on previous structured entrylevel training arrangements. These took two forms. There was (and is) a traditional four-year apprenticeship system (operating under State legislation and, in many cases, dating from last century) covering occupations mainly in manufacturing and construction. There was also the Australian Traineeship System (under Commonwealth legislation) which was initiated in This was a qualification based on 12 months combined training and paid work, usually consisting of one or two days a week off-the-job training in TAFE with paid work. Traineeships have been in occupations not covered by the traditional trades in manufacturing and construction. New Apprenticeship System refers to a set of arrangements encompassing the former two modes but incorporating changes that make the new system simpler, more relevant, more flexible and more responsive to the needs of users. These changes include: greater scope for part-time employment with structured training, training arrangements of different duration and different mixes of work and training. New Apprenticeships also make possible part-time, school-based apprenticeships and traineeships. They can also entail the use of more flexible industrial relations agreements with appropriate wage arrangements that reflect the time spent in productive work. There is also the capacity of enterprises to choose the formal training including the appropriate elements of a Training Package that responds better to their needs. Streamlined administrative processes for signing and paying incentives to employers are also being implemented through one stop shop New Apprenticeship Centres. 1 The New Apprenticeship Scheme has expanded its coverage to include new occupations such as information technology, communications and services. 2 As of March 1999, there were approximately 232,000 apprentices in training. 3 The User Choice policy The objective of the national User Choice policy is to increase the responsiveness of the vocational education and training system to the needs of clients (specifically employers and 1 New Apprenticeship Centres provide information on apprenticeship/traineeship options to employers and other interested people; market apprenticeships and traineeships in the local area; administer Commonwealth incentive payments to employers, handle all administrative requirements in relation to registration of training contracts and work closely with Job Network employment service providers, training providers, schools and other organisations. 2 OECD, 2000, p ANTA, 1999, Annual Performance Report Brisbane, p 47.

2 their apprentices and trainees) through the encouragement of a direct and market relationship between individual providers and clients. User Choice is defined as the flow of public funds to individual training providers, which reflects the choice of individual training provider, made by the client. 4 User Choice comprises three elements: significantly, greater market power to individual clients to negotiate with individual registered training providers, both public and private, about the off-the-job component of new apprenticeships. The negotiation can include choice of provider and choice about specific aspects of training, such as location, timing etc; increased responsiveness on the supply side of the training market, to enhance the capacity of individual VET providers to respond to the expressed needs of clients. Training outcomes will then be able to reflect more closely clients views of their own needs. This increased responsiveness will include greater contestability among individual providers; User Choice outcomes are compatible with public expenditure constraints and efficient use of resources. There can be no implication that all requests for training from clients, however specialised or expensive, will be met from public funds. The national User Choice policy identifies the client as the employer and employee, as identified in the New Apprenticeships Training Agreement, acting jointly. The objectives of the User Choice policy are further defined through nine principles that can be used as indicators of progress or success in achieving effective User Choice. These principles are: Principle 1: Clients are able to negotiate their publicity funded training needs: Principle 2: Clients have the right of choice of registered provider and negotiations with User Choice over specific aspects of training: Principle 3: User Choice operates in a national training market not limited by State and Territory boundaries: Principle 4: The provision of accurate and timely information about training options is necessary for informed choice: Principle 5: Pricing of training programs by State / Territory Training Authorities should be based on clearly identified State / Territory unit costs benchmarks. Unit costs set for efficiency provision may be increased by including a loading for access and equity reasons. Principle 6: Training over and above that which is essential to the qualification outcome for the apprentice or trainee, and is above that which is funded publicly, can be negotiated within existing initiatives: Principle 7: User Choice will be harnessed to improve access and equity in the vocational education and training systems and be integrated within existing initiatives: 4 KPMG Consulting, 1999, National Evaluation of User Choice: Phase 2 Overview report. Australian National Training Authority, 20 September. 2

3 Principle 8: Regulatory frameworks and administrative arrangements relating to vocational education and training at the national, State and Territory level are to be complementary to the achievement of the objectives of User Choice: Principle 9: Evaluation of outcomes of User Choice against objectives is an integral element of a program of continuous improvement. Innovation is required to achieve and maintain a best practice training system. ANTA Ministerial Council agreed in 1996 to progressive implementation of User Choice during 1997 and to full implementation of User Choice for off-the-job training for apprentices and trainees from January In New South Wales, where TAFE is widely regarded as more highly centralised and bureaucratic than in other States, the State Government has reserved its position and not formally implemented the User Choice policy. However, more flexible arrangements and choice have been implemented for employers, apprentices and trainees in New South Wales, consistent with User Choice principles. Need to take into account other supporting policies It is, however, important to note other supporting policies that are likely to significantly increase the effectiveness of User Choice. These include the range of financial incentives available to employers to take on New Apprentices, the national marketing campaign urging employers to recruit New Apprentices and the role of New Apprenticeship Centres as brokers. The financial incentives to employers include $1,250 for signing on a New Apprentice, payroll tax rebates/exemptions (in some States and Territories), Workers compensation premium exemptions (in most States and Territories), assistance to employ and train a person with a disability and assistance to employ and train Indigenous Australians. Incentive payments to employers are also available for trainees in a contract of training who progress to a higher qualification level and for completion of training at higher levels. There is also an incentive to employ and train a New Apprentice in a skill classified as being 'in shortage' in rural and regional Australia. The national marketing campaign has been conducted for certain periods (two to three weeks) to raise business and youth awareness of New Apprenticeships and the role of New Apprenticeships Centres. The national advertising campaign is delivered through television, radio, print and the Internet. The advertising campaign is supported by a coordinated communication program involving promotion through major industry associations and education associations, stakeholder briefings, regional events and media. New Apprenticeships Centres (there are 300 sites around Australia) are also an important supporting policy initiative that enables User Choice to have a greater impact. New Apprenticeship Centres act not only as marketing agents but also as brokers between employers and the administrative system regulating contracts of training and the provision of publicly funded training for apprentices and trainees. They can, in many cases, be the means for employers to exercise their entitlement to choose how and when the training for their apprentices or trainees is delivered. New Apprenticeships Centres appear to be playing a valuable role in minimising the transaction costs for employers in dealing with the overly complex bureaucratic arrangements. A national survey of 2,786 employers conducted in June 1999 by the Federal Government showed a high level of support among employers for the role of New Apprenticeships Centres in overcoming the red tape involved in receiving the financial incentives available for taking on a New Apprentice. The survey results also showed that a majority of New 3

4 Apprenticeships Centres followed up with employers and kept in touch with them in a professional and diligent way. 5 Eighty per cent of employers were satisfied with their New Apprenticeships Centre s performance in providing a one-stop integrated service and would use the same New Apprenticeships Centre on a future occasion. 6 How User Choice Works in Practice User choice is a purchasing system whereby a State or Territory Government pays for training from the Registered Training Organisation chosen by the employer, within parameters set by the regulatory framework of the training market. This means that funds do not pass to the employer but are paid by the State Government to a training provider selected by an employer. There is a schedule of fixed prices for the units of training purchased so there is no competition in terms of price. Information is provided by brokers such as federally funded New Apprenticeship Centres. 7 National Evaluation Results A National evaluation has recently been conducted some 18 months into the implementation of the policy. 8 The evaluation is based on representative surveys of training providers; employers; case studies of providers; focus groups of apprentices and trainees; and a selfassessment survey of State Training Authorities. The evaluation found that User Choice is driving positive actions on the part of training providers. This may not be able to be precisely separated from other reforms and providers may not be uniformly positive, but on balance providers report that User Choice is affecting their operations and relationship with employers and that this is a positive result. The main conclusion of the evaluation is that On balance, the results show that the policy framework is strong, progressing well at the current time and that the policy should stand as is. Where change or action is required it is in the process of implementation, not the policy framework. There are some areas where implementation action could be better focused, coordinated actions could be undertaken by State Training Authorities, ANTA and the Commonwealth Department of Education, Training & Youth Affairs, as well as some potential hot spots which warrant further monitoring. 9 Implementation problems However, a recent independent investigation into the quality of training in Queensland's Traineeship System by Ms Kaye Schofield (1999) has identified a number of limitations with the particular administrative form in which the User Choice policy has been implemented in Queensland. These included not awarding User Choice contracts competitively according to the known quality of training resources, training delivery or training outcomes, but instead sharing the training among all providers that meet the selection criteria - selection criteria that 5 Hon David Kemp, MP, 1999, New Apprenticeships Centres a Nationwide Hit, Media, Release K12711, 10 November. 6 Ibid. 7 A more detailed description of how User Choice works in Queensland is provided in Attachment 1. 8 KPMG Consulting, 1999, National Evaluation of User Choice: Phase 2 Volume 1: Employer Survey, Provider Survey and STA Survey. Volume 2 Report on Apprenticeship/.trainee Focus groups and Case studies. Australian National Training Authority, 20 September. 9 Ibid p 2. 4

5 implicitly assume that the registration, accreditation and auditing processes effectively ensure training quality. 10 The independent investigation in Queensland also found that the brokerage function was not operating effectively to offer choice. It was found that in many cases employers, trainees and apprentices were presented with only one option in terms of training provider and training plans, rather than a range of training providers and the ability to negotiate training plans in terms of content and flexibility, which was the intent of User Choice. 11 The response of the Queensland Government to the identification of a number of implementation problems was, however, to reaffirm its support for the continuation of User Choice policies: These deficiencies are not an argument to move away from the concept of User Choice but rather to ensure that the system operates more effectively. 12 The Queensland Government has responded by making a number of changes to administrative procedures. These include requiring all User Choice contract holders will be fully compliant with the Australian Recognition Framework quality standards; and requiring that employers, and apprentices and trainees will be fully informed of their entitlements under User Choice including choice of provider. Clear conflict of interest clauses are to be included User Choice contracts with New Apprenticeship Centres. The User Choice price list is being reviewed to ensure that training providers are being effectively compensated for the services they provide. It is also planned to make training providers a party to the training agreement for individual trainees. New tender processes for User Choice contract holders are to be established to ensure the viability of particular industry and regional training markets. 13 Examples of User Choice in practice The Brisbane Institute of TAFE (Gateway Campus) with 850 apprentices and 50 trainees has set up a dedicated unit to market apprentice and traineeships directly to employers and to maintain a continuing relationship. 14 There are seven account managers to handle all aspects of an employer s dealings with the Institute and visits the employer s workplace every 4 to 6 weeks for 90 minutes at a time. Support services are also available to apprentices and trainees in their capacity as students of TAFE. The account manager also seeks ways to reduce the costs of off-the-job training to employers such as by careful scheduling to take advantage of more economical arrangements. Other changes include up to 60 per cent of formal training delivered on-the-job at the workplace. Cost increases due to providing the new services have been met by reducing overheads and increasing flexibility in working arrangements. The primary pressure for shifting from a passive role as a trainer to include the proactive role of broker has come from another brokerage service (New Apprenticeship Centre) which is directly employers to private training competitors. According to the Institute, User Choice policy is seen as giving 10 Schofield, Kaye, 1999, Independent Investigation into the Quality of Training in Queensland's Traineeship System: Final Report, 2 July, Prepared for Department of Employment, Training and Industrial Relations, Queensland., piv. 11 Queensland Department of Employment, Training and Industrial Relations, 2000, Submission to the Senate Committee Inquiry into The Quality of Vocational Education and Training in Australia, January, p Ibid, p Ibid, p KPMG Consulting, 1999, Volume 2 Report on Apprenticeship/.trainee Focus groups and Case studies. Pp

6 substantial power to employers because of their capacity to use other training providers. This applies particularly where an employer wants training delivered fully on-the-job. Employers still had concerns about aspects of the Institute s efforts. These included the provision of inadequate information about available options and last minute changes to timetabling for offsite training. The Institute admits that it is still learning the best approach to training delivery and is seeking to improve over time. Another example of the operation of the User Choice policy is that of International Catamarans (INCAT) and the TAFE system in Tasmania. INCAT is a manufacturer of large catamaran ferries in Hobart employing 1,000 employees, 200 of whom are apprentices or trainees. The User Choice policy has underpinned the development of a new internal apprenticeship program focused on aluminium fabrication. This has resulted in changing over 50 per cent of the curriculum formerly based metal fabrication to meet its needs. Considerable use has also been made to give due recognition to the skills of the existing workforce acquired on-the-job. INCAT has achieved major cost savings by reducing of the off-the-job curriculum by over a third and assessing employees pre existing skill levels. The costs in lost salary per apprentice have reduced from $8,030 to $4, Other benefits have been the scheduling of training to reflect better the needs of the work site so that just-intime training is now the norm. This has resulted in better job rotation for apprentices to facilitate the acquisition of the necessary range of skills. INCAT is a Registered Training Organisation in its own right and purchases services and access to the facilities of TAFE though sub-contracting arrangements. TAFE delivers most of the off-the-job training and INCAT itself delivers the expanded on-the-job training as well as appropriate additional off-the-job training. As a Registered Training Organisation, under the User Choice policy, INCAT receives funding for the delivery of the off-the job training component. The first example illustrates how a large TAFE Institute has made a number of changes to protect the market in which it had previously been a monopoly provider. These changes involved developing closer links with employers to better meet their training requirements. The second example shows how a large employer, in particular, was able to benefit from customising the standardised trade training. This and other evidence suggests that large companies with a large number of apprentices/trainees and the resources to identify clearly what they want from the off-the-job training curriculum are more likely to be able to enter into a productive partnership with TAFE. However, smaller employers may have less capacity to benefit from the range of options available under User Choice. Employer response to User Choice A national representative survey of 782 employers of apprentices and trainees was carried out in July/August Employers reported that their satisfaction with training providers has improved in the period that User Choice has been in place. They stated that training providers are more flexible, they are involved in a range of training decisions and they are equipped with information to make choices and influence provider behaviour. The survey results show that employers of apprentices and trainees now believe that there are fewer barriers to accessing training and that User Choice has been a success in involving them in training 15 KPMG Consulting, 1999, Volume 2 Report on Apprenticeship/.trainee Focus groups and Case studies. Pp The 800 replies represent a 21 per cent response rate. This low response rate suggests that there may be a bias to those employers of apprentices and trainees who may be favourably disposed towards the topic. 6

7 decisions for their apprentices and trainees. The evaluation also produced evidence of more meaningful partnerships developing between providers and employers. Impact on training providers The National Evaluation s representative survey of 618 training providers 17 showed that 88 per cent believed that their staff working with apprentices and trainees understood key elements of the policy. As many as 80 per cent of training providers said that they had taken steps to improve their competitiveness as a result of User Choice. More than two-thirds had introduced new marketing programs, new or revised arrangements for managing student enrolments and classes, and revised existing procedures for employer liaison. Providers view of key elements of the policy The key elements of the User Choice policy were believed by training providers to be: choice of training provider (80 per cent); encourages provider flexibility in terms of training content (78 per cent), encourages providers to market and publicise training (76 per cent), and enables training provider and employers to work together (72 per cent). Other aspects of the policy highlighted by training providers as important were: allowing employers to choose the location of training (72 per cent), and giving apprentices and trainees the right of choice in relation to aspects of how the training is conducted (67 per cent). 18 Impact on providers The policy also had an impact on how training providers went about their business. Some 45 per cent of training providers surveyed reported that they had introduced additional training programs, and 43 per cent said that they had changed training program content as a result of greater client choice. Other changes included the sequencing of training programs (54 per cent), rearranged timetables (56 per cent), new marketing efforts (70 per cent) and new student enrolment procedures (69 per cent). 19 Some three quarters (74 per cent) of training providers surveyed claimed that they seek employer input into decisions about training. However for a significant minority (39 per cent) this has only been the practice since the User Choice was introduced. 20 Nearly half (48 per cent) of the training providers surveyed agreed that User Choice had resulted in greater relevance of training programs to employers needs and 54 per cent agreed that their responsiveness to employers training needs had improved. Two-thirds (67 per cent) of providers agreed that User Choice has made training more attractive to employers. Over half (55 per cent) of the providers surveyed reported increases in student enrolments in the last two years and 37 per cent of these respondents attributed the increased enrolments to the introduction of User Choice. 21 Greater use of private training providers Another effect of the introduction of User Choice appears to have been an increase in the use by employers of private training providers. Quantitative information on market share is only available for one State, Queensland. A progress evaluation of User Choice in Queensland 17 Representing a 31 per cent response rate. 18 KPMG Consulting, 2000, Volume 2, Table 3b, p KPMG Consulting, 2000, Volume 2, Table 4b, p KPMG Consulting, 2000, Volume 2, Tables 5a & b, p KPMG Consulting, 2000, Volume 2, Tables 4a & b, p71. 7

8 notes that the major impact of User Choice on TAFE Queensland has been in the Brisbane and surrounding regions where well over 10 per cent of the apprenticeship market has been lost to Private Providers and Group Training Companies. The State apprenticeship market share of new approvals and re-approvals held by TAFE Queensland has declined since the introduction of User Choice arrangements, from 99.6 per cent in 1994/95 to 91.9 per cent in 1997/98. For the same period, the market share held by private training providers has increased from 0.3 per cent to 4.4 per cent, and for Group Training Companies from 0.1 per cent to 3.7 per cent. In 1997, there were 13 providers other than TAFE Queensland Institutes involved in the User Choice pilots. By the end of 1998, 50 Private Providers and Group Training Companies were active in the apprenticeship market. 22 The KPMG national evaluation s survey of private providers found that private providers were more likely to state that User Choice had been a success, and to support the different aspects of the policy such as flexibility in terms of location, timing and content of training. 23 Effect on TAFE The national evaluation reported that since the introduction of User Choice, organisations with larger student bodies (which are more likely to be TAFE Institutes) report that they spend more time negotiating details regarding service provision than organisations with smaller student bodies. 24 TAFE providers were more likely than private training providers to state that User Choice meant more paperwork. 25 The progress evaluation of User Choice in Queensland noted that employers, Group Training Companies (group employers of apprentices), and Industry Training Advisory Boards all expressed concerns that the quality performance of TAFE Queensland was declining, at least relative to its major competitors, in the User Choice environment. The report noted that the perceptions are that TAFE Queensland is focusing too heavily on selling and marketing, to the detriment of its training quality ( the rhetoric does not match the reality ); has a pervasive morale problem among its staff, which is negatively impacting on TAFE-employer relations; is still, in many ways and in many areas, unresponsive and inflexible to employers needs and circumstances; is not offering appropriate flexible delivery options to employers; and is destroying itself from within by its approach to competition among its own Institutes. 26 Negative effects of the policy The downside of the User Choice changes for training providers was identified as increased paperwork (reported by 78 per cent), increased costs of administration (reported by 75 per cent), increased costs due to greater employer liaison (71 per cent) and more time spent in dealing with State Training Agencies (61 per cent). 22 Smith, L., 1999, The Impact of User Choice on the Queensland Training Market: a Progress Evaluation. Department of Employment, Training and Industrial Relations Queensland, March, p vi. 23 KPMG Consulting, 1999, National Evaluation of User Choice: Phase 2 Volume 2 Australian National Training Authority, p Ibid, Volume 1, p Ibid, Volume 1, p Smith, L., 1999, The Impact of User Choice on the Queensland Training Market: a Progress Evaluation. Department of Employment, Training and Industrial Relations Queensland, March, p x. 8

9 Effectiveness measures of User Choice Increased New Apprenticeship take up It is difficult to isolate the specific effect of the User Choice policy as it is linked to other major policy initiatives such as New Apprenticeships, backed by a large national advertising campaign. However, the survey of training providers, reported above, noted that over a third (37 per cent) of those training providers who reported an increase in student enrolments within the last two years attributed it to the operation of the User Choice policy. The take-up of New Apprenticeships has increased significantly over the last three years. At the end of June 1999, there were 244,800 New Apprentices in training in Australia 27 This represents an increase of 77,300 places or 46 per cent increase on the 1996 figure. Employer satisfaction with VET graduates Another indicator of the effectiveness of User Choice over time will be employers satisfaction levels with new VET graduates. User Choice is only likely to have been operational for employers of trainees who have completed a 12 months traineeship. Overall, in 1999, around 83 per cent of employers of a recent VET graduate (of a TAFE or private provider) reported being satisfied or very satisfied with the VET system. Just over two-thirds of employers (70 per cent) of a recent VET graduate held the view that the VET system providing graduates with skills appropriate to employers' needs. This is a substantial increase from 56 per cent stating the same view in Confirming this finding, there has been a drop from 1997 to 1999 in the proportion of employers holding the view that the VET system does not take into account the needs of employers (from 40 to 33 per cent). 28 However, it is also important to note that between 1997 and 1999, there was a shift among medium and large enterprises with recent VET graduate employees to those who had received training with a private provider rather than Technical and Further Education (TAFE) Institute. These improvements in employer perceptions of VET graduates may, therefore reflect a greater reliance on private training providers who may be more flexible in meeting employer needs. 29 However, the effect on employer attitudes of the increased responsiveness offered under User Choice policy is probably better assessed over a longer time period and with more specific data in relation to employers of apprentices and trainees. Outstanding issues yet to be resolved Three problems areas with implementing User Choice were identified by the KPMG national evaluation. First, over bureaucratisation of choice was identified as a problem. It was reflected in high levels of provider concern about increased cost and administration. It is inevitable that User Choice will increase some aspects of accountability and performance monitoring but a balance is required. The Evaluation recommends that State Training 27 Hon David Kemp, MP, 1999, New Apprenticeship Numbers Continue To Grow, K13111, Media Release, 11 November. 28 NCVER, 1999, Survey of Employer Views on Vocational Education and Training, Statistics at a Glance, National Centre for Vocational Education Research, Adelaide. 29 As noted above. this is also suggested by the findings of an evaluation of User Choice in Queensland. See Smith, L, 1999, The Impact of User Choice on The Queensland Training Market: a Progress Evaluation. Department of Employment, Training and Industrial Relations Queensland, March, p vi. 9

10 Authorities need to assess carefully their administrative requirements to minimise unnecessary bureaucracy and maximise provider and employer understanding of the important public accountability requirements that necessarily attend a new way of allocating training funding. Second, there are indications that there may be a collision occurring between two principal national policies User Choice and Training Packages. Anecdotal evidence from the Evaluation suggests that the way Training Packages are being interpreted and implemented may be introducing inflexibility and restrictions on client choices. Third, the evaluation noted concerns from training providers that User Choice, if interpreted solely from the employer interests in specific business relevance of training, may conflict with apprentice and trainee interests in acquiring a breadth of skills and experience. It is suggested that a balance between internal and external labour market aspirations of the two User Choice clients can be achieved, as is the objective of Training Packages and the National Training Framework. It is recommended that training providers have a role in advising clients on training choices that balances the interests where possible. 30 In relation to the brokerage role of New Apprenticeship Centres in implementing User Choice, another potential problem area is in the issue of the private management of public monies. The progress evaluation of User Choice in Queensland noted unsubstantiated information that deals are also alleged to exist between providers and Group Training Companies, providers and New Apprenticeship Centres, and providers and Industry Training Advisory Boards in the form of a mate s club in which training is continually directed to the same couple of providers. 31 Training For Young People on The Youth Allowance Another market-type mechanisms being piloted in the State of Victoria is the TAFE Youth Allowance Initiative. The TAFE Youth Allowance Initiative was introduced in 1999 to provide a training and further education option for these young people. It ensures that those young people who choose to enrol in a TAFE program can be accommodated in a TAFE Institute or other registered training organisation. Under arrangements made between the Victorian Office of Post Compulsory Education, Training and Employment and the Centrelink federal government agency responsible for initial dealings with job seekers, Centrelink issues Youth Allowance recipients who are under 18 years of age with an entitlement to 400 hours of training in accredited courses (or modules) delivered in the registered training organisation of their choice. The Victorian Government through Centrelink reimburses providers for the cost of training, in accordance with a set Purchasing Schedule per student contact hour. The first entitlements were issued in March Redemption Rates For the 12 months to February 2000, over 3,100 entitlements have been issued to date resulting in over 1,400 enrolments. The redemption of the entitlement has consistently been around 50 per cent of those eligible for the entitlement. The TAFE entitlements have been 30 KPMG Consulting, 1999, National Evaluation of User Choice: Phase 2 Overview report. Australian National Training Authority, p3. 31 Ibid, p x. 10

11 particularly successful in regional areas with the overall participation rate in regional Victoria consistently much higher than in the Melbourne metropolitan area. However, there is substantial variation in participation patterns between regional areas. For example, participation is very high in the Bendigo area, whereas the Central Gippsland region has very low issuing and participation rates to date. Provider Participation Private training providers, TAFE Institutes and Adult and Community Education (ACE) providers are all actively involved in the provision of training and further education to Youth. TAFE accounts for the largest number of enrolments. Enrolment figures show that ACE provision is far more extensive in regional areas. Only two out of a total of 22 providers in the metropolitan area are ACE providers whereas nearly two thirds of the 36 providers in regional areas are ACE providers. Training Programs Entitlement recipients are enrolled in module/units from a wide range of accredited programs, including vocational certificates, pre-employment programs and general education courses. The high level of participation in modules in General Education and Employment preparation programs indicates a need amongst this cohort for basic skills training which is employment related. There is a clear indication that the integration of modules from General Education programs into industry-based certificates to allow for additional language and literacy support is a popular option for provision to TAFE Youth Allowance participants. Model programs have also been developed in the areas of Retail, Hospitality, Office Administration, General Construction and Horticulture. During December 1999, a review of the TAFE Youth Allowance Initiative was conducted. The aim of the review was to identify particular features of the program which contribute to the successful participation of young people in training; impediments that might prevent the training option being of maximum value to the participants; and recommendations for enhancement to the program in 2000 are being prepared for the relevant State Minister. Conclusion The development of market-type mechanisms in the provision of publicly funded training in Australia has been a significant feature of the reforms introduced by Federal and State Governments over the last decade in Australia. In particular, User Choice arrangements for employers and their employees in contracts of training have introduced a much greater responsiveness into the system than previously existed. Initial teething problems are to be expected in implementing a policy that is very different from past practice. However, the policy has now achieved broad support among public and private training funders and there is agreement that it is merely a matter of improving the implementation process. Employers too are becoming more aware of the opportunities available to them under User Choice. User choice is likely to reach its potential as employers become more knowledgeable about their options and more demanding in what to expect from training providers. 11