Australia is preparing to overhaul the architecture of its tertiary education landscape in a way not seen for generations. A new Australian Tertiary Education Commission, proposed in the Universities Accord legislation, is being pitched as the long-term steward capable of unifying vocational education and higher education, delivering needs-based funding, lifting participation, supporting equity, and driving the nation towards a target where around 80 per cent of working-age Australians hold a tertiary qualification by 2050. It is a bold vision. Yet the design of the commission has triggered growing concern across VET, higher education, policy institutes, regional networks, industry bodies and system commentators. These concerns are structural, not political. They question whether the governance model proposed can truly deliver the independence, resourcing, diversity, stability and sector-wide coordination required for reform of this scale. This article provides a deeply researched, contemporary analysis of those concerns and offers practical questions, scenarios and guidance for Registered Training Organisations, non-university higher education providers, dual sector institutions and universities. It explores the tension between visionary ambition and fragile design, the risks of centralisation, the challenges of integrating two historically separate sectors, and the potential for confusion in a system already stretched by continual regulatory change. Ultimately, it argues that Australia must get the steward right, not merely legislated, if it hopes to avoid another cycle of reform fatigue and policy fragmentation.
A Tipping Point for Tertiary Governance
Australia’s tertiary sector stands at a moment of profound consequence. The promise of a unified system, one that recognises vocational education and higher education as interconnected engines of national productivity and social mobility, has now progressed from policy aspiration to legislative drafting. The Universities Accord laid out the conceptual blueprint, positioning the Australian Tertiary Education Commission (ATEC) as the long-term, independent steward the sector has never fully had. In principle, few disagree with the need for such a steward. In practice, many are questioning whether the model on the table matches the scale of the task.
Across the tertiary landscape, the mood is complex. Providers recognise that the current system is too fragmented, too cyclical and too vulnerable to political shift. The historic divide between VET and higher education does not reflect the reality of modern learners whose pathways span both. Industry expectations of skills development have changed dramatically. Labour market volatility demands new forms of agility, new funding mechanisms and new cross-sector partnerships. In many respects, the Accord’s foundational assumptions are correct: Australia needs more people with tertiary qualifications, more accessible pathways, more equity supports, and more long-term, evidence-driven planning.
Yet sector leaders also know that the way a reform is implemented matters more than the reform itself. A governance model that looks unified on paper can, if poorly designed, centralise control, diminish diversity, slow innovation, create regulatory overlap, and compound the very confusion it aims to solve. Much of what is emerging in commentary reflects that tension. The sector wants system stewardship. It does not want another administrative layer that adds complexity without strengthening coherence.
A Promising Vision Built on a Fragile Framework
The Universities Accord final report was expansive in scope. It recommended a more seamless tertiary ecosystem, an uplift in attainment to meet a rapidly evolving economy, and a commission that could carry reforms beyond political terms. It acknowledged that VET, higher education, industry, communities and learners must be linked through a single strategic narrative rather than competing institutional interests.
However, the governance model proposed for ATEC diverges sharply from well-established examples of independent statutory authorities. Rather than sitting outside the machinery of government with a clear mandate to publish frank and fearless advice, the commission is proposed to operate within the Department of Education. Staff would be employed under departmental arrangements. The departmental Secretary would serve as the accountable authority. The Minister would approve the work plan, issue directions, and request specific advice on funding, student numbers and system-level settings.
While the language of independence features prominently in public communications, the design raises challenging questions about whether such independence is structurally possible. Independence must be more than aspirational rhetoric; it must be demonstrably embedded in governance, powers, reporting lines and professional culture. Without that, the commission’s stewardship risks being constrained by short-term political pressures.
Limited Independence in an Era That Demands More
For decades, reviews of Australia’s tertiary governance have emphasised the need for enduring, evidence-driven institutions capable of resisting political volatility. The VET sector knows this volatility particularly well, having experienced successive waves of changes to standards, funding, regulators, compliance expectations and performance measurement. The higher education sector has not been immune either, navigating cost pressures, international student policy shifts, changing research funding arrangements and fluctuating government priorities.
An effective steward must be insulated from these fluctuations. However, placing the commission within the department complicates that principle. Independence is undermined when:
• the accountable authority is a departmental official
• staffing is subject to public service structures
• budget negotiations occur through the same channels used for operational policy
• the work program requires ministerial approval
• analysts and policy experts may be reassigned across competing internal priorities
These conditions risk creating a commission that is administratively dependent rather than strategically independent. Australian history offers cautionary lessons. Bodies such as the Productivity Commission and the Australian Law Reform Commission are deliberately established with structural independence so they can publish extensive, sometimes uncomfortable reviews that support long-term policy stability. Their value lies not merely in expertise but in their ability to speak with a credible distance from immediate political pressures.
A commission embedded within a department, even with the best intentions, may face tacit constraints on the scope, tone and timing of its advice. This matters deeply for VET and higher education providers who rely on clear, authoritative, long-horizon planning signals to make investments, shape offerings and build partnerships.
A Workload That Looks Herculean on Paper
The scope of tasks assigned to ATEC is unprecedented. It is expected to design and manage mission-based compacts, review funding models, analyse cost structures, inform workforce development, oversee performance measurement, coordinate cross-sector participation targets, contribute to long-term skills forecasting, and help shape the overall size and composition of the system.
These responsibilities are sprawling in complexity and interdependence. They require deep expertise across economics, social policy, educational evaluation, labour market analytics, equity design, strategic planning, and regulatory interpretation. They require strong relationships with state governments, industry peak bodies, Indigenous communities, regional networks, and private providers.
Yet there is limited clarity about whether ATEC will be staffed or funded at a level commensurate with the breadth of this task. Without sufficient resourcing:
• the commission may focus narrowly on the areas easiest to monitor and quantify, such as compliance metrics
• high value but complex areas like equity, student support, regional ecosystems and cross-sector pathways may receive less attention
• the commission may become reactive rather than strategic
• policy sequencing may become rushed or fragmented
The VET sector already operates under a heavy compliance burden. Many smaller RTOs note that administrative demands often far outweigh the available internal expertise. If ATEC defaults to compliance-driven enforcement rather than evidence-driven stewardship, the sector could experience yet another layer of regulation rather than a new source of coherence.
Centralisation of Power: A Steward or a System Controller?
One of the most significant points of contention is the extent to which ATEC could influence student numbers, program profiles, international student cohorts, and the distribution of Commonwealth-supported places. These functions, if centrally managed, create a system where a single body holds immense influence over institutional strategies.
The Risks of Excessive Centralisation
Dampened diversity:
A centralised model can inadvertently create homogeneity. Institutions may converge toward similar course profiles, risk management strategies and workforce configurations that align with centrally set priorities rather than local or community-specific needs.
Reduced innovation:
Regional providers, dual sector institutions and VET organisations partnering with industry need the agility to respond quickly to new technologies, workforce demands and local economic shifts. Multi-year compacts determined centrally may not allow for timely responsiveness.
New strategic vulnerabilities:
If one entity miscalculates demand in a critical field, such as health, construction, advanced manufacturing or digital technologies, the ripple effects can be significant. Local communities, industry partners and future students bear the consequences.
Cross-sector disconnection:
While the Accord aspires to unity, centralised decisions risk reinforcing the dominance of one sector over another. If VET is treated largely as a feeder system rather than an equal pillar, pathways will narrow rather than expand.
For RTOs, the risk is particularly acute. They operate within dynamic local contexts and often specialise in rapid upskilling and reskilling aligned to industry needs. A centralised approach may slow the agility that is fundamental to VET’s value proposition.
A Risk of Reinforcing a University-Centric Narrative
Despite the Accord’s repeated references to a unified tertiary system, the public discourse has been dominated by universities. This is partly due to political visibility, media attention, and the historical weight of higher education institutions. Yet private universities, non-university higher education providers and the thousands of RTOs delivering essential skills training form an equally important part of the ecosystem.
The Structural Blind Spot
Much of the Accord consultation has been shaped by higher education priorities such as research intensification, demand-driven undergraduate funding, regional university sustainability, and the future of international education. While these are important, they do not represent the full breadth of tertiary education.
VET providers operate under different regulatory frameworks, cost structures, qualification types, industry engagement models and workforce challenges. They navigate state-based funding environments, diverse learner cohorts, and far more frequent qualification updates. Any tertiary steward must fully understand these complexities, not treat them as peripheral.
The Importance of Regional and Local Contexts
Regional Australia faces distinct challenges:
• population decline in some areas
• higher delivery costs
• dispersed industries
• fewer local training options
• inconsistent digital infrastructure
Without strong representation from regional VET and dual sector institutions, ATEC risks making decisions based on metropolitan assumptions.
Integration Requires More Than Consultation
A truly unified tertiary system requires jointly developed protocols, integrated data systems, aligned definitions, shared quality frameworks where appropriate, and collaborative funding models that allow students to move meaningfully between VET and higher education. None of these outcomes emerges simply by “consulting” VET. They require structural representation.
System Stability and the Realities of Funding
The Accord’s ambitions are expansive. Lifting tertiary attainment to 80 per cent requires not only more funded places but also stronger student support, expanded regional delivery, greater equity measures and sustained investment in infrastructure, digital resources and workforce capability.
However, the funding environment is constrained. Caps on international student cohorts, broader public sector budget pressures, and inflationary cost increases all shape institutional realities.
The Funding Gap
Providers across VET and higher education are raising concerns that the aspirations of the Accord are not fully matched by fiscal commitments. Without proper funding:
• equity promises become symbolic rather than operational
• regional delivery weakens rather than strengthens
• workforce shortages in teaching, training and student support worsen
• institutions are forced to rationalise offerings in high-cost areas such as engineering, nursing and community services
The Risk of Unintended Consequences
If ATEC is expected to drive generational reform without adequate resources, it may:
• rely heavily on blunt policy instruments
• push system change faster than institutions can adapt
• intensify compliance expectations
• create uncertainty for providers planning long-term investments
For both VET and higher education, stability is not a luxury. It is a necessity. Workforce pipelines, partnership development, course accreditation, and infrastructure investments all depend on regulatory predictability.
What a Credible Steward Truly Requires
A commission can be transformative if its structure reflects its mission. Across submissions, a relatively consistent set of recommendations has emerged.
A Governance Model That Embeds True Independence
This includes:
• appointment of commissioners as the accountable authority
• transparent reporting lines to Parliament
• safeguards that allow publication of evidence-based advice
• balanced representation across VET, higher education, regions, industry and Indigenous communities
Resourcing at Scale
A genuine tertiary steward requires:
• specialised economists
• labour market analysts
• equity and inclusion experts
• funding and cost model specialists
• regional education strategists
• VET specialists who understand training packages, industry clusters and state systems
• researchers, evaluators and data scientists
This is not achievable with a small secretariat.
Mapped Governance Relationships
ATEC must operate with clear boundaries and collaboration protocols with:
• ASQA
• TEQSA
• Jobs and Skills Australia
• state training authorities
• funding and regulatory agencies
• industry advisory bodies
Without this, duplication, overlap, and contradiction will proliferate.
A Staged Reform Pathway
Successful reform requires:
• realistic timelines
• transparent exposure drafts
• pilots and phased rollouts
• sector-wide communication strategies
• impact assessments that include smaller providers, regional institutions and community-based RTOs
Practical Questions Every Provider Should Be Asking
Providers across the tertiary sector should continue to engage constructively but assertively throughout the legislative process. Key questions include:
• Will ATEC genuinely have the freedom to provide politically inconvenient advice?
• How will VET and regional voices be structurally embedded in decision-making?
• What protections exist to preserve mission differentiation and institutional diversity?
• Will funding be adjusted to match the scale of new duties and performance expectations?
• How will ATEC coordinate with existing regulators to prevent overlap or contradictory requirements?
• What mechanisms will allow the commission to be held accountable for unintended consequences?
These are not barriers to reform. They are essential due diligence.
Case Example: How Centralisation Could Affect a Small Regional Provider
Imagine a small regional training organisation that specialises in aged care, early childhood education and agricultural skills. It partners closely with local employers and operates on tight margins. If ATEC were to centralise decisions around student load and funding allocation based on metropolitan projections, the provider could face reductions in high-cost programs, even if local demand remains strong.
This scenario mirrors past examples where centralised funding decisions failed to account for regional variations, leading to shortages in critical local skills. Such cases remind us that governance design must incorporate regional flexibility, not override it.
Case Example: A Dual Sector Institution Navigating Conflicting Signals
A dual sector metropolitan institution might receive one set of funding cues from its VET regulators, another from higher education planning arrangements, and a third from ATEC compacts. If these signals conflict, the institution may experience delays in program development, uncertainty about investment and contradictory compliance expectations.
This example illustrates how poor coordination could erode the very integration the Accord aims to achieve.
Towards a Future Where Tertiary Education Works as One System
Australia has long needed a mechanism to synchronise the moving parts of tertiary education. The Accord’s vision acknowledges that fragmentation is inefficient, inequitable and unsustainable. A long-term steward could provide the continuity and coherence that political cycles cannot.
However, this requires a robust design. Independence must be real, not symbolic. Resourcing must be proportional, not symbolic. Representation must be diverse, not symbolic. Coordination must be structural, not symbolic.
If Australia gets this right, it could create a tertiary architecture that genuinely blends VET and higher education, supports lifelong learning, strengthens industry partnerships, and delivers prosperity across regions and demographics.
If it gets this wrong, the nation risks embedding a new layer of confusion at a time when providers already feel overstretched, and learners already feel overwhelmed by a changing economy.
The Steward Must Be Built for the Journey, Not the Launch
The Universities Accord highlights a national truth: education is central to Australia’s future. A commission that can steer the system with independence, clarity and long-term vision is genuinely needed. Yet structure defines capability. The current ATEC design carries risks that must be confronted head-on.
Providers across the tertiary landscape should welcome the ambition of a unified system while insisting on a governance model that is fit for purpose. The sector must continue to ask difficult questions, propose constructive refinements, and champion a design that serves the full diversity of learners and institutions in Australia.
A steward created in haste may deliver short-term visibility but long-term confusion. A steward designed with care can deliver stability, coherence and fairness for decades to come. Australia is standing at the threshold of that choice. The sector’s voice will determine which path the country takes.
