Industry training organisations (ITOs) and Modern Apprenticeships are getting some negative press, which is a byproduct of them moving from a sheltered policy environment to a more accountable one. ITOs do good things, but they have been helped and hampered by uncritical analysis of their performance, and by flattering comparison of them to the missteps of other parts of the tertiary education sector.

ITO policy has been overseen by some of the same people since before the Industry Training Act passed in 1992. They have overseen conservative policy settings with simple performance-based measures that have avoided major problems while generating results that appealed to politicians and industry. A major tertiary education subsector has developed from the ashes of the old apprenticeship system. The Modern Apprenticeship scheme, added by Labour in 2000, was a great piece of politics, but by “bringing back apprenticeships” it also helped to elevate ITOs’ place in the public and policy mind. This is in marked contrast to the crises faced by PTEs, ITPs and wananga in the 2000s under much looser policy settings and performance measures. Unfortunately, the good headline results for ITOs have also stalled useful change.

While ITOs have performed well over trainee numbers and have been as bad as the rest for qualification completions, they have not faced the same investigation as others of their internal operations. NZQA audits of ITOs have a very limited range, while TEC data reporting is a fraction of the depth that tertiary education providers carry out. The TEC even publicises industry training, sending out annual statistical profiles, which they do not do for other sectors. But things are changing and two recent reports expose major issues.

1. The current TEC reviews of industry training operational policy appear comprehensive and rigorous – once implemented, they should ensure effective oversight of ITOs. Right now, though, there is work to be done, with the latest report, on auditing of ITOs, uncovered the following major items (p.5). These have the potential to blow up quite publicly, but I don’t expect any senior ITO people would be surprised by the findings and sunlight will help resolve them.
   • “ITOs claiming as valid trainees a significant number of trainees who are either ‘inactive’, including a number whose employment had terminated and the employer was defunct;
   • ITOs enrolling trainees in programmes that result in a funding claimequivalent to significantly more than 70 credits per annum at either one ITO, multiple ITOs or multiple tertiary education organisations (TEOs);
   • information to indicate an apparent failure to account for subsidies paid to employers as a deduction from industry cash contribution; 
   • Modern Apprenticeships Co-ordinators (including a number of ITOs) subcontracting their brokerage function without the consent of the TEC;
   • the reporting of a significant number of trainees as Modern Apprenticeships who were not eligible to be reported as such;
   • inadequate monitoring of trainees who had not achieved credits and were enrolled well beyond their expected completion date;
   • ITOs enrolling trainees in Limited Credit Programmes with no clear intention to progress to enrolment in a National Certificate;
   • a significant mismatch between the credits reported as achieved to NZQA and the TEC; and
   • subcontracting of training activity amongst ITOs that involved one ITO arranging the training and another ITO reporting and claiming funding for the arranging of the training.”
2. A review of Modern Apprenticeships by the Mayors’ Taskforce for Jobs (MTFJ) is very critical of current policy and practice. Since Simon Collins covered the issue well at the NZ Herald on Saturday here and here, I won’t go into the details. It’s a major report, but I expect many parts will be challenged by ITOs.  

I’m sure that ITOs will be concerned about the two critical reports, but they are in many ways a healthy sign. The MTFJ is  a long-time supporter of ITOs, helping develop local graduation ceremonies with mayors to increase the profile of apprenticeships.  Their involvement in a critical report is a good example of the ITO sector’s maturation – friends are willing to be critical, not just boosters. With the TEC’s series of reports, they are bringing some real rigour to the regulation of ITOs, which will set up ITOs well for the likely reprioritisation of tertiary education spending soon. ITOs have been keen to use comparative results in their lobbying, and improving oversight will give others more confidence in the numbers. In the short term though, ITOs have hit a rough patch.