Fee-Free TAFE: What We're Learning — And Why We're Asking RTOs to Help Us Finish the Picture

Since early 2026, Vivacity Coaching & Consulting has been running an independent, evidence-led review of whether Australia's Fee-Free TAFE funding model delivers demonstrable value for money — for students, employers, taxpayers, and the VET market as a whole. We're not setting out to prove the policy has succeeded or failed. We're building a verifiable evidence base that can stand up to parliamentary and public scrutiny, and we're publishing this update because the sector deserves to see where that evidence currently points.

Declared interest: Vivacity's RTO advisory client base is disclosed throughout this review's outputs, consistent with the transparency standard we're holding the policy itself to.

What the evidence shows so far

The money announced is not the money spent. Of roughly $1.05 billion contracted to states and territories, our analysis of actual Commonwealth expenditure data shows only around $659 million had been paid within an 18-month window. Announced funding, budgeted funding, and paid funding are three different things, and public commentary routinely collapses them into one.

TAFE delivery costs around 2.4 times more per funded hour than private provider delivery. Using NCVER and Productivity Commission data, government funding per hour sits at approximately $24.00 for TAFE against $9.79 for private RTOs — a ratio that has held steady at roughly 2.45:1 since 2019. That gap predates Fee-Free TAFE. What we haven't yet found is a published policy justification for why the differential exists at that scale, or why it should.

The market is consolidating, not simply "defunding" independent providers — a narrative correction our data forced us to make. Non-TAFE funding's share of the system has been flat for seven years and actually rose 10.0% in real terms between 2022 and 2024. Government-funded provider numbers fell 5.2% nationally (1,527 to 1,447) over 2020–2024, but the entire net decline sits with non-TAFE providers. That's a genuine finding worth sitting with — it's a smaller, more concentrated market, not one being starved outright.

We cannot yet measure whether Fee-Free TAFE itself is working. NCVER can't isolate Fee-Free activity from the rest of the VET system until a dedicated Free TAFE data collection begins in 2027, with genuinely comparable four-year completion data unlikely before around 2032. This isn't a footnote to our review — it's one of our central findings. Australia is committing well over $1.6 billion through to 2034–35 to a mechanism we currently have no reliable way to evaluate.

Taken together, our supportable position is this: Australia is directing VET places toward delivery that costs substantially more per hour, into a consolidating (not collapsing) market, without a published rationale for the price differential and without the data infrastructure to measure whether it's achieving its stated purpose for most of the decade it's funded for.

We want to be precise about what the evidence does not yet show. We have not established that Fee-Free TAFE is causing the enrolment shifts we're seeing in private providers — correlation and causation are being kept firmly apart in this review, and we won't publish a claim we can't support.

Our plan from here

The review is structurally complete, and the remaining work is chasing down outstanding data: several Freedom of Information requests are still active with state and Commonwealth agencies, and a handful of NCVER and Productivity Commission releases due later this year will sharpen the completion-rate and funding-intensity findings further.

Before anything is finalised, every provider and government agency named in a case study is given a formal right of reply — that's a non-negotiable step in how we run this review, not a courtesy. We're also preparing to brief federal parliamentarians on the findings ahead of publication, so the evidence is in front of decision-makers before it's in front of the public.

The final report is due at the end of September 2026.

Where the sector comes in

This review draws heavily on our own consolidated evidence register — but one gap we can't close with government data alone is what's actually happening inside independent RTOs day to day. That's what our State of Australia's RTO Sector 2026 Survey is for.

We're still building that picture. If you run, manage, or work inside an RTO — whatever your funding mix — five minutes of your time genuinely sharpens the evidence going in front of Parliament.

Complete the RTO Sector Survey 2026 →

As Angela Connell-Richards notes, "The strongest case we can make to Parliament isn't the one that confirms what people already believe about Fee-Free TAFE — it's the one that survives contact with the data. That's what we're building, and it's stronger with more of the sector in it."