An Act relating to financial assistance to the States, the Australian Capital Territory and the Northern Territory in connection with the provision of Free TAFE and vocational education and training places, and for related purposes
Contents
Part 1—Preliminary
1 Short title
2 Commencement
3 Object
4 Simplified outline of this Act
5 Definitions
Part 2—Financial assistance for FT places
6 Grants of financial assistance
Part 3—FT agreements
7 FT agreements
8 Key matters to be dealt with in FT agreements
Part 4—Other matters
9 Consultation with Ministerial Council
10 Act does not limit power to make other grants of financial assistance
An Act relating to financial assistance to the States, the Australian Capital Territory and the Northern Territory in connection with the provision of Free TAFE and vocational education and training places, and for related purposes
[Assented to 27 March 2025]
Preamble
The Parliament of Australia acknowledges the following matters.
High quality vocational education and training (VET) is vital to Australia’s future, producing the knowledge and skills to position Australia as an economically prosperous, socially equitable and environmentally sustainable democracy.
All Australian governments are committed to building a high‑performing and world‑class VET sector, a system in which training is accessible to Australians from all walks of life, supporting students to succeed and supporting all Australians to train, upskill and retrain.
A well‑resourced and supported public TAFE network is at the heart of a high‑quality, responsive and accessible national VET sector.
Embedding Free TAFE as an enduring feature of the VET system highlights the importance of VET in skilling the Australian workforce and the ongoing work required in elevating VET to provide opportunities for Australians to be skilled in industries of national importance. With a focus on priority cohorts, it also helps make training accessible to Australians who experience social and economic exclusion.
An ongoing commitment to Free TAFE provides certainty of investment to students, the VET sector, States and Territories and industry.
In its role as a national policy leader, the Australian Government will work collaboratively with States and Territories to deliver Free TAFE and a strong and sustainable VET system.
The Parliament of Australia enacts:
Part 1—Preliminary
1 Short title
This Act is the Free TAFE Act 2025.
2 Commencement
(1) Each provision of this Act specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.
Commencement information
Column 1 Column 2 Column 3
Provisions Commencement Date/Details
The whole of this Act The day after this Act receives the Royal Assent. 28 March 2025
Note: This table relates only to the provisions of this Act as originally enacted. It will not be amended to deal with any later amendments of this Act.
(2) Any information in column 3 of the table is not part of this Act. Information may be inserted in this column, or information in it may be edited, in any published version of this Act.
3 Object
The object of this Act is to provide for ongoing financial support to the States for the delivery of FT places and, in doing so:
(a) support the delivery of at least 100,000 FT places across Australia each year; and
(b) acknowledge that TAFE and other public training institutions are key pillars of the VET sector; and
(c) acknowledge the importance of shared stewardship, by the Commonwealth and the States, of the national VET system; and
(d) remove financial barriers to education and training, including for people experiencing economic disadvantage; and
(e) support education and training in areas of high workforce demand, with emerging skills needs or that are otherwise a national or State priority.
4 Simplified outline of this Act
This Act provides for ongoing financial support to the States for the delivery of FT places.
If a State is a party to an FT agreement, the Commonwealth is to make a grant of financial assistance under section 16 of the Federal Financial Relations Act 2009 for the purpose of making payments in accordance with the FT agreement.
The financial assistance must be spent in accordance with the FT agreement and is subject to any other terms and conditions set out in the FT agreement.
Part 3 sets out what is an FT agreement and the key matters to be dealt with in FT agreements.
Part 4 deals with other matters, such as the requirement for the Minister to consult the Ministerial Council before seeking to amend this Act.
5 Definitions
In this Act:
FT is short for Free TAFE.
FT agreement: see section 7.
FT place means a free place in a course at a TAFE institution or a course provided by another VET provider.
Note: An FT place may not be free of all fees. The fees covered will depend on the terms and conditions of the relevant FT agreement.
Ministerial Council means a body (however described) that consists of the Minister of the Commonwealth, and the Minister of each State, who is responsible, or principally responsible, for matters relating to skills and training.
rules means rules made under section 11.
State includes the Australian Capital Territory and the Northern Territory.
TAFE means technical and further education.
VET means vocational education and training.
Part 2—Financial assistance for FT places
6 Grants of financial assistance
Scope
(1) This section applies to a State if the State is a party to an FT agreement.
Grant of financial assistance
(2) The Commonwealth is to make a grant of financial assistance under section 16 of the Federal Financial Relations Act 2009 for the purpose of making payments to the State in accordance with the FT agreement.
Note: Under section 16 of the Federal Financial Relations Act 2009, grants of financial assistance can be made to a State to support the delivery by the State of specified outputs or projects.
Terms and conditions of grant
(3) The financial assistance is payable to the State on condition that the financial assistance is spent in accordance with the FT agreement.
(4) The financial assistance payable to the State is subject to such additional terms and conditions (if any) as are set out in the FT agreement.
Interaction with the Federal Financial Relations Act 2009
(5) Except as provided by subsections (2) to (4), nothing in this section is intended to limit the operation of the Federal Financial Relations Act 2009.
Part 3—FT agreements
7 FT agreements
An FT agreement is an agreement, as amended from time to time, that:
(a) is entered into, and in force, between the Commonwealth and one or more States; and
(b) sets out the terms and conditions on which financial assistance is to be provided to the States for the purpose of the delivery of FT places; and
(c) relates to the delivery of FT places during the calendar year starting on 1 January 2027, or a later calendar year; and
(d) is expressed to be an FT agreement for the purposes of this Act.
8 Key matters to be dealt with in FT agreements
(1) Without limiting paragraph 7(b), the terms and conditions of an FT agreement with a State must deal with the following matters:
(a) the period of the FT agreement;
(b) the areas of study, or the industries, that are a national or State priority for FT places to be offered in;
(c) the number of FT places that are to be offered in the State;
(d) the calendar year, or years, during which the FT places are to be offered;
(e) the groups that are to be prioritised for access to the FT places;
(f) the amount of financial assistance that is to be provided to the State and a schedule of payments;
(g) performance milestones;
(h) the proportion of the financial assistance that is to be provided to:
(i) TAFE institutions; and
(ii) other VET providers;
(i) the VET providers, or classes of VET providers, eligible to receive funding for the FT places;
(j) arrangements for reviewing and evaluating the agreement;
(k) a process for varying the agreement;
(l) a requirement for the State to provide the Commonwealth with information about:
(i) the total amount of funding provided for FT places in the State; and
(ii) the amount of funding provided by the Commonwealth for the FT places in the State; and
(iii) the courses in which the FT places are being offered; and
(iv) the number of persons enrolled in an FT place in those courses; and
(v) of the persons enrolled in an FT place in those courses—the number of persons who completed the course; and
(vi) if the agreement identifies groups that are to be prioritised for access to the FT places—the number of persons enrolled in an FT place who are in an identified group;
(m) requirements relating to the form, manner and period within which the information mentioned in paragraph (l) is to be provided.
(2) An FT agreement is not invalid merely because it does not deal with one or more of the matters mentioned in paragraphs (1)(a) to (k).
Part 4—Other matters
9 Consultation with Ministerial Council
(1) The Minister must consult the Ministerial Council if the Minister proposes to introduce a Bill for an Act that amends this Act into a House of the Parliament.
(2) If the Minister introduces a Bill for an Act that amends this Act into a House of the Parliament, the Minister must also table in that House a report setting out what consultation has taken place.
10 Act does not limit power to make other grants of financial assistance
This Act does not limit the Commonwealth’s power to make other grants of financial assistance to the States in respect of FT places.
11 Rules
(1) The Minister may, by legislative instrument, make rules prescribing matters:
(a) required or permitted by this Act to be prescribed by the rules; or
(b) necessary or convenient to be prescribed for carrying out or giving effect to this Act.
(2) To avoid doubt, the rules may not do the following:
(a) create an offence or civil penalty;
(b) provide powers of:
(i) arrest or detention; or
(ii) entry, search or seizure;
(c) impose a tax;
(d) set an amount to be appropriated from the Consolidated Revenue Fund under an appropriation in this Act;