Sustainable TVET financing is generally an important factor for functioning TVET systems. There is in particular a direct relationship between securing sufficient financial resources, e.g. for competent TVET teaching staff, TVET learning infrastructure, etc., and the outcome quality TVET is expected to provide in accordance with the Occupational Standards. Increasing the outcome quality normally also implies increasing the financial requirements. In Viet Nam and other ASEAN countries, growing financial requirements also result from expanding TVET systems due to population growth and the increasing demand for a competent workforce.
Against the background of growing competition for limited public financial resources, increasing financial requirements for expanding the quantity and improving the quality of TVET based on demand make securing sustainable TVET financing a major challenge and key issue in TVET-related development efforts. In this regard, dealing with financial requirements for demand-oriented TVET is an important issue. It includes e.g. information on actual costs and major cost drivers as well as containing costs as far as is feasible. Another main issue is mobilising funding sources in addition to public funding, with the main focus on financial contributions from companies and trainees (respectively their parents) as TVET stakeholders and beneficiaries. A third major issue is administration and the allocation of funds with a focus on transparency and accountability as well as efficiency and effectiveness, e.g. through performance-based allocation mechanisms.
Link to financing study.