The damning report suggests TAFE NSW is not economically viable or competitive and faces an uncertain future unless drastic changes are made.

However, the NSW Teachers Federation (NSWTF) has slammed the findings and said the report was being used to strongarm TAFE teachers into accepting reduced salaries and working conditions.

The Boston Consulting Group report was commissioned by TAFE NSW.

It found high teaching salaries and low teaching hours contribute to the organisation’s high unit costs, which were found to be 60 per cent higher than other TAFEs around the country.

“TAFE NSW has become an expensive, high-cost system where 40 to 60 cents in each dollar spent on TAFE is going towards administration and backroom costs, not on frontline teaching,” NSW Skills Minister John Barilaro said.

“The current system is failing students, failing industry, and failing to meet the demands of employers to create the workforce for the jobs of tomorrow.”

However, NSWTF spokeswoman Kathy Nicholson said the report was flawed in a number of ways, such as using old data.

It used data from 2013 to suggest smaller TAFE institutes, such as New England, the Riverina and Western NSW “appeared sub-scale” to successfully compete in the VET market.

The Leader asked TAFE New England (TNE) institute director Peter Heilbuth if the organisation was too small to be competitive, to which he replied the future market for TNE would change significantly.

“Future markets for TAFE NSW and TNE stretch beyond the New England region, and the traditional classroom-on-a-campus approach,” Mr Heilbuth said.

“TNE is working to broaden our reach beyond New England. This document talks about an opportunity to modernise TAFE NSW and TNE so we can provide the right training and skills to more people into the future.”

The report also cited private college Australian Careers Network (ACN) as an example of a cost-efficient education provider – despite the Australian Federal Police investigating the organisation for fraud.

Ms Nicholson said the report was TAFE NSW’s attempt to blackmail teachers into voting for lower salaries and working conditions.

“They’re trying to ram through this enterprise agreement,” Ms Nicholson said.

“They’re basically saying, ‘If you don’t vote for this enterprise agreement, there won’t be a TAFE and therefore you won’t have a job’.

“TAFE delivers quality to students and to do that, we need to attract the best teachers the industry has to offer.

“How do regional areas do that if we don’t have conditions that are attractive?”