Opposition says PM's vocational skills deal a 'big pill'

The states and territories should reject Labor's multi-billion dollar skills package, the federal opposition says.

The plan outlined by Prime Minister Julia Gillard on Monday would give all Australians an entitlement to government funding for vocational training and extend HECS-style loans to the sector.

It aims to increase the standard of the VET sector, which currently trains 1.8 million students a year, by giving states and territories funding set aside in the budget worth almost $9 billion.

Gillard is due to present the vocational education and training (VET) package to the Council of Australian Government's (COAG) meeting on April 13.

Opposition employment spokeswoman Sussan Ley said on Tuesday the plan did not offer value for money and questioned whether it would work.

"Expanding student loans and a national entitlement to training do not automatically lead to higher completion rates of study and, in some cases, achieves the exact opposite," she said in a statement.

Victoria is the first state to show its hand ahead of the COAG meeting.

The state's Higher Education and Skills Minister Peter Hall said it looked like Victoria would see a decrease in funding under the plan.

"It is our intention to work with the Commonwealth government in a constructive and respectful manner but that needs to be reciprocated," he said in a statement.

He also wants the loans scheme to cover fees for Certificate III and IV courses, not just diplomas and advanced diplomas.

Business and education groups on Tuesday recommended the states get on board the government's plan.

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