John Key is right to say that the country needs to improve the value it gets from tertiary education and Industry Training Organisations (ITOs) can help, Industry Training Federation Executive Director Jeremy Baker said today in response to comments the Prime Minister made in his opening speech to Parliament.

"It is our long held belief that much can be done to better match what is funded in tertiary education with the skills that are needed by industry," Mr Baker said.

"Under the current system there is no process to ensure that funding committed to tertiary education is targeted to the areas where there is a clear skill demand. ITOs have developed approaches that would ensure that money invested in tertiary education was towards courses and qualifications our workforce needed.

"ITOs are also keen to work with government to provide better connections between schools, tertiary education and the workplace. We can provide clear vocational education and training pathways linked to qualifications that have real value.

"What's more, industry training is the most cost effective part of the tertiary education system and therefore can provide excellent value for money," Mr Baker said.

More than 35,000 businesses and more than 180,000 apprentices and trainees are involved in industry training every year.