3. ASSESSMENT OF KEY ISSUES AND POLICY RESPONSES

In April 2018, for the first time in the country's history, a law on vocational education was adopted. This law defines the principles of state policy in the field of vocational education and provides an organisational, legal and economic basis for the VET system. The law introduced three levels of VET: initial, technical and higher technical vocational education. Currently the government is actively working on the development of secondary legislation that covers different aspects of VET, such as development of occupation standards, rules of admission to vocational education institutions, assessment of students and transition from different levels of study.

The EU and UNDP are supporting the establishment of a Regional Industrial VET Competence Centre in Ganja and Regional VET Centre of Excellence for occupations in agriculture and industry (manufacturing) sectors in Jalilabad. The Baku State Vocational Training Centre on Industry and Innovation, which was established by the Cabinet of Ministers of the Azerbaijan Republic on October 11, 2016 and with support from the Korean Economic Development Cooperation Fund, started its activities in September 2019. The new centre in Baku is equipped with the most up-to-date material and technical base and provides training for more than 1 000 students in eight occupations: ICT, automotive, mechanics, industrial installations, electronics, electrical engineering, automation and construction. All of these centres successfully cooperate with industry entities.

The VET Roadmap also envisages establishment of 10 modernised VET centres of excellence across the country, which will provide training in the priority occupations that are in high demand in the labour market. These centres will have modern infrastructure, materials, and technical and training bases, and a management structure that will be based on public–private partnership. In 2019, construction of two new VET centres began, and five more VET centres will be constructed in 2020. It is envisaged that modernised VET infrastructure will improve the VET image and make it more attractive for learners and parents. However, in reality, many state VET institutions still have inferior infrastructure and lack a material base and equipment for teaching.

The SAVE initiated changes in the old curricula and proposed the development of new programmes. A new curriculum template has been developed and tested by the EU VET reform project, but there is a further need to establish a formal process for development of curricula. Until now, 81 modular educational programmes (curricula), 51 modules, 55 new textbooks and 78 modular textbooks have been developed. According to the national Torino Process report, out of 168 programmes in VET institutions, only 36 are competency-based modern curricula. The transition to modern content of vocational education is ongoing and is planned to be completed by 2020.

The State Strategy on the Development of Education is gradually addressing issues to attract qualified teachers and managers. In Azerbaijan, improving the teaching and learning environment is identified as a priority objective both in the Education Strategy and VET Roadmap. In this context, some steps have been taken in recent years to improve the prestige of the teaching profession, the professionalism of teachers, and to attract talented people. The difficulty attracting well-qualified new entrants and to retain them once they have started to teach is also a challenge for the VET system. In 2019, teachers' salaries were increased more than twice in comparison to the 2018 salary level. The question remains whether this increase will be enough to attract highly qualified professionals. It is widely acknowledged that the formation of an educated and competent person depends on the academic skills, teaching experience and professionalism of teachers. Since 2017, the MoE has been carrying out diagnostic assessment of teaching staff in VET institutions. Plans are underway to develop specific conditions and criteria for selection of pedagogic staff, including identification of those specialities that need involvement of professionals with practical experience.

The SAVE, together with GIZ, has developed a training programme for VET teachers and managers. However, until recently, participation of teachers and trainers in professional development courses, seminars or training has been very limited and focused on theoretical knowledge. The lack of facilities to provide professional development courses for VET teachers and weak interest from enterprises to cooperate with VET institutions in teachers' development have negatively influenced the professional development of teachers. Also, most of the initiatives for supporting professional development of VET teachers has been financed and organised by international projects.

Several new initiatives have been introduced to increase access to VET for some vulnerable groups, such as people with disabilities, children without parents, etc. They are admitted to VET institutions without entry competitions, can study free of charge and receive a monthly scholarship of AZN 50. In addition, implementation of inclusive vocational education principles is being piloted at Baku State Vocational Education Centre for Technics and Technologies. To ensure better transparency in admissions to vocational education institutions, in 2016, ASAN service piloted online admission procedure in Baku and Ganja. As of 2018, the VET admissions process is organised through ASAN service centres across the entire country. In the 2018/19 academic year, VET institutions received more than 16 000 applications through the electronic application system.

The MoE also introduced a digital teaching material platform that contains electronic versions of the study books and other materials. A curriculum management information system has also been created and includes online resources. Since November 2018, VET learning materials have also been included in the platform and are accessible for everyone. The MoE has also introduced a digital skills pilot programme at secondary education schools which aims to introduce coding and programming languages as part of the curriculum. VET institutions have also introduced an ICT module for all occupation curricula. Furthermore, in order to facilitate the digital transformation, the government set a priority of modernisation of technology teaching with the involvement of business.

To encourage involvement of the various stakeholders in the development of the education system, four standing committees have been established under the MoE: on education and employment, education and ICT, education content and textbooks, and students and young people. They involve representatives from government agencies, the private sector, education professionals and other relevant stakeholders, and act as consultative bodies. The success, however, will depend on willingness and capacity of different stakeholders to participate, as well as the ability of the MoE to lead the process.

Both the VET Roadmap and VET Law set integration of employers into the VET system as one of the strategic targets, and partnership with employers is one of the key prerequisites for modernising the country's VET system. Some progress has been achieved in establishing better cooperation between the education system and business sector. The MoE has signed a memorandum of cooperation with several large enterprises (e.g. Azersun and Gilan Holding). The SAVE has initiated more than 100 cooperation agreements between agencies, schools and the private sector, although they are not binding. The National Confederation of Entrepreneurs (Employers) Organizations is implementing a project – Cooperation in the Field of Vocational Education – funded by the German Federal Ministry for Economic Cooperation and Development that aims to strengthen cooperation between entrepreneurs and vocational education institutions to increase employment of young people and support the training of staff in accordance with the needs of the labour market.

Most of the donor-coordinated projects, including EU projects, are piloting WBL as part of newly designed curricula. The British Council, in partnership with the SAVE and the tourism industry, continues implementation of the Access to Hospitality and Apprenticeship Scheme. During the 2018/19 academic year, the programme was implemented in Baku, as well as in the other regions of Azerbaijan (Gabala, Ganja, Qusar and Ismayilli), in three specialities: chef, hotel concierge, housekeeping attendant. GIZ is implementing a project – Establishing Dual-like VET Pilots in Tourism and Agriculture – in Gabala, Ismayilli and Gakh districts. Based on the data provided by the projects, the initiatives that include WBL components have been successful. More than 60% of graduates were able to either remain in the companies as employees or get full-time employment in the sector. By 2025 employers will be fully integrated into the VET system, from development of educational curricula to financing, and this is the target of the VET Roadmap.

To increase autonomy of VET institutions, in February 2019, the Cabinet of Ministers approved new statutes for VET institutions that transform vocational institutions into public legal entities and provide more freedom for vocational institutions to provide services, as well as manage finances. Transformation of the institutions into public legal entities is an ongoing process, and it will take time to implement measures in line with the VET Law and new statutes. Overall, even though they can provide various paid education services to individuals and legal entities and receive donations, they have little flexibility in managing financial resources due to various legal procedures. The poor infrastructure and a weak capacity of teachers limit the ability of state VET institutions to provide quality training and generate additional revenues.

The VET Roadmap sets a goal to build an outcome-based strong financing system which incorporates performance-based rewards for VET institutions and teaching staff to ensure efficient use of funds. The Cabinet of Ministers has approved new rules for financing state VET institutions that determine the requirements for budgetary funds in accordance with the uniform budget classification for the current activities of the state VET institutions operating in Azerbaijan. Within the framework of the EU Technical Assistance project, the guidelines and methods have been developed for budget formation, definition of financial sources, distribution of funds and their management. Furthermore, the VET Law envisages the establishment of the Vocational Education Development Fund, which will manage and allocate the funds among VET institutions in a transparent manner. The fund is due to function under the MoE as a public legal entity and will be supervised by the governing body which will consist of both private and public sector participants. The SAVE has developed a draft project for the establishment of the fund.

The authorities of Azerbaijan are aware of the need to reform VET financing and have set a goal to build an outcome-based strong financing system which incorporates a performance-based rewards mechanism for VET institutions and teaching staff to ensure efficient use of funds. A first step would be to increase the financial resources and optimise their utilisation.

The ETF recommends reviewing the VET financing system by diversifying its resources, developing a costing approach and improving the distribution of funds, their management and monitoring.

a) Increase the share of non-state resources by diversifying the sources of funds to support the national ambitious plans for economic diversification. The idea is to make those who benefit from public policies also contribute to them. This contribution could take many forms such as a training levy or income generation by schools. A first option would be to convince employers about the SAVE proposal to establish a VET Development Fund. Another complementary and quick way to increase VET resources could be the extension of WBL to more priority occupations. The VET private provision, practically non-existent in Azerbaijan, should also be developed and incentivised to contribute to the national efforts to bridge the skills gap for priority sectors.

b) Move towards a more performance-oriented approach for resource allocation. Currently, budget is determined by a simple percentage increase (or decrease) on the previous year's budget (historic incremental approach) which does not take into account the performance of providers or the achievement of VET policy objectives. Policy makers should consider establishing basic criteria for the allocation of funds based on performance and policy priorities (e.g. enrolment, graduation, placement, continuing training and WBL). This should include a costing methodology to ensure accurate and sustainable budget formation and execution. The cost estimation of the outcomes and activities will not only optimise the use of resources but also improve transparency, accountability and credibility of the policy options.

c) Provide more financial autonomy to VET schools in order to better respond to the local labour market needs, promote innovation, optimise resources and thus enhance attractiveness. This should go hand in hand with reinforcement of management schools capacity and revisited accountability rules, based on defined priorities and agreed objectives. This autonomy will also reinforce the financial diversification of resources, as schools will be able, where possible, to generate incomes through provision of services and goods. The concept of vocational excellence, being currently implemented through the EU grants in Ganja and Jalilabad, could be a model to be extended.

In summary, the ETF recommends speeding up the implementation of this new financing framework by drawing on the guidelines and methods for budget formation, definition of financial sources, and distribution of funds and their management, which were developed within the framework of the EU Technical Assistance project. This includes the speedy establishment of the Vocational Education Development Fund, which will manage and allocate the funds among VET institutions in a transparent manner. Finally, the planning should take into account the various sources of funds, which are both public and private (including VET private providers' and donors' contributions), in order to bridge the current gap between strategies and actual achievements, ensure more visibility and transparency, and make the policy more credible.

The VET Roadmap acknowledges that partnership with employers is one of the key prerequisites for taking the VET system of Azerbaijan to a modern level and envisions that by 2025, employers will be fully integrated into the VET system, from development of educational curricula to financing. Indeed, the national Torino Process report states that the current centralised governance is one of the main factors hampering the effectiveness of VET in Azerbaijan.

The ETF recommends a comprehensive and coherent approach to address this issue by fostering the conditions conducive to a multi-level and multi-stakeholder governance ecosystem that steers skills development to answer efficiently the real socio-economic needs and foster attractiveness for young people and enterprises. The national authorities need to create incentives and dedicated policy mechanisms for the involvement of employers in the VET policy cycle. This should range from policy planning to implementation and monitoring, including development of VET standards and curricula in accordance with the real needs of the labour market as well as active participation in the governance of the VET system.

This requires cohesive cooperation and coordination between different actors, not only at national level but also at sectoral and local levels. These governance arrangements can take many forms:

a) At national level: The need to improve coordination of policies for skills development would need the establishment of a high-level, national VET tripartite body/council, composed of a VET authority, employers and employee representatives. Its mandate and role should be discussed and agreed with the objective to design, monitor and assess VET policy in a collaborative way. The ETF recommends setting up a unified, national VET authority with a mandate to steer the overall VET system as a way of improving cooperation between state bodies with stakes in VET and avoid policy fragmentation and overlapping. This authority would be supported by the VET high council in terms of strategic orientation.

b) At sectoral level: Sector skills councils are an effective way to involve employers in policy design. The sector skills councils need to be progressively established as independent employer-led organisations in the priority economic sectors. In addition to their role of skills anticipation, reducing skills gaps and shortages, and developing and managing occupational standards, the sector skills councils will seek to build a skills system that is driven by employer demand. The MLSPP Occupational Standards Action Plan for 2018–25 could be the framework to implement this initiative. This plan envisages a more active role for sector skills councils.

c) At local level: The regulation for Ganja and Jalilabad centres of excellence that has been recently developed and endorsed by national authorities (in the framework of the EU grants programme) provides more financial and management autonomy to these centres and foresees active participation of employers in school development, both in terms of initial and continuing training as well as validation of non-formal and informal learning (VNFIL). These centres have already established ad hoc memorandum of understanding with many enterprises in the region with the objective to better know and anticipate the skills needs and ensure more WBL. The dynamic created around this initiative needs to be fostered and extended to other schools, through schools networks and collaboration. The MoE and SAVE should take the lead to ensure continuity and sustainability, notably through the adoption of the public–private partnership framework being developed.

The general understanding about the importance of education/business partnerships and cooperation formats can be improved by conducting awareness-raising campaigns for education providers, employers, young people and the broader public, presenting success stories and highlighting the advantages that all parties could gain from this partnership. At local level, very good public–private partnership initiatives have been developed (e.g. in Jalilabad and Ganja) that should be consolidated, structured and extended. The same goes for WBL as a concrete way of cooperation with the private sector.

In summary, the ETF recommends that the national authorities create incentives and dedicated policy mechanisms for the involvement of employers and the private sector in the (re)development of VET standards, curricula and provision in accordance with the real needs of the labour market. Successful human capital development policy requires cohesive public sector coordination, not only at national level, but also vertically with regional and local constituencies, as well as different stakeholders. Employers' involvement in the design of VET content and the provision of VET can be improved by motivating more companies, in particular SMEs, to participate in sector associations, which in many EU countries, for example, are decisive for VET content development that targets the needs of various industries and sectors of the economy.

The national Torino Process report admits that the lack of a comprehensive teacher development policy in VET has an overall negative impact on the quality of the VET system and thus on its attractiveness. It is also stated that school management needs to be improved in order to support the VET authorities to foster vocational excellence and provide more autonomy to schools.

The ETF recommends improving and streamlining the professional standards for VET teachers and masters and introducing career and professional development schemes for VET personnel. This is about improving and streamlining policies and requirements for teachers and other professional staff in view of promoting a higher professional standard of work and introducing career development schemes with special attention on building relevant professional competences. In the same vein, Azerbaijan could consider allowing practitioners from the world of work to enter teaching even without formal teaching qualifications. It is also important to carry out activities to enhance the prestige of the teaching profession, including creation of a promotion and career development system. Sharing expertise and best practice among teaching personnel, as well as companies, needs to be further stimulated.

The MoE and SAVE should also accelerate and enlarge development of centres of excellence to ease the process of teachers' professional development and to allow a better and more relevant recruitment policy. The recent regulation related to vocational excellence needs to be enforced. This needs investment in the existing school management staff, notably through capacity building and awareness-raising, and a more stringent recruitment policy of school managers.

Reinforcing the capacity of public authorities to gather and use evidence in policy analysis, design, planning, monitoring and implementation concerning skills development is an important precondition for measuring the effectiveness and efficiency of the policies.

To enable more targeted skills supply policy development, a wide array of data on VET schools, programmes and graduates is needed. Administrative data on school enrolment exists, but survey data and long-term analysis of VET are lacking. A more targeted policy approach would require regular use of analytical tools such as tracer studies with graduates and employer surveys that would provide data for more sophisticated planning and show if the training is relevant to the labour market.

The shift to more targeted policy-making will require capacity building with regard to data collection and analysis. The newly established Labour Market Observatory under the Ministry of Labour is an important step in this respect and should be adequately resourced with both financial and human resources to ensure sustainability and quality of data analysis.

In line with the Decent Work Programme for 2016–2020 signed with the International Labour Organization (ILO), important steps are being taken to improve youth employment. The state programme Azerbaijani Youth 2016–2021 is focused on youth education and employment, and includes skills development, career guidance and entrepreneurship. However, as a framework document it does not provide concrete activities or indicators. The important step forward is the new Employment Strategy that establishes clear national targets. The Employment Strategy adopted in 2018 sets important targets for young people, indicating that by 2030, the proportion of young NEETs, i.e. those aged 15 to 24, should be reduced to 15%. In 2017, the figure was 23%.

The Law on Employment (2018) introduces an economic and organisational basis for state policy in the field of employment promotion and establishes the integration of young people into the labour market as one of the goals of active labour market programmes (ALMPs). The MLSPP is actively working on the development of secondary legislation to ensure effective implementation of the law. At present, the SES, under the MLSPP, implements ALMPs through its 80 employment centres and three regional vocational training centres (Baku, Nakhchivan and Goychay). The SES registers unemployed persons and provides employment services to jobseekers. In 2018, a total of 119 230 jobseekers applied to employment offices for assistance in job search, of which 51 774 were provided with a job. However, the registration rates at the employment centres are low and the outreach of services is limited. The SES deals with a small fraction of potential beneficiaries, as many young people, such as NEETs and those who live in rural areas, usually do not register. There is a certain stereotype that a good specialist will not apply to employment centres. Thus, employment centres usually serve young people with lower skill levels, i.e. general education graduates.

In 2019, the MLSPP launched the new employment subsystem as part of its centralised electronic information system to promote more transparent and accessible employment services. The subsystem allows provision of employment-related services electronically, without contacting an employment centre. It also established a vacancy bank as an electronic information resource for new jobs. It provides real-time access to information on employment services, including information about employment opportunities for jobseekers.

The Youth Employment Programme and associated Youth Fund of the MLSPP were launched in April 2019. The aim is to assist young people in successful career development (finding a job), creating additional jobs (especially in the regions) and increasing competition in the labour market. Vocational and higher education graduates under the age of 29 will be able to participate in the programme. They will be awarded a minimum one-year employment contract and will be funded by the Youth Fund for a certain period of time. There will also be opportunities to participate in career planning activities and vocational training. Preference will be provided to young people from socially vulnerable groups (persons with disabilities, IDPs, etc.), those living in the regions and those who have no work experience.

The Youth Foundation under the President of the Republic of Azerbaijan is a non-profit legal entity ensuring activities in the science, education, culture and other social fields concerning youth policy. It functions in cooperation with government and local self-government bodies, mass media, NGOs and international organisations. The Foundation implements grant completion for local NGOs working with young people aged 16 to 29, supporting participation at international conferences and events. Talented young people with special needs for social protection will also receive financial support from the Foundation to cover their tuition costs. The main criteria are the young student's attendance, educational performance, and relevance of the applicant to the vulnerable group. Students from vulnerable groups who are aged 16 to 29 and who were admitted to VET institutions can apply to these funds as well.

The Youth Foundation established Youth Development and Career Centres in Baku and the regions so that young people can get training on various topics related to their personal and professional development. Some of these centres, especially those in the regions, will also provide vocational skills training. President Ilham Aliyev signed a decree on additional measures to support the activities of the Youth Foundation, and AZN 4 million has been allocated by the Presidential Reserve Fund envisaged in the 2019 state budget to the Youth Foundation in order to create and maintain representative offices of the Youth Development and Career Centres at the Heydar Aliyev Centres operating in cities and regions of the country. The Foundation is planning to establish about 50 Youth Development and Career Centres all over the country by April 2020.

To further improve services, in June 2019, the Cabinet of Ministers approved new rules on provision of career counselling services. The rules establish the scope and procedure for vocational counselling services, with the aim to provide support and information about job and training opportunities available for vocational and professional education, and measuring interest and socio-psychological characteristics of young people (students and pupils of educational institutions), employers and unemployed people. The SES is also involved in provision of career guidance activities to young people who are still in education. For example, the SES organises job fairs, including events at the leading universities, for students and graduates under the motto 'the first step in your career' to help young people to establish initial contact with employers and to promote their integration into the labour market. The SES has also been organising interactive workshops on the role of parents in choosing a profession for their children, with participation of professional psychologists and vocational guidance experts at almost all city and district secondary schools. In 2018, a total of 118 138 young people were involved in career guidance activities. Overall, career guidance services are limited and concentrate more on short-term employment options rather than on longer-term career development and career planning.

The SAVE has identified responsible staff in secondary schools to create links to VET institutions. Also, VET institutions organise open days for secondary school pupils and their families to inform them about VET programmes and relevant occupations. The SAVE Department on Career Guidance and Cooperation develops international cooperation programmes, cooperates with employers to enhance the effectiveness of VET, and takes actions to promote VET and awareness-raising about VET.

Access to higher education is a very important element of human capital development policy when it comes to young people. After joining the Bologna Process in 2005, Azerbaijan has put in place a number of reforms to revamp the higher education sector according to European standards. Some of these reforms have benefited private institutions. For instance, for the first time in 2010, private universities became eligible for the state-funded voucher programme where a high-achieving student could select private universities and have her/his education financed by the government. As evidenced by the Action Plan on the Implementation of the State Strategy on Development of Education adopted in 2015, the government aims to transition from a state-controlled higher education system to a self-regulated higher education market where students and HEIs define the supply and demand for tertiary education. The introduction of fees for such admissions tests, similar to the ones in the United States administered by the Educational Testing Service such as SAT, is seen as part of the movement to liberalise higher education (Abbasov and Jarafli, 2018).

Some notable improvements are now evident. The gross enrolment rate in tertiary education was up to 27% (4% in vocational education and 23% in higher education), although still well below its neighbours Georgia (51.8%) and Armenia (51.2%) (UIS, 2016). Overall, despite attempts to modernise and diversify the tertiary education system, it still remains highly state-controlled even to an extent that the exact number of places at each HEI is approved by the Cabinet of Ministers on an annual basis. Therefore, considering the involvement of several key stakeholders – Cabinet of Ministers, MoE, State Examination Centre, along with individual HEIs – adopting new reforms and instituting change in higher education has proven to be a difficult task (Abbasov and Jarafli, 2018).

Youth unemployment is an issue in Azerbaijan. Young people constitute a diverse population that include various vulnerable groups such as young women, low-skilled youths, those who dropped out from school, those who experienced difficulties in entering the labour market due to a lack of work experience, those who reside in rural areas, and IDPs.

In line with the country efforts for youth participation support (Decent Work Programme for 2016–2020 with the ILO, Youth 2016–2021, ALMPs, self-employment initiatives, etc.), the ETF recommends ensuring more coherence of and adjusting the youth employment policies so that they include services and training offers that are more user-friendly and appealing for young people, thus making the focus on youths an integral part of the country's mainstream labour market policy.

Specifically, the ETF recommends improving youth support measures by tailoring them to the specific needs of different groups, in particular disadvantaged young people. The ETF also recommends investing in the professional development of staff from the SES, to prepare them for the complex task of target group outreach and diverse needs and expectations.

The national Torino Process report recognises that one of the factors that impedes the entry of VET graduates into the labour market is their choice of occupation. State programmes encourage development of industry, construction, transportation, ICT and other sectors but either few students enrol in these occupations or there are few enterprises where they can get practical knowledge or employment upon graduation.

Many young people, particularly those from poor and disadvantaged backgrounds as well as rural areas, struggle to find decent employment because they lack guidance and information about the labour market. Providing young people with career guidance that is based on high-quality information about labour market prospects can help them to choose education and professional career paths and support them in better matching their skills and competences as well as aspirations.

The ETF recommends strengthening the quality and effectiveness of early career guidance and counselling services at general and VET institutions, including building career education into the curriculum, linking it to students' overall development and offering guidance in career planning throughout secondary schools. Employers and NGOs (in addition to SAVE and the Labour Market Observatory) should be involved in the development of trades and the promotion of VET and career guidance. Thus, career guidance can be used as a preventive measure to improve the labour market outcomes of young people.

The important aim of Azerbaijan's employment policy is to encourage the gradual transition from the passive assistance system to a self-employment system that would prevent dependence of low-income people and stimulate entrepreneurial activities. This is done by implementing a large-scale self-employment programme that is aimed at creating opportunities for the unemployed to establish small businesses, in particular by providing low-income families with various assets (goods, materials and livestock), as well as training in entrepreneurship. In 2018, a total of 7 267 unemployed people were involved in the programme, including 1 174 young people. Currently about 75% of businesses established through the self-employment programme are in farming.

As interest in the programme is very high (in the first half of 2019, the programme received about 45 000 applications), in 2019, it was expanded, involving more than 8 500 people with a particular attention to vulnerable groups, including young people. In June 2019, the MLSPP, the SES and the UNDP announced the start of a self-employment programme for persons with disabilities. The aim is to support 500 unemployed persons with disabilities who have the desire and vision to start their own business. With support from the new World Bank's Azerbaijan Employment Support Project, it aims to increase effectiveness of the self-employment programme by improving targeting and introducing complementary support services to increase the likelihood of business survival in the medium to longer term.

Although the overall implementation of the self-employment programme is considered to be successful and it has been significantly expanded since it started in 2016, its thorough evaluation and cost–benefit assessment has not been implemented yet. Lack of a robust system for tracking the beneficiaries after the services provided is an overall weakness in the implementation of support measures by the SES. This might be linked to the weak culture of monitoring and evaluation. The existing monitoring activities are limited to measuring participation in the training programmes, with little attention being paid to the quality. There is a need to introduce regular monitoring of key indicators (both input and output) to assess the performance of the different employment programmes implemented by the SES, particularly with a focus on those where training measures are a significant part of it.

In June 2019, the Cabinet of Ministers approved new rules for the organisation of vocational training for jobseekers and unemployed people that provide grounds for the involvement of VET institutions in training provision outsourced by the SES. In agreement between the SES and SAVE, vocational institutions and VET providers, under the responsibility of the MoE, also started to provide short-term courses from May 2019. The first step was to pass the VET Law, which established the legal basis for the enhanced role of VET in the provision of continuous vocational education by allowing VET institutions to provide short-term courses for up to six months. These courses can also be organised upon the request of companies on the basis of tuition fees being paid.

Technological change makes it harder to anticipate which job-specific skills will thrive and which will become obsolete in the future. Thus, the ability to adapt quickly is increasingly valued by the labour market. At present, analysis of the labour market in terms of occupations is not developed enough to inform corresponding VET policies, and in particular the needs for continuing VET. The importance of labour market needs analysis has been confirmed by the positive experience of two priority centres (Jalilabad and Ganja). Building on the labour market surveys carried out in 2017, both centres now offer courses in six new occupations in line with labour market needs. The new courses, which cover such growing industries as wine making, and tea and strawberry production, have attracted new students' attention. Enrolments rose by 22% in Jalilabad and 9.5% in Ganja (UN, 2019). These types of courses could be particularly relevant for adult learners.

The Council on State Support to NGOs under the Auspices of the President of the Republic of Azerbaijan was established in 2007. Each year the council conducts a competitive process for grant allocation for various important social, cultural and public topics for NGOs. The council is planning to put VET on its list of topics for future grant allocations which will allow local NGOs to apply for and implement projects related to raising awareness about this field among various groups of people in Baku and the regions.

At present, although a document certifying general secondary, specialised secondary or higher education is required for employment depending on the complexity of the profession, a document certifying vocational qualifications is not required. This has resulted in the fact that most people actively engaged in the labour market have no document proving their qualifications. The VET Roadmap acknowledges that the requirement for a vocational qualification certificate, a key quality-certifying indicator, is one of the main reforms that would transform the attitude towards vocational education and would have a positive impact on work safety and increase labour productivity and competitive production. It sets up a strategic target to ensure that after 2025, a vocational qualification could be compulsory for employment.

The Action Plan on the Implementation of the Education Strategy (2015) establishes a task to introduce a new system for the validation of competences acquired through non-formal and informal learning. Also, the recently adopted Employment Strategy determines the priority of development of VNFIL and establishment of the workforce certification system, and the Azerbaijan National Qualifications Framework (AzNQF) provides the basis for the development of VNFIL. However, according to the Education Law, VNFIL is only foreseen in the vocational education pillar. The SAVE is in charge of developing VNFIL and its legislative base. It does this in cooperation with the MLSPP. The UNDP supports the development of a legal framework and pilotes new mechanisms for recognition of prior learning in the Ganja VET Competence Centre in the framework of the EU grant project. Recently, there has been greater openness towards VNFIL and there is a growing interest in public debate in relation to several high-profile events and articles in the press.

In July 2019, the President of Azerbaijan signed a decree to establish the National Observatory on Labour Market and Social Protection Affairs under the MLSPP (elsewhere referred to as the Labour Market Observatory). It is envisaged that the observatory will collect, analyse and publish information on the supply and demand for occupations and skills that will help students and jobseekers to choose fields of study and invest in skills to enhance their employment and wage prospects. As the key role of skills development is to meet the skills needs for catalytic sectors that would enable economic transformation and move workers from low-productivity sectors, there is a need for a forward-looking approach to understand the future skills needs, particularly in the application of innovative content such as computer science, natural sciences and engineering, including robotics, artificial intelligence and nanotechnology.

An important recent achievement was the adoption of the AzNQF (2018). This step supports Azerbaijan's convergence with the European higher education area and is aligned with the European qualification's framework for LLL. The AzNQF is closely linked to other policy initiatives, including the reduction of informal employment, employment promotion and labour mobility. However, to fully implement AzNQF, there is a need for a more systemic approach. From 2018, the shift to a modern curriculum has started by formulating new programmes based on occupational standards and involving employers in the curriculum development process. The legal status of occupational standards has been strengthened by the AzNQF decree, the VET Law, the Employment Strategy 2019–2030 and a law on the Use of the Budget of the Unemployment Insurance Fund for 2019. Secondary legislation has been drafted and adopted to establish a new workflow for developing standards.

Until now, the MLSPP, together with representatives from companies and social partners, has developed 289 occupational and 63 qualification standards for priority occupations. Occupational standards have been developed for agriculture, energy, construction, manufacturing, tourism trade, business and individual services, ecology, transport, and finance and insurance. It is envisaged that budget allocated from the Unemployment Insurance Fund will be used to upgrade existing professional standards in line with the AzNQF, as well as to develop other new occupational and qualification standards that are considered an economic priority. Occupational standards are generally seen as the new starting point for developing state educational standards, but there is currently no system-wide use of them.

The ETF carried out an evaluation in 2018 of the use of occupational standards which showed that they can be better used by education authorities. Different approaches have been tested to involve representatives from the world of work more in renewing vocational and higher education standards, but so far a more consolidated new approach is only coming into place, slowly with the support of EU and donor projects. The donor support can accelerate some of these developments, but in the end, much depends on institutional capacity in the country. It is important to clarify the coordination mechanisms, and to empower sectors and training providers to start playing a more active role in standard and curriculum development.

Azerbaijan recognises the important role of entrepreneurial skills in fostering development of SMEs. Stimulating entrepreneurial ways of thinking and encouraging entrepreneurship are the priority goals indicated in the strategic roadmaps. The SME Roadmap further sets out a number of policy actions to promote entrepreneurship. According to the Action Plan 2018–2020 approved by the Ministry of Economy, the Small and Medium Enterprises Development Agency (KOBIA) will organise special training with the participation of SME subjects in promoting entrepreneurial thinking in the vocational education institutions, supporting organisation of manufacturing training and manufacturing practices in accordance with the concept of dual VET. In 2018, a structured policy partnership led by the SME Agency's Lifelong Learning Commission was established to coordinate activities of government and non-government actors on entrepreneurial learning.

To promote entrepreneurial learning in VET, in 2018, an entrepreneurship module was introduced as a mandatory module in all VET levels. However, it is not implemented in general education. Materials, guidebooks and online resources focus on financial and economic literacy, (business) planning, idea creation, market analysis and legal aspects. Practical entrepreneurial experience is compulsory in selected VET schools, and secondary vocational school programmes in some specialities include 14 weeks of entrepreneurial practice. Also, the SAVE, together with other relevant stakeholders and non-government institutions, is organising events, workshops, competitions and field visits of VET students to encourage entrepreneurship of VET students. It also launched a new mentoring programme for providers of vocational education aimed at building their capacity to promote entrepreneurship and entrepreneurial thinking.

The Education Strategy establishes LLL as a priority. The Education Law includes reference to non-formal and informal learning and a wide spectrum of qualifications for adult learning. Furthermore, the VET Roadmap and VET Law set priority directions to provide a relevant legal basis for organisation of adult education and further training courses in VET institutions, and define formal, non-formal and informal vocational education. The development of this legislative framework is ongoing.

In line with the above, the ETF recommends prioritising the expansion of adult education opportunities, in a LLL perspective, and the collection of evidence on participation in order to improve employability, close the mismatch gaps and ensure more equity. This improvement should cover the content and methods of training as well as their relevance to the labour market needs.

This could include reinforced involvement of public providers in adult education and better coordination of the involvement of private providers. Developing interactive and participatory methods will be relevant in gaining the interest of young people in learning and development of skills. Also, the use of new technologies (from distance learning to digitalised teaching and learning materials) has the potential to attract more potential beneficiaries.