The realization of the need for reform in Australia's vocational education and training (VET) system stems largely from changing economic circumstances and a changing industrial relations environment. The reforms are intended to provide the following: national coherence in training arrangements and outcomes, improved quality and more widespread provision, greater flexibility in training delivery, a stronger focus on the needs of industry, participation by disadvantaged groups, and increased public recognition of the value of training. A central aspect of the reforms is the establishment of a competency-based training system. The National Training Reform Agenda has established the directions for future development of VET in Australia. Components of the new system include the following: competency-based training; development of National Competency Standards; Australian Standards Framework; Australian Qualifications Framework; National Framework for Recognition of Training; development of training curriculum; flexible delivery of training; convergence of general and vocational education; and increasing the involvement of young people in education and training. Other important aspects of the new national training system are the promotion of closer linkages between vocational education institutions and industries and improved participation of special social groups. (Illustrative best practice examples show the new system in action. Appendixes contain a glossary and 58 references.) (YLB)