One of Sydney's biggest vocational trainers will be forced to cancel key engineering courses next year as a result of changes to the state's education system.

South Western Sydney TAFE, which was named the largest training provider of the year in 2013, will halve teaching staff numbers and slash engineering courses at three colleges next year as a result of inadequate  funding in the wake of changes to the NSW vocational training system.

According to Fairfax Media leaked documents reveal that government funding will be insufficient for the cost of courses following the introduction of a new system in January next year, which will see TAFE exposed to competition from private training providers.

The documents state that the introduction of a competitive funding model is set to result in “declining market share for the public provider” necessitating course reductions.

Engineering trades class will be axed at the Campbelltown, Chullora and Wetherill Park campuses, alongside courses in fitting and machining, metal fabricating and welding, sheet metal and vehicle-building.

Approximately 28 out of 54 members of the teaching staff will also be retrenched in response to the introduction of the new system. These staff cuts follow upon a wave of mass retrenchments last year, which saw nearly 400 TAFE employees, including 220 teachers, lose their jobs.

According to a TAFE spokesperson the courses have come under review as a result of a stark decline in student numbers, with enrolments plunging 25 per cent due to a lack of related employment opportunities in South Western Sydney.

Members of industry have decried the decision, with Peter Blanchard, chief executive of the Institute of Automotive Engineers, noting that TAFE training is “absolutely essential,” and that the cutting of courses which are a deleterious impact on the sector.

Greens MP John Kaye said that “the loss of engineering skills at local TAFE colleges will undermine any opportunities for recovery in the manufacturing sector in South Western Sydney.”

Engineering features prominently on the O’Farrell government’s targeted list of skills that are in high demand by employers,” said Kaye, himself an  engineer by training. “There is something badly wrong with competition-driven funding when it destroys training opportunities that have been identified as a focus for industry need and jobs growth.”