Strengthening VET integrity

This week the Australian government introduced legislation which aims to strengthen ASQA’s powers as a regulator, making it easier for them to remove poor performing/fraudulent providers.

Numerous peak bodies including the Australian Council of Trade Unions, the Australian Education Union, the Australian Industry Group, the Electrical Trades Union, Independent Tertiary Education Council Australia, and TAFE Directors Australia, issued media statements supporting the changes (although ITECA also went on to suggest additional safeguards be added to the Bill).

The government’s media release states that the intent of the legislation is to:

1. Cause an RTO’s registration to automatically lapse where the RTO has not delivered training and/or assessment for 12 months. This addresses integrity risks of dormant/”shell” RTOs failing to show genuine commitment to VET;
2. Prevent RTOs from expanding their course offering if they have been operating for less than 2 years. This will allow ASQA to scrutinise new RTOs to ensure they demonstrate capability and genuine commitment to VET over a reasonable period;
3. Provide ASQA with greater discretion in prioritising, considering and deciding RTO applications. This will allow ASQA to quickly progress applications for reputable organisations, while scrutinising high risk ones.
4. Empower the Minister (with the agreement of state and territory Skills Ministers) to determine that ASQA need not, or must not, accept or process new RTO applications (or those for one or more classes of RTO). This will enable ASQA to address trends in applications by non-genuine providers, or manage unsustainable influxes into the VET sector and address associated risks;
5. Expand offence and civil penalty provisions to cover a broader range of false or misleading representations by RTOs about their operations. This will allow ASQA to target egregious RTO conduct exploiting and luring students with false descriptions of training, facilities and false testimonials;
6. Increase five-fold maximum penalties for a breach of relevant offences or civil penalties under the Act. Tougher penalties will deter RTOs that currently see penalties as a risk worth taking or a ‘cost of doing business’.

Proposals 1, 2, 5 and 6 will have minimal/no impact on the majority of existing providers.

Proposal 4 will increase the value of existing RTOs – as licences to operate face restrictions, those who are already operating in the sector benefit from less competition.

The challenge for existing providers sits with proposal 3: superficially of course it makes sense to make it easier for low risk providers to restructure their business operations, including starting delivery to international students.

The catch is that this element of the changes relies on a sound risk assessment from ASQA and currently the size and scale of an RTO’s operations counts towards their risk assessment level. So a large, well performing organisation looking to make changes to its operations may face significant delays while applications from smaller, newer and less robust organisations will be fast-tracked.

A related issue which has emerged in the last few days (and which I have been advised on by others working with affected providers) relates to the delays ASQA seems to be experiencing in its processing of applications for changes to scope from CRICOS providers – where these changes result from updates to the relevant Training Package. It appears that the delays in updating the provider’s CRICOS scope of registration have seen some at risk of entering provider default because they cannot continue to teach their students without the updated course being added to their scope. Apparently some of those affected have had their applications for the updated non-equivalent qualifications approved by ASQA but they remain waiting for the changes to be reflected on their CRICOS scope of registration.

As a former VET regulator, I fully support legislative changes designed to remove fraudulent and poor quality providers from the VET sector – but administrative delays leading providers into potential default are not appropriate even where they might involve higher risk providers.