Problems with the pilot of the Revised Standards for RTOs

This week the Revised Standards for RTOs take effect and after I raised concerns about the effectiveness of ASQA’s risk assessments last week, I was contacted by two leading figures in the sector who separately shared concerns about how ASQA chose to pilot the Revised Standards before their implementation.

I had seen the details in the May ASQA IQ update and thought it was an incredibly small group of providers for a pilot, especially given the statement in the ASQA update that “providers were selected based on a broad range of criteria including size, CRICOS registration, location, indigeneity, enterprise and patterns of compliance.”

The providers which were chosen were:

  • Technical and Further Education Commission (TAFE NSW)
  • The Infinite Knowledge Institute Pty Ltd
  • Diocese of Lismore Catholic Schools Ltd
  • Ambulance Victoria, and
  • Tranby Aboriginal Co-operative Limited.

What I should have paid more attention to was the provider characteristics.

On three of the six criteria used by ASQA to select providers for the pilot, there are questions to be asked. Those criteria are:

  • CRICOS – despite international VET providers being subject to significant financial stress at present (as a result of policy changes in the sector – and which may have an impact on their ability to invest in system-level compliance changes), having additional known compliance risks beyond those affecting domestic-only providers, and despite CRICOS VET providers being required to comply with both the Standards for RTOs and the ESOS National Code – there was only one CRICOS provider included in the pilot and because it was TAFE NSW, it is highly atypical amongst CRICOS VET providers. In 2023 TAFE NSW educated 295,000 students – just 2,300 were international students (ie 0.8% of their student population).
  • Location – three of the five RTOs chosen in the pilot have their head office in NSW (ie 60%). In reality 28% of VET providers have their head office in NSW.
  • Patterns of compliance – according to the details on the training.gov.au website none of the five providers have had serious non-compliance issues resulting in conditions being placed on their registration. We know from the Audit Office of NSW that in 2018 ASQA’s re-registration audit of TAFE NSW identified systemic non-compliances but they were addressed as part of the rectification process, without conditions being imposed. More surprisingly, one of the providers selected for the pilot advises prominently on their website that they deliver one of their courses (to students with no prior industry experience) in 60% of the specified nominal hours. They also teach the course fully online (telling prospective students they will be able to study at their own pace, and ‘reassuring’ them there will be no phone calls, no video and no audio recording!). When I checked with a leading industry expert as to whether this was acceptable for the course in question, I was advised that: “I don’t believe any training (for this course) can be done fully online. How can you read body language online? How can you role play online when you can’t read body language and interpret behaviour.?” With the provider having been part of the pilot and their website continuing to include these details about their course, presumably other providers should interpret this as meaning this is acceptable practice under the Revised Standards for RTOs?

Other issues with the design of the pilot:

ASQA Stakeholder Liaison Group

One unspecified factor which appears to have been used by ASQA to select the providers for the pilot was membership of ASQA’s Stakeholder Liaison Group (SLG). TAFE NSW, the Diocese of Lismore Catholic Schools Ltd, and Tranby Aboriginal Co-operative Limited are all SLG members.

While these are obviously diverse providers who can and are adding depth to ASQA’s understanding of the Revised Standards – they also currently have a mechanism to share their experiences with ASQA and in doing so to inform the regulator’s thinking and operations.

They may also, as a result of their SLG membership, have been involved in conversations with ASQA that other providers have not been included in, and thus their experiences in the pilot could have been different from other providers which are similar in nature to them but are not SLG members.

What about the ACE sector?

One of the provider types missing from the pilot was community education providers.

Tranby is a non-profit community education provider, but it justifiably describes itself as being “unique in Australia as the first national independent Indigenous adult education provider, operating since 1957.” Its Indigenous ownership and national focus make it unlike most community education providers.

For that reason it is likely that including a more typical ACE provider, alongside Tranby, could have added much needed depth to the pilot of the Standards.

What about dual-sector providers and those with VET Student Loans approval?

TAFE NSW was doing a lot of heavy lifting in the pilot.

Not only was it the only CRICOS provider involved, it was also the only dual-sector provider and the only one with VET Student Loans (VSL) approval.

For decades dual sector providers have argued there is a need for greater regulatory harmony between the Standards for RTOs and higher education’s Threshold Standards. Greater tertiary harmonisation was also a key recommendation of the higher education Accord Panel, and has strong support from Jobs and Skills Australia. Despite this, and with TAFE Institutes comprising just 11% of all dual-sector providers, ASQA chose to rely exclusively on TAFE NSW and to not involve any of the other 80 dual sector providers in the pilot.

ASQA also chose not to involve any of the other 160 providers with VSL approval in the pilot, again relying solely on TAFE NSW to understand any interactions between the changes to the Revised Standards and their potential interplay with the requirements of the Commonwealth government’s key source of direct funding to VET providers, the VSL scheme.

What about providers with government funding outside NSW?

In the same way that the Revised Standards may interact with the requirements providers must comply with as part of the VSL scheme, the same may be true in relation to the obligations that state and territory governments impose on the providers they fund.

With each state and territory government having a different funding contract with the providers they fund it is surprising that ASQA chose to only involve two government-funded providers in the pilot: Tranby and TAFE NSW  and both of them receive funding from the NSW government. But both are also atypical in terms of the broader range of providers that state and territory governments fund.

  

Which providers should have been included in the pilot?

To give any kind of reliable feedback to ASQA on how the Revised Standards interacted with key provider funding and additional regulatory requirements, and on providers with a variety of different characteristics, the pilot should have included a minimum of 12 providers.

The pilot group should have included at least one provider from each state and territory – and the providers collectively should have had the following characteristics:

  • TAFE Institute
  • ACE provider (with state or territory government funding)
  • enterprise RTO
  • school or school system offering VET
  • Indigenous-owned (with funding from a different state or territory than the ACE provider)
  • CRICOS approval (at least 2 providers given the current risk profile of international VET)
  • domestic fee-for-service provider with high levels of RPL (given the sector-wide risks of poor RPL practice)
  • state-territory government funding contracts (at least 2 more providers with funding from different jurisdictions than the ACE and Indigenous-owned providers)
  • dual sector provider, and
  • VSL-approved provider.