Sharon Claydon (Newcastle, Australian Labor Party) Share this | Hansard source

I rise today to speak on the National Vocational Education and Training Regulator Amendment Bill 2015, which is currently before the House, and to support the amendment moved by the member for Cunningham. I do so because, whilst this bill is designed to improve regulatory oversight of the vocational education and training sector, it fails to provide adequate protection for students and taxpayers from unscrupulous providers and proposes no sustained course of action to engage with the community to prevent this type of behaviour from continuing into the future.

We have heard numerous examples this morning of the actions of unscrupulous registered training organisations and brokers. These actions have had serious impacts on vulnerable individuals. The situation of people being left with large debts and no qualifications or useless qualifications must be addressed. It is Labor's view that the government must act with more urgency to ensure the protection of students is prioritised. To this end, the government should immediately seek a consumer protection information campaign by the ACCC, including advice for people who need to seek redress, and consider other mechanisms available to strengthen consumer protections. They should also support Labor's call for the Auditor-General to conduct an audit on the use of VET FEE-HELP. And they should, in more detail, look at amending the proposed registration period so that the extension from five to seven years is granted only to existing low-risk providers at renewal of registration.

Importantly, the bill contains amendments to the National Vocational Education and Training Regulator Act 2011 that support ongoing reform measures, including reducing the regulatory burden for NVR registered training organisations, protecting the integrity of the VET system, giving the regulator capacity to respond to emerging issues, and technical amendments to improve the efficiency and operation of the act and, consequently, the regulator. The bill also contains an administrative amendment to extend the maximum period of registration able to be granted by the regulator from five to seven years, a point on which the member for Cunningham has moved an amendment, which I referred to out the outset.

This bill itself contains no specific consumer protection provisions in its current form, and that is something that must be remedied. Hence the amendments moved this morning. In recent months there has been an explosion in media reports of unscrupulous RTOs preying on vulnerable students and signing them up for large VET FEE-HELP debts. In many cases, the students are not even aware that they have signed up for a course, let alone a significant debt of around $20,000. Under VET FEE-HELP students are able to access up to $97,728 in total for most courses offered by eligible registered training organisations. The problem is exacerbated by RTOs employing brokers to recruit students on their behalf and then attempting to distance themselves from the actions of the brokers. This bill takes some steps to put responsibility on the RTOs for the actions of their brokers. There is also a change to allow a more rapid response to quality standards issues by the minister and the regulator. I hope that the bill will help address some of the unprincipled behaviour that is being seen across the country, including in my electorate of Newcastle, where RTOs or brokers are providing inducements to potential students on street corners, shopping centres and train stations.

A constituent of mine recently shared her experience of being approached as she was waiting outside a busy well-known shopping centre in Newcastle. She was not sure whether it was by an education provider or broker acting on their behalf. Not surprisingly, these people were notable in their reluctance to be identified, so it is unclear exactly who she was dealing with. But they did make clear that there were great gains to be had in undertaking enrolment in a course with their institution. An inducement of the offer of a laptop was one such incentive they were providing her while actively encouraging her to enrol in a course of study. They promised there would be no up-front costs. So you get a free laptop with no up-front costs whatsoever. All costs were to be deferred and paid back.

This in itself was of some concern to that constituent, who is on a disability support pension with a very low fixed income and is clearly not aware of what the extent of that debt might be but, like many people on low fixed incomes, is extremely nervous about locking herself into any form of debt. These are people who are often living fortnight by fortnight and who are very, very careful about the way they budget. They have constrained household incomes and are extremely reluctant to take on some kind of additional burden.

But the kicker in the approach that is being made to these people is that at no point is it really made clear what that level of debt burden is going to be. The said provider vaunted their extremely—allegedly—high success rate in terms of the college and at no stage asked about my constituent's capacity to repay a debt that she would obviously incur; nor did they ask her anything about her specific interests or needs for additional tertiary education in the first place. It was a loan that, if taken up, she could not have repaid, so eventually that debt would have been called in and she would have been pushed into severe financial hardship. She is not alone in that story. It is a story with multiple variations that has been repeated to me in my electorate of Newcastle from people who, as I said, are embarking on the weekly shopping and are having people just outside the checkout attempting to sign them up to a vocational education and training course which may or may not be of any use to their particular life circumstances.

I would also like to touch on an assertion that was mentioned by the previous speaker and also by the Assistant Minister for Education and Training. The allegation is that somehow Labor in government failed to protect students and taxpayers from unscrupulous providers and wasted billions of dollars as a result. Indeed, a number of speakers on the opposite side of the House have put that proposal forward again today. I would suggest not only that that assertion is completely false and quite unhelpful in this particular debate but also that Labor is very proud to stand on a strong record of having invested in skills and helping students and workers to obtain the skills they need to participate and compete in a modern workforce, as well as introducing regulation and quality assurance into the vocational education and training system. We are here to offer constructive, useful, sensible amendments that we hope the government is willing to pick up, but it is of little value to go back over the years and try to blame Labor yet again for a shortfall of action at this present time.

For over a year now we have been having these discussions around the actions of unscrupulous RTOs. We really have been too slow to act, so I welcome this bill coming before the House today. The problems for both potential students and these vulnerable people in our community are very much at the forefront of my mind and, I know, the minds of many others in this House. Measures that we can take to prevent that from happening are absolutely worthwhile and worthy of bipartisan support. But, having failed to stand up to those unscrupulous providers so far, this government, in addition to demonstrating that slowness of action, has also cut $2 billion out of the skills and training sector. In my electorate of Newcastle those cuts are hurting—and hurting people badly. The axe has already fallen on the following programs and services: the Australian Workforce and Productivity Agency; the Tools For Your Trade program—gone; the Australian Apprenticeships Access Program—gone; the Australian Apprenticeships Mentoring Program—gone; the Accelerated Australian Apprenticeships Program; the Apprentice to Business Owner Program; the National Workforce Development Fund; the Workplace English Language and Literacy Program; the National Partnership Agreement on Training Places for Single and Teenage Parents; the Alternative Pathways program; Productive Ageing through Community Education; the Step into Skills program; the Joint Group Training Program; and base funding for industry skills councils.

When you take all of those programs and forms of assistance out of the vocational education and training sector, you cannot be surprised that people in communities seeking to enter into vocational education and training are hurting as a result of those cuts. These are critical programs, for young Australians in particular—the next generation of skilled men and women who will shape the future of this nation. Cuts to vocational education and training are short-sighted. They hurt us both now and into the future.

While federally we have an issue with the Abbott Liberal government sending TAFE and vocational education and training backwards, in my home state of New South Wales we have the double whammy of the Baird Liberal government cuts to deal with as well, winding the VET sector even further back. Since 2011 the New South Wales Liberal government has cut an additional $1.7 billion from education and training. They have sacked 1,100 TAFE teachers and support staff, cut TAFE courses, slashed class contact times and drastically increased student fees by up to thousands of dollars. In 2015 alone—this year alone—fees have already risen significantly, with 40 per cent of students being slugged an extra $500 to $1,500 for their courses this year. In my electorate of Newcastle, the 2014 fee for a Diploma of Electrical Engineering, for example, was $3,636 for a full-time study course over two years. This year, that fee will be $7,280.

At a time when unemployment in Newcastle has hit a staggering 10 per cent—more than doubling in the last 12 months on this government's watch—this government should be doing everything they can to make training and retraining accessible and affordable, but instead Mike Baird and his mate the Prime Minister are pricing some students out of an education altogether. Not only are students being slugged; RTOs are being abandoned with the rollout of the NSW Premier's Smart and Skilled program.

An editorial in the Newcastle Herald from November last year describes the situation well. It said:

Governments have an over-riding responsibility to the tax-paying public to be as efficient as possible with the allocation of financial resources.

And companies that lose tenders or contracts will naturally complain that things have not gone their way.

But judging by the growing disquiet around the state government’s 'Smart and Skilled' vocational training reforms, something appears to have gone seriously wrong with a process that is part of a broader, national overhaul of non-university education funding.

Something certainly has gone wrong, and I urge this government as of today to stand up to those unscrupulous providers to support Labor's amendments. I join with my Labor colleagues in calling on the Abbott Liberal government to accelerate the introduction of consumer protections for vulnerable people being exploited by unscrupulous training providers.

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