Nick Champion (Wakefield, Australian Labor Party) Share this | Hansard source

It is a great pleasure to speak on the National Vocational Education and Training Regulator Amendment Bill 2015. As the House knows, we will be supporting this bill but with amendments. They are important amendments, which seek to insert some consumer protection information from the ACCC into the legislation, as well as seeking an audit by the Auditor-General of the VET Fee-Help program. The amendments and extensions of this bill improve the government's ability to regulate vocational education.

Vocational education is particularly important for the electorate of Wakefield. Many years ago I looked at some of the maps of higher education versus trade certificates in Adelaide. If you overlay that, you can see very clearly that places like Elizabeth and Salisbury have high proportions of people with trade certificates or vocational education, and that is because they make and do things—they work with their heads in their hands to create the wealth that helps to sustain Adelaide. If you go to any farming community north of Elizabeth, you will find the same sort of industry and talent exhibited by the farming communities. Vocational education has particular importance to my electorate, and I have seen numerous organisations do vital work in this area, such as Civil Train. In my own professional life, when I worked for the Shop Assistants Union, I saw a lot of vocational education in retail—some of it good, some of it not so good. It is always important to keep the standards up and have government overseeing all of this.

This bill does have some important provisions in it: extending the penalty provisions to trading corporations to create a new offence of prohibiting a person from advertising or offering to provide a VET course without including the name or registration code of the registered training organisation; extending the period of registration to be granted by the regulator from five to seven years—which is obviously important for the good operators and helps to keep red tape down for them. The bill also provides that a minister may, by legislative instrument, make for quality standards a condition of registration; it also states to whom and for what purpose a regulator may disclose VET information; it improves the regulator's ability to issue a written direction; and it allows the issue of a search warrant in a court in any jurisdiction for the premises of a training provider to be searched. Schedule 1 makes transitional provisions for some of those amendments.

We support all of that. It is a sad fact of public life these days that legislators of all party colours have to be cognisant that whenever we draw up legislation we may need to come back to revisit it and put in stronger safeguards to protect consumers and to stop unethical behaviour by corporations and individuals in accessing taxpayers' money. We have seen this phenomenon take hold wherever the Commonwealth is involved in providing assistance, rebates or any financial incentive, we have to be very careful in choosing the parameters we put around it. This area of vocational education and training is particularly important, but I do not think anyone anticipated the behaviour that this bill is attempting to stamp out. We do need to be cognisant of some of the behaviours that occur out there. I have seen this in my own electorate, and it has been widely reported on: training providers sitting out the front of Elizabeth Centrelink and recruiting people, as they come out, to courses.

On the face of it there is nothing wrong with providers advertising their wares and making themselves available to people who might want to improve their qualifications and thus get a job. That would be a good thing, But you really do have to question some of the behaviours that go on, and these behaviours have been reported. One young man, Lukus Whitehead—my office has had some interactions with his mother—came out of Centrelink and was persuaded to embark on a new course on the proviso that he would get a laptop. We saw this behaviour reported on the ABC on 21 October. Lukus has an intellectual disability, and he was sold two diplomas. Fortunately, that matter has been, in part, dealt with with the VET FEE-HELP loans, which basically went from $18,000 to $30,000, which is an extraordinary debt. Lukus signed up for two diploma courses at a level just below a bachelor degree level. He did not finish the first one and then was signed up to a second one. You do have to question it when providers are behaving in that way. They really are undermining the integrity of the system.

We also saw, on 23 December, a very similar story with trainees in Tasmania who signed up to courses, incurring big debts to the Commonwealth for these courses and often being unable to repay those debts, because they will not get jobs because of the nature of the training. We have seen these sorts of problems and practices going on, and they are very concerning indeed. The use of incentives is particularly concerning—laptops being given to students as part of their course. On the face of it, that sounds like a reasonable proposition: a person might need a laptop to complete the training to get a job. But if the incentive is the laptop and not the training, if the incentive is, 'Well, you get a laptop; don't worry about the debt, don't worry about the course, because you'll never have to pay it back unless you get a job', then that is a concern. It is maybe not a concern to the training company, or even to the individual, but it is certainly a concern to the Commonwealth taxpayer, who at the end of the day will foot the bill.

These are particularly concerning developments. I do not think any legislator would necessarily have anticipated it, but, unfortunately, it is a fact of life these days that we have to think about such things when it comes to this legislation. We saw on 16 February this year the headlines 'Unscrupulous education brokers harvesting job-seekers' details, Senate inquiry told'. So, there is a question about some of the information that is being put around. We have seen a number of stories which would give us cause for concern.

This is somewhat related, because we have a private market here, but the Commonwealth is, in effect, incurring the debts, and particularly if they are bad debts then the taxpayer gets stuck with that bill, and it is a bit of a hurdy-gurdy. We do have to be concerned about that. The United Kingdom, which has a similar process in place for higher education, had a report, Too good to fail: the financial sustainability of higher education in England, which talked about a deregulated system providing 'the worst of both worlds, where all parties feel they are getting a bad deal' and where 'government is effectively funding universities by writing off student debt rather than investing directly in teaching grants'. We know that Professor Bruce Chapman, who was the architect of HECS, has warned the Senate inquiry on the higher education deal:

The problem, as I see it, is that doubtful debt is a cost to the taxpayer but the universities are essentially controlling what that cost is going to be because the doubtful debt is a direct function of the loans that are outstanding and if the universities control what those fees are then that they will ultimately be controlling the levers that determine what that doubtful debt is and what the taxpayers pay. It is akin to a blank cheque being handed from the government to the universities on the matter of doubtful debt.

The same can be said for the vocational education sector in this case, because if we have unscrupulous colleges going out there and signing up students who have no reasonable prospect of finishing their courses then, in effect, the Commonwealth taxpayer is the bunny that gets the bill at the end of that process. I do not think that is the intention of the parliament. I certainly know it is not the intention of the previous government or of this government. No sensible legislator would think that was a good outcome. What we want is a vocational education system that trains people for work, and that there be real work at the end of that training. There is nothing more frustrating for the community and for legislators than seeing people trained for no discernible outcome.

When we come to look at this bill, what we want is a vocational education sector which has good links to industry, which provides jobs, where good providers are rewarded, where bad providers are penalised and where unscrupulous and unethical behaviour is run out of the system. You cannot expect people to have any faith at all when people are being induced into courses and into student debt with free tablet computers or otherwise. Just last night—you would not credit the timing—one of my constituents, Mr Tim Bedford, was cold called by a diploma course provider pushing him to sign up for a course and advertising these sorts of inducements. You just would not think that they would still be at it. These providers are completely ignoring the very clear signals being sent by this parliament about such behaviour. In this line of work, we are constantly surprised by the behaviours that occur when the Commonwealth puts some money on the table to do any function of government business. We really do have to drive this sort of behaviour out of the system.

For that reason, as I said before, we have amendments that put in place consumer protections by the ACCC and provide advice for those people. We are calling on the government to support our call to have the Auditor-General look into this area, which I think is a sensible thing to do. I certainly welcome this bill. The government is doing the right thing in this area, so I will not bash them on it. But as legislators we do need to be absolutely cognisant of the need to constantly update out legislation to prevent this sort of behaviour in any area of Commonwealth spending.

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