John Cobb (Calare, National Party) Share this | Hansard source

It is with a lot of feeling that I speak on our Higher Education Support Amendment (VET FEE-HELP Reform) Bill 2015. The member for Wills mentioned that there are victims here, and he is quite right. The good providers who are doing the right thing are victims because it sullies the good name of everybody when providers take advantage of young people and of a government system that allows those people to borrow money from the Commonwealth. Obviously, the students themselves are victims if they are encouraged to get involved in a course that either is no good to them or does not leave them with anything substantive at the end of the day. It is good to see that, when there is a need to sort something out, all sides of the House support sorting it out.

The bill is about reforming the vocational education and training sector because of the actions of a minority of unscrupulous training providers and/or their agents. The bill will strengthen the administration of the VET FEE-HELP loan scheme to protect students who, in their youth and inexperience, are obviously vulnerable. It will also protect taxpayers and the reputation of the broader sector, as I said earlier, through pushing the minority of poor providers out.

Make no mistake, we, the government, are happy to support the VFH scheme that allows students to study higher level VET qualifications without the stress of having to pay up-front fees. We are serious when we say we are happy to do that. However, following Labor expanding the loan scheme in 2012, it has experienced significant growth. Generally, we would see a spike in education as a positive, but, unfortunately, some of this growth is a result of providers who aggressively market the scheme, roping in vulnerable people, young and inexperienced people. These people expect their study to lead to a world of opportunity, but some are just left with a significant debt and no real training outcome.

We have already taken a number of steps to crack down on VFH providers doing the wrong thing. In March this year, a series of measures was introduced, including banning inducements to students under the VFH loan scheme, tightening VET marketing and recruitment practices, and ensuring students have more information on training providers so that they can make an informed choice. These are just a few of eight measures, some of which have already been given effect through changes to VET guidelines or student communication products.

The bill intends to build on these measures with new safeguards. Its primary purpose is to prevent inappropriate enrolments and debts by introducing a two-day cooling-off period between enrolment and application for a VFH loan. Students will, from 1 January 2016, have two days after enrolment before they are allowed to submit a request for Commonwealth assistance. No longer will course enrolment be confused with the loan application. The bill ensures this cooling-off period is in place even with late enrolments close to the census date, which is when students incur the debt.

It will also introduce prerequisites to ensure students can complete the higher level VET courses—diploma and above—which the VFH is available for. It will protect vulnerable students from the outset, before they incur a debt, by requiring providers to establish minimum prerequisites for enrolment in each course. This ensures a student's capacity to complete the course, including assessment of language, literacy and numeracy proficiency, is properly assessed before they are enrolled and before they incur a debt. While we know there are many training organisations which already have stringent admission requirements, there are some who do not, so we are seeing vulnerable students being targeted and undertaking courses they do not have the capacity to complete. This bill makes this good practice a requirement for all VET FEE-HELP approved providers for courses for which students wish to access VET FEE-HELP.

The bill will also require a parent or guardian's signature before a student under 18 can request a loan. This is common sense as it will ensure young people who may lack financial literacy or the necessary life experience to make the right decision do not sign up to a course that will have no real benefits and get into debt they do not need.

The bill will further protect students and taxpayers by making it easier for a student to have their debt cancelled where they have signed up for a loan inappropriately. The bill broadens the circumstances in which students can have their loan cancelled where inappropriate behaviour has been used in their recruitment and acceptance into a course. The taxpayer should not and will not bear the cost. The government will be requiring providers to repay the costs of any loans that are remitted in such circumstances and may impose additional penalties on providers, such as fines or conditions on approval.

An extremely important consequence of this bill is the infringement notice scheme. This will see providers breaking the rule held to account through introducing a scheme of infringement notices attached to civil penalties for VET FEE-HELP training providers that engage in improper conduct.

The Department of Education and Training will now be able to deal with inappropriate behaviour by providers directly with a number of new powers available to them. The department will be able to cancel student debt and force providers to repay the Commonwealth. That is a very strong action and I believe a necessary one—that the department will be able to cancel student debt and force providers to repay the Commonwealth. The new suite of powers will also include administrative action such as suspension or revocation of approval or civil penalties including infringement notices. Dodgy providers will no longer be able to float under the radar without consequence. They will face the force of the law.

Administrative changes will be introduced lifting the standards for those who are approved to offer VET FEE-HELP funded courses. A higher bench mark will ensure that only the best providers will be approved to offer the scheme. It will weed out those doing the wrong thing. Australian students deserve the best access to education that provides high-quality outcomes. We must set a high benchmark for our providers. This is why we have introduced a new minimum registration and trading history requirement for new VET FEE-HELP provider applicants. This ensures all new providers will have a proven track record in delivering high-level qualifications.

It is necessary these reforms have come before the House. It has happened as a result of Labor failing to introduce appropriate controls and safeguards to protect students and taxpayers from low-quality providers when the scheme was widened. The reputation of the Australian VFH sector is at stake. We know the incredibly contribution many of these providers make. The majority of providers are obviously very conscientious and very good and are proud of their reputation. I hope they do not feel aggrieved by this because they are not being targeted. I think this is a situation where those who are doing the right thing know who they are and those who are not doing the right thing most definitely know who they are. I commend the bill to the House.

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