Sharon Bird (Cunningham, Australian Labor Party, Shadow Minister for Vocational Education) Share this | Link to this | Hansard source

I move:

That all words after "That" be omitted with a view to substituting the following words: "whilst not declining to give the bill a second reading the House:

(1) notes that:

(a) whilst this bill is designed to improve regulatory oversight of the sector, it does not address the damage to individuals that has already occurred or propose action to engage with the community to minimise future problems;

(b) the actions of unscrupulous Registered Training Organisations and brokers have had serious impacts on vulnerable individuals;

(c) reports of people being left with large debts and no qualification or useless qualifications must be addressed; and

(2) calls on the Australian Government to:

(a) act with more urgency to ensure the protection of students is prioritised;

(b) 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; and

(c) support Labor's call for the Auditor-General to conduct an audit on the use of VET FEE-Help."

I want to speak to colleagues today in support of the amendment that I have moved on behalf of the opposition to this bill and express my hope that the government sees that it is a reasonable amendment and supports it. I would also foreshadow that we will propose a detailed amendment that I believe is also sensible and reasonable and I hope the government will be able to support it.

Having made those comments, I would indicate that Labor supports the bill passing and we seek to make some constructive amendments that will strengthen the message and the operation of the changes. We are acutely aware of the individual stories of stress, hardship and suffering of vulnerable individuals that are emerging every day—indeed, again last night on the ABC. We read them in newspaper stories, we see them on television news items and we hear them in our electorate offices. We strongly believe that the government needs to act swiftly to deploy any and all consumer protection activities at its disposal. We recognise that this bill seeks to improve the powers, effectiveness and responsiveness of the national regulator and the national standards, and we of course support that. We do believe that this is not the right time or environment to lengthen the automatic time frame for registrations. However, we will suggest some alteration to seek to make this an earned benefit for high-performing and low-risk RTOs rather than the standard.

However, Labor is very concerned that the government's sole focus to date has been on the regulation and investigation side of the story, and now the timing is imperative. It is well overdue for the government to take action to strengthen the consumer focused actions that are available to them. We must be out in public spaces providing well developed and usable consumer guides and information to the general public to make them more aware of the unscrupulous activities that are taking place in their streets and shopping malls, as well as on websites and social media sites they visit. We need an organisation such as the Australian Competition and Consumer Commission to develop a full package, as they have done for other sectors that have proven to be susceptible to these sorts of aggressive and unprincipled marketing and recruitment practices.

On the consumers' page of the ACCC website are listed debt and debt collection; groceries; health, home and car; internet and phone; misleading claims and advertising; online shopping; petrol, diesel and LPG; prices and receipts; and sales and delivery. It is our view that we need a section of resources developed for consumer advice and information on vocational training courses, fees and debts. The extensive information available in each section provides sound advice to everyone, with checklists, warning signs, suggested strategies for decision making and ways to find a reasonable recourse when things go wrong. All of this information is needed in our communities now to be able to provide preventative advice to people and to help those who have been caught already, signed up to courses they could never complete or that were so shoddy that they would not be able to provide a pathway to work or further study as they had hoped and, indeed, were promised.

The situation is even more distressing and difficult for those people who signed up for debts, usually unaware that they were doing so and subsequently discovering that they had a debt for, on average, $20,000 and very often no qualification to show for it. These people need advice and assistance to seek redress, whether that is a direct refund from the training provider or waiving of debt by the Commonwealth. They need information on how to go about that and what their rights might be.

On Monday of this week, the Senate committee inquiry into the private VET sector tabled its interim report. This indicated the evidence received by the committee specifically addressing the significant growth in the volume of VET FEE-HELP loans. Under the section of the interim report headed 'Marketing techniques used by private providers', they stated:

The committee has received a number of submissions that highlight concerning reports of aggressive marketing techniques used by private education companies and education brokers.

The committee is concerned about the link between access to government funding and a subsequent increase in targeted marketing, particularly that which de-emphasises the real cost of undertaking VET and misconstrues the costs associated with VET FEE-HELP.

I would encourage interested members to look at the submissions that have been made to this inquiry. In relation to the consumer matters our amendment seeks to address, I would particularly draw members' attention to the submission from the Consumer Action Law Centre. Much of the evidence and recommendations of this submission describe the abuses that are occurring in the VET market and make recommendations about the powers of ASQA, as the national regulator, to address consumer protection and consumer rights issues. I particularly draw members' attention to recommendation 6 of that submission, where the Consumer Action Law Centre says:

We recommend that ASQA's jurisdiction be extended: a. to ensure that appropriate policies exist in relation to selling techniques, unfair prices and quality. These factors should be taken into account when accrediting a provider, and determining whether accreditation should continue; b. to regulate education brokers and unregistered subcontracted providers; and c. to consider consumer protection issues, including unfair contract terms in private VET provider contracts within the meaning of section 23 of the Australian Consumer Law. Consideration of standard terms and conditions should be an aspect of accreditation.

The submission gave a number of examples. I would like to share what the Consumer Action Law Centre found in their own review of what was out there. The first example they give is:

Tuition fees are not refundable or transferable after the commencement date, except in the case of extreme illness which precludes a student from staying in Australia. This must be supported by a doctor's certificate and the refund of unused tuition fees will be sent to the student's home country. All applications for refund must be in writing and must be received by the Institute no later than three months after the commencement of the course. Applications received after three months will not be granted.

A second example is:

A full refund less a $370 administration fee will be given to students who cancel or withdraw their enrolment in writing within five days of enrolment. If you are studying certificate III-IV in fitness, the student kit will not be despatched until after the five-day cooling off period. No refunds will be given after five days of the date of enrolment, and the student is liable to pay the balance of any fees owing.

It goes on with some other examples.

The Consumer Action Law Centre was very concerned that the insertion of these detailed requirements was causing confusion to some students and leading to them to miss out on their protections and rights. The submission goes on further to specifically talk about VET Fee-Help. It says:

We are also concerned that the VET Fee-Help model encourages private VET providers to provide barriers to withdrawal before the census date, being the date they receive guaranteed payment from the government. Students have reported difficulties with withdrawing from courses prior the census dates and being referred to marketing teams that persuade them to continue with or to defer a course that actually does not suit their needs or that they will never complete. Once the census date has passed, there are limited incentives for unscrupulous VET providers to provide ongoing support to students.

The marketing of VET Fee-Help loans to disadvantaged and vulnerable students is also worrying. We are particularly concerned about studying now, pay later slogans that fail to highlight the actual costs of study and marketing TAFE Fee-Help loans to students who are unlikely to be able to repay their loans. These sorts of slogans draw upon behavioural biases such as myopia and overconfidence and are more likely to result in students enrolling in courses that are inappropriate to their needs.

So what do the serious consumer issues mean in reality, in the lives of real people living in our communities? This has only been well documented recently and, if members of the House have missed the media reports, I would like to take them through some of the stories that have been publicly aired. Last night on the ABC's 7.30, we had another report of a large training provider recruiting students from a shopping centre with incentives such as free iPads and laptops, with these people then heading straight to the local pawnshop to sell them. The report spoke to Dylan Palmer in Lowood, Queensland, who was travelling three hours each day to Brisbane to study digital gaming. Dylan has Asperger's Syndrome and found that the teachers at the college provided very little support when he was running out of time. He is now left with $27,000 VET Fee-Help debt and he is unsure whether he will ever be able to finish the qualification. He was excited, he said, to be studying digital gaming—he was obviously very interested in it. What is so devastating is that Dylan's experience with training may now seriously affect his confidence and put him off participating in a training course again.

On 28 February ABC radio reported another example of a single mum, Samantha Saxton, who had enrolled in a diploma of salon management and Cert III in hairdressing,. She now has a $33,000 VET Fee-Help debt and has had to go to TAFE and start again. She said that she figures that she would have learnt more from Youtube than she did at the college. Her employer said that Samantha was unable to perform tasks, such as cutting men's hair, restyle cutting and foils—tasks that a graduate should be able to complete. Samantha said she complained at least 10 times about the quality of the course, but no steps were taken to rectify those problems. On 26 February ABC's 7.30 did another report on another provider targeting disadvantaged areas and welfare recipients and selling door-to-door. Sales staff were pressured to sign up students, and many sales staff completed the literacy, language and numeracy test on behalf of the students they were signing up. A former careers adviser said the free iPad or laptop was very influential in signing up these students.

Last year in Hobart Nola Smith encountered a door-to-door salesperson from this training provider. The double diploma in counselling and community services online courses appealed to the single mum of three, as she was able to stay at home with the kids and show her oldest child that she was also doing some study. She was promised no up-front course fees and advised that if she did not turn over $53,000 she would not have to repay the fees. She was influenced by the free laptop, as she has a 13 year old in high school and could not afford to buy him a laptop. When she went to complete the online course application, the salesperson took over and filled it out for her. Nola has been informed that she will probably still have to pay the money back and finds it a very scary prospect as a single parent.

In The Age on 16 February, a Melbourne job hunter was targeted after entering her details in jobs advertisement site. A broker cold-called her and persuaded her to enrol in a diploma of management. The broker guided her through the enrolment, saying there was no need for her to read the details. She did not even start the course and, at 19 years of age, she has a debt of almost $24,000. On 27 January ABC am reported Shaquille Ray's experience of the training provider in Parramatta. He was enrolled in a digital media degree; he found the course content had been copied directly from Wikipedia, which he said he knew because he had authored the Wikipedia entry. He is trying to have his $20,000 debt reversed but the college has refused. He referred to his concern about his fellow students, one of whom was illiterate. He said there were no prerequisites, except for a questionnaire for enrolment in the course. On 14 November last year The Australian had a report from United Voice, this union representing childcare workers, that 80 per cent of childcare RTOs had recently failed audits. The National Secretary, David O'Byrne, said some of the qualifications were clearly not worth the paper they were written on because some childcare centres were refusing to hire applicants who had graduated from courses, some of which had only lasted a few weeks. Those students were being told by employers that the time and effort they had put into those courses was not going to be recognised because of the quality of the course.

In October last year, on ABC radio, the chief executive of Adult Learning Australia, Sally Thompson, said that she saw many disadvantaged students being recruited to training companies outside the local Centrelink office. She said the promoted courses were expensive and that they were not appropriate for long-term unemployed people with higher needs. In particular, she said:

Our members often deal with people with quite low skills; they often deal with people with English as a second language, people with literacy difficulties and they've been telling us for a long time that they're just inundated with these kinds of spruikers.…

The spruikers tend to hang out in places where they think marginalised people will be.

These are the sorts of concerns we have seen over recent months in the media—real stories. I think those should, if nothing else, drive us to urgent action. In the second half of last year, when these reports were getting more regular, the shadow minister for higher education, research, innovation and industry, Senator Kim Carr, and I wrote to the Auditor-General to ask for an inquiry into the use—and indeed misuse—of VET FEE-HELP to ensure that skills funding is being used in accordance with the intention of the legislation and not being squandered by unscrupulous providers. We were pleased to receive advice in January that the Auditor-General has requested that a performance audit of VET FEE-HELP be included in the Australian National Audit Office's 2015-16 work program.

This amendment invites the government to publicly state again its support for that review. This situation is so serious, and its impact on vulnerable people so distressing, that it does require urgent action. For these reasons, Labor is calling on the government to support the amendment before the House today. I would like to take some time to talk to the specific details of the bill. Protecting and enforcing regulations and standards that seek to protect the quality of the vocational education sector and ensure its viability and reputation are critically important tasks for government. I have spoken at length on many occasions about the significance of the postsecondary education sector to participation and productivity achievement of the nation and its contribution to growing national wealth and economic diversity. It is also a key driver of the ability of individuals from diverse educational experience to achieve the knowledge and skills they need to participate in work or further education.

The nation was well served for many decades by our public TAFE system. Unfortunately, over recent years we have seen the undermining of the funding and staffing of our TAFEs across the nation. The serious concern this has caused among the general public has been well demonstrated by the prominence of TAFE campaigns in the Victorian and Queensland elections and in the upcoming New South Wales election. I believe that for the preceding decades, when TAFE was the major provider in our system, many other countries in fact looked to Australia, looked at the strength and depth of our TAFE system, to learn from our world-class vocational training. Indeed, as many of us know if we have family and friends with young people who have completed a trade or training in our TAFE system, if these young people travelled they were snapped up overseas because the quality of our skills education was so well regarded. We have also had many strong performers in the private training sector, as well as large and medium employers who have developed their own effective training sections. These providers also benefit from a rigorous quality focus in the sector, as the sharks that are feeding in this market are uncaring of which genuine providers have their viability destroyed by their unscrupulous activities.

The proposals in this bill that go to providing improved definitions and clarifications to enable better regulatory coverage are worthwhile, including the increased capacity for more prompt and effective action to protect quality as problems emerge in the sector. As I indicated at the start, the proposal that does give Labor some concern is the amendment to the registration period from five to seven years. It seems to be exactly the wrong time to be loosening the regulation by requiring registration reviews after a longer period of operation. If it is an option, I believe it should be earned and therefore an incentive for providers to be more rigorous in their own quality management and student protection systems. I understand from the comments of national regulator ASQA's CEO to Senate estimates last week that it is intended to increase the focus of resources on the intelligence- or complaint-generated audits and reduce the focus on the known, predictable periodic audits. While that would seem on face value to make perfect sense, it is our view that at this time it sends a contrary signal to the broader VET market, at a time when the message should be consistent, until the serious market issues are well resolved.

I am aware that many members of the government have made public comments also on the concerns that have been raised with them in their community from people who have been caught up in these unscrupulous practices. I believe the opposition's amendment provides an opportunity for us to join together in calling for a renewed focus and a very public conversation about the consumer protections we need to prioritise in order to protect vulnerable people who are being manipulated for a profit in so many of the examples that have been brought to our attention. For that reason, I commend the amendment to the House.

In the bit of time that I have left I want to take people to the issue that I think is at the heart of so much of our concern about this, from my own experience in my electorate with people who have raised these issues with me, and my colleagues who have talked to me. The issues about the operation of the market, the quality and reputational importance of the sector, and the national education and economic development task are all critically important. They are absolutely significant tasks for our national government. And I think that at a critical point in time we have an opportunity here to build a very sustainable, high-reputation sector and to stem what is an emerging flood of problems. But within that there are individual people who are having their dreams slashed, their confidence and sense of wellbeing demolished and, I would argue, their ability to continue to engage in the future with training and education seriously undermined by what is happening.

These people—such as the single mum we talked about, the young man with Asperger's syndrome, the refugee who has arrived with poor literacy and numeracy skills or the young person who has come out of school in an area with high youth unemployment and is struggling to get a foothold in the employment market—very often are out in our public spaces. They are particularly in Centrelink queues, in shopping centres, at train stations or online, desperately going through job seeker websites.

I encourage members to go online and search for a job you might have been interested in if you were a young person starting out, perhaps a shop assistant or sales type job. Just watch what comes up. I have heard stories from individuals who thought they were applying for a job through one of these sites—and there is the example we heard of in the media report—but suddenly discover they have actually signed up as having an interest in doing training. They are then pressured and told, 'If you do this, there will be a job at the end of it.' All sorts of promises are made to them.

Their commitment as individuals to seeking either a training place or a job is something that we should commend them for. Despite the difficulties they are dealing with, they are actively out there, trying to get a start. The fact that somebody can come in at that point in their life and with foresight and knowledge unscrupulously take advantage of them and walk away with a profit and leave them with a significant debt is absolutely disgraceful. I have heard in some examples from my colleagues that some of these 'spruikers', as Sally Thompson from Adult Learning Australia described them, make comments to people such as, 'Don't worry about the debt. You'll never had to repay it. Until you earn $53,000 a year, you will not have to repay it.' In actual fact, the reality for them is that it is still going to be a debt of concern in their life.

I would hope that for those individuals who are told, 'You can sign up for this debt for this course and you will never have to repay it because you will not earn $53,000,' the reality is quite the opposite and that they actually do well and go from strength to strength and get past the threshold for domestic students to start repaying the debt. I would hope that is the wish of all of us for them. One group of retired people in a community group that just wanted to get some computer skills were told, 'Sign up to this diploma to get them, and don't worry about the debt. You are all retired. You will never have to repay it.' I would hope that some of these spruikers and companies start to understand that, whether they have to repay it or not, for vulnerable people on limited incomes a debt hanging over their heads is a serious stressor in their lives. These are, at heart, the human stories. These are the real stories of people in our community who simply out of a wish to better themselves and being not well-informed consumers in this market are being specifically sought out and unscrupulously used by these operators.

I can think of no greater task for a parliament such as ours than to encourage people to engage in education. I think that is what we all want to do. I have been working on education for many years in this parliament and I have found good, solid commitment to it from people across all parties. We want people to engage. We want them to participate. We want the disadvantages that they may have carried with them from life circumstances to be addressed so that they can get a good-quality education and have access to work and full participation in our communities. That is an absolutely critical task for government.

So when we see this sort of activity I do not think we can drag our feet. I do not think we can consider that the need for action is not urgent. There are people out there today walking the streets of suburbs, knocking on doors. When I returned to my electorate last Friday, I had a letter from a lady saying that she was visiting a friend in one of my suburbs when somebody knocked on the door and asked, 'Are you permanent residents and under 65?' She said, 'No, we are over 65. Why do you want to know?' He said, 'The government is giving away free laptops. But you don't qualify, so I will keep these.' To be fair, if they had been under 65, he may then have sat down and gone fully through what the training was that he was going to sign them up for, what the debt requirements were and so forth.

I have no doubt that these people are out there in the suburbs now as I speak. As they go through those suburbs, I think we need to be acting swiftly. I hope that the government's bill is one way in which we can do that by strengthening those regulations and by looking to improve the speediness and effectiveness of the ability of the government and the regulator to act. I think that is good, and I commend those amendments.

I would say to the government that I think including at this point in time an amendment that says that instead of five years registration people get seven years registration is just the wrong signal. I understand the intention of the regulator and the argument that those are well known, predictable audits and so therefore you are not going to catch terribly much in them. I do understand that. And I do understand the auditor's desire to focus on the place where they are getting intelligence, reports and media stories saying that there is a problem. I understand that as well. I also understand the argument that in the higher education sector under the TEQSA university regulator people are registered for seven years and so there is some consistency, particularly for those who are dual sector providers and have to be registered with both. I understand all of that. It makes sense. But my argument would be that this is exactly the wrong time for this. Until we get on top of these practices and put action in place to ensure that, as much as possible, we have strangled off this sort of behaviour and this sort of unscrupulous exploitation of very vulnerable people, it is the wrong time to be moving a proposal in the bill such as this. So I would ask government to rethink that. It might be something to revisit further down the track, but I think it muddies the whole message at this point in time and heads us in exactly the wrong direction.

I commend the opposition's amendment to members, and I hope that they have a look at it in the spirit it is intended. I know that members opposite have also been making public comment about their concern about vulnerable people in their communities who are coming to them with a great deal of worry about what is happening. So I hope that we can get to that point in the debate, and I commend the amendment to the House.

Ross Vasta (Bonner, Liberal Party) Share this | Link to this | Hansard source

Is the amendment seconded?

Andrew Leigh (Fraser, Australian Labor Party, Shadow Assistant Treasurer) Share this | Link to this | Hansard source

I second the amendment and reserve my right to speak.

Ross Vasta (Bonner, Liberal Party) Share this | Link to this | Hansard source

The original question was that this bill be now read a second time. The honourable member for Cunningham has moved as an amendment that all words after 'That' be omitted with a view to substituting other words. If it suits the House, I will state the question in the form that the amendment be agreed to. The question now is that the amendment be agreed to.

Melissa Price (Durack, Liberal Party) Share this | Link to this | Hansard source

I rise today to speak on a bill the subject of which is at the very core of the quality of our vocational education and training—the quality of service providers, which impacts upon the quality of graduates. It therefore has a direct impact on business and Australia's productivity. The National Vocational Education and Training Regulator Amendment Bill 2015, once implemented, will have the effect of improving the quality of Australia's vocational education and training scheme by: enabling the Australian government to create new quality standards to quickly address problems with vocational education and training providers or courses; requiring anyone and everyone who is marketing a course to clearly identify which registered training organisation is providing the qualification; extending the registration period for RTOs from five to seven years to enable the national training regulator to focus its attention on investigating and acting upon high-risk and poor quality providers; and making technical amendments to improve the administration of the act.

I have chosen to speak on this bill for three reasons. First, it is pivotal to the future of young Australians. Second, in Durack, my electorate, I see remarkable VET institutions and teachers, and young students who are doing very well and securing great jobs both here and abroad. Third, I am distressed by the less than complimentary anecdotes and comments about aspects of the system generally as it relates to quality of training and to waste. Therefore, I say loud and clear that service providers are on notice. It is taxpayers' money, after all, and providers must be accountable. We are all watching. Not only is poor service, in the broadest terms, unjust to our young people and students; it is also damaging our productivity, as a nation, and our reputation. We heard from the member for Cunningham about unscrupulous training providers. We must put an end to this and be able to quickly address problems with vocational education and training providers or their courses. Of course, there are many high quality service providers in Australia who already meet the quality standards. They are to be congratulated.

My large electorate of Durack, of some 1.6 million square kilometres, occupies a hefty portion of the great state of Western Australia, and VET courses are taught in a range of ways and places—in the old TAFEs, in schools, by private organisations; the list goes into the thousands in Western Australia—and tighter controls are needed to achieve consistent quality outcomes. To provide some context, here are some key facts about vocational education and training in Western Australia. In 2013, there were 164,000 public VET students in Western Australia. The Australian government will provide Western Australia with $199 million in funding to support the subsidisation of VET training. In 2012, there were 52,000 VET qualifications awarded through the public VET system. There are approximately 42,000 apprentices and trainees in Western Australia, and 2,200 of these are currently in Durack. There are 507 registered training organisations in Western Australia, as at January 2014. Western Australian students undertaking a VET qualification have a 34 per cent likelihood of completing that qualification compared to 36 per cent nation-wide—not great stats, I am afraid. In 2013, approximately 11,000 international students enrolled in VET qualifications in Western Australia.

So, we are talking large numbers—masses of student, domestic and international, regional, rural and remote, and over 500 service providers who are responsible on behalf of the government for the delivery and quality of the system and its outputs. This is where the bill we are debating today is intended to have some gravitas, effecting some powerful and positive changes. Western Australia undertook an independent review of the vocational education and training sector in 2013, leading to the publishing of a report. The report recommendations had a flawless focus on improving the structure of the sector, governance arrangements and training outcomes. The Western Australian findings are well aligned to the intent of the bill we are debating today—which will have the effect of improving the quality of Australia's vocational education and training scheme, primarily by improving accountability and governance and quickly addressing problems with providers or courses.

In my introduction I mentioned that there were three reasons I wished to join the debate today. One is my distress when I hear comments about aspects of the system generally relating to the quality of training and training providers and to waste. The introduction of a quality standard via this bill should go a fair way towards addressing this matter. The Standards for Registered Training Organisations, established in 2012, were intended to ensure national consistency and compliance across Australia's VET system. As part of the government's reforms to the VET system, new standards are set to take effect this year, which will strengthen requirements on RTOs and third parties. Importantly, they must advise prospective and current students of debts and government subsidies before students sign up to a course.

Secondly, in order to overcome the change cycle for standards, which is around 12 months, a new instrument, equivalent to emergency powers, is being introduced, to be used only for serious and critical issues impacting on the quality of training being provided to students. Known or emerging quality issues that compromise the student and, let us be frank, the industry in Australia as a whole can be readily and quickly addressed. It gives industry, states and territories a direct avenue for action by the Commonwealth to deal with their concerns.

Let us look now at the marketing of training. A measure being introduced in this bill has come about in direct response to the negative impact of marketing by third parties in the training sector and, in particular, in the VET FEE-HELP market. In my electorate and, indeed, more broadly in my travels across Western Australia, I hear many worrying comments about this issue. The new requirement will firmly address the actual marketing of training and the type of information that must be provided to prospective students, including VET FEE-HELP loans, state entitlements and subsidy arrangements they sign up to. This is a matter of providing good information and ensuring people understand it, as well as its impacts, which were referred to by the previous speaker, the member for Cunningham. It must be clear to all students what they are signing up for, every single time their debt level is due to increase—and, hopefully, if someone is being offered a laptop, they also understand what their ultimate exposure is going to be. The standards make it clear that RTOs are responsible for service delivery by brokers on their behalf, thus providing clarity, accountability and better governance. This accountability has been problematic.

On the performance of RTOs, new mechanisms to assess performance, albeit of poor-performing providers, include targeted and random investigations and audits, leading to early detection of noncompliance. Having visited students in vocational education and training institutions across my electorate of Durack—in places like Geraldton, Exmouth, Carnarvon, Broome, Kununurra and Morawa—and discussed the merits as well as the problems of the VET system, I feel strongly that the amendment moved to this bill will not only benefit the students but also benefit local businesses who employ these students.

The introduction and successful passage of this bill builds on the work the government is already doing to improve quality. The bill adds to the strong reforms the government is instigating to expand quality across the VET sector, including new national standards for training providers, reforming the National VET Regulator and a new National Training Complaints Hotline. The government could not be more serious about supporting vocational education and training, together with higher education.

The National Vocation and Education Training Regulator Amendment Bill 2015, once implemented, will effectively improve the quality of Australia's education and training scheme. No-one can argue with that. I commend the bill to the House.

Alannah Mactiernan (Perth, Australian Labor Party) Share this | Link to this | Hansard source

Labor support this legislation, the National Vocation and Education Training Regulator Amendment Bill 2015. We think it is incredibly important that we provide stronger protections for people entering into vocational education and training programs. We are in fact deeply alarmed by what is going on across Australia in this regard.

I start by saying, though, that these are very complex issues, and their relationship with policy decisions can have profound consequences. For example, in Western Australia, since 2013, TAFE fees increased by 515 per cent. That seems extraordinary, but that is the case. We are seeing vocational education and training becoming an incredibly expensive model. What that has done is put TAFE, publicly provided vocational education and training, out of the financial reach of many people, and obviously this has created an environment where people are increasingly looking to private providers for something that is much more financially achievable.

The explosion of concerns about the quality of product coming from private providers must be seen in the context of the massive walking-away by government, by state government, from the responsibility of providing, at a reasonable and affordable cost, access to vocational education and training. Indeed, I note that, in the United States of America now, they are so concerned about the quality and the level of skill formation that state jurisdictions are going in the opposite direction and reducing or even removing altogether fees for vocational education to ensure that they get more people into vocational education and training. So you have to look at the context. These things do not occur in a vacuum. The proliferation of companies that are behaving in a questionably ethical way arises in the context of public sector providers becoming more and more expensive and driving people from that system.

I will talk about a couple of cases. For example, in Western Australia, concerns have been raised about a company called iCollege, which offers a whole raft of programs, including some 26 business courses. The fees range from around $300 to $2,000 per course. Because they provide programs across state borders, unlike others which are offered only in Western Australia, these are subject to ASQA regulation. These programs, which are in most cases not accredited anywhere, are attracting lots of students. Now, there has been an inquiry by ASQA into the courses that are being offered, but ASQA found that they were not in violation of any law. Quite clearly, the reason these investigations emerged is that people were investing in these programs, signing up for up to $2,000 per course, only to find that the qualification they received was not accredited anywhere that was recognised within Australia.

ASQA quite rightly points out that because iCollege is not a registered training organisation it is not in violation and that really this is a case of buyer beware. We think that that is a very irresponsible attitude for government to be taking, hence the amendments that we are moving here. We want it to be recognised that there are issues of consumer protection that need to be taken into account. This is not simply a question of raising the standards for the registered training organisations but of recognising that there are people operating outside the system or even RTOs operating in a way, with their marketing, that is unscrupulous and is leading many vulnerable people into an unacceptable situation where they are paying good money, taking on board what governments of all persuasions are telling them—that they have to get out there; they have to get themselves skilled; they have to get themselves trained—undertaking these programs and then, unfortunately, finding that they are left with a qualification that is worth nothing. For a government to say that it is a case of buyer beware is extremely unfortunate. Many decades ago we recognised that buyer beware was not a fair principle for us to be operating under and we put in place a whole range of consumer protection mechanisms. It seems to me that today, as unemployment is increasing, when the skills gap is increasing and when the cost of government provided vocational education is increasing dramatically, we have an absolute obligation to make sure that these practices are stamped out. That is why we do not believe that this legislation, whilst we do support its general thrust, is going to cover all the bases that need to be covered in providing adequate consumer protection for those people, many of whom are unemployed and desperately seeking to obtain a qualification.

In Western Australia, ASQA covers only international students and RTOs that operate outside as well as inside Western Australia's borders. The rest of the sector is regulated internally by the WA Training Accreditation Council. I am not being critical of the TAC and I perhaps understand why Western Australia decided that it wanted to preserve its own entity, to ensure a proper focus on Western Australia. It is unclear, and I cannot see anything in any of the papers that have been produced that will clarify how this legislation is going to permeate its way into Western Australia, which has not signed up to ASQA. I certainly hope that the minister in the reply is able to provide some clarification. We would be very keen to find out what arrangements, undertakings or negotiations have taken place with Western Australia to ensure that we see these provisions paralleled in the work of the WA Training Accreditation Council. That is an important query that we have. We do not know, because it is not evident from the materials that have been made available, whether or not these protections are going to permeate into Western Australia with its Training Accreditation Council.

I want also to reflect on one of the anomalies that arise out of having two of these entities. I understand that there are resource issues, but we are getting feedback that ASQA is coming over to Western Australia and spending time auditing TAFE courses which have already been audited by the WA Training Accreditation Council. Given that there is so much concern about the operation of RTOs and about people operating in an unethical way, it seems to me that our duplicating auditing processes is quite bizarre. We have a TAC which is able to audit the TAFE institutions. I would have thought that we should be working to establish a greater degree of cooperation so that TAFE staff do not have to go through two sets of accreditation while we clearly have so much unattended business going on. Last night on 7.30, there was another expose—there has been a mounting volume of these—showing a college that has a graduation rate of 10 per cent, despite claiming something like $290 million in government funding by VET FEE-HELP.

So we have two separate problems. We have the problem that those companies operating outside of the system that are not registered RTOs really need to be subjected to some form of scrutiny so that people are not being led down the wrong path; we also have an even higher level of obligation where we have federal and state government or federal government funding going into the proliferation of private RTOs that are reeling people into the VET system and delivering very much substandard training. I think this is where we have to be very, very careful about what we have been doing generally. We see it in the university sector. As Vice-Chancellor Greg Craven said, under the current funding models that we are looking at, we will get Ma and Pa Kettle universities being formed to milk the system. We already see Ma and Pa Kettle RTOs in operation here.

We support the legislation because it gets tougher—it gives us the capacity to take a tougher line—but we do not think that it goes far enough. We think we have to do more to protect both those students who are doing accredited courses and those students who have been seduced into non-accredited courses.

Eric Hutchinson (Lyons, Liberal Party) Share this | Link to this | Hansard source

I rise to speak in support of the National Vocational Education and Training Regulator Amendment Bill 2015 and the related bills. I note the comments of the member for Perth and also the previous speaker on the other side, the member for Cunningham, in respect of the fees, the cost and the impediments to young people to go on to vocational training in this instance. That is right and that is proper. I draw their attention not specifically to this bill but more broadly to the discussion of the bill that was passed recently in this House a second time and is now again before the Senate—the higher education bill—and the needed reform bills. I make the point of what will be forgone. Let us make no mistake: if this legislation does not pass the Senate, the abolition of all FEE-HELP and VET FEE-HELP loan fees, which are currently imposed on some students undertaking higher education and vocational education and training, saving those students money and putting all students and institutions on a level playing field—and they love a level playing field on the other side—simply will not happen. So I ask those on the other side, who I have no doubt are supportive, as we all are, of seeing better opportunities and more opportunities in education for our young people, particularly in my state of Tasmania, to consider that.

We have failed our young people for too long by the participation rate that we have either at university or in other vocational education and training courses. Part of that goes back to the structure that we have in years 11 and 12, or the lack of structure. I commend the Minister for Education and Training in the state of Tasmania, Minister Rockliff, for the major reforms that he is undertaking in expanding the number of high schools that are able to offer year 11 and year 12 courses in my state. It is a staged process. Some schools have put up their hands to say they want to be part of this process and have not been successful in the first round, but the state government is doing really good work. This is so critical, particularly critical for the students who come from the remote and regional areas within my electorate of Lyons.

I also remind those opposite that funding to the Tasmanian state government from the Commonwealth, remembering that only 15 per cent of the funding for government schools comes from the Commonwealth, has increased over the forward estimates by 34 per cent. This is a good thing. This demonstrates how committed this government is to improving the opportunities not only for students going onto higher education but also for students going into vocational training—and also, in the case of Tasmania, there are opportunities to go on and complete years 11 and 12, which is required, obviously, to go into many of these other courses.

The purpose of this bill is to allow the government to create a new quality standard to enable problems with the VET providers or VET courses to be quickly addressed; to require anyone who is marketing a VET course to clearly identify who is providing the qualification; to extend the registration period for registered training organisations from five to seven years so that the national training regulator can absolutely focus on investigating and acting on high-risk and poor-quality providers—I think that makes a lot of sense—and to allow technical amendments to improve the administration of the act. The bill contains an amendment to improve transparency in the marketing of training—and a number of speakers have referred to this. This measure has come about in direct response to the negative impact of marketing by third parties, often referred to as brokers, in the training sector and, in particular, the VET FEE-HELP market. Potential vocational students must be able to clearly see what they are signing up for and who is the registered training organisation.

In my home state of Tasmania, Australia's smallest state in terms of geography and population, there are more than 100 Skills Tasmania endorsed RTOs. They range across a huge part of the employment and training sector, from child care and retail training to nursing and primary industries such as the timber industry. The providers are not just locally based companies; many are part of nationally accredited organisations. I do appreciate that it is a daunting experience for a young person and their family to find the right course and the right opportunity for their education needs. So it is imperative that the information that they receive is accurate and the RTOs and the organisations are, indeed, operating legitimately and responsibly.

As we try to improve employment opportunities, particularly for our young people in Tasmania—I know that we are not the only jurisdiction that has challenges, but we do have a real challenge with youth unemployment—the number of training courses to upskill those looking for jobs has grown. You can study for a certificate in sport turf management, shearing, or beekeeping.

In terms of the shearing industry, I think of people like Jack Monks, who is doing a wonderful job working with Australian Wool Innovation, and getting young people involved in an industry which requires a lot of skill and a lot of fitness to be able to make a good career. I think of people like Evelyn Archer, who has made a career out of wool classing, and is now the training provider for those people who want to go on from being shed hands and different things, to undertaking a career in wool classing. They are doing good work.

You can undertake business administration training, training in aged care or early childhood education, or you can get a certificate IV which will equip you with the skills to be involved in youth justice.

In my own office, NDA is a local training provider that undertakes a lot of the training that my staff have the opportunity to participate in. Recently, in correspondence sent to my office, their newsletter said:

RTOs have been in the news recently for all the wrong reasons: think ripping off clients and delivering meaningless 'instant' qualifications to name just a couple. I mention this because the Skills Fund is about to open a new round of funding and NDA would like partner with your organisation in a tender. You can do this with some confidence because:

Indeed, there are good RTOs. It is those RTOs that we want to see supported.

This bill ensures that registered training providers are ultimately responsible for services delivered by brokers on their behalf. And all parties involved, including the brokers, are required to clearly identify which RTOs will be responsible for the qualifications that students sign up to receive. In fact, under the proposed amendment, the Australian Skills Quality Authority will have the power to take action against those who do not make it clear who is responsible for the quality of the training. Our young people, in particular, deserve training of the highest standard and consistency. The federal government has committed $68 million over four years to the Australian Skills Quality Authority to enforce the tough new standards.

In terms of research, in The contribution of education to economic growth in Australia, 1997-2009 Tom Karmel estimated the impact of increasing education levels on economic growth and found that raised education levels contributed to improved productivity in the order of nearly 0.2 per cent per annum in the years of his research. He also found that this change in education levels led to an increase of about three per cent over the eight years in the average hours worked in the 15- to 64-year-old population. This was almost entirely due to increases in the number of women with degrees and post-graduate qualifications.

I look forward to the Treasurer's release of the Intergenerational report tomorrow. It is something that, I think, every Australian should contemplate. Opportunities arise because we have with a nation that is living longer. That is something that we should all celebrate.

I also noted some data in the Karmel paper about a comparative country, Canada. Interestingly, if in this country we had the same level of female work place participation as in Canada—and I think most Australian's would understand it to be a comparative jurisdiction with many similarities, such as being a big country with a small population—the Australian economy would be, every year, $25 billion larger. I think that is something to contemplate. It is a challenge for all of us. It starts with the sort of reforms that we are trying to make in terms of the legislation before us today.

It is agreed that productivity —innovation, if you like— is enhanced by workers who possess the skills and knowledge required to undertake the occupations for which they have been trained . The role of Australia's VET system, supported by the g overnment, is to provide students with the skills needed for work in various occupations and trades.

This g overnment has already done much in this field to provide top quality vocational training and make students feel secure in the training that they are receiving. It has l aunched the Nation al Training Complaints Hotline, a joint initiative with the states and territories to provide a single point for complaints to be heard and actioned. It will also crack down on inducements like free i Pads or cash rebates , and enhance duty of care for training providers to abide by the date they sign a student up to a student loan.

These reforms have come about partly because o f the rapid expansion of VET FEE -HELP and its misuse by some providers . It was a direct result of Labor's failure to properly administer and implement the program —isn't that a story we have heard before?— and failure to protect vulnerable students and taxpayers from unscrupulous training providers. The Australian Skills Quality Authority will undertake 23 audits of RTOs who have been identified trying to exploit the VET FEE-HELP program.

The f ederal g overnment will provide nearly $ 6 billion this year to support vocational education and training courses through direct funding for programs, support to the states and territories , and student loans. In particular, we have replaced the grants that were previously given to those people undertaking apprenticeships, because the problem was that half of them did not complete the courses—yet, we were giving them a grant up front. The system has been changed and the new trade support loans are something that I am particularly excited about. I can see just how helpful they will be in my home state of Tasmania. I have spoken to a number of employers and a number of apprentices about these, and they all welcome them. We are trying to boost the number of skilled tradesmen and tradeswomen.

Trade s upport l oans will provide support of up to $8 , 000 in the critical first year of an apprenticeship and up to $20,000 over four years. If you complete your apprenticeship, we will knock 20 per cent off. It is the best deal these young people will ever get in their life. It is a system that is accountable not only to the people that it is supporting but also to the taxpayers of Australia. These loans have proved so successful in the six months since the scheme was introduced that 16,000 people across Australia have already taken them up. The loans are to help apprentices with the costs of living and learning, particularly in the early years of their apprenticeship, when wages are low, to try to stem the flow of young people dropping out of training because they do not believe they can afford it. Those who take out a loan will not be charged interest or fees on the loan and are not required to start paying back their loan until their income is above $53,345, in 2014-15.

Research last year proved that the VET system offers a cheaper and less stressful entry point to the education sector for people who have experienced some social disadvantage in their lives. Tabatha Griffin found that financial stress was one of the biggest barriers to students moving from lower level qualifications to higher level VET and higher education. So we are moving to alleviate that. Other research last year by academic Sonia White found that the inherent differences in the two sectors mean that transitioning students have to adjust to two different learning cultures, expectations and models of assessment.

Our higher education reforms introduced by Minister Pyne last year recognise the potential of a collaborative framework between VET providers and universities for facilitating the smooth transition from the VET sector, which is critical in my state, through those pathway courses to university. I commend the bill to the House.

Sharon Claydon (Newcastle, Australian Labor Party) Share this | Link to 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.

Karen McNamara (Dobell, Liberal Party) Share this | Link to this | Hansard source

I rise to support the National Vocational Education and Training Regulator Amendment Bill 2015. This bill builds upon this government's reform of the vocational education and training—VET—sector to ensure that Australia is equipped with a skilled workforce and a productive economy.

This bill introduces measures to enhance the integrity of the VET system; provide an effective balance between protection and regulation of the VET system; and improve the efficiency and operation the NVETR Act and, consequently, the Australian Skills Quality Authority.

This government is working constructively to enhance the operation of Australia's VET system. The federal government will provide almost $6 billion this year alone in support for vocational education and training through direct funding for programs, support to the states and territories, and student loans. In electorates, such as Dobell, it is essential that this funding is directed at proven programs that meet the needs of our local labour market and sectors of the economy with a high demand for skilled workers.

The 2011 census identified in Dobell that 24 per cent of residents aged over 15 had a certificate-level qualification. Only 18 per cent have attained undergraduate and/or postgraduate qualifications. The census also identified that manufacturing, trade, accommodation and food services, construction, health care, and social assistance made up 62 per cent of all employment within Dobell. Furthermore, one-third of employed persons aged 15 years and over nominated their occupation as labourers, machinery operators, technicians or trades workers. With only one in two students in Dobell obtaining a year 12 qualification, these numbers highlight the importance that vocational and education training plays on the Central Coast.

I engage on a regular basis with local job service agencies, apprenticeship support providers and other training organisation to ensure that the training they deliver is aligned with local job requirements. No benefit is derived from training for training's sake. Government funding must be directed at addressing local skills and job needs, and providing training that addresses skill shortages within the local economy.

Sadly, over recent years, this has not always been the case. For too long, we have seen taxpayers' money wasted on training that has failed to meet employer and industry requirements, and has also failed the student. In addition, the previous government failed to safeguard quality standards and allowed unscrupulous providers to operate unfettered. This has resulted in students, who have completed training, being unable to secure employment, due to their skills and knowledge failing to meet workplace requirements and standards. For example, I have been informed by cafe owners in Dobell of situations where young people have presented with a Certificate II in Hospitality; yet, when placed in a practical workplace environment, they lack the necessary skills to meet the business needs, including face-to-face customer service skills.

In fact, it would appear, particularly in Dobell, that we now have an oversupply of certified baristas and fitness instructors in the job market. This is an example of training program failing to consider the needs of the local employment market. Not only are these examples a misuse of taxpayer funds; the results are psychologically damaging to job seekers who are trying to do the right thing only to be let down by a training providers who have failed to equip them for the workplace. This also places the student at an unfair financial disadvantage.

The intent of this bill is to improve the quality of Australia's VET system by enhancing the quality of education and training provided by the VET sector; improving transparency in the marketing of VET courses; reducing the regulatory burden by lengthening registration periods; and amending administrative arrangements to reduce red tape and better position the national regulator to investigate unscrupulous providers. Above all, this bill seeks to protect the integrity of the VET sector. This sector needs strong quality assurance in order to deliver high-quality training outcomes for students.

Employers are entitled to have confidence in the training received by potential employees. Regardless of which organisation has provided training, there should be consistently high standards to ensure that relevant knowledge and skills are taught to students.

As a member of the Standing Committee on Education and Employment, a strong vocational training sector is an area I strongly believe in. Our recently concluded inquiry into TAFE demonstrated the vastness of Australia's VET sector.

The TAFE sector is the largest education and training provider in Australia with 61 government owned TAFE institutions and university TAFE divisions. While the federal government has no direct administrative role in TAFE, it exercises a regulatory function through the Australian Skills Quality Authority by registering training organisations and accrediting courses.

Through COAG, various levels of government have agreed to six objectives for the VET system, including: a national system of streamlined industry defined qualifications with flexibility to respond to major national and state priorities and emerging areas of skills needs; a modern and responsive national regulatory system that applies a risk-management approach and supports a competitive and well-functioning market; and ensuring that consumers are provided with the information they need to make choices about providers and training that meets their needs. These objectives, while focused specifically at TAFE, form the basis of amendments within this legislation.

The bill is addressing concerns that have been raised in relation to the ability of the VET sector to respond to emerging issues promptly and effectively. Such delays have the potential to impact upon the quality of training offered by registered training organisations. The bill establishes he capacity for the Minister for Education and Training to develop and enforce standards in relation to quality in the VET sector. Quality standards will focus the quality of training by establishing a new standard to address emerging issues which impact on the quality and integrity of training for individuals and students. Importantly, the quality standards will ensure that unanticipated changes in the VET sector can be quickly addressed in a timely manner.

These new powers will provide the Commonwealth the equivalent of 'emergency' powers to address known or emerging quality issues that compromise student interests and the quality of outcomes. They will also provide industry and individual states and territories a direct avenue of action to the Commonwealth to urgently address issues of concern. Prior to the issuing of a standard, the minister will consult with key stakeholders, including state and territory ministers, along with industry partners. Furthermore, standards will be issued within weeks, providing better protection for students. Currently it can take up to 12 months to change a standard. This is simply too long to make a change if there are critical issues impacting on the quality of the training being provided to students. The quality standard will become a condition of registration for registered training organisations.

This bill will also enhance he requirements of advertising and offering of VET courses. This is in response to concerns raised in regard to methods undertaken by some registered training organisations with respect to the marketing of their courses. Current arrangements mean that it can be at times unclear to students enrolling online who is responsible for delivering their course. This bill will provide greater transparency by requiring individuals marketing VET courses, including brokers, to be explicit in their communication and advertising to prospective students about which organisation will be responsible for issuing the qualification or statement of attainment. Under these reforms, when a student receives marketing material they will be able to clearly identify the registered training organisation responsible for the qualification they are signing up to complete. Under this amendment, the Australian Skills Quality Authority will be able to pursue anyone, not just training providers, who fail in their obligation to demonstrate who is responsible for the quality of the training. This government is committed to ensuring that students receive the highest quality education and training through our VET system. These reforms continue to build upon the work the government is undertaking to improve quality in the VET sector.

Already we have introduced tough new regulatory standards for training providers which came into effect on 1 January 2015 for new providers and will apply to existing providers from the 1 April 2015. In addition, the Australian Skills Quality Authority is moving towards a risk-management model of regulation to ensure focus is on those who are doing the wrong thing. On the 19 January, the government launched the National Training Complaints Hotline, which is a joint initiative with the states and territories to provide a single point to make it easier for complaints to be heard and actioned. Following this announcement I visited Peter Willcockson, managing director of local small business, Express Lube, in Dobell. Peter, who employs nine apprentices across his business, welcomed the news, saying:

As a small business operator it is important that apprentices are well educated and are able to adapt to working in a workshop. However this isn't always the case. From experience I see apprentices arrive at my business not knowing bask mechanical theories. In some cases we are talking about second year apprentices.

Peter's comments back up the actions of the government and the need to improve the quality and standard of training provided to students in the VET system. It is inexcusable to see people arriving at work with training under their belt, not knowing basic theories and unable to do their job. This is the sort of feedback that can be reported to the National Training Complaints Hotline and investigated.

The government's reforms require an effective national regulator. We want the Australian Skills Quality Authority to spend less time dealing with compliance and more time addressing unscrupulous practices and dodgy operators. The bill makes a suite of administrative amendments to strengthen the national regulator and to better place them to fulfil the above objectives. The regulator has, in the course of conducting its functions, identified a number of areas where administrative improvements may reduce regulatory burden and improve efficiency. These administrative amendments seek to streamline and improve processes in addition to reducing the regulatory burden on the sector. These include: enabling the regulator to request information from persons holding themselves out as a regulated entity; clarifying that all organisations that are constitutional corporations covered by the civil penalty and offence provisions and prescribed in part 6 of the NVETR Act; and improving the sharing of VET information between agencies.

In another step to reduce the regulatory burden on the sector, the bill seeks to increase the registration period for providers from five to seven years. This amendment allows the Australian Skills Quality Authority to better target its resources towards higher risk registered training organisations. We are continuing to fulfil our commitment to reduce red tape and compliance in order to strengthen our economy and reduce costs to business. Importantly, this is a cut in red tape for those registered training organisations that do the right thing. Rather than having to re-register every five years, organisations will only have to go through the process every seven years.

This amendment will allow the regulator to redirect its effort away from the renewal process and focus on better targeted and more random auditing, compliance and enforcement actions against poor-quality providers. This is in response to findings by the Australian Skills Quality Authority who stated that re-registration based auditing is a less effective approach to quality assurance when compared with targeted or random audit activities. Our reforms are forged in partnership with students, employers, training providers and the states and territories, with the common goal of improving the quality of Australia's VET sector. The days of training for training's sake are over, as are the days of unscrupulous operators taking advantage of students and the Australian taxpayer. This government is looking at further action beyond this legislation before the House. We will crack down on inducements, such as free iPads or cash rebates, tighten marketing practices and enhance duty-of-care provisions for training providers to abide by, when they sign up a student to a student loan. It is unconscionable for training providers to offer incentives in order to sign up students and receive government payments. If this is their approach to attracting students, you do have to wonder what level of training and education they are providing to vulnerable young people.

The lack of a regulator compliance framework has unfortunately seen vulnerable students taken advantage of by these dodgy training providers. We will be seeking to address the rapid expansion of the VET Fee-Help and its misuse by providers. The Australian government has committed $68 million over four years to the Australian Skills Quality Authority to enforce these new standards, and we will continue to reform the Australian VET sector to ensure that the needs of students are front and centre and that they receive the necessary education and training to address labour-force shortages. This is the only approach that, we believe, will deliver lasting benefits for students, such as those on the Central Coast—where VET accounts for a quarter of our post-school qualifications. It is the only approach that will best prepare residents on the Central Coast for employment in the local labour market. With over 50 per cent of local jobs found in industry, which is heavily dependent on vocational training, we must ensure that students are spending their time preparing for work in fields where there are available jobs.

I am proud to be a member of the government that is delivering real support to students undertaking vocational training and education, including Trade Support Loans and a new Australian Apprenticeship and Traineeship Support Network to commence on 1 July. I will continue to work along with local VET providers on the Central Coast and ensure that this government strengthens our VET providers—(Time expired)

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to 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.

Nickolas Varvaris (Barton, Liberal Party) Share this | Link to this | Hansard source

I am very pleased to speak on this important bill today because I know how significant it is to the many students and vocational training providers we have in Australia. The National Vocational Education and Training Regulator Amendment Bill 2015 will enable better regulation and enforcement of our registered training organisations to ensure students and taxpayers are not left in the dark as to the viability of their respective careers or finances. This is an important piece of legislation for many reasons. First and foremost, it affects our vital employment sector and those who specialise in trades. When you think about it, this is far reaching. Every hairdresser, plumber, electrician, mechanic and so forth that we encounter in our lives has gone through the vocational education training system. They have developed and refined a specific and tailored form of procedural knowledge that significantly contributes to our economy and labour market, not to mention the essential services their trades provide to society. Not only do we all rely on the services of a vocational education graduateat some point, but asthese professionals eventually leave the labour market,it is critical they are replaced by those who are equally skilled.

This last point is increasingly significant because our nation is facing an increasingly ag e ing population , with retirees set to outnumber workers. Five years ago every Australian who had reached 65years of age was supported by five working adults. By2050,it is projected thatone retiree will be supported by only 2.7 working adults. Our labourmarket is declining every year, and the need for skilledworkers to continue the services and goods theyprovide cannot be stressed enough.We not only need more workers but, critically, we need skilled workerswho have the right training intheir choice of profession.

It is disappointing to me and to the constituents who have flagged it with my office that there are a number of registered training organisations who are not providing adequate training to equip these workers. Some of my constituents are seeking a career change, whilst others have finished school and are keen to take on a trade that they are passionate about. Yet many of them are baffled by the lack of consistency in quality and training materials provided as well as the difference in costs between the different providers. A few of them were unaware of the financial assistance that is there to assist with course fees, whilst others felt the government's financial assistance on offer had been marketed rather forcefully to them—they were being offered free electronic gadgets and other incentives unrelated to their course. You can imagine that with so many choices of provider, so many courses to choose from and uncertainty about how funding is actually delivered, they have come to my office very confused. These people have a dream and a passion to fulfil. The lack of uniformity, the dramatic difference in costs and the various reputations of course providers has often left them demoralised.

As a federal representative, I know that my colleagues and those opposite want all Australians to be actively engaged in their vocational courses, with training organisations that can deliver what they promise. I know that all members of this House want our students to obtain qualifications from training providers that enable them to successfully complete their studies and take on a job that can reward them accordingly. We certainly do not want to have organisations that exploit students and vulnerable individuals by offering unrelated incentives and not disclosing their fee structure. Unfortunately, some of these hypothetical scenarios are a reality for many individuals. I was perplexed to learn from one constituent that her qualification in child care still left her with an inability to find work despite an industry demand for childcare workers. I was disturbed to learn of a young apprentice who did not know how much the total loan for his fees was or how the fees were calculated to begin with.

I was disappointed to learn that one constituent was solicited repeatedly by an education service provider that she had never heard of, cold calling her on her mobile, who had somehow gotten her details even though she never registered an interest with that organisation or course. Marketing in education is not new, and this is not the issue at stake. What becomes a problem is unscrupulous marketing that centres the focus on the organisation's profitability, with no consideration for the student's best interests. Today's bill seeks to redress the balance by enabling new quality standards in vocational education to be enforced, not just regulated. It will also enable the Australian Skills Quality Authority, our national training regulator, to investigate those breaching the rules and act upon poor-quality providers.

The bill will also allow for significant reforms across our vocational education sector, through the provision of a national VET complaints hotline. It will reduce the regulatory burden on high-performing VET providers, through extension of registration from five years to seven years, and it will allow clear identification of providers who issue a qualification certificate. The bill today will amend the National Vocational and Education and Training Regulator Act 2011 to strengthen the protection of students, to ensure those providers who continuously deliver high quality training do not suffer from over-regulation, but it will also enable those who provide inadequate training to be audited, and sanctions enforced.

We cannot afford to have a poorly educated workforce. It is unfair to the students and to our taxpayers. In addition, it is also dangerous to have inadequately trained professionals. Think of the electricians, whose services are life-time guarantees, and the mechanics, whose training is there to ensure our vehicles are safe and roadworthy. These are just two critical examples of why we must have high-quality graduates.

It is our role to ensure a duty of care to those learning, and that these provisions are adhered to by the training organisations. It is unfortunate that some providers in this vital sector have not been able to undertake all their proceedings having regard for the best interests of their students, in particular the quality of training and the abuse of the sector's VET FEE-HELP. Like the tertiary sector's HECS debt, a student can borrow every dollar of the cost of their course, with no repayment obligation until they reach a certain salary. Furthermore, some organisations have increased or varied the cost of their courses to take advantage of VET FEE-HELP, which they market as 'study now and pay later' to lure students in. Unfortunately, some students have been unable to repay their loans because they were unable to get the job they had hoped for, due to poor-quality training. Some students, as I mentioned previously, have been unaware of how much they owed until they received an invoice. This is not the solution to having a better trained workforce. In actual fact, it would altogether put students off from entering the vocational market. So it is pleasing that this bill will allow our national regulator, ASQA, to make it mandatory that students are aware of what they are signing up for, and that they are notified of their loan fees. This will extend to the brokers who market these educational providers and programs.

In addition, the National Training Complaints Hotline, a joint initiative with the states and territories, will act as a triage system for complaints to be heard and investigated. It is regrettable that whilst most registered training organisations provide exceptional value and support for students, there are those who deliver substandard training to learners.

I implore members from all sides to support this vital bill, to ensure the viability of our vocational sector and that they have regard for the best interests of their students. There is a clearly demonstrated need for enforcement, not merely more regulation. The bill is not about increasing red tape. It is about realigning the interests of students, tax payers and employers so that our skilled labour market is high in quality. It is essential that ASQA is given the resources and support to regulate and enforce the rules of our vocational education providers so that the abovementioned stakeholders do not lose out.

I cannot stress enough the importance of ASQA. Its increasing focus on compliance and auditing has been critical in identifying those providers who are not up to scratch. Our community deserves to have full confidence in the training and assessment framework being delivered in this country, so that trades can continue in their high standards and students learn the right skills to take on a career of their choice. It is our role and the intention of this bill to ensure that there is good faith in the vocational sector, and that the system is carried out with integrity. We want current and future students to have the freedom to choose their path of study without being restricted by fees; however, that should not mean they are exploited by rogue training organisations. The viability of a robust, quality VET sector is needed so that Australian businesses can continue to thrive. This bill is one part in reducing malpractice and inefficiency in this vital sector.

Whilst we all recognise that individuals must research carefully the institutions that provide these studies, we must also take into account those who are unable to make informed decisions by themselves and who might be exploited. Both ASQA and the coalition government will work together to ensure students are provided with the right training and skills needed for their trade and not just saddled with debt. We are committed to creating a framework where funding and support go to the right participants, so that students receive the right qualifications and skills to enter into the labour market.

I ask members of this House to strongly support the bill, which will ensure the best interests of our vocational students, taxpayers and employers. Today's bill is essential to strengthening and maintaining Australia's quality vocational education training system, so that everyone can benefit from our trades sector. I commend the bill to the House.

Joanne Ryan (Lalor, Australian Labor Party) Share this | Link to this | Hansard source

I rise with colleagues on this side of the House to support the National Vocational Education and Training Regulator Amendment Bill 2015 and to welcome some of the changes that are being addressed, but also to suggest further changes that may address a serious issue that has been highlighted in the press and in the chamber this morning as speaker after speaker has told stories from their electorates.

One of the reasons we all are fully aware of this is not just because people have been walking into our offices to talk to us about it, because, bluntly, a lot of our most vulnerable are not big complainers. They do not necessarily have the assertiveness or the confidence to raise a complaint about these issues. I think that has been one of the issues as to why this has been going on for so long.

The report from the University of Sydney has certainly shone a light on the area of VET provision and some of the things that have been occurring. It has done so recently, and a Senate inquiry has assisted with that. The study by the University of Sydney shone a light on some of these practices merely through looking at the figures. The report identified businesses in the vocational education sector making super-profits of 30 per cent. That surely should be ringing alarm bells. Clearly it points to a problem. A 30 per cent profit is not usual, and one might argue that it is not possible if you are delivering quality education in any sector.

Another alarming statistic in that report concerned the TAFE sector in Victoria, which is the traditionally trusted provider of VETs—one that provides the quality we expect in our training and skills programs. It has been dramatically marginalised. In fact, it has gone from providing 70 per cent of VET training in Victoria down to 20 per cent. Both of those things clearly show that there is a structural problem occurring in this sector and it needs to be addressed. Of course, it would not be a problem if this Victorian reduction to 20 per cent were being replaced with high quality education. But, given 30 per cent super profits and the stories we are hearing that have been highlighted in the press of late, we now know that that is not true. We certainly know that these things need to be addressed. Therefore, I welcome the amendments in front of us this afternoon. This sector certainly needs reform. The market based mechanisms have no place in the case management of our most vulnerable on their journey to secure training and employment.

Last year, the shadow minister for vocational education, Sharon Bird, and I met with about 30 apprentices at the Werribee Plaza site in my electorate. This is a huge building project that is underway, employing 700 tradespeople. Pleasingly, there were a healthy number of apprentices employed. In the meeting with these young Australians—all proud of having secured an apprenticeship and a great start to their working lives—they were also keen to share some of their negative experiences. The conversation soon turned to the off-site training that they were going through. Two common topics were cost and quality. The apprentices told of starting with one RTO, which had lobbied their employer as a so-called cheaper option to TAFE, only to switch after a term because the quality was so poor.

These stories started to come through. The apprentices spoke of teachers with poor English and of assessment where the answers were provided. As a former teacher, I do not think that I need to lecture the chamber, but, if you are going to give a student a test, that is a test of your teaching more than a test of their learning, and you certainly do not provide the answers to give yourself a pat on the back when they get 100 per cent. They also complained of classes that were cancelled and never made up.

The apprentices and their employers were genuine in trying to gain real skills and real training—and they had a genuine desire to learn and improve—but this was not what they had found in the sector. Many of them had changed providers in order to find one with quality. Most preferred the TAFE options, as they felt the quality was so much higher and the teachers were genuine in wanting these young adults to acquire real skills. The employers could see the benefit of utilising a quality provider. We also heard similar stories about quality from the preceding member's contribution in this debate. The quality could be found if they went out to look, however, if you were an employer with less scruples or an apprentice that knew no better, would you go and look for it? That is the question. I did not ask at the time whether any of them attempted to make a formal complaint regarding the poor providers, but I suspect not.

Last week, I met with a community leader in my office, who is a representative of a growing ethnic group in my electorate. As part of that meeting, which was wide-ranging, he mentioned that he had been approached by several women in the community who had been placed in training. They were very proud and happy to participate in the training, and a large number were training in certificate courses that enabled them to become child carers. Although they had participated and qualified, they actually had limited knowledge about how to establish themselves as a carer. The training did not actually provide the skills they needed to lift themselves into employment and start making a valuable contribution to our society. I know that I will not be the first person nor the last person today to speak of this happening in communities. This also follows recent stories of various childcare centres refusing to take graduates from some RTOs who had a reputation for poor quality. I know that some will argue that this is the market doing its work. However, for those people who have done those courses, had that one-off opportunity and cannot do a course of a similar accreditation again in a different field and get that kind of support, it is too late.

As last year's high school graduates are weaving through the maze of options for post school education, there seems to have been an increasing number of media reports about these unscrupulous RTOs preying on vulnerable students. Again, we are hearing about that today. Students are being hoodwinked into enrolling for courses that are poor quality with no real job prospects at the end of them. Sometime these people do not even realise they have signed up to a significant debt. It is pleasing that this bill goes some way to address these issues. It builds on the work of the previous government, which of course established the Australian Skills Quality Authority, ASQA, in 2011. We on this side of the chamber know and understand that strong regulation of the sector is important to ensure young people receive quality training and are not signing away for a large debt.

I am pleased to see that the current government allocated a further $68 million to ASQA last year and that they have established a National Training Complaints Hotline. I am also pleased to see that new standards are being implemented next month. These are important because the stories are growing in our communities. They are growing because the fact is that, amongst the for-profit operators, there are unscrupulous providers hawking VET courses door to door or, worse, cleverly hiring community learning centres to add a level of legitimacy to their activities. They are preying on the vulnerable.

One story from my electorate, which has a happy ending but carries a moral with it, is about a young man. He was a jobseeker. He had not been unemployed for a long time. He had left school and had a couple of jobs. As with most young people, he was utilising the internet and the modern recruitment tools. He found a position advertised on SEEK to which he promptly responded. He sent in his resume and got an interview. He attended the interview, but he came home, not with the job, but with a course already signed up. He received no independent career guidance, which, you will understand, as a teacher I value highly. No-one had explained the regulations around certification and Commonwealth funding, and he had no understanding of the full array of options if he had seriously considered re-engaging in education. His story stunned me, not just for the fact that he had responded to a job advertisement and come away with a course, but also for the fact that he had signed up for a vast array of certificates. They all looked good on paper. He was going to do a 10-week course. He did; he attended. He was told during the eighth week that the last certificate would not be completed in the 10 weeks, but would occur when they got the numbers, and they would call him. He did not get the call. It will not surprise anyone in the chamber to know that this last certificate was the most expensive certificate and also the one that probably made him the most job-ready.

He pursued the issue by phone several times but the promised call backs did not eventuate. Some months later he saw the same ad in SEEK and he rang the number. He secured another interview and he got his 'gotcha' moment. He ultimately got the certification and the Commonwealth got value for money. He is employed and has been employed since gaining that certification. So it is a happy ending but a moral tale about unscrupulous for-profit operators.

Labor recognises the importance of quality assurance and today we have suggested what we think are some sensible amendments to go with the amendments being put forward by the government. We must free the regulator to chase the real dodgy providers, those making superprofits off the back of our taxes and vulnerable students. We have seen reports of RTO businesses making superprofits of 30 per cent in the vocational education sector and that clearly points to a problem. In the process, people are being exploited and that also needs to be addressed.

Senator Carr and shadow minister Bird have been fierce advocates in calling for action. They recognise that the market-based mechanisms have no place in the case management of these vulnerable people. The fact is that, amongst the operators motivated by profit, there are unscrupulous providers. So we have suggested some amendments that we think strengthen the bill and that take a few steps further to, importantly, improve the regulatory oversight of the sector but also provide support for those people who have been caught up in this system, the vulnerable individuals, who have possibly been left with large debts and, in some cases, with no qualifications or useless qualifications.

As a case in point, one amendment addresses the notion of extending the registration to seven years. Our amendment calls that that only be offered to low-risk providers, with the view that it sends the wrong signal to extend the period for registration and therefore the length of time without an audit, although we recognise that the intent of that part of this amendment is in fact to free up the regulator from doing continuous audits. We think that that measure would reverse that signal to the market and ensure that those low-risk operators are free to continue and would free up the regulator to do so some of that work.

However, we also call on the government to act with more urgency, to ensure the protection of students is prioritised in this process and to 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 in the sector. Labor supports the call for the Auditor-General to conduct an audit on the use of VET FEE-HELP.

This is obviously an area of passion of mine. I have left the most compelling argument to the end of my contribution and that is around schools. I will give you this example. These unscrupulous providers are not just knocking door to door; they are not just trying to engage people who have lost their job or who have been long-term employed. They are actively pursuing current secondary students. I will give you a scenario that might help you understand. In a high school such as the one where I worked for many years we have many vulnerable students —at-risk students—who have many things in their lives that make them at risk. One of the safest things for them to do is to maintain their enrolment and attendance at a school. To that end, schools put wrap-around support in place for some of our most vulnerable children, with a view of keeping them at school as long as they can. I know that, currently, in schools around the country some of those children are coming back to school, and saying, 'I'm here to exit because I'm going to do a course.' The course will not come with careers guidance and it will not come with welfare support. You will have a year 9 or a year 10 student, aged 14 years and nine months, heading off to do a course that they have signed up to and, unbeknownst to them, it will disconnect them from their education.

Fiona Scott (Lindsay, Liberal Party) Share this | Link to this | Hansard source

Firstly, I would like to commend the member for Lalor for her passionate and heartfelt remarks. It is good to see a schoolteacher in this place stand up for her community. So thank you.

I rise today in support of the National Vocational Education and Training Regulator Amendment Bill 2015. This bill sees a lot of bipartisanship on both sides of the chamber and it really brings out the best in what this place does. The bill seeks to addresses many of the challenges faced within my electorate of Lindsay. Further, this bill will provide clarity to both education providers and students alike.

For too long, vocational training has been treated as the poor cousin when it comes to attaining workplace skills. Some of the certificate courses being offered are foundation stones for our youth to gain entrance into the workforce.

Every day, right across western Sydney, hundreds of registered training organisations do extraordinary work. I myself have been a product of the Western Sydney Institute of TAFE where I gained early vocational courses in marketing and graphic design and, finally, a diploma in marketing management. This provided a gateway opportunity for me to then go to the University of Western Sydney and study a Bachelor of Business, with a major in marketing and, finally, a Masters of Business Administration from the Australian Graduate School of Management.

I would never have been able to achieve these things and have that gateway if I had not attended the TAFE college in my local community, on Henry Street, in Penrith. I am very passionate about this sector because I really can see what it will actually do for so many of our youth. But, like so many of the brilliant RTOs, we are all equally disappointed when we see rogue operators partaking in unscrupulous activities and bringing the entire industry into disrepute.

I stand here today, a product of the VET system. Now, in my capacity as a member of parliament, I feel that it is my responsibility to ensure that other young people are provided opportunities and that other young people can trust the vocational training that they sign up to. Further, accessibility and affordability of the system are essential, as is a system that continues to provide a diversity of program formats designed to meet the varying skills and levels, the individual learning outcomes, of students. These are all crucial elements of the sector.

Currently, for many students working their way through the system, this is not easy. Understanding which registered training organisation is providing which course and what gateways they will potentially open is, for many students, obscure and ambiguous, and students will often be forced to sign up to courses through third-party organisations. Sadly, some of these training bodies have gone door to door with sales techniques whereby potential students have been enrolled in courses with the enticement of an iPad, a laptop or even some form of tablet and maybe a couple of hundred dollars.

I was at a multicultural event over the weekend and was pulled aside by a couple of the elders at that event. They were extremely distressed and very, very upset. A few of their youth who had not been in Australia very long and were still coming to grips with English were signed up to a training program. They ended up being saddled with large amounts of debt. They were given a laptop computer—one of them was given an iPad—and told, 'Here you go, on your way, off on your course.' They were so, so upset. They were upset for their youth, but they were also upset about the waste of government dollars in this program. This community group really has been one of the most innovative in my community. To see these men, whom I respect so much, so upset about this program made me very, very angry.

What also made me angry about this was hearing through my office from nursing homes which have had individuals signed up to these programs. The fact is that these rogue operators are absolutely targeting our most vulnerable, targeting people who may not necessarily know what they are signing up to. This is an abhorrent thing that they are doing, and it must stop.

This amendment is designed to clean up this mess, with one simple requirement: if you offer a course, you must identify which certifying body that course is with. Not only is this amendment good for openness and accountability; it is good for transparency. I would have thought that this is a bonus for organisations in showing they have a credible product to offer.

Registered training organisations must meet curriculum and quality standards. All major representative organisations overseeing these providers would also agree. All the stakeholders are cognisant and supportive of the need to address quality issues in vocational education and training. As for setting the quality standard, the government will further consult with all states and territories, employer groups and the sector to develop the quality standard.

The Australian Council for Private Education and Training is one of the many industry bodies which firmly believe these changes will deliver better transparency for the sector. Rod Camm, the chief executive of the council, says that requiring the registered training organisation to be listed is something that students have a right to know about. He further goes on to say:

As the peak body representing quality private providers, ACPET—

the Australian Council for Private Education and Training—

has been a vocal supporter of measures that strengthen the VET system …

… These measures are necessary to protect both students and colleges …

Finally, Rod says:

After a necessary and welcome period of consultation by the government, I think we can all agree these reforms are urgent, and must be passed as soon as is practicable.

TAFE Directors Australia have a similar view. Malcolm White, the CEO of TAFE Directors Australia, said:

The legislation is an important step in enabling the regulator to act quickly to address the practices of a few unscrupulous training providers that are damaging the reputation of VET—

vocational education and training in Australia. Importantly it will also allow the regulator to respond effectively to the questionable actions of some brokers and third parties engaged in 'selling' courses on behalf of registered training organisations. TDA calls on all members of the House of Representatives and the Senate to support this important legislation.

That is the key to this bill. It is to prevent the system from being further rorted. It is to put confidence back in the system. And it will lay bare those charging exorbitant prices for their services.

Jim Barron, the Chief Executive Officer of Group Training Australia, goes further. He believes the legislation will help to ensure that providers will ensure that training is of a high quality to meet the needs of apprentices, trainees and employers. It is an important reform that will help bring equality of opportunity for those who partake in such training.

In New South Wales alone there are more than 564,000 students involved in vocational education. About 10 per cent are international students. This government will subsidise New South Wales to the tune of $579 million to keep those courses affordable. That money will be spread across 1,100 operators right around NSW. Two hundred and fifteen of those 1,143 registered training organisations are in Western Sydney. With such money involved, we really need to ask: are we getting value from that money? With 101,000 apprentices reliant on these courses for their careers, can we afford this? Can we allow for this damage to the training and career opportunities of our students and our communities to continue? Of course the answer is no.

In 2012, 150,000 people were awarded their qualifications through these organisations. It is essential that these qualifications meet basic standards. What we do not want to see is more nightly television exposes, like those that we have seen over the past fortnight where people are being awarded hairdressing qualifications but are unable to carry out basic cuts. These are not the first stories of operators selling courses as part of immigration scams or of other institutions that are just not delivering on their promises. This brings me to the next part of the bill.

The bill ensures that organisations have their registration periods extended from five to seven years. It will ensure that the national regulator can better meet the 2012 standards and the 2015 amendments can be better enforced. Under the current system too much focus is being placed on the audit assessment at accreditation time. Under the changes in the bill, the national regulator can work between these periods to ensure quality is maintained over a length of time and not just at renewal time. The aim is to cut the red tape from strong performing operators, while placing greater focus on the poorer performing operators in the spectrum. Further, it is a strange quirk that the existing legislation makes it near impossible for the national regulator to investigate non-registered training organisations, even if they make claims of being registered. This bill will strengthen the national regulator's power. Under the amendments, anyone purporting to be registered can be investigated. Very simply—and common sense would say, I think—this is definitely a necessary amendment.

The bill will also complement a number of changes that are taking place right across New South Wales, and part of those changes is a new national entitlement, Smart and Skilled. This program provides a range of new subsidies for non-apprentice courses, assisting those studying for Certificate Levels I, II and III. Alongside this program are a range of Commonwealth programs, including the Industry Skills Fund and Trade Support Loans, which were introduced as part of the 2014-15 budget. To support these measures in this amendment bill, there will be the creation of a new National Training Complaints Hotline. On the hotline, Rod Camm, from the Australian Council for Private Education and Training, said:

The message to all providers is clear: tidy up your act or leave the sector … There’s no place for unscrupulous behaviour in this sector and we fully support the government’s measures to stamp it out.

These are very, very strong words. This is good legislation. It will shore up an important educational sector. It will help build on the confidence of the industry, and it is for that the reason that I commend the bill to the House.

Jill Hall (Shortland, Australian Labor Party) Share this | Link to this | Hansard source

I argue very strongly that the amendment to the National Vocational Education and Training Regulator Amendment Bill 2015 should be agreed to, but, in doing so I would firstly like to pick up on a comment that the previous speaker made. I agree with much of her contribution to this debate but not her comments about the New South Wales government's Smart and Skilled program. This program is actually an attack on vocational education in that state. For her to stand up here, in this parliament, and praise Smart and Skilled is really praising an attack on vocational students in New South Wales. I will talk a little bit more about that later in my contribution to this debate.

I support the amendment put forward by the member for Cunningham. Unfortunately, under this government's watch and the watch of the New South Wales government, vocational education and training is in free-fall when it comes to vocational and education training providers—I will refer to them as VET providers from here on in—being poorly monitored. In New South Wales, the government is slashing funds to TAFE.

This bill is long overdue and it does make some significant improvements in this area, but it does not go far enough, unfortunately. All members of this House will have constituents who have been in touch with them about how they have been duped by private providers who act irresponsibly and who sign people up to inappropriate and substandard courses. This legislation is an improvement, but, as I said, it does not go far enough. I will in a moment spend some time highlighting just how ineffective the monitoring of this area is and how little recourse people—usually young people—have when they are signed up to undertake a course with providers who, in many cases, are very unscrupulous.

As the previous speaker mentioned, there have been media reports of unscrupulous RTOs, registered training organisations, preying on vulnerable students who end up with large VET-FEE HELP tax debts. I will talk a little about a constituent in the Shortland electorate, Leah. I met with Leah's mother at one of my mobile offices and she told me the story of Leah. Leah received an ATAR score of 33 per cent, and so she enrolled at the University of Newcastle to improve her ATAR score—academically, not strong. While Leah was at the university—she was actually in the library—she received a phone call from Careers Australia. This is the organisation that I am going to talk about here—'The fastest way to a better job'. Well, it has not been a fast way for Leah. Leah was offered a double diploma in business and management. She thought a double diploma in business and management. She thought: 'That sounds reasonable.' This is a double diploma in business and management for a young person who had a very, very low ATAR score and who needed to improve her academic achievement before she could enrol in something at that level. Ten minutes later she received another phone call from them, from which she understood that the government was covering the cost of the course and that it was going to be an online course. She was directed to a link to sign up online while she was sitting in the library. When signing up to this diploma, Leah was not informed about the debt that she would incur to the tax office, the full costs associated with the course, how FEE-HELP would affect her financial life later or what the sets of data were or what they meant.

Leah submitted her first assignment three times and did not receive the competency. Until she received her first letter indicating that she had incurred a cost for the first part of the course, she was not aware of this aspect of the implication of signing up. She then brought it to her mother's attention. She felt that she had been taken advantage of and that she did not fully understand the system. The process to sign up was quick and she thought it was a government paid course. She did not have any time to see what was involved in the study or to assess her ability to achieve the competencies it required. Regardless of her academic level, through the whole process the cost was not explained to her properly. Her mother has written to Careers Australia explaining this and is still waiting for a response. At the moment her total debt is $16,787.97 and she does not have any competencies. Instead, what she has is a large debt, and her opportunity to find employment has not improved at all.

That is the type of situation that this legislation is addressing. We on this side of the House have a strong record on helping students and workers to get the skills that they need. I am a particularly strong supporter of school based apprenticeships and apprenticeships within my local community.

FEE-HELP was a direct result of a Howard government initiative in 2007 and commenced in 2009. We established a national regulator—the Australian Skills Quality Authority—and in 2012 increased coverage of VET-HELP to diplomas and associate diplomas. We acknowledge there is a role for them, but the thing is that they have to be properly monitored. That is what I would argue strongly has not been happening. The Australian Skills Quality Authority, ASQA, regulates RTOs. It says that it has received 4,000 complaints and conducted 3,000 audits since it was established in 2011. It needs to be strengthened. It needs to have more power and greater authority, as is set out in the amendment by the minister.

There are more than 4,500 private training colleges in Australia. The number has grown exponentially since this government came to power. The government has allocated $68 million to clean up the industry, but it has also cut in other areas. So whilst it has given lip service to addressing this issue I do not think that this government's performance in this area has been nearly strong enough. There have been 350 colleges cancelled, suspended or refused registration. In addition to that, we have report after report of issues such as childcare centres blacklisting accredited training organisations because they provide poor training to enrolled students. There are industry cowboys providing quick, dirty services. There are students saying that teachers forget to teach half the content of courses. There has been action, as I mentioned, against hundreds of providers. Unions have called for a national inquiry into training. I must say that I feel that, from everything I have read, that is something that needs to happen. In Victoria the situation has been particularly bad. I know that when the new minister for education and training took office he was horrified at the extent of the problem.

But what really concerns me is that in its minibudget this government is cutting $200 million in important skills funding. It has cut $66 million from Support for Adult Australian Apprentices and slashed over 10,000 training places from the Skills for Education and Employment program. The Support for Adult Australian Apprentices program was put in place to remove barriers to completing an apprenticeship and to encourage upskilling for adult workers. Unfortunately adult apprentices are now in an unenviable position because of the cuts to programs. It has been a devastating blow to adult workers. This is added on to the 2014 cuts of almost $2 billion.

The Abbott government has also axed $43.8 million from the Skills for Education and Employment program. That funding was for over 10,000 places in training programs that help job seekers who have poor literacy and numeracy skills bring their reading, writing and basic maths skills up to speed. That is very important if you are going to be seeking employment. The government does not understand how hard it is for somebody with poor numeracy and literacy to keep a job or how hard it is for somebody with poor literacy and numeracy skills who is unemployed to find a job. This government does not have a plan to help people find a job; rather, it has a plan to extend their training to private providers, and that will lead to more young Australians ending up with debts.

At the commencement of my contribution to this debate I indicated that I would refer to the New South Wales government. The New South Wales government has been privatising vocational education through funding policies such as Smart and Skilled, which came into effect on 1 January. My office and I have received many complaints, and we receive them because there is no point going to the office of the state member. He was a Liberal Party member but now he is an Independent after his appearance at the New South Wales ICAC. This policy has led to cuts in programs, it has led to cuts in specialist positions like disability support workers in TAFE, and it has led to a decline in vocational education through the TAFE system.

Premier Baird has attempted to divert attention from the state government's Smart and Skilled policy to privatise TAFE. It is designed to take money out of TAFE and hand it over to private for-profit organisations, when the Baird government has already slashed TAFE funding and TAFE courses, has sacked teachers and support staff and has increased fees. The New South Wales election will be held next month and voters will have a chance to say no to the Smart and Skilled program. Labor does not support the Liberals' Smart and Skilled privatisation program and have committed to scrapping it, TAFE fees will be frozen at 2014 levels, indexed to inflation, and a 30 per cent cap will be placed on the amount of public funding contestable by private operators.

The unfortunate thing is that whenever a Liberal-National Party government is in power it impacts upon the students and it impacts upon the public sector—it diverts money from the public sector to the private sector. There needs to be proper monitoring of the private sector, but they do not include that in their privatisation push. The Liberal Party and the National Party are the parties of privatisation, and in New South Wales this has been exhibited very clearly. The people of New South Wales have a very clear decision to make at the end of this month.

Ann Sudmalis (Gilmore, Liberal Party) Share this | Link to this | Hansard source

Australia's work and training relationship needs quite a shake-up. There was a time where our gender determined the stream of training subjects that we were directed towards. This week we celebrate International Women's Day, and it is significant that we as women are no longer directed towards secretarial studies or home-maker courses; in fact, girls these days, thankfully, can pretty much take on any career choice they want. Our youth can choose from a huge career range.

Whilst many of us have successfully aimed for and achieved a degree or other qualification at university, young men and women, also people choosing to change careers, can attend a different, often more practical, application of education learning. We call this, in general terms, vocational education and training. Our Australian scheme is envied in many places around the world as a quality alternative educational pathway. In recent years, we have finally begun to re-realise that our vocational education is not only desirable but absolutely essential. Following this recognition, as we developed several areas of skills shortage past governments scurried to shore up the gaping holes in our skilled labour force. Rather than the slow, steady, methodical approach that was needed, there was a frantic process of registration of a number of organisations that supposedly offered training, education and qualifications. While this superficially looked to be the solution pathway, many of these training organisations did not train and many students could barely grapple with the English language, so education was 'off the whiteboard' and, as for qualifications, they were not worth the certificates printed. Businesses were crying out for tradespeople, students really did want a recognised and full qualification and the government wanted a return on its investment dollar.

Over recent years, various attempts have been made to remedy the situation, without a lot of success, hence the need to introduce the National Vocational Education and Training Regulator Amendment Bill 2015. This bill will improve the quality of the VET system and help the Australian government to create new quality standards in order to quickly address problems with VET providers or VET courses, and require anyone marketing a VET course, including brokers and other third parties, to clearly identify which registered training organisation is providing the qualification. It will also extend the registration period for RTOs from five to seven years, which will help the national training regulator, the Australian Skills Quality Authority, to focus its attention on investigating and acting upon high risk and poor quality providers. At first I was a little unsure of this extension but on talking to some of my fair dinkum RTOs it makes perfect sense—more time for them to just concentrate on getting great results for their students, rather than fussing around with paperwork, which in turn means more time for ASQA to check out the other RTOs.

In 2012, the original standards for ASQA were put in place. The standards are the instrument ASQA uses to ensure nationally consistent, high quality training and assessment across Australia's VET system. Compliance with the standards is a requirement for all ASQA-registered training organisations, but these standards have not always been met. The standards describe the requirements that an organisation must meet in order to be an accredited training provider in Australia. Training must be delivered by a training provider meeting industry requirements, as set out in the training package or accredited course, and it must have integrity for employment and further study. Also, training providers have to operate ethically and consider the needs of both their students and industry. However, there have been some pretty significant problems, so some major reforms had to be put in place: new standards for new RTOs from 1 January this year and for existing RTOs from 1 April. The standards strengthen the requirements for RTOs and third parties acting on their behalf, including the requirement to advise prospective and current students of any debts and government subsidies before they actually sign up to a course.

Often, for a government to create new standards, negotiations must take place with all the states and territories and approval must be secured from the ministerial council. But this can take around 12 months—way too long for the current problems, with unethical RTOs giving great RTOs a bad name. As a consequence, a quality standard has been devised and is introduced with this bill. Essentially, this will give the Commonwealth the equivalent of emergency powers to address known and emerging quality issues that compromise student and, eventually, industry interests and the quality of outcomes. It will also give industry and individual states or territories a direct avenue to the Commonwealth for action to urgently address issues of concern. In addition, these stakeholders will be part of the development of the quality standards. The Australian government will consult with employers, training providers and the state and territory governments to deliver the new quality standard within weeks.

The quality standard will be a condition of registration for RTOs. This also provides government and registered training organisations with the ability to respond far more rapidly to emerging issues than the current structures allow, sending a clear signal that, when required, the government can take action against those who are undermining the quality of the training sector.

These new standards also apply to the type of training in the information that must be provided to prospective students, including VET FEE-HELP loans, state entitlements and subsidy arrangements they sign up to. It must be absolutely clear to all students what they are signing up for, every single time their debt level is about to increase. The standards also make it clear that registered training providers are ultimately responsible for services delivered on their behalf by brokers, including that these third parties have to have a written agreement.

This measure of third-party notification has come about in direct response to the negative impact of marketing by such parties in the training sector and, in particular, the VET FEE-HELP market. There are a number of young students who are terribly confused about what their load currently is. A potential vocational student should be able to clearly identify the registered training organisation responsible for the qualification they expect to get. Under the proposed amendment, ASQA will be able to pursue anyone, not just training providers, who does not make it clear who is actually responsible. In line with this amendment, the bill will also clarify the coverage of 'person' to include organisations that are constitutional corporations, for coverage of civil penalty and offence provisions in part 6 of the act, so ASQA can take action.

To improve the effectiveness of ASQA in dealing with unscrupulous practices, this bill makes a suite of administrative amendments. Currently, the act only allows the regulator to request information from a regulated registered training organisation, which kind of defeats the purpose. ASQA cannot request information from a person or an organisation that is pretending to be an RTO. Another improvement is gained by amending the definitions of vocational education and training information so ASQA can share that information wherever necessary. Some changes are as simple as terminology changes, like from the Australian Quality Framework, a very current Public Service term, to the more user-friendly VET Quality Framework.

ASQA has advised the government that renewal, or re-registration, audits are the least effective method of identifying poor-performing providers, leading to less sanction activity than other types of audits. Extending the registration period will enable ASQA to redirect its resources from re-registration audits to more-targeted and random investigations and audits which will actually find the providers who are doing the wrong thing.

In doing so, the bill brings registration for RTOs into line with current registration under the Tertiary Education Quality and Standards Agency, TEQSA. With a number of providers offering both higher education and vocational education and training, this will mean that the process is duplicated across them rather than having two separate processes. Finally, a system where the standards make training providers responsible for their services delivered by brokers is a much better checking system.

The government is so serious about making sure this works that there is an allocation of an additional $68 million over four years to allow ASQA to really enforce these standards. This is a complete change, managing risk to our students and their education, as opposed to the policies of those on the other side that caused ASQA to spend time and resources on cost recovery rather than checking up on dodgy RTOs.

As part of this suite of changes, there is also a new National Training Complaints Hotline. On 19 January 2015, we launched this National Training Complaints Hotline—and it has actually been a 'hot line'. It is a joint initiative with the states and territories to provide a single point of contact to make it easier for complaints to be heard and actioned. Gilmore residents can call 133873, email skilling@education.gov.au or visit the training complaints website.

The government is looking at further action to crack down on inducements such as 'free' iPads or cash rebates, and increase the duty-of-care provisions for training providers to keep when they sign up a student, make sure that the student loan is actually spelt out and address single-unit qualifications where the full loan amount is levied up-front. That is totally inadequate, and we must address this.

The rapid expansion of VET FEE-HELP in the last few years and its misuse by providers is a direct result of Labor's failure to properly administer and implement the program, failure to establish a strong compliance regime and failure to protect these vulnerable students and taxpayers from unscrupulous training providers.

You might wonder, Deputy Speaker Broadbent, what else this government is doing to support vocational education and training. We are going to provide almost $6 billion this year in support of vocational education and training through direct funding for programs, support to the states and territories, and student loans. We have introduced the new trade support loans, which is up to $8,000 in the critical first year, up to $20,000 over four years, with almost 16,000 of these already taken up in the first six months of offer.

There is a new Australian Apprenticeship Support Network, to start 1 July this year, to cut red tape and improve apprentice commencement and completion. This will offer tailored support to Australian apprentices and their employers from pre-commencement to completion, entry-level screening and testing to ensure assisted apprentices find the right training pathway and are well matched to their employer. How many times do we hear about a young person going into the wrong career and being stuck there? This individual case management and mentoring will be available to those at risk of noncompletion. The $476m industry skills fund will be a key component of the government's Industry Innovation and Competitiveness Agenda. It is absolutely critical. Most importantly, as part of this entire initiative the government is conducting a full review of training products in the VET system.

There will of course be more reforms, following periods of consultation that occurred in the first part of 2015. One initiative as a result is the introduction of the vocational education in schools framework, preparing our secondary students for work. A second series of national VET reform consultations hosted by the VET Advisory Board was held throughout January and February, and the results will be taking into consideration by the government when rolling out reforms. As part of the broader reform of training packages, the government is moving to a more contestable model for training package development and maintenance from 1 July 2015.

The coalition worked with all stakeholders to review and revive the vocational education in schools framework, to help our students get the right training for the right place, the right job and the right employer. Updated for the first time in more than a decade, the framework marks the start of an exciting phase for students who choose to pursue a vocational pathway to their preferred career and for those who develop and implement VET programs in our secondary schools. Elevating the status and quality of the vocational pathway is critical for the skills audit that we need in our nation. Throughout 2015 we will be working with the schools involved and other stakeholders to establish the curriculum, recruit year 9 students who will join the recently announced P-TECH for year 10 in 2016 and engage industry partners. These concerns emphasise the study of science, technology, engineering and maths, all extremely important and absolutely dear to my heart. Over the next four years we have also budgeted $1.9 billion in loans to apprentices under our Trade Support Loans, $1.79 billion in apprenticeship incentives, $1 billion for adult migrant English and so on. We are actually getting on with the job of investing in our students.

As part of the inquiry into TAFE education we saw examples where dodgy RTOs have been allowed to flourish at the expense of well-known and well-respected TAFEs. The Labor Party say they are the friends of TAFE—really? When you allow unchecked, unaudited, non-compliant organisations to expand exponentially while TAFEs and very effective private RTOs are struggling to survive, I have to question the value of Labor's friendship. In fact it is more a case of: with friends like that, you don't need enemies.

To conclude, Labor failed to support training, but I would like to congratulate the member for Cunningham for the introduction of this amendment. It is really just a shame that it did not come about in the last government, as so many students now have difficulties that they will have to deal with in the future. I congratulate the member for Cunningham for bringing this forward, because it addresses the issues that developed, and they needed to be addressed. Now we have a bipartisan approach to look out for the betterment of our students, our industry and their training.

Andrew Giles (Scullin, Australian Labor Party) Share this | Link to this | Hansard source

I rise to make a contribution to the debate on the National Vocational Education and Training Regulator Amendment Bill 2015. I note that the previous speaker touched on the relationship between Labor and the TAFE sector. That was of course a very significant issue in the recent state election in Victoria, as you may well recall, Deputy Speaker Broadbent, as may the Parliamentary Secretary to the Prime Minister, who is at the table. There is no doubt in the minds of the Victorian community who the friend of the TAFE sector and, indeed, vocational training is. It is the Labor Party and it will continue to be.

The purpose of this bill is to amend the National Vocational Education and Training Regulator Act 2011 to protect the integrity of the VET system and to give the regulator capacity to respond to emerging issues. It also makes some technical amendments designed to improve the efficiency and operation of the act and consequently the regulator. The bill would also extend the period of registration able to be granted by the regulator from five to seven years.

I note that the member for Cunningham has moved a series of amendments to this bill which would have the effect of amending the proposed registration period so that the extension from five to seven years would be granted only to existing low-risk providers at renewal of registration. It is a sensible amendment, which I support. The further amendments introduced by the member for Cunningham are similarly sensible and worthy of the support of all members of the House in so far as they call on the Australian government to act with greater urgency to ensure that the protection of students is prioritised—that is a matter that many contributors to this debate have touched upon—to immediately seek a consumer protection information campaign through the ACCC, including advice for people who need to seek redress, and consider other mechanisms which might be available to strengthen consumer protections, and also to support Labor's vital call for the Auditor-General to conduct an audit on the use of VET FEE-HELP.

A little bit of context is important in this debate. When we debate the future of vocational education and training we need to think about the present high unemployment rate, particularly the high youth unemployment rate. We also need to acknowledge the very significant cuts that have been made to a range of relevant programs that are denying people access to the training that they need.

In recent weeks we have seen a spate of disturbing media reports and some powerful stories recounted by contributors to this debate. I think of the contribution by the member for Shortland, earlier, who detailed the travails of a constituent of hers. These reports are, I am sure, concerning to everyone in this place and highlight the importance of proper regulation and of the enforcement of that regulation. We have seen some shocking cases of exploitation, often of very vulnerable people. Indeed, just last night on 7.30 there was yet another story about a registered training organisation, Evocca College, allegedly doing the wrong thing. What is especially concerning about this story is that it is not about one of the so-called fly-by-night operations that we hear about from time to time. In fact, this is one of the largest registered training organisations in Australia. The ABC reported that Evocca College has a graduation rate of about 10 per cent despite claiming more than $290 million in government funding via VET FEE-HELP

The ABC's figures go on to suggest that, out of 38,000 students who signed up to its diploma courses in the past four years, only 2,000 were handed diplomas by October last year. There were over 16,000 students who officially cancelled and almost 4,000 who timed out of their courses. The college says about 15,000 are still on track to graduate. I was pleased to hear that the Australian Skills Quality Authority is investigating this college, although I note that the allegations contained in the 7.30 report last night were not matters it was aware of.

Last night's report featured a student, Dylan Palmer, who has Asperger's syndrome and is enrolled to study digital gaming at Evocca's Brisbane campus. It appears he was referred to the course by a friend who received $100 cash from Evocca, and Dylan received a free laptop. He now has a $27,000 VET FEE-HELP debt to go with it, and he still has not finished and is struggling to finish this course. This is, sadly, one example of many whereby RTOs have, it appears, actively targeted vulnerable members of the community. I note that other contributors to this debate on both sides of the House have highlighted these shameful practices. There have been a slew of stories in the media of this nature. They are deeply concerning.

I note that this bill will do nothing for Dylan and people in his situation as it does not address the damage to individuals that has already occurred or propose action to engage with the community to minimise future problems—hence the amendments moved by the member for Cunningham. The actions of unscrupulous RTOs and their brokers have had serious impacts on vulnerable people. The reports of people being left with large debts and no qualifications or useless qualifications, as we have heard in this debate, must be addressed. The government must act with greater urgency to ensure the protection of students is prioritised.

But we have heard instead the minister and government members continue to blame Labor for supposedly allowing RTOs to behave in this manner. I note, in passing, that this government has now been in power for 18 months, as we await the beginning of good government, but still blames the Labor Party for everything. What did the former minister, who is now, rather ominously, the Minister for Health, do on her watch? Very little, it would appear. Those opposite conveniently forget that it was the Howard government that extended the use of FEE-HELP to include the VET sector for approved diploma and advanced diploma courses. It is true that VET FEE-HELP commenced in 2009 and that Labor amended the legislation in 2012 to increase the coverage to all diplomas and associate diplomas and also conducted a trial to extend VET FEE-HELP to cert IV courses; but it is also true that, in order to maintain quality in the VET sector, in 2011 Labor established a national regulator, the Australian Skills Quality Authority. When the Howard government first extended the use of FEE-HELP to VET, it should have done what Labor did in government and establish the regulator—appropriate regulation for a sector in receipt of very large sums of Commonwealth funding. In government, Labor had to react to a situation that had already begun to show signs of problems arising, in large part, from major changes to the VET market in Australia. This is why those RTOs that are doing the right thing will benefit from greater oversight and accountability in their industry—it is in their interests as much as the general public's for these cowboy operations to be reined in.

There is a bigger issue here that needs to be discussed, and that is the orthodoxy of allowing a totally deregulated marketplace to operate unfettered by government oversight but accompanied, of course, by much government largesse, where the only real winners are those RTOs who get money regardless of the education they provide and regardless of the outcome for students. What we have seen is fees go up and quality go down. I am very grateful for the work that has been done on behalf of the Australian Education Union in research into just how much money some RTOs are making, despite the limited information that is available.

Those opposite will no doubt continue to trot out their ideological world view that the market will respond negatively to dodgy operators and that those that provide a good quality education will prosper. But I ask members opposite: how is that going? We have had more competition but, oddly enough, vastly increased profits—extraordinary levels of profit. This does not add up until you look at the lack of quality being delivered by so many RTOs.

Mr Tudge interjecting—

It is pretty clear where they are making their super-profits. I am very glad that Labor introduced a regulator to oversee this industry, but now it is time for this government to stop being an opposition in exile and start acting appropriately to address all of these matters.

I note for the benefit of the parliamentary secretary that this is occurring in Victoria under the Andrews Labor government, which recently announced a review of quality assurance in Victoria's VET system. This will feed into the Mackenzie review, which is anticipated to recommend a model of sustainable, high-quality training right across the training sector. This year the Victorian Registration and Qualifications Authority will conduct regulatory campaigns targeting specific qualifications and occupations and will be on the lookout for inadequate supervision, work or duties that do not match the qualification an apprentice is enrolled in and employers who do not release apprentices to attend training or pay them to attend training. Once again, Labor is setting an example of what to do. I remind the House that in Victoria we had four years—four long years—of a coalition government engaged in brutal TAFE funding cuts and issuing carte blanche to RTOs. Frankly, judging from what I have heard from constituents and what we all see in the media, it has been a mess for many students, taxpayers and the community more generally. This was, of course, a major issue in last year's state election right across Victoria but also locally, with the sell-off of the Greensborough campus of NMIT and the overall starving of funding to these providers in Melbourne's north being very major issues.

This is not limited to Victoria. Nationally, the regulator has cancelled, suspended or refused registration for 350 colleges. The reports we have been discussing in the course of this debate suggest that this is just the tip of the iceberg.

It is worth asking the question: what is wrong with supporting TAFE more effectively, as this government presses on with extending very, very significant Commonwealth subsidies to higher education private providers? I anticipate that those opposite will make the point that TAFEs are a state government responsibility—and of course they are—but, when students of private operators are allowed access to large Commonwealth government backed loans, the TAFE system and its integrity are under threat. This is because the standards and qualities of TAFE are generally much higher than many RTOs, meaning that in many cases, again, the costs are higher too. I just do not accept the furphy that private operators, through sheer competitive force, have driven costs down. The evidence is not there to support that in any event. The only thing which has been driven down is quality, and that is something we will all pay for. Unfortunately, we have seen less and less money spent on a per-student basis while RTOs prosper—prosper to an extraordinary degree. Surely, it is not in the interest of students that this continues.

I referred, briefly, to work done on behalf of the AEU looking at the profit and practices of a range of RTO operators. In considering the structure of vocational education and training in Australia, we would do well to return to the objectives that were set out in the 2012 National Partnership Agreements on Skills Reform, which included improving training accessibility, affordability and depth of skills; encouraging responsiveness in training arrangements; assuring the quality of training delivery and outcomes; and providing greater transparency through better information to ensure consumers can make informed choices and governments can exercise accountability. This bill, of course, goes some way to achieving these objectives, but it was too little and too late. The amendment moved by the member for Cunningham obviously picks up on some of these issues.

What is at stake for students? We are seeing more and more students, in this sector, loaded up with debt they will never repay, and often with qualifications that will not get them a job. I mentioned Dylan Palmer earlier in my contribution. It is worth noting that Dylan is still keen to finish his course, but his disability makes this difficult. That Dylan travelled three hours a day to attend his course in Brisbane is a strong indication of his dedication. Students like Dylan are not at fault here. There is not an independent source of information where they can find out beforehand about the provider, the course on offer, or the likely job prospects.

Increasingly, the prospective and current students that RTOs are targeting are not sophisticated consumers. They do not speak English, they may have a disability, and, in many cases, they are financially illiterate. That VET students have access to VET FEE-HELP loans is problematic at many levels. This encourages the RTOs to advertise, 'Study now, pay later.' However, FEE-HELP loans were originally designed for university students with the fees and loans being calibrated at the likely lifetime earnings of a university graduate. This has very limited application to many of the VET courses being provided—in particular, in fields of endeavour like child care. I ask: where is the equity in this approach? It is not something which is readily transferable. The vast majority of graduates of RTOs simply will never earn sufficient money to pay these loans back. This dashes the dreams, confidence and aspirations of these students to engage positively in our community.

It does not stop with the individual students. Taxpayers are also the losers in this situation, as we are all left with a bad debt that will not be repaid. The Grattan Institute's recent research puts these bad debts at 40 per cent. I would not be surprised if it turned out to be higher. More broadly, we end up with a society where unemployment remains high because the training does not meet the needs of today's labour market, much less the needs of tomorrow's labour market. So, we have, in this environment, a very small group of winners—big winners—with the current system. And then there is the rest of us—students and the community at large—picking up the tab for years to come. So much for intergenerational fairness.

Education remains one of Australia's biggest exports. We, have a mostly good reputation, but this reputation is being damaged when dodgy RTOs are allowed to operate. I strongly support students getting a vocational education. It is essential we ensure RTOs are delivering the quality that we are all directly or indirectly paying for. It is what these students deserve and what Australia needs.

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the National Vocational Education and Training Regulator Amendment Bill 2015, which will act as this coalition government's next step towards ensuring Australians have access to high-quality vocational education and training or VET courses, high-quality providers of these courses and, by extension, a highly skilled workforce.

This is a sector which Australia as a whole cannot afford to let down, by allowing its reputation to be damaged by a few unscrupulous providers. Unfortunately, though, this is currently the case. Right now, a 15-year-old student who has decided that higher education is not for them, and who instead wants to pursue a VET course at TAFE or perhaps wants to attend an industry skills centre to gain qualifications, cannot be guaranteed to know which registered training organisation, RTO, is responsible for the qualification he or she is signing up to receive. This is a serious concern to me, and it should be a serious to all members in this place. It is a concern because, how can that student exercise due diligence in selecting the right course for them if they are not even sure that the qualification they will be handed upon completion is appropriately accredited, or that the course they are paying for will provide them with a level of skill appropriate to that course?

Many members in this place would know that I did not receive a tertiary education. I spent my time going through an apprenticeship as an electrician. Fortunately, 60 per cent of my family—the siblings—did get a tertiary education. My parents worked hard to stump up and pay for that education. There was no HECS available at the time, so it was paid for by my parents. I think that the VET training and apprenticeship schemes are as important today as they were back when I left school at the tender age of 16.

In that former life, I started off as an apprentice electrician earning $39 per week—back in 1974. Things have, thankfully, improved since then. I would highlight that it is through the work of this government that the rate of apprenticeship dropouts in Australia is slowly declining, and our VET skilled workforce is starting to once again feel secure and appreciated. This was something that was lacking through the six years of government by those opposite, when they established a VET-FEE HELP system but did not even bother to develop a dedicated compliance strategy.

In comparison, this government has introduced a range of measures to support vocational education and training, including providing almost $6 billion this year, to support VET through direct-funding programs. This includes the new trade support loans, which I have spoken about previously in this place. These loans will provide support of up to $8,000 in the first year to apprentices, and up to $20,000 over the life of a four-year apprenticeship.

The program was railed against by those opposite because we cut out a system that they had established. I know this system is attractive to a lot of young people. It is so attractive that my son took up an apprenticeship as soon as this scheme was announced and established, and he is now working as an apprentice bricklayer. He is working on new projects and new housing in the northern suburbs of Perth. This type of loan will help ensure that he is able to complete his apprenticeship without having to be concerned that he will not be able to afford rent or petrol for his car each week, or the necessary tools that he needs to renew or use during his time as an apprentice working on the tools.

I am sure that members can appreciate that, compared to my $39, I will not be keen to hear any excuses about him not being able to afford that tank of petrol. (Time expired)

Ross Vasta (Bonner, Liberal Party) Share this | Link to this | Hansard source

Order! It being 1.30 pm, the debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour and the member will have leave to continue his remarks at that time.