Brendan O'Connor (Gorton, Australian Labor Party, Minister for Skills and Training) Share this | Link to this | Hansard source

I move:

That this bill be now read a second time.

Today I'm introducing the National Vocational Education and Training Regulator Amendment (Strengthening Quality and Integrity in Vocational Education and Training No. 1) Bill 2024.

This bill amends the National Vocational Education and Training Regulator Act 2011, hereafter mentioned as the act, to support the integrity and quality of Australia's vocational education and training sector. It does this by strengthening and clarifying the powers of the national VET regulator, the Australian Skills Quality Authority, namely ASQA.

The bill empowers ASQA to take decisive action against the minority of non-genuine or unscrupulous registered training organisations. The bill targets those organisations that use their business operations as a veil of legitimacy for fraudulent activity, or to circumvent the regulatory requirements for the delivery and assessment of vocational education and training. The bill will enable ASQA to take swift action to deter and remove non-genuine or unscrupulous RTOs, and to apply greater scrutiny to new RTOs seeking to enter the VET sector.

The bill also provides for increases to penalties that ASQA is able to seek against RTOs for serious breaches of the act. The penalty units in the act have not been increased since the act commenced in 2011, and these changes are in the view of the government long overdue. This is designed to ensure that penalties in relation to unscrupulous or non-genuine conduct outweigh any financial gain to be had from that conduct.

The government is committed to supporting a high performing, reputable and trustworthy VET sector. The government recognises that this sector is critical to skilling Australians, creating career opportunities and pathways to secure work, as well as delivering the skills needed to drive the economy. This is demonstrated in the landmark, $30 billion, five-year National Skills Agreement between the government and state and territory governments that will provide the skills needed for a modern economy.

The bill represents the next step in the government's work to protect students and build the integrity and quality of our VET sector. It follows the government's $37.8 million investment to support ASQA's processes, as provided for in the 2023-24 Mid-Year Economic and Fiscal Outlook. This investment provides for an integrity unit within ASQA, significant upgrades to ASQA's digital and data systems, and the establishment of a tip-off line to detect and address unacceptable and egregious behaviour by RTOs.

Working with state and territory ministers, the government has also strengthened the fit and proper person requirements under the act, to apply increased scrutiny on those in management positions within RTOs. This change expanded the list of matters ASQA can consider when determining if a person is fit and proper, including a new power to consider conduct that suggests a deliberate pattern of unethical behaviour.

These changes are being made in parallel with work underway to revise the Standards for Registered Training Organisations. New RTO standards are being designed to drive integrity across the sector. These reforms will emphasise quality rather than baseline compliance and will make it more difficult for non-genuine or poor-quality providers to comply with the new standards.

The amendments in the bill respond to integrity and quality issues highlighted in a number of reviews dating back to 2018. These reviews made recommendations to ensure students from Australia and overseas who choose to access our VET sector can be confident in the high standard of education and training delivered. These recommendations include those made in the 2023 Rapid review into the exploitation of Australia's visa system, conducted by Christine Nixon AO, APM (known as the Nixon review), as well as those in the 2018 review entitled All eyes on quality: review of the National Vocational Education and Training Regulator Act 2011, conducted by Professor Valerie Braithwaite (known as the Braithwaite review).

The bill has also been informed by the 2023 report of the Joint Standing Committee on Foreign Affairs, Defence and Trade, entitled, 'Quality and integrity—the quest for sustainable growth': interim report into international education.

The bill also incorporates changes from the lapsed Regulator Performance Omnibus Bill 2022, to improve regulator efficiency and remove areas of legal uncertainty for regulated entities.

I turn now to the measures in the bill.

First, the bill enables the automatic lapsing of an RTO's registration where it has not delivered training and/or assessment for a period of 12 months, as recommended by the Braithwaite review. These provisions will apply to any RTO that has not delivered training and/or assessment for 12 consecutive months. This targets the integrity risks posed by dormant RTOs that are not demonstrating a genuine commitment to education and training delivery. For example, dormant RTOs that use their registration purely for on-selling purposes will be subject to an automatic lapsing of their registration, by force of law, where they have not delivered training and/or assessment for 12 months.

To ensure procedural fairness, RTOs will be able to seek an extension from ASQA in instances where the RTO has a legitimate, reasonable justification for the non-delivery of training or assessment. These extensions are for a maximum of 12 months and will only be granted where the reason the RTO has not provided training or assessments is demonstrably outside its control. Such limited circumstances could include, for example, natural disasters such as fire, flood, or pandemic events.

This measure applies to RTOs that have not delivered training and/or assessments for 12 consecutive months from 1 January 2023, in order to apply to dormant providers currently in the sector. For these RTOs, their registration will lapse on 1 July 2024 (or after 90 days following the day after royal assent, whichever is later). Those RTOs will be able to apply to ASQA for an extension 60 days before their registration lapses to demonstrate a legitimate, reasonable justification for the non-delivery of training or assessment.

Second, the bill will prevent an RTO from adding new courses to its scope of registration in the first two years of registration to manage quality risks to students, addressing a Braithwaite review recommendation. This will ensure newly registered RTOs are required to focus on delivering quality training and/or assessment in the segment of the market for which they were originally approved. It will also provide ASQA with the opportunity to assess a new RTO's operations over a reasonable period, to ensure a new RTO has a sound understanding of the educational integrity and commitment required to operate in the sector, prior to expanding its course offerings.

Third, the bill expands the period within which the regulator can conduct an internal review of decisions. This ensures ASQA can give due consideration to complex or high-risk review decisions.

Fourth, the bill gives ASQA greater discretion in terms of how it prioritises, considers, and makes decisions in relation to applications for initial registration of an RTO. This ensures registration applications can be prioritised, such as where reputable applicants propose to deliver courses in areas of skills shortage or where there is community need. It will also enable ASQA to decide simple applications quickly and efficiently, while applying appropriate scrutiny to complex or high-risk applications.

Fifth, this bill empowers the minister responsible for VET to determine a specified period where the regulator is not required to, or must not, process or accept initial applications for RTO registration. This determination must be made in consultation with ASQA and with the agreement of state and territory skills ministers.

This determination could be used by the minister where ASQA identifies a trend in applications by non-genuine or unscrupulous providers seeking to enter the VET sector, for reasons other than a genuine commitment to delivering quality training. The determination could also be used where ASQA has received a considerable influx of applications, and the number of applications means that granting them would have a deleterious effect on the integrity, health and quality of the VET sector. The determination may apply to one or more classes of applications. This will permit ASQA to target specific cohorts of RTO applicants that pose a risk to the sector, without disrupting the acceptance and processing of other applications for registration.

Sixth, the bill improves student protection by expanding offence and civil penalty provisions to cover a broader range of false or misleading representations by RTOs about their operations. This clarifies that ASQA will be able to consider broader activities that relate to a non-genuine or unscrupulous RTO's business operations, including where it publishes false and misleading descriptions about its training, or misleading images of delivery locations, premises, and facilities. It would also prohibit the publication of false testimonials. These provisions will remove impediments to ASQA taking decisive action in response to RTOs that seek to mislead students with false representations and false advertising.

Applying tougher penalties to egregious RTO behaviour is imperative to support integrity in the VET sector, and to deter those that currently see penalties as a risk worth taking, or a 'cost of doing business'. The bill increases the maximum penalty for many of the offence and civil penalty provisions in the act five-fold. Currently, maximum penalties for affected offences under the act range from $9,390 to $187,800. These amendments mean those penalties will now range from $46,950 to $939,000 under current penalty unit values. These increases are focused on the offences and civil contraventions which threaten VET integrity, student protection and are otherwise indicative of practices that may be associated with non-genuine or unscrupulous providers.

Finally, the bill supports effective regulation through a number of technical and administrative changes.

Measures previously introduced in the lapsed Performance Regulator Omnibus Bill 2022 further support efficient regulation by clarifying the use of personal information contained in audit reports, aligning registration requirements with similar requirements under the Education Services for Overseas Students Act 2000 (the ESOS Act) and clarifying review processes to better align with the internal review process in the Tertiary Education Quality and Standards Agency (TEQSA) Act 2011. This will ensure streamlined interactions for entities regulated by both TEQSA and ASQA under the ESOS Act.

The measures in the bill, combined with the steps already taken, demonstrate the government's commitment to lifting integrity and delivering quality outcomes for those who access our VET sector.

The bill supports the majority of providers—those who are genuine, who are doing the right thing, providing excellent education and training, and are in the business of doing it for the right reasons. They, along with students, industry and the whole Australian community, will benefit from the removal of non-genuine and unscrupulous providers, who undermine integrity and trust in the VET sector.

A well-regulated and trusted VET sector will strengthen Australia's ability to ensure our skills and training workforce needs are met now and into the future.

I commend the bill to the chamber.

Debate adjourned.