Bills Digest no. 41,
PDF version [832KB]
Social Policy Section
The Bills Digest at a glance
Structure of the Bills Digest
Purpose of the Bills
Structure of the Bill
A complicated policy landscape
The legislative framework
The regulatory space
Program and funding flows
Australian government programs
State and territory government
Policy design and responsibility
The VET FEE-HELP Scheme
Reforms to expand the VET system
Emerging issues with VET FEE-HELP
Government responses and further
A new model for VET FEE-HELP
Senate Education and Employment
Senate Standing Committee for the
Scrutiny of Bills
Policy position of non-government
Position of major interest groups
Statement of Compatibility with Human
Parliamentary Joint Committee on
Key issues and provisions
The unclear purpose of VET
Approved course providers
The design of the VET market
The use of listed providers
VET and higher education
The effectiveness of regulation
A new regulatory regime – more of the
Inputs and outcomes
Administrative complexity and the VET
The cost of education
The cost to government
Table 1: Fees and loans time series
What now for the VET FEE-HELP model?
Date introduced: 13
House: House of
commencement details see page 5 of this Digest.
Links: The links to the Bills,
their Explanatory Memorandum and second reading speeches can be found on the
Bills’ home pages for the VET
Student Loans Bill 2016, the VET
Student Loans (Charges) Bill 2016, and the VET
Student Loans (Consequential Amendments and Transitional Provisions) Bill
2016, or through the Australian
When Bills have been passed and have received Royal Assent,
they become Acts, which can be found at the Federal Register of Legislation
All hyperlinks in this Bills Digest are correct as
at November 2016.
The Bills Digest at a glance
What the Bills are
This Bills Digest relates to three Bills being:
- the VET Student Loans Bill 2016 (the Student Loans Bill)
- the VET Student Loans (Consequential Amendments and Transitional
Provisions) Bill 2016 (the Consequential Amendments Bill) and
- the VET Student Loans (Charges) Bill 2016 (the Charges Bill)
- The Bills result from a 2015 policy commitment to reform the VET
FEE-HELP scheme. The administration and fiscal sustainability of VET FEE-HELP
has been subject to criticism and media attention since 2014.
- The Student Loans Bill is based around three concepts: that of
the eligible student, the approved course, and the approved
course provider. These are intended to ensure that vocational education
and training (VET) student loans are directed to those students who are most
likely to benefit from financial support.
- The Minister will be able to set a loan cap for each eligible
course, limiting the amount of financial assistance the government is able to
offer eligible students in these courses.
- VET student loans will be treated as FEE-HELP debts in line with
the existing Higher Education Loan Program (HELP) under the Higher Education
Support Act 2003. Students will be required to repay their loan debts
through the taxation system when their income reaches a set HELP threshold.
- To improve the oversight of the scheme, the Student Loans Bill grants
monitoring and enforcement powers to the Department of Education and Training
that are more extensive than those under the existing VET FEE-HELP scheme or
other HELP loans schemes. A civil penalty regime will also apply in cases of
- TAFE Directors Australia and the Australian Council for Private
Education and Training have expressed concerns that the new regulatory requirements
will lead to students missing out on education. This may be because a student’s
chosen course or provider is not approved for loans under the scheme, or
because the student will not be able to afford the out-of-pocket fees above a
capped loan amount.
- Consumer law advocates believe that the transitional measures do
not go far enough to support students who have incurred a loan debt under the
VET FEE-HELP scheme due to inappropriate provider behaviour.
- The Senate Education and Employment Legislation Committee encouraged
the Minister to take into account the various stakeholder concerns on the broad
use of legislative instruments in implementing the VET student loans scheme.
The Committee also recommended the government establish a VET Ombudsman to
better protect students from fraudulent provider behaviour.
- It is unclear whether the additional regulatory requirements
under the new VET student loans scheme will be effective in ensuring
appropriate provider behaviour and lead to better student outcomes. Existing
regulatory powers under the VET FEE-HELP scheme seem to not have been used
- The specific requirements for VET student loans may complicate
administration for providers who offer a variety of student loans both under
the existing HELP loan scheme and the new VET student loan scheme.
- The new VET student loans scheme does not address the issue that many
VET graduates have relatively lower incomes. This may mean that repayment could
take an extended period and the default rates may be high. Overall, this means
the cost to the taxpayer of the program may continue to be considerable.
Structure of the Bills Digest
Through 2015 and 2016, there have been extensive attempts
to reform the VET FEE-HELP program, ensure appropriate provider behaviour and
contain the cost to government. Many of the provisions in the current Bill are
based on settings in the existing VET FEE-HELP program. As a result, this Bills
Digest should be read in conjunction with the Bills
for the Higher
Education Support Amendment (VET FEE-HELP Reform) Bill 2015.
This Bills Digest will focus on the effectiveness of the
2015 and 2016 reforms in considering the introduction of a new student loan model
through this package of VET student loans Bills. The Digest uses VET FEE-HELP
as a starting point for comparison with the proposed new VET student loans
The VET Student Loans Bill 2016 and the VET
Student Loans (Charges) Bill 2016 commence on 1 January 2017.
Sections 1 to 3 and Schedule 2 of the VET Student Loans
(Consequential Amendments and Transitional Provisions) Bill 2016 commence
on Royal Assent. Part 1 of Schedule 1 commences at the same time as the VET
Student Loans Bill 2016. Part 2 of Schedule 1 commences at the later of the
commencement of the VET Student Loans Bill 2016 or immediately after the
commencement of the Higher Education Support Legislation Amendment (2016
Measures No. 1) Bill 2016. It does not commence at all if both these Bills do
The VET Student Loans Bill 2016 (the Student Loans Bill)
establishes a new income-contingent loan scheme (VET student loans) for
eligible students undertaking specified vocational education and training (VET)
qualifications at approved providers.
The VET Student Loans (Consequential Amendments and
Transitional Provisions) Bill 2016 (the Consequential Amendments Bill) amends
existing legislation to grandfather the current VET FEE-HELP loan scheme,
transition existing VET FEE-HELP providers to the new scheme, and allow more
information sharing between existing government agencies in order to improve
administration of VET student loans.
The VET Student Loans (Charges) Bill 2016 (the Charges
Bill) sets out a charge to be levied on approved VET providers as a tax.
of the Bill
The Student Loans Bill is made up of 10 Parts:
1 sets out preliminary matters, such as commencement, objects of the Bill,
2 details the circumstances in which the Secretary of the Department of
Education and Training may approve an application for a VET student loan
3 specifies the conditions under which VET student loans must be paid and
4 specifies how a VET provider may become approved to offer VET student
loans to its students
5 specifies other requirements which are to be placed on providers approved
to offer VET student loans
6 specifies how FEE-HELP balances under the VET student loans scheme are to
7 specifies what decisions under the VET student loans scheme are to be
considered reviewable decisions and how any review can be undertaken
8 specifies the regulatory powers granted to agencies to monitor the VET
student loans scheme
9 specifies the ways in which information disclosure under the VET student
loans scheme can be authorised and what offences apply when this power is
10 specifies general administrative provisions.
The Consequential Amendments Bill is divided into two
Schedule 1 of the Consequential Amendments Bill
deals with the substantive changes to relevant education legislation and is set
out in two parts:
Schedule 2 of the Consequential Amendments Bill
details transitional provisions to allow existing VET FEE-HELP providers to
become authorised as approved course providers under the new VET student loans
The Charges Bill has one Schedule which provides a
framework for the imposition of a charge on approved providers. Details of the
charge will be set out in regulations.
The regulation of the VET sector in Australia and the
administration of the VET FEE-HELP scheme have been subject to much
parliamentary and public debate and activity over the past decade. This Bills
Digest provides key background information and an update on developments since
the most recent reforms passed the Parliament in November 2015.
Emerging out of each state and territory’s separate trades
and training regimes, the current VET sector is governed by a myriad of
legislative frameworks, regulatory agencies and funding streams across
different levels of government and different jurisdictions.
This complicated and fragmented policy landscape makes it challenging to
address systemic issues with VET such as improving provider quality and student
attainment. These structural barriers should be kept in mind when considering
the effectiveness of policy reforms such as VET student loans.
At a federal level, the legislative framework for VET
consists of three key pieces of legislation:
Each Act creates separate application processes, often
administered by separate Australian Government agencies and under different
legislative requirements, in order to be granted status as a registered
training organisation (RTO), approved to offer a HELP loan, or appear on the
Commonwealth Register of Institutions and Courses for Overseas Students
VET regulation is complicated, due to the federal system
of powers and responsibilities inherent in the Australian Constitution.
Education is not explicitly listed as one of the areas on which the Federal
Parliament has power to legislate under section 51 of the Constitution.
Accordingly, education has been regulated primarily by the states and
New South Wales, Queensland, South Australia and Tasmania
have referred power to the Commonwealth to enable it to enact national
legislation dealing with VET matters.
Victoria and Western Australia chose not to refer their authority for VET
matters to the Australian Government as part of the establishment of ASQA in
2011. Instead, they kept their own separate regulators. As a result, ASQA
undertakes the following activities:
regulation of RTOs in all states and territories save Western Australian and
Victoria, except where RTOs based in these jurisdictions offer training to overseas
students or students in ASQA’s referred jurisdictions, the Australian Capital
Territory or the Northern Territory
regulation of English-language courses for overseas students except where the
provider is a school or a higher education provider and
regulation of accredited VET courses.
ASQA indicates on its website that it confers with the
state-based regulators in Victoria and Western Australia, and formal mechanisms
such as memorandums of understanding and communication protocols exist to support
a collaborative regulatory environment.
Multiple VET programs exist across Australia, with
multiple funding flows. This is in comparison to the relatively unified system
of higher education funding under the Higher Education Support Act 2003.
Based on the recipient and the mode of funding, VET
programs can be categorised in three ways:
to subsidise VET training at given providers. This is delivered either:
intergovernmental agreements to states and territories (and so comes indirectly
from the Australian government) or
through state and territory programs
to offset any remaining fees for VET students. This is delivered either:
student loans such as VET FEE-HELP and the new VET student loans program or
fee waivers in line with state and territory program criteria
to achieve particular targeted VET outcomes. This may include support for
underrepresented student groups, or limited measures to improve provider
quality or student attainment. This is delivered either:
intergovernmental agreements to states and territories (and so comes indirectly
from the Australian government)
Australian government programs or
state and territory programs.
At a federal level, the majority of funding is delivered
not through legislation, but through intergovernmental agreements. These are
designed to assist states and territories with the costs of running their own
VET programs, in line with certain agreed principles or reform objectives.
The Intergovernmental Agreement on Federal Financial
Relations (IGAFFR) is the current overarching framework for Commonwealth-state
relations, agreed by all states, territories and the Commonwealth in 2008.
Under the IGAFFR, a series of six National Agreements define the objectives,
outcomes, outputs and performance indicators, and clarify the roles and
responsibilities that guide the Commonwealth and the states in the delivery of
services in key sectors.
National Specific Purpose Payments (SPPs) are the funding mechanism through
which the Commonwealth supports State and Territory efforts in delivering
services in key sectors.
The current national agreement for the VET sector is the National
Agreement for Skills and Workforce Development (NASWD).
The Australian Government provides states and territories with a given SPP
amount on an annual basis in accordance with this agreement.
To achieve certain specific time-limited reforms, the
Australian Government may enter into a given National Partnership with
jurisdictions. A National Partnership typically includes implementation funding
(to undertake the given reforms) and reward funding (to reward jurisdictions
when they reach agreed performance indicators).
The National Partnership on Skills Reform (NPSR) is the
current National Partnership for the VET sector, and required jurisdictions to
implement a number of reforms in order to be eligible for federal VET FEE-HELP
It is due to expire on 30 June 2017, and has recently been reviewed.
No agreement on future National Partnership funding after this date has yet
been reached, although the SPP will continue.
A number of programs are also delivered by the Australian
Government. These include programs designed to increase the uptake of training
within industry (the Industry Skills Fund), incentives to reduce the barriers
faced by employers and apprentices in the apprenticeship system (the Australian
Apprenticeships Incentives Program and the Trade Support Loans scheme),
measures to increase the access to training (the Adult Migrant English Program
and the Skills for Education and Employment scheme), and research and
administrative support for the national training sector (funding for the
National Centre for Vocational Education and Training and the Australian
Industry and Skills Committee).
These programs are typically administered by the
Department of Education and Training through funding agreements, out of
ordinary budget appropriations.
Specific RTOs are chosen to receive funding through competitive or
non-competitive application processes.
Particular eligibility criteria is associated with support provided for
territory government programs
States and territories typically fund the training system
through block funding or competitive funding processes, with funding allocated
between public providers like TAFEs, community and not-for-profit providers,
and private providers. As a result providers are able to offer a certain number
of training places. Often the number of overall training places is capped,
which maintains some level of government discretion over budget outlays.
States and territories will fund these subsidised places
in line with their own locally determined skills needs – for example, a
qualification in defence engineering may be subsidised in one jurisdiction but
not another. The level of subsidises is often used to make a particular
vocation more attractive or to support a particular group of disadvantaged
students through greater subsidises or fee waivers.
As the criteria for these subsidises are determined by state and territory
governments, they are typically managed through funding contracts with
particular RTOs. The ability of state bureaucracies to manage these contracts
in an effective way has been criticised as states and territories have sought
to expand their VET sectors in recent years.
Outside these subsidised places, students are still able to undertake
unsubsidised (full fee) training from RTOs.
design and responsibility
As can be seen from the discussion above, the landscape
for VET is complex. While a national regulator, ASQA, exists, its jurisdiction
does not yet cover all RTOs. Even with regards to the RTOs who fall under its
jurisdiction, these RTOs may be receiving funding through VET FEE-HELP and
other Department of Education and Training programs, through state and
territory programs administered by state and territory bureaucracies, or
through up-front student fees. Different frameworks apply to this funding, from
legislative requirements for student loans, to contractual obligations set out
in funding agreements, and aims and objectives in intergovernmental agreements.
The application of consumer law in safeguarding students who are unaware of
their rights in purchasing training adds another layer of complication.
How these different legal requirements and contractual
frameworks interact may be unclear to the provider, to the student, and to the
policy officer or program manager. Their complexity would also make it
challenging to identify which policy reforms or funding streams lead to
particular practices in the VET sector, and increase the possibility for
unintended consequences resulting from policy changes.
Understanding the context and choices of participants in
the VET sector is also difficult due to a lack of comprehensive data. A single
student identifier was only introduced from 1 January 2015.
Previously, due to the separate state and territory based VET systems, a
student could not be tracked across different jurisdictions, reducing the
capacity of policy makers to examine whether students who abandoned
qualifications or dropped out may have finished their qualifications across
The data collection for VET is also problematic. While
states, territories and the Australian Government jointly fund the National
Centre for Vocational Educational Research (NCVER), until 2014 its data
collection only reported on funding that was government subsidised. Reporting
on the broader VET sector, called total VET activity, has been implemented
progressively since 2014, although there are still exemptions from this
The total VET activity collection does not currently identify the entire VET
FEE-HELP cohort, which also makes analysis of student outcomes and funding
Finally, the lack of clarity over who is responsible for
the VET sector, how it operates, what it involves, and why it works (or
doesn’t) can also be seen in the policy ambitions for VET in Australia. While
there is no formal statement on what the VET sector is or should be, the
parties to the NASWD have agreed that their reforms should aim to create:
1. A national training system, accessible to all working age Australians,
that provides them with the opportunity to develop the skills and
qualifications needed to participate effectively in the labour market.
2. A responsive, agile and equitable national training system that meets
the needs of industry and students (including those from disadvantaged groups
or locations) and provides pathways into, and removes barriers between,
schools, adult, vocational and higher education, and employment.
3. A high quality national training system that is centred on quality
teaching and learning outcomes.
4. A national training system where individuals, businesses and
jurisdictions have access to transparent information about training products,
services and outcomes so they are able to make informed choices and decisions.
5. A sustainable national training system with a stable funding base that
promotes opportunities for shared investment across governments, enterprises
6. An efficient national training system, where government efforts
appropriately respond to areas of future jobs growth and support the skills
needs of Australian industry.
7. A national training system that works with Australian businesses and
industries to develop, harness and use the skills and abilities of the
The first aspiration suggests that workforce participation
is the key – the emphasis may be on skilling Australians to participate in
existing industries. But the sixth and seventh aspirations indicate it may be
about future jobs, growth industries and innovation. At the same time the
second aspiration indicates the VET system is also responsible to provide
pathways back into learning and employment for students who might be
disengaged. A focus on equity (such as using VET as a pathway to disadvantaged
students) may result in lower attainment rates, depending on how this cohort is
supported. A focus on existing industry needs may raise calls for retraining
and industry transition when economic restructuring occurs. A focus on future
jobs growth may result in governments picking winners and be ineffective.
Understanding how administrative (funding, legislation,
programs) and policy (design, aims, responsibility, outcomes) complexity is
inherent to the VET sector is crucial in considering how schemes like VET
FEE-HELP or the new VET student loans scheme may work.
VET FEE-HELP was introduced in June 2007 by the Howard
Government, as part of legislative amendments to Higher Education Support
Act 2003 (HESA).
At the time, it extended the existing loan scheme for full-fee paying higher
education students (FEE-HELP) to those vocational education and training (VET)
students undertaking full-fee paying Diploma, Advanced Diploma, Graduate Diploma
and Graduate Certificate qualifications. The program commenced on 1 January
2008, and while HESA set out the broad framework, the capacity for the
department to manage VET FEE-HELP was set out further in VET Guidelines.
The focus on full-fee paying students was in line with the
existing FEE-HELP scheme; this was supposed to offer financial support to those
students who would not otherwise receive subsidises to undertake a VET
qualification, thereby expanding the pool of students who could access VET.
In addition, the introduction of VET FEE-HELP was
regulated by the use of credit transfer arrangements. These required the VET
provider to have a credit transfer arrangement in place with a higher education
provider (for example, a university). This meant that the higher education
provider had assessed the training offered by the VET provider and was willing
to accept the VET qualification as credit towards a higher education
qualification. While it did not mean there was an entirely independent audit of
the VET provider, the higher education provider had a reputational reason to
ensure that it only recognised qualifications and students who were capable of
meeting its own particular standards and qualifying for one of its own courses.
expand the VET system
There were a number of significant reforms to VET under
the Rudd and Gillard governments which had the effect of expanding the VET
system. Amendments in 2008 ensure students in Graduate Certificate and Graduate
Diploma qualifications could access VET FEE-HELP, but maintained the credit
Following moves by the Victorian Government to introduce
contestable VET funding from 2009, the Australian Government allowed VET
FEE-HELP loans to be offered to any student (including subsidised students) and
any RTO (whether they had a credit transfer arrangement or not).
These restrictions were only removed for any state deemed to be a ‘Reform
At the time, only Victoria was listed, but the other jurisdictions had been encouraged
to similarly reform their VET sectors and open funding up to a variety of
Significant reform emerged out of the 2010–11 Budget, on
11 May 2010, with the announcement of a national entitlement to a training
place, expanding access to VET FEE-HELP to further VET qualifications,
transparent information for students, and a new national VET regulator.
The creation of the NPSR in 2012 was intended to progress these VET reforms.
This went hand-in-hand with the expansion of VET FEE-HELP: as each jurisdiction
implemented the agreed reforms of the NPSR, they each became ‘Reform States’,
allowing students to enrol as they wished and directing funding in the form of
state or territory subsidises, as well as VET FEE-HELP loans, in line with student
As the new national VET regulator, ASQA was given
responsibility for regulating registered training organisations over which it
had jurisdiction. This involved assessing a provider’s capacity against the
relevant Standards, both for those organisations applying to be registered and
become an RTO, and existing RTOs.
Once a provider was registered with ASQA, it could then apply separately to the
Department of Education and Training in its various incarnations to be approved
to offer VET FEE-HELP loans to its students. The VET FEE-HELP process was
governed by a separate set of guidelines under HESA.
issues with VET FEE-HELP
The first concerns were flagged by a review undertaken by
the Victorian Government in 2010, indicating that some VET students were
unwilling to take out VET FEE-HELP loans ‘because they were afraid of debt’.
Concerns about student debt are common to the HELP suite of loans more
generally: the debt profile associated with the HELP suite of loans was most
recently analysed in 2014 by the Grattan Institute.
Section 3.5 of the report dealt specifically with VET FEE-HELP and found that
people with a vocational education diploma or advanced diploma were 50 per cent
less likely to repay their loan than those in higher education.
Any default on existing student loans would be a potential cost to the budget,
as the budget papers provide for a fair value of HELP loan debt, considering it
an asset as it is likely to be repaid.
The expansion of VET FEE-HELP loans was also reported as
having changed the business model of the VET sector. As the loan involved an
upfront payment to a provider, new providers had incentive to enter the market
and utilise methods to build up their student numbers quickly. Private
providers often were largely dependent on government funding from VET FEE-HELP
There were no penalties in place should a student fail to complete a
qualification, nor would the provider have to pay back the loan amount. In
order to entice more students – and get more funding, VET FEE-HELP providers
started to utilise aggressive marketing techniques, including brokers, agents,
inducements and potentially misleading advertising practices to direct students
to their particular course offerings.
The Opposition first raised VET FEE-HELP quality concerns
in response to media reports in October 2014.
The Department of Education’s capacity to properly administer and scrutinise
the scheme was questioned by the Australian Greens’ spokesperson in the same
Media reports of registered training organisations using inducements such as
iPads or laptops to sign up students who were not academically suited to
undertake qualifications continued.
responses and further scrutiny
Government reforms to address identified issues with VET
FEE-HELP and the broader VET sector ensued through late 2014 and 2015.
First, the relevant Standards for registered training
organisations were updated, following a process of consultation and agreement
from relevant Council of Australian Government (COAG) ministers.
These became effective as of 1 January 2015, with ASQA provided with additional
funding of $68 million over four years to enforce them.
The new Standards would apply to all RTOs, regardless of whether they offered
VET FEE-HELP and would have a sector-wide impact.
Second, to address particular issues with VET FEE-HELP,
the relevant guidelines were revised in March 2015, to ban RTOs from providing
inducements such as laptops, iPads, vouchers or cash.
Third, the VET Guidelines were revised again in June 2015,
with elements becoming effective in July 2015 and January 2016.
These measures were intended to ensure VET FEE-HELP providers gave accurate
information to students about the nature of VET FEE-HELP loans, marketed VET
FEE-HELP assistance responsibly, were held accountable for the agents they had
contracted to sign-up students, did not create any barriers to withdrawal for
students (to ensure they couldn’t delay withdrawal and so ‘skim’ the VET
FEE-HELP funding off an enrolment), and to prevent a VET FEE-HELP provider
charging more than 25 per cent of the fee in any one fee-period.
While these reforms were being implemented, Parliamentary
scrutiny of the VET sector emerged as a result of a Senate inquiry. The Senate
Education and Employment References Committee established an inquiry into ‘the
operation, regulation and funding of private vocational education and training
(VET) providers in Australia’ on 24 November 2014. The Terms of Reference
included an examination of the ‘operation of VET FEE-HELP.’
The final report was tabled on 15 October 2015.
Key issues identified by the Senate report included:
approach of ASQA—its risk-based regulatory approach means that it focuses on
the provider, rather than assessing the qualifications provided to the student.
The Committee view was that ‘there was every reason to doubt ASQA is fit for
capacity of the Department of Education and Training, as well as ASQA, to
monitor VET FEE-HELP arrangements
use of brokers by RTOs and their clear financial interest in signing up
students to courses regardless of the student’s need or proficiency
ability of RTOs to subcontract out their training to unregistered
organisations, lowering the level of scrutiny and
lack of clarity regarding review or assistance for domestic students who have
issues with VET FEE-HELP debts, as a separate Ombudsman for overseas students
Further legislative reform to the VET FEE-HELP scheme was
introduced in October 2015.
The Higher Education Support Amendment (VET FEE-HELP Reform) Bill 2015 enhanced
the regulatory powers under HESA to include the following additional
requirements for providers:
minimum period for operating as a registered training organisation
minimum period for providing courses leading to award of qualifications in the
Australian Qualifications Framework
‘student entry procedure’, including minimum academic standards, for VET
the consent of a responsible adult is provided in case of students under the
age of 18 applying for VET FEE-HELP loans and
a two-day ‘cool off’ period to ensure that prospective students have time to
reflect on their VET enrolment before they seek a VET FEE-HELP loan.
Investigatory and monitoring powers were introduced,
including a civil penalty framework for cases of non-compliance, to ensure the
new requirements on VET FEE-HELP providers were adhered to. New administrative
powers were created to allow the Secretary of the Department to re-credit a
student’s FEE-HELP balance in certain circumstances, essentially cancelling
their VET FEE-HELP loan. This would assist where providers had not adhered with
their new obligations and so enticed students into taking out a loan without
proper information or authorisation.
Following the introduction of this Bill to Parliament,
significant amendments were introduced in the Senate and the Bill passed both
Houses on 3 December 2015, to commence on 1 January 2016.
These amendments had the effect of:
total 2016 VET FEE-HELP loan amounts for existing VET providers at 2015 levels,
with the Secretary granted the power to make exemptions for monopoly providers
in an identified area of national importance where the course was relevant to
employment in a licensed occupation
new entry requirements for registered training providers seeking to offer VET
from payments in advance to payments in arrears for the largest training
providers and setting new reporting requirements
the government to pause payments to providers with poor performance pending
resolution of performance issues and
other minor amendments to:
the appointment of investigators to external non-government bodies to better
cope with expertise and resourcing requirements and
fee charging associated with attesting to the veracity of a provider’s literacy
and numeracy testing tool.
A new version of the VET Guidelines was issued, utilising
the new legislative powers granted by the amendments to HESA and
specifying in more detail the new requirements placed on VET FEE-HELP
In contrast, the Opposition had set out a series of
amendments to the VET FEE-HELP Reform Bill which would have gone further than
those passed by the Parliament. They included:
creation of an industry funded national VET Ombudsman
the Auditor-General to conduct an audit on the VET FEE-HELP scheme and
the Department to write to prospective VET FEE-HELP students to inform them of
their potential debt and seek consent for the loan, rather than relying on
providers to do so.
The press release on the Opposition’s proposed amendments also
flagged that in referring the VET FEE-HELP Reform Bill to a Senate Committee
for consideration, the Australian Labor Party would utilise this committee
inquiry to examine options for capping tuition fee levels for courses covered
by VET FEE-HELP loans and to lower the lifetime limit on VET FEE-HELP student
The Greens then Tertiary Education Spokesperson, Senator Robert Simms, called
upon the Government to ‘fix’ the for-profit VET system, ultimately by
disallowing for-profit providers from offering VET FEE-HELP.
These iterative changes through 2015 and 2016 essentially
increased the requirements on RTOs in relation to VET FEE-HELP students only.
It had the unintended effect of increasing the administrative complexity for
providers, as many VET FEE-HELP providers would also be training students who
were not receiving VET FEE-HELP assistance and therefore be covered by
different entry requirements and applications processes.
A new model
for VET FEE-HELP
The changes introduced through 2015 were essentially stop
gap measures, with the Government announcing it would undertake a ‘full
overhaul of VET FEE-HELP’ in time for 2017.
On 4 April 2016, Senator Scott Ryan, the then Minister for
Vocational Education and Skills announced that consultations on the future of
VET FEE-HELP had commenced.
The consultations were informed a discussion paper on the VET FEE-HELP redesign,
which was released on 27 April 2016.
Submissions were open until 30 June 2016. The discussion paper did not
include formal terms of reference, but the Minister’s foreword stated:
We need to ensure the scheme is underpinned by a strong
regulatory framework that provides greater protection for students, delivers
quality and affordable training that has strong links to industry needs, at an
affordable cost to taxpayers. This is not simply a matter of private versus
public sector provision, VET has always been a blended sector and should remain
so. To achieve this, there needs to be a frank assessment of the scheme thus
far. To address the problems we must first understand them. We must also
specifically consider the impacts of possible changes to the scheme, in
particular the incentives they provide for providers and students and, in some
cases, governments. That is why I am committed to a wide ranging and
comprehensive consultation process.
The discussion paper summarised the inception and
development of the VET FEE-HELP scheme, including its expansion and detailed a
series of what it termed design flaws, including the lack of appropriate
regulatory powers. It examined key trends in student numbers, the significant
increase in program expenditure and provided some analysis of the costs
involved for VET FEE-HELP funded qualifications as compared to non-VET FEE-HELP
funded qualifications. It also attempted to quantify how successful the 2015
and 2016 reforms had been and outlined options for change which would protect
students, regulate providers appropriately, and ensure better VET system
As part of its options for change, the discussion paper
sought feedback on a series of discussion questions.
Topics covered included whether further student eligibility requirements were
necessary, the possibility of introducing lifetime loan limits (to protect
students from becoming too indebted over the course of their vocational
education and training), whether the government should introduce limits on the
amount which could be loaned per course, what ways existed to ensure students’
interests were paramount, including better information and regulation, what
data could be used to measure the quality of providers and courses, and
eligibility requirements for providers and courses under any new scheme.
In the lead up to the 2016 federal election, the future of
VET FEE-HELP emerged as a point of difference between the major political
parties. In May 2016, the Leader of the Opposition promised to cap VET FEE-HELP
loan amounts at $8,000 a year as part of the ALP’s reply to the 2016–17 Budget.
Further reforms to VET FEE-HELP included a change to the funding incentives to
ensure greater completion rates, better links between loans and the needs of
industry, cracking down on the use of third-party agents by VET FEE-HELP
providers, raising the entry requirements for providers and ensuring regulators
had tougher powers to audit, investigate and suspend unscrupulous providers.
This reform package for VET FEE-HELP subsequently became an ALP election
The Australian Greens went further than the Opposition in
proposing that for-profit VET providers be ineligible for government funding,
including loans such as VET FEE-HELP.
Conversely the Coalition criticised aspects of these
proposals, especially the ALP’s promise to cap VET FEE-HELP loans.
The then Minister drew attention to the negative reaction of peak bodies in the
sector to the prospect of caps, and likely consequences for students in
additional out of pocket costs in cases where a capped loan was not enough to
cover the course fee.
The Coalition election policy was to ‘redesign the VET FEE-HELP scheme for
Education and Employment Legislation Committee
The Bill was referred to the Senate Education and Employment
Legislation Committee for inquiry and report by 7 November 2016. Details
of the inquiry are available on the Committee’s website.
The concerns raised by the submissions and participants in
this inquiry will be explored in more detail in the ‘Position of major interest
groups’ and the ‘Key issues and provisions’ sections of this Bills Digest.
Standing Committee for the Scrutiny of Bills
The Senate Standing Committee for the Scrutiny of Bills had
no comment on the Consequential Amendments Bill, but has sought further
information from the Minister on certain aspects of the Student Loans Bill and
the Charges Bill that it regards as problematic.
In regards to the Student Loans Bill, the Minister’s advice
has been sought on the following provisions:
65, which imposes personal liability on executive officers of approved
course providers under certain circumstances without explanation as to whether
the processes set out in the Guide
to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers
in relation to the incorporation of vicarious liability offences into statutes
has been followed
74, which limits the decisions for which an internal review or appeals
process is applicable, thereby limiting the capacity of applicants under the
VET loans scheme to seek to overturn potentially unfair decision making
77 and 81, which grant broad administrative powers for decision-makers
under the VET student loans scheme to reconsider their decisions once made, which
could be considered to make administrative decisions more unpredictable and
less certain if they can be revisited at any time
85, which allows for infringement notices to be issued in the case of an
offence or civil penalty provision under the proposed Act, also without
explanation as to whether the processes in the Guide
to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers
have been followed
101(2), which imposes absolute liability in relation to one element of the offence
of unauthorised access to, or modification of, personal information of loan
recipients, again without detailed justification or discussion of whether the
approach accords with the Guide
to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers
114, which allows the Secretary to delegate, in writing, all of his or her
powers under the proposed Act to an APS employee without regard to whether all
these powers are appropriate for delegation and whether there is a level of
seniority or experience required to utilise them and
116(5), which allows the rules made under the proposed Act to adopt or
incorporate matters set out in another written instrument. This may impact on parliamentary
scrutiny as the document referred to may be subject to change without the
parliament being advised.
The Committee also sought the Minister’s advice on an
aspect of the Charges Bill:
7, which allows for the amount of the charge to be set by regulation
without any guidance on how it should be set or any limit to the amount.
position of non-government parties/independents
Following media reports on the scope of the new VET
student loans scheme, the Labor Opposition Shadow Minister for TAFE and
Vocational Education put out a series of press releases noting where the new
scheme incorporated elements of the ALP’s election policy.
The ALP also introduced amendments to the Student Loans
Bill in the House of Representatives. These amendments would have the effect of
establishing an ombudsman to assist students with complaints regarding the VET
student loans scheme, and to require the ombudsman to publish information about
the number of complaints received on a six monthly basis.
The proposed amendments were not passed in the House of Representatives.
Despite this, the Australian Greens stated that they had
reached agreement with the Government to introduce an ombudsman to the VET
student loans scheme.
The Government has also stated it will establish an ombudsman, but these
provisions were not in the Bills as introduced.
The sole crossbencher who spoke on the Bills in the House
of Representatives, Rebekha Sharkie of the Nick Xenophon Team, supported the
reforms, but expressed concern regarding the adequacy of student protections,
the appropriateness of the eligibility requirements for funding specific
courses, and the capacity of the Department of Education and Training to
administer the new scheme properly in the light of its administrative history.
major interest groups
The major interest groups all express a view that while
reforms to the VET FEE-HELP program are needed, the proposed VET student loans
scheme contains provisions that are too arbitrary and will restrict access and
equity for students enrolling in vocational education and training. This
section provides an overview of these criticisms: stakeholder concerns
regarding particular provisions are addressed in the ‘Key issues and provisions’
section of the Bills Digest.
The peak body for the private VET sector, the Australian
Council for Private Education and Training (ACPET) supports key elements of the
Bill, but states that ‘there are a number of features of VSL [VET student
loans] that will not support quality training choices and outcomes for some
students’ and that ‘the reforms will see a major downgrading of the
Commonwealth Government’s commitment to vocational education and training, with
significant implications for the future of Australia’s workforce development’,
with an estimated 500,000 students ineligible for support under the new program
and so missing out on vocational education and training and the resulting job
ACPET also contends the reforms will lead to major job losses across the
sector, as some providers will miss out on funding and have to close.
The peak body for the public TAFE sector and the VET
divisions of dual sector universities, TAFE Directors Australia (TDA),
expresses similar concerns regarding student access. TDA contends that as access
was the principal reason for establishing VET FEE-HELP in 2008 and then
expanding the scheme through 2012, limiting access to only certain students
undertaking certain courses in certain providers as has been proposed under the
new scheme would conflict with the stated aims of the current National
Partnership on Skills Reform.
The major unions who have made submissions to the Senate
inquiry into the Bill include the Australian Council of Trade Unions (ACTU),
the Australian Education Union (AEU), and the National Tertiary Education
Union. The ACTU comments that the Bills represent a good first step, although
the extensive use of delegated legislation to define elements of the new loans
scheme and the short time span before the new scheme starts in 2017 make it
hard to assess the potential effectiveness.
The ACTU calls for further reforms, involving a 30 per cent cap on funding
allocated contestably, restoring the TAFE system as the public provider of
quality across the country, conducting a review into the future of the
market-driven approach to VET, and ensuring the VET regulator has the necessary
powers and resources to audit both provider quality and student training
The AEU endorses the ACTU submission in full.
The NTEU gives qualified support for the measures in the Bills, but expresses
concerns that the reforms will entrench the different funding and regulatory
regimes between higher education and VET and so generally lead to gaps in the
provision of tertiary education for students who might be in need of
alternative entry pathways and other forms of education.
Industry bodies the Australian Industry Group and the
Business Council of Australia urge the Senate to pass the Bills, noting there
may be some unintended consequences of the new scheme due to its design.
Key recommendations are for the government to allow grandfathered students to
continue to access a VET FEE-HELP loan through 2018, to change the legislation
so that the concept of eligible courses better connects with industry need and
to require government to consult with industry in developing rules for the new
scheme, to remove the capacity for ASQA to conduct audits of the scheme, and to
require the government to publish VET market information and real-time data on
government expenditure to better inform public assessment of the VET student
The Explanatory Memorandum to the Student Loans Bill notes
that the new VET student loans scheme is expected to reduce the value of new student
loans being issued by more than $2.4 billion per annum by the end of the
forward estimates in 2019–20, leading to an estimated reduction in otherwise
total HELP debt of more than $7 billion by June 2020 and by more than $25
billion by June 2026.
The proposed reforms will have a negative impact of $58.6
million on underlying cash over the forward estimates, including administered
and departmental funding.
There are no special appropriations associated with these
Statement of Compatibility with Human Rights
As required under Part 3 of the Human Rights
(Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the
Bills’ compatibility with the human rights and freedoms recognised or declared
in the international instruments listed in section 3 of that Act. The
Government considers that while the Bills engage with the right to privacy and
the right to be presumed innocent, what limitations exist under the Bills are
reasonable, necessary and proportionate.
Overall the Bills are compatible with human rights.
Joint Committee on Human Rights
The Parliamentary Joint Committee on Human Rights considers
that the Bills do not give rise to human rights concerns.
Broadly, five key issues have emerged in the commentary
and policy history surrounding VET FEE-HELP and new VET student loans which
have only been partly addressed by the current Bills and accompanying material:
unclear purpose of VET
design of the VET market
effectiveness of providers
costs of education and
purpose of VET
As noted earlier in this Bills Digest, there is a lack of
clarity over the purpose of VET. The Student Loans Bill goes some way to resolving
this, by indicating in the Objects of the Bill (clause 4):
The object of this Act is to provide for loans to students
for vocational education and training, ensuring that loans are provided:
(a) to genuine students; and
(b) for education and training that
meets workplace needs and improves employment outcomes.
This is a narrower definition than that offered by the
intergovernmental agreements associated with VET, which do not indicate some
students may not be ‘genuine’ or that the key purpose of VET is workplace
related and leads to employment. Indeed, under the intergovernmental
agreements, the purpose of VET as a way of removing barriers for students who
otherwise might be excluded from education, training and employment is
The Student Loan Bill attempts to resolve these issues
through the concepts of eligible students, approved courses and approved course
The Secretary can only approve a VET student loan if they
are satisfied the applicant is an eligible student (clause 7
in Part 2 of the Student Loans Bill). The Student Loans Bill also
provides for a definition of an eligible student (clauses 9 through 12).
These provisions ensure the student is enrolled in the course, has provided the
required documentation, is undertaking the course primarily at a campus in
Australia and is either an Australian citizen, holder of a permanent
humanitarian visa who is usually resident in Australia, or a qualifying New Zealand
citizen. These are fairly standard provisions and similar requirements can be
found in the Higher Education Support Act 2003 in relation to the HELP
series of student loans.
Clause 12 of the Bill creates a duty on providers to
assess students’ academic suitability for their course. This echoes the
‘student entry procedure’ required by the VET FEE-HELP Reform Bill in 2015.
However that element of the VET FEE-HELP reforms was only introduced from 1 January 2016,
so it is unclear as to how effective it has been, or whether implementation has
been challenging. It also raises the question as to whether this is an
appropriate requirement, considering the overall purpose of VET has been stated
as removing barriers to entry, rather than creating new ones.
There is also some evidence about the nature of the VET
FEE-HELP cohort to date. A study undertaken by the National Centre for
Vocational Educational Research (NCVER) in 2015 found that in comparison with
non-VET FEE-HELP assisted students, those assisted by VET FEE-HELP were more
aged under 25 years than over 35 years
be employed and
The 2015 and 2016 reforms to VET FEE-HELP were based on the
assumption that those students were systemically being enticed into taking
education which was academically inappropriate for them. As was discussed
earlier, there was also significant anecdotal reporting of VET FEE-HELP students
being unaware they had entered into a loan. NCVER showed that the VET FEE-HELP
student cohort is different to other VET students. It may be that in expanding
access to VET FEE-HELP, the program was being utilised by a cohort that had been
previously underserviced by HELP student loans.
In higher education, specific funding is available to
providers to support disadvantaged students who have additional support needs,
such as academic assistance.
This includes targeted funding to support students with disability.
No similar Australian Government program exists for VET students, even though
based on the NCVER study, students with disability are more likely to utilise
VET FEE-HELP compared with the broader VET cohort.
Continuing to require some form of student academic
assessment may actually discourage those students who could best benefit from
financial assistance to undertake VET qualifications, while not addressing the
issue of whether providers are funded adequately to support these students
throughout their studies.
As per existing requirements for VET FEE-HELP, only diploma
and higher level VET courses are eligible for VET student loans.
However, there are two new provisions in relation to approved courses which
both significantly narrow the scope of VET student loans and alter the
relationship between government and VET providers.
Under the existing VET FEE-HELP scheme, as in higher
education and VET sectors generally, providers have the ability to use third
parties to assist in course delivery, either through sub-contracting or other
arrangements. At best this can allow for greater collaboration or innovation in
the provision of training, with RTOs able to contract out the delivery of
particular units or functions such as student administration to specialists in
these fields. At worst it can lead to substandard or inappropriate practices
and lower costs for the provider but not the student.
Clause 15 of the Student Loans Bill creates
additional barriers for these types of contractual arrangements: providers
approved to offer VET approved courses will only be able to be delivered by
another provider approved under the VET student loan scheme, a person or body accredited
by the Tertiary Education Quality Standards Agency (TEQSA, the national regulator
for higher education), or a person or body approved in writing by the
Secretary. The Explanatory Memorandum notes that this will address concerns
that some VET FEE-HELP providers have been essentially selling access to the
scheme, rather than delivering training.
However, these new barriers could dissuade providers from working with other
entities to develop innovative approaches to training that may serve particular
needs such as students studying via distance or online methods, or students
with special needs.
The relationship between providers and government is also
significantly altered by the authorisation of a new legislative instrument
under clause 16 of the Student Loans Bill, the courses and loan caps
determination. This allows the Minister to determine which courses of
study will be eligible for VET student loans and how much financial support
(given as a maximum loan amount) each course will be eligible for.
Currently tertiary education funding from the Australian
Government is entrusted to providers for their use. Regulatory agencies such as
TEQSA and ASQA and associated legislative standards create barriers to entry,
but once registered by a given regulator, each institution is responsible for
its funding in accordance with various guidelines. This can come in the form of
funding dedicated to a particular undergraduate or research place, or to assist
students with up-front costs through loans.
The VET FEE-HELP scheme was also established on this basis, emerging as it did
out of the existing HELP series of loans. The courses and caps determination
marks a significant intrusion by government in the operations of RTOs. It will
change the funding incentives for vocational education and training and may
lead to examples where a certain course that was eligible for a VET FEE-HELP
loan is not eligible for a VET student loan. It shifts the funding model to one
more akin to that used by states and territories, which as has been discussed,
typically provide subsidises and set places in line with local skill needs.
The use of this new power is also arbitrary. While the
Explanatory Memorandum states that ‘it is anticipated the courses approved in
the determination will be limited to those courses with a high national
priority, that align with industry needs and lead to employment outcomes’, the
development of the courses and caps determination is not guided by any
provisions of the proposed Act.
The Department of Education and Training has released a provisional list of
approved courses for consultation.
This list includes the following criteria for approval:
Courses are approved if they are current (in other words, not
superseded), and on at least two state and territory subsidy/skills list, or
are science, technology, engineering or mathematics (STEM) related or tied to
licencing, accreditation, or registration requirements for a particular
These criteria do not appear in the proposed Act and do not
have to be adhered to in developing the list of approved courses. This creates
uncertainty for providers whose eligibility can be changed at any moment, even
if they meet all other requirements of the proposed Act. Including specific
criteria or consultation processes in the proposed Act would go some way to
clarifying the purpose of the loans and providing greater surety to providers.
The Student Loans Bill creates extensive requirements for
those seeking to become an approved course provider, and so offer approved
courses to eligible students who can apply for VET student loans.
Part 4 sets out the conditions under which an RTO can
become an approved course provider. Many of these are holdovers from existing
provisions under VET FEE-HELP: it is interesting to consider how these will
operate. As with VET FEE-HELP, Part 4 of the proposed Act allows aspects of
these entry standards to be specified further in the rules. These include the
‘provider suitability requirements’ and how to determine whether those involved
in the operation of an RTO constitute a ‘fit and proper person’.
Clause 26 in Part 4 lays out the matters that
may be dealt with under the provider suitability requirements. Many of these
aspects, while building on typical assessment criteria under programs such as
VET FEE-HELP, potentially raise more questions than they answer. What standards
for ‘financial performance’ can be met when a company’s business model is
dependent on a government funded program such as VET student loans, a program
whose other eligibility criteria (such as the approved course list) can be
changed as needed and so lead to significant reductions in funding? How will
ensuring approved course providers have ‘experience in providing vocational
education’ allow new entrants to enter the market and drive competition and
innovation? How will ‘student outcomes’ be taken into consideration – will poor
student outcomes be seen of an example of low provider quality, or of a
provider seeking to offer training to student cohorts with poor literacy and
numeracy skills to start with? What constitutes an ‘industry link’?
These factors have the effect of narrowing the pool of
possible applicants – those with evidence of experience in vocational education
and training, good student outcomes and industry links are more likely to be
established RTOs, with developed curricula and training methods. Whereas
previously the VET FEE-HELP scheme could assist every student undertaking a
Diploma at an extensive range of providers, the new VET student loans scheme
limits the scope of assistance. Fewer providers are likely to be approved for VET
student loans: they will be able to receive funding for fewer courses and enrol
of the VET market
The use of
Clause 27 of the Student Loans Bill allows the rules
to stipulate that a listed course provider will be taken as
having met one or more of the course provider requirements. The Explanatory
For example, the Rules may specify that a TAFE established by
a State is taken to meet the ‘fit and proper person’ requirement, or similarly
the Rules may provide a listed course provider is not required to be a body corporate.
Listed course providers are set out at subclause
27(2). They include Table A and B providers under HESA (the public
and not-for-profit universities), state and territory TAFE institutes, and any
other training organisation owned by the Commonwealth, a state or a territory.
This listing can also be augmented by the Rules as provided for under the
proposed Act. All listed course providers (including any specified in the Rules)
must be RTOs.
The Consequential Amendments Bill sets out
arrangements for moving to the new approved provider arrangements. Item 2
of Schedule 2 to the Consequential Amendments Bill provides that Table A
and B providers under HESA (the public and not-for-profit universities),
state and territory TAFE institutes, and any other training organisation owned
by the Commonwealth, a state or a territory are taken to be approved course
providers on 1 January 2017 if they are a VET provider immediately before that
date. This approval will be for seven years (item 5 of Schedule 2
to the Consequential Amendments Bill). Other bodies that are VET providers
immediately before 1 January 2017 which apply to the Secretary before 1 January
2017 and are taken to be suitable as an approved course provider during the
transition period will be taken to be approved by the Secretary for the
‘provider transition period’, which will expire on 30 June 2017 or a later date
determined by the Minister (items 1 and 8 of Schedule 2 to the
Consequential Amendments Bill). The proposed VET Student Loans scheme
automatically includes public providers in the transition period, putting
private providers at a disadvantage.
As a concept, listed providers are also found in HESA,
where ‘listed providers’ are well-established universities that have automatic
access to certain funding programs. This is not the only conceptual borrowing
from the higher education framework. Since the creation of the Higher Education
Contribution Scheme (HECS) in 1989, the major public universities have had
their undergraduate course fees capped at a set level. Since 1996, three
different cap amounts have been used, set in legislation, and associated with
particular qualifications. It is interesting to note that unlike higher
education, the proposed cap amounts for VET student loans are not set by the
Student Loans Bill, but will be entirely dependent on the courses and caps
At a federal level, higher education funding is structured
very differently to that of VET. HESA provides for a set government
subsidy for undergraduate students, and then caps the amount students can be
charged. Together this Commonwealth contribution and student contribution are
intended to make up the cost of providing education. In the more fragmented
system of VET funding, the Australian Government will cap the amount students
will contribute to their education through a VET student loan, but there is no
guarantee to a provider that they will receive enough subsidy funding to cover
the cost of education, as these subsidies are set independently at a state or
territory level. This basic design difference raises the question as to whether
approaches used in higher education such as the HELP framework are appropriate
in shaping the VET market.
effectiveness of regulation
ASQA is the national regulator for the VET sector. The
Department of Education and Training administered the VET FEE-HELP scheme, and
will now administer the VET student loans scheme. Existing RTOs in Victoria and
Western Australia who wish to access VET student loans may have a range of
compliance issues as identified by their state based regulators. In considering
whether the Student Loans Bill will provide a more effective regulatory
approach than found under VET FEE-HELP, the regulatory powers available, regulators’
capacity to use those powers, and the systemic nature of VET have to be
regulatory regime – more of the same?
The VET FEE-HELP Reform Bill established new regulatory
powers for the VET FEE-HELP scheme, including monitoring powers, investigation
powers, infringement notices, and the use of civil penalties.
These powers have only been in effect since 1 January 2016 and there has been
no review or audit of how they have been used and whether they have been
effective in addressing inappropriate provider behaviour.
Part 8 of the Student Loans Bill extends these powers
to include enforceable undertakings and injunctions. As with the monitoring and
enforcement powers introduced by the VET FEE-HELP Reform Bill, the use of these
powers is governed by the Regulatory Powers (Standard Provisions) Act 2014.
Except in the case of enforceable undertakings and injunctions, these powers
may be utilised by both Departmental and ASQA officers. Enforceable
undertakings and injunction action is reserved to the Department of Education
and Training only.
Part 9 sets out an extensive information disclosure
regime, allowing specified officers to use and disclose information in relation
to the VET student loans scheme to certain agencies, bodies or persons, in
relation to law enforcement, and to assist in the provision of vocational
education and training. This information disclosure regime builds on amendments
recently made through the Higher
Education Support Legislation Amendment (2016 Measures No. 1) Bill 2016.
As with that Bill, there is no requirement for the Secretary to publish VET
student loan scheme information to allow for better external research or
assessment of the scheme, nor is there provision in Part 9 for the stated aims
of the information disclosure regime, or a legislated review requirement to
assess whether these aims have been met.
To date there has been no recent public review of ASQA, the
Department, the state-based regulators in Victoria or WA, or their capacity to
collaborate and share data. With the significant changes to the VET regulatory
landscape since the introduction of measures like VET FEE-HELP and the
establishment of ASQA itself, a first principles approach might be to examine
the powers of each entity and see if they are fit for the current environment.
It does appear that collaboration, and a concern over remit
and bureaucratic boundaries, may have hampered an effective approach to VET
FEE-HELP compliance. In an answer to a question on notice emerging out of the Senate
Inquiry into the VET Student Loans Bills, ASQA revealed that a cross-agency
round table to discuss a joint approach to VET FEE-HELP did not occur until 12
November 2014, and an analysis of existing VET FEE-HELP complaints against the
various responsibilities of ASQA, the Department of Education and Training, and
the Australian Competition and Consumer commission was not undertaken until 8
The proposed new compliance regime does not resolve the fundamental lack of
clarity over responsibility.
It’s also useful to note in this context that recent court
action against RTOs has been commenced by the Australian Competition and
Consumer Commission, viewing unethical RTO practices as potential breaches of
consumer law, rather than the VET regulatory framework.
This raises further questions as to whether ASQA or the Department have an
adequate regulatory capacity to deal with the sector.
A further question is whether regulators have adequately
used their existing powers. It may not be that new powers provided by the
Student Loans Bill are needed, but that there has been an unwillingness or
inability on the part of the bureaucracy to provide effective monitoring and
remedial action. In a submission to the Senate Inquiry on the VET Student Loans
Bills, a former SES officer with the Department of Education and Training
identified that both the Department and ASQA had existing powers to seek
information, revoke funding approval, undertake audits and hold providers
accountable under the relevant legislation: the problem was not that these
powers did not exist, but that they were not used.
Creating new powers, as the Student Loans Bill does, does not address this
What may explain an unwillingness to undertake regulatory
activity? Part of it may simply be capacity. Previous reforms, such as the
banning of inducements, did not appear effective: since the introduction of the
new VET Guidelines across 2015, media reports continue to indicate that
providers are still offering students now-prohibited inducements such as
laptops, raising ongoing questions as to the capacity of the Department to
properly enforce regulatory changes.
Further, the Department of Education and Training is not a regulator, but a
department of state, a policy maker. Its role as program manager of VET
FEE-HELP and VET student loans may not be appropriate, depending on whether the
aim is to improve compliance, or improve outcomes.
Both the Department and ASQA appear to operate in line with
what has been called the ‘cake making approach,’ which is an input-based
This assumes that if Standards or Guidelines are adhered to – that the
ingredients are all in place – the ‘cake’ will come out fine. Neither the
Department or ASQA taste the ‘cake’ to ascertain its quality—they do not audit
the student’s competencies, or test their qualification or specific learning
experience. Neither, after all, are training organisations. They do not have
the capacity to make such assessments. But the lack of regulatory effectiveness
to date raises questions about the adequacy of the ‘cake making approach’,
questions the current Bills do not resolve.
As has been seen, concerns regarding student outcomes under
VET FEE-HELP has been a persistent feature of coverage of the program since
2014. The most recent VET FEE-HELP statistical report, released by the
government, also received media attention.
The report indicated that of those VET FEE-HELP assisted students who commenced
in 2013, the qualification completion rate was 22.9 per cent, based on
completions between 2013 and 2015.
This compared with a completion rate of 21.9 per cent for the 2012 cohort, and
26.1 per cent for the 2011 cohort.
These are undoubtedly poor completion rates. Yet the nature
of the competency-based VET system means that a student may gain a skill, or
finish a unit of study, without needing to complete the qualification. They can
also return after several years, with a record of competencies achieved, and
finish the qualification in line with their skills needs and personal capacity.
Students may drop out of training or fail to complete for a variety of personal
reasons: it does not automatically follow that the RTO was of low quality or
the training was bad, and using completion rates as a proxy neglects to take
into account a student’s choice to drop out for their own reasons. It fails to
take into account the broader nature of education, and reduces it to a simple
product that the student has purchased off the shelf, with gaining the qualification
as the sole indicator of quality or success.
While the overlap between VET FEE-HELP students and students
who only partially completed their qualification cannot be identified, students
who only completed a subject in 2015 did so largely because of personal reasons
(33.0 per cent) or because they got what they wanted out of the training (21.2
The Minister has proposed barring providers with poor student outcomes from the
scheme, although the legislative basis for this barrier is unclear.
It may fall under the provider suitability requirements in the Rules to the Act
when they are made (in particular, ‘student outcomes’ as referenced at
paragraph 26(2)(f) of the Student Loans Bill). Still, placing the
responsibility for poor completion rates on the provider also fails to capture
whether some of the inputs such as funding adequacy or student support
contribute equally to outcomes.
complexity and the VET system
As TAFE Directors Australia noted in its submission to the
VET FEE-HELP Reform Bill 2015, each government reform to VET FEE-HELP had the
effect of treating VET FEE-HELP providers as separate from the rest of the
Additional compliance and regulatory requirements were placed on RTOs in
relation to their VET FEE-HELP students, but not in relation to any other VET
students they may have had. The same approach is used in VET student loans – a
more punitive approach to compliance, with greater penalties, additional
requirements for providers to meet, and greater powers to monitor provider
compliance. These may amount to a ‘tick the box’ exercise, depending on the
willingness of officials to use these powers in a meaningful way.
Yet the issue may not be with VET FEE-HELP providers.
Regulatory failure may simply derive from the VET sector being hard to
regulate, due to the complexity of funding and program streams and the presence
of multiple regulators. The persistently high level of non-compliance—only 18.2
per cent of RTOs audited in 2015–16 were initially compliant with the
regulatory standards, following initial compliance rates of 24.7 per cent in
2014–15, 23.9 per cent in 2013–14 and 19.6 per cent 2012–13 —could indicate
systemic issues with the sector.
The cost of
Fundamentally, the purpose of student loans remains
unresolved by these amendments and the Government’s reforms to date. The
Opposition’s amendments also do not appear to clarify the issue.
Students—and governments—do not know what they are buying
until those students have finished their qualifications and are working in the
sector. That is the nature of education. The quality of education may be
affected for several reasons—a trainer may have a poor relationship with a
student, or may be relatively new and unable to provide adequate support. There
may be underfunding or governance issues which plague the provider. And
students choose to undertake education for a variety of purposes themselves.
The focus on completion rates (and on likely repayment) assumes that students
have gotten nothing from their training if they fail to complete their
The cost to
Most of the commentary around the costs involved in the
VET FEE-HELP program have related to the costs to government. The Assistant
Minister’s second reading speech to the current Bills explicitly referenced the
‘enormous cost to the Budget’.
It is true that the VET FEE-HELP scheme has led to
significant outlays. As can be seen from the information below, the Australian
Government has loaned out more than $6 billion to VET FEE-HELP students between
2009 and 2015. However due to the nature of income-contingent student loans
such as VET FEE-HELP and the new VET student loan scheme, much of this debt is
likely to be repaid.
Fees and loans time series (2009–2015)
Source: Adapted from DET, ‘Table 2.13: fee and loans time
series (2009–2015)’, Study tables, DET, Canberra, 24 October 2016.
As the Grattan Institute has pointed out, the issues with
VET FEE-HELP repayment are likely to be structural, due to the poorer
employment prospects and lower average incomes associated with many
qualifications in the VET sector.
The new VET student loan scheme will likely lead to lower
outlays, as it will involve fewer students. But it will not affect debt
repayment under the program. The existing HELP repayment threshold, designed
for higher education graduates, may simply not capture enough VET graduates,
due to their lower incomes. A more comprehensive approach to fiscal
sustainability could take into account the lower average incomes associated
with VET students and so have a separate repayment threshold suitable for VET
But there are no clear metrics for assessing the costs to
government. How much should government attempt to contain costs in the VET
FEE-HELP scheme? Was the scheme ‘acceptable’ in 2011, when only $205 million in
loans were paid out? At what point did it meet the ‘something must be done’
test? $500 million? $1 billion? Without knowing what the aims or parameters
are, it is hard to judge the efficacy of these reforms. If they reduce VET
student loans in 2017 to $1 billion, will that be an ‘adequate’ reduction?
Similarly, while a separate repayment threshold for VET
graduates would likely lead to increased debt repayments from that student
cohort, it may also increase the administrative costs for the agencies such as
the Australian Tax Office (which administers the compulsory repayment system) and
the Department of Education and Training (which manages HELP policy). The lack
of clear metrics is compounded by the lack of clear objectives: reforms to
improve fiscal sustainability such as separate thresholds may incur
administrative costs and also result in unfair and unequal treatment for
different graduates. Knowing how and where to balance the tradeoffs inherent in
any student loans scheme is crucial for understanding its effectiveness.
for the VET FEE-HELP model?
Many of these questions raised by the Redesigning VET
FEE-HELP discussion paper can be seen to have been answered by the
legislative amendments in the current Bills. The reforms in the current Bills
also adopt elements from Opposition proposals, such as loan caps, despite the
Government’s earlier criticisms.
A hallmark of reforms to VET FEE-HELP through 2015 and 2016
was that they increased the requirements on providers. RTOs had to meet higher
entry standards to the VET FEE-HELP scheme, they had to provide more
information, they had to screen their students more closely and had to ensure
the information they gave them regarding loans was not misleading and did not
involve inappropriate enticements. Interestingly rather than simply redesign
VET FEE-HELP, the current Bills establish a new scheme under a separate Act –
although as the new VET student loan scheme bears some key commonalities with
VET FEE-HELP and other HELP loans, it may be a question of branding rather than
actual distinction. Knowing exactly what constitutes a ‘new model’ for VET
FEE-HELP is unclear, although it is certain the proposed Bills will
significantly change the relationship between government and providers. It is
uncertain as to whether this latest intervention is one of degree rather than
one of kind.
It is also interesting to note that the Government’s
response to VET FEE-HELP has been to continually seek regulatory reform, to
promote greater government intervention in the VET sector. It is worth
considering why even greater regulatory powers are outlined in the current
Bills if this approach has not been successful to date.
Overall the reforms proposed in the current Bills, as
through 2015 and 2016, are not informed by a structural understanding of the
VET sector, its complexities, the activities of providers, and a solid
understanding of student outcomes. The appropriateness of using a student loan
framework designed for higher education in a distinctly different sector – VET
– goes unquestioned. The fundamental tension between expanding access to VET
through loans and limiting fiscal exposure by government goes unresolved. The
particular needs of the demographic serviced by VET FEE-HELP to date go
unexplored, and whether the anecdotal accounts of poor training or students
unknowingly signed up to loans represent a systemic failure is yet unknown.
The myriad of regulatory agencies, departmental staff,
programs, policies and funding streams seems compounded by situating VET
student loans as yet another complication which students will have to make
informed choices about and properly comprehend the risks in taking on a loan.
Providers will have to add additional administrative requirements, solely for
their VET student loan students, compounded by the processes in place to
grandfather any existing VET FEE-HELP students.
While representing a significant improvement on the status
quo, the Bills highlight the capacity for further reform: the amendments
address issues after the horse has bolted but do not go to the cultural or
systemic issues of why VET providers seem more likely to rort government
funding and provider poorer outcomes than those in other education sectors.
Expanding funding to both the school and higher education sectors has not
resulted in sham providers and inappropriate marketing practices, so it could
be questioned why it has in VET. Until these systemic issues are explored,
reforms are likely to continue to be iterative, reactive and ultimately
Education Support Amendment (VET FEE-HELP Reform) Bill 2015, Bills
digest, 60, 2015–16, Parliamentary Library, Canberra, 2015.
of Australia, ‘Higher
Education Support Amendment (VET FEE-HELP Reform) Bill 2015 homepage’,
Australian Parliament website.
more detailed background on the history of the VET FEE-HELP scheme, please see
Griffiths, Higher Education Support Amendment (VET FEE-HELP Reform) Bill
2015, Bills digest, op. cit.
an overview of policy reforms within the VET sector, please see G Gootzee, The
development of TAFE in Australia, 3rd edition, National Centre for
Vocational Education and Research (NCVER), Leabrook, 2001; and T Dumbrell, Resourcing
vocational education and training in Australia, NCVER, Adelaide, 2004.
of Education and Training (DET), ‘Commonwealth
register of institutions and courses for overseas students’, DET website.
This is the official Australian Government website that lists all Australian
education providers to offer courses to people studying in Australia on student
visas and the courses offered—whether the course be in the nature of schooling,
vocational education and training (VET), English language assistance, higher
education, or other learning.
Constitution, section 51.
Education and Training (Commonwealth Powers) Act 2010 (NSW); Vocational
Education and Training (Commonwealth Powers) Act 2012 (Qld); Vocational
Education and Training (Commonwealth Powers) Act 2012 (SA); and Vocational
Education and Training (Commonwealth Powers) Act 2011 (Tas).
Commonwealth is able to legislate in relation to the VET sector in the
Australian Capital Territory and the Northern Territory using the territories
power in section 122 of the Constitution.
Australian Skills Quality Authority (ASQA), ‘Jurisdiction’,
ASQA website, and ASQA, ‘Establishment
and legislation’, ASQA website.
with other regulators’, ASQA website, and ASQA, Strengthened
communications protocols between [Victorian] DET and ASQA, media
release, 27 July 2016.
of Australian Governments (COAG), Intergovernmental
Agreement on Federal Financial Relations, COAG, July 2011.
on Federal Financial Relations (CFFR), ‘National
Agreements’, CFFR website.
Agreement for Skills and Workforce Development, COAG, July 2011.
Partnership on Skills Reform, COAG, April 2012.
Allen Consulting, Review
of the National Partnership Agreement on Skills Reform: final report,
ACIL Allen Consulting, Adelaide, 21 December 2015.
J Ross, ‘Governments
get a fail on diploma funding’, The Australian,
9 November 2016, p. 30.
a breakdown of current Australian Government VET funding, see Australian
budget statements 2016–17: budget related paper no. 1.5: Education and Training
Portfolio, ‘Program 2.8: Building skills and capability’, pp. 69–75.
for example, DET, ‘Adult
Migrant English Program service providers’, DET website, last modified
27 June 2016. As a result of 2016–17 Budget measures, the Australian
Government has released a new business model for AMEP. This model will align
with the new service provider contracting period commencing 1 July 2017.
for example, Australian Government, ‘Summary
of the Australian government apprenticeships incentives programme’,
Australian Apprenticeships website, effective from 1 July 2015. This
documentation specifies who will be eligible for an incentive payment under the
program, the way the program operates and the levels of each payment.
an example, the Australian Capital Territory government maintains a Skilled
Capital Qualifications List as part of its Skilled Capital training program,
which indicates what VET units of study and qualifications it is willing to
subsidise, the amount of the subsidy, the number of places available (often
capped in order to contain costs) and the maximum concession. The list is
updated in line with skills needs to ensure there is not a glut of particular
qualifications. See ACT Directorate of Education and Training, ‘Skilled
capital qualification list’, The Directorate of Education and Training
website, August 2016.
F Tomazin, ‘Training
rorts crackdown’, The Age, 20 September 2015, pp. 1–2 and
R Wallace, ‘State
to audit 500 VET providers in crackdown on dodgy dealings’, The
Australian, 1 July 2015, p. 31.
unique student identifier was introduced through the Student Identifiers
Act 2014. For analysis, see L Doyle and C Ey, Student
Identifiers Bill 2014, Bills digest, 61, 2013–14, Parliamentary
Library, Canberra, 2014.
is “total VET activity?”, fact sheet, NCVER, July 2016. NCVER
has put together a series of useful fact
sheets on its total VET activity collection.
is VET FEE-HELP?, fact sheet, NCVER, July 2016.
National Agreement for Skills and Workforce Development, op. cit., ‘Clause
of Australia, ‘Higher
Education Support Amendment (Extending FEE-HELP for VET Diploma, Advanced
Diploma, Graduate Diploma and Graduate Certificate Courses) Bill 2007 homepage’,
Australian Parliament website; Higher Education
Support Amendment (Extending FEE-HELP for VET Diploma, Advanced Diploma,
Graduate Diploma and Graduate Certificate Courses) Act 2007.
. Higher Education
Support Act 2003 - VET FEE-HELP Guidelines, as made 22 May 2008.
Gillard (Minister for Education), Commonwealth
will support states willing to reform VET, media release, 26 August
. Amendment No. 1 -
Higher Education Support Act 2003 - VET FEE-HELP Guidelines, 24 March 2009.
Gillard (Minister for Education), Australians
to receive a national entitlement to a quality training place, media
release, 11 May 2010.
National Partnership on Skills Reform, op. cit.
Australian Skills Quality Authority (ASQA), ‘Understanding
the requirements for registration’, ASQA website.
apprentices get a leg-up’, The Age, 24 September 2010, p. 11.
Norton and I Cherastidtham, ‘Section 3.5: VET FEE-HELP’, Doubtful
debt: the rising cost of student loans, Grattan Institute, Melbourne,
April 2014, p. 20.
Australian Government, ‘Statement
6: Debt statement, assets and liabilities’, Budget strategy and outlook:
budget paper no. 1: 2016–17, May 2016, p. 6–22, for an explanation of how
HELP debt is accounted for in budget terms and the most recent estimation.
K Loussikan, ‘Evocca
weighs options for growth’, The Australian, 1 October 2014, p. 23; J
Ross and D Kitney, ‘Vocation
buys into college system’, The Australian, 1 May 2014, p. 19; T
deregulation opened floodgates’, The Australian Financial Review,
1 November 2014, p. 17; T Dodd, ‘Providers
data “amazing”’, The Australian Financial Review, 3 November 2014,
p. 11; S Evans, ‘ASIC
steps in as vocation shares crash’, The Australian Financial Review,
29 October 2014, p. 13; T Dodd, J Thomson and S Danckert, ‘Vocation
runs out of options’, The Australian Financial Review, 27 November
2015, p. 10, for media accounts of providers who had become reliant on
government funding. A study of RTO financial records was undertaken in S Yu and
D Oliver, The
capture of public wealth by the for-profit VET sector, Australian
Education Union, Australian Education Union, Melbourne, January 2015.
first identified this as an issue in a strategic review published in September
2013. See ASQA, Marketing
and advertising practices of Australia’s registered training organisations,
ASQA, Melbourne, 20 September 2013.
Bird (Shadow Minister for Vocational Education), Government
must act to protect quality in the training sector, media release,
7 October 2014; S Bird (Shadow Minister for Vocational Education), Additional
action needed on quality in VET sector, media release, 9 October
scheme relies on trust’, The Australian, 8 October 2014, p. 27.
over course’, Hobart Mercury, 27 October 2014, p. 3.
produced guidance on the transition from the 2012 set of Standards to the new
Standards, indicating the differences and its regulatory expectations. See
mapping and treatment of non-compliances – standards for RTOs against SNRs’,
Macfarlane (Minister for Industry), Australian
Government bolsters skills and training with $68M of new funding and new
standards, media release, 8 October 2014.
. Higher Education
Support Act 2003 – VET Guidelines 2015, as made 30 March 2015.
. Amendment No. 1 to
the VET Guidelines 2015, as made 18 June 2015.
Education and Employment References Committee, ‘Terms
of Reference’, Inquiry into the operation, regulation and funding
of private vocational education and training (VET) providers, The Senate,
Education and Employment References Committee, Getting
our money’s worth: the operation, regulation and funding of private vocational
education and training (VET) providers in Australia, The Senate,
Canberra, October 2015.
Griffiths, Higher Education Support Amendment (VET FEE-HELP) Bill 2015,
op. cit., for more detail on the Bill as introduced.
Parliament of Australia, ‘Higher Education Support Amendment (VET FEE-HELP
Reform) Bill 2015 homepage’, op. cit.
of amendments moved by the Senate, Higher Education Support Amendment (VET
FEE-HELP Reform) Bill 2015, and Supplementary
Explanatory Memorandum, Higher Education Support Amendment (VET FEE-HELP
Reform) Bill 2015 for an overview of the amendments moved and their intended
purpose. Please note some amendments moved by the Senate were introduced by
non-Government Senators and so are not covered by the Supplementary Explanatory
. Higher Education
Support (VET) Guideline 2015, as made 18 December 2015.
Carr (Shadow Minister for Higher Education, Research, Innovation and Industry)
and S Bird (Shadow Minister for Vocational Education), Time
to get tough on shonky providers, joint media release, 9 November 2015.
Simms (Greens Tertiary Education Spokesperson), Fix
the for-profit VET ‘shambles’, media release, 30 November 2015.
more information on administrative complexity in the tertiary education sector,
see J Griffiths, ‘Tertiary
education providers—more regulation for some and less regulation for others’,
FlagPost, Parliamentary Library blog, 14 December 2015.
Dodd and P Riordan, ‘Freeze
on payments to college “shonks”’, The Australian Financial Review,
2 December 2015, p. 4.
Ryan (Minister for Vocational Education and Skills), Nationwide
VET FEE-HELP consultations start today, media release, 4 April
Ryan (Minister for Vocational Education and Skills), Release
of the Redesigning VET FEE-HELP discussion paper, media release, 29
of Education and Training (DET), Redesigning
VET FEE-HELP, Discussion
paper, DET, Canberra, released 29 April 2016, p. 6.
Shorten (Leader of the Opposition), Sen K Carr (Shadow Minister for Higher
Education, Research, Innovation and Industry), S Bird (Shadow Minister for
Vocational Education), Labor's
plan to stop dodgy providers ripping off taxpayers and students, joint
media release, 5 May 2016.
Labor Party (ALP), Protecting
students & restoring integrity to VET FEE-HELP, ALP policy
document, Election 2016.
the TAFE system: building our skills future, Greens policy document,
Ryan (Minister for Vocational Education and Skills), Labor's
assault on TAFE students, media release, 16 June 2016.
Party of Australia, Putting
students first, Coalition policy document, Election 2016.
Education and Employment Legislation Committee, ‘VET
Student Loans package’, Inquiry homepage.
Standing Committee for the Scrutiny of Bills, Alert
digest, 8, 2016, Senate, 9 November 2016, pp. 52–59.
to framing Commonwealth offences, infringement notices and enforcement powers,
Attorney-General’s Department, Canberra, September 2011.
Standing Committee for the Scrutiny of Bills, Alert
digest, 8, 2016, Senate, 9 November 2016, pp. 52–59.
K Ellis (Shadow Minister for TAFE and Vocational Education), Liberals'
hypocrisy on VET loan caps, media release, 5 October 2016.
Student Loans Bill 2016, VET Student Loans (Consequential Amendments and
Transitional Provisions) Bill 2016, VET Student Loans (Charges) Bill 2016’,
House of Representatives, Debates, 19 October 2016, p. 2547.
House of Representatives, ‘VET
Student Loans Bill 2016’, Votes and proceedings, HVP 14, 19 October
2016, p. 256. K Ellis (Shadow Minister for TAFE and Vocational Education), Liberals
vote against VET Ombudsman, media release, 19 October 2016.
Hanson-Young (Greens Spokesperson on Education), Greens
secure VET Ombudsman for exploited students, media release,
13 October 2016.
reading speech: VET Student Loans Bill 2016’, House of Representatives, Debates,
13 October 2016, p. 1853.
reading speech: VET Student Loans Bill 2016, VET Student Loans (Consequential
Amendments and Transitional Provisions) Bill 2016, VET Student Loans (Charges)
Bill 2016’, House of Representatives, Debates,
18 October 2016, p. 2347.
Council for Private Education and Training (ACPET), Submission,
no. 23, to the Senate Education and Employment References Committee, Inquiry
into the VET Student Loans package, October 2016, p. 2.
Directors Australia (TDA), Submission,
no. 26, to the Senate Education and Employment References Committee, Inquiry
into the VET Student Loans package, 21 October 2016, pp. 3–4.
Council of Trade Unions, Submission,
no. 6, to the Senate Education and Employment References Committee, Inquiry
into the VET Student Loans package, 19 October 2016, p. 1.
Education Union, Submission,
no. 14, to the Senate Education and Employment References Committee, Inquiry
into the VET Student Loans package, 19 October 2016, p. 1.
Tertiary Education Union (NTEU), Submission,
no. 2, to the Senate Education and Employment References Committee, Inquiry
into the VET Student Loans package, 2016, pp. 3–5.
Industry Group and the Business Council of Australia, Joint
submission, no. 43, to the Senate Education and Employment References
Committee, Inquiry into the VET Student Loans package, October 2016, pp.
Memorandum, VET Student Loans Bill 2016, p. 6.
Statement of Compatibility with Human Rights can be found at pages 9–19 of the
Explanatory Memorandum to the VET Student Loans Bill.
Joint Committee on Human Rights, Human
rights scrutiny report:report 8 of 2016, 9 November 2016, p.
National Agreement on Skills and Workforce Development, op. cit.,
for example Division 90, Higher Education
Support Act 2003, in relation to the HELP loan for subsidised
undergraduate students (HECS-HELP). The Explanatory Memorandum to the VET
Student Loans Bill also notes the parallel between the citizenship eligibility
provisions and those in FEE-HELP and VET FEE-HELP. See Explanatory Memorandum,
VET Student Loans Bill 2016, op. cit., p. 23.
23B: Entry procedure for students, Higher Education
Support Amendment (VET FEE-HELP Reform) Act 2015.
preliminary analysis of the outcomes of students assisted by VET FEE-HELP,
NCVER, Adelaide, 6 November 2015, pp. 6–7.
the programs authorised under the Higher Education Support Act 2003 (HESA)
by Chapter 1 of the Other
Grants (Education) Guidelines 2012.
program information, see DET, ‘Higher
education disability support program’, DET website, last modified 15
clause 14 in Part 2 of the VET Student Loans Bill 2016, compared with
Clause 6(1)(ca) of Schedule 1A of HESA, and the accompanying definition
for ‘qualifying VET course’ in the HESA dictionary.
Memorandum, VET Student Loans Bill 2016, op. cit., p. 25.
the case of subsidised university places, funding is authorised under the Commonwealth Grants
Scheme Guidelines 2012, and paid in accordance with funding
agreements which exist between the Department of Education and Training and
each individual university. For most undergraduate university places (save
medicine), universities are able to enrol as many students as they wish and
allocate funding accordingly.
VET student loans:
approved courses, DET, Canberra, 17 November 2016.
Memorandum, VET Student Loans Bill 2016, op. cit., p. 32
of Australia, ‘Higher Education Support Amendment (VET FEE-HELP Reform) Bill
2015 homepage’, op. cit.; Griffiths, Higher Education Support Amendment (VET
FEE-HELP Reform) Bill 2015, Bills digest, op. cit.
of Australia, ‘Higher
Education Support Legislation Amendment (2016 Measures No. 1) Bill 2016
homepage’, Australian Parliament website.
103 in Part 10 of the Bill allows, but does not require, the Secretary to
publish information (other than personal information about a student) if the
Secretary is satisfied that the information would assist students in enrolment
decisions, in understanding their VET entitlement or to encourage compliance
with the Bill.
Education and Employment Legislation Committee, Answers
to Questions on Notice, Inquiry into the VET Student Loans package,
25 October 2016, p. 1.
Competition and Consumer Commission, Careers
Australia undertakes to repay Commonwealth for VET FEE-HELP diploma courses,
media release, 16 May 2016.
no. 32, to the Senate Education and Employment References Committee, Inquiry
into the VET Student Loans Bills 2016, October 2016, ‘Attachments 2 and 3’.
ripped off in get-rich college rort’, The Age, 17 September 2015, p.
1; and M Bachelard, ‘Dodgy
colleges still using lure of “free” laptops’, The Age, 23 November
2015, p. 8.
Lavarch (Commissioner – Risk, Intelligence and Regulatory Support, Australian
Skills Quality Authority), Evidence
to Senate Education and Employment References Committee, Inquiry into
private vocational education and training providers, 16 July 2015, p. 54.
colleges “rort” loans despite low finishing rates’, Canberra Times,
24 October 2016, p. 5; K Louissikian, ‘Vocational
colleges are graduating only 23pc’, The Australian, 24 October 2016,
‘Table 1.13: three year
cohort completion rate by student characteristics, for commencement years
2011–2013’, Student tables, DET, Canberra, 24 October 2016.
4: main reason for not continuing the training for government-funded subject
completers, 2014 and 2015 (%)’, Government funded student outcomes 2015,
NCVER, Adelaide, 3 December 2015.
to VET student loans “to stop college rorts”’, The Australian,
17 November 2016, p. 1.
Directors Australia, Submission,
no. 6, to the Senate Education and Employment References Committee, Inquiry
relating to the Higher Education Support Amendment (VET FEE-HELP Reform) Bill
2015, 20 November 2015, p. 1.
report 2015–16, ASQA, Melbourne, 22 September 2016, p. 26.
‘Second reading speech: VET Student Loans Bill 2016’, op. cit., p. 1853.
and Cherastidtham, ‘Section 3.5: VET FEE-HELP’, op. cit.
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