Govt sets VET deregulation agenda

3 July  2014


The government has set out its deregulatory intentions for vocational training, with industry and Registered Training Organisations set to gain greater control of the sector, and a shift away from “gateway control” to “responsive regulation”.


MacFarlaneSpeaking at a skills summit organised by the Australian Council of Private Education and Training and the Australian Chamber of Commerce and Industry, industry minister Ian Macfarlane said the government had “revisited” the work of the now abolished National Skills Standards Council (NSCC) and released new draft standards for training providers and regulators.

The proposed standards dump what the minister described as” several of the more contentious reforms” proposed by the former NSSC, notably measures that would have strengthened Registered Training Organisation (RTO) entry (“gateway”) standards, including a change from registered training organisation to licensed training organisation. The proposed requirement for all RTOs to have an “Accountable Education Officer” has also been removed.

The minister said the retreat from the NSCC’s proposed strengthening of standards doesn’t signal a lesser emphasis on quality:

We will still require a registered provider to meet quality standards and have a robust approach to quality assurance.  But we won’t dictate how that is demonstrated.

We would have thought any enforceable standards involves a form of dictation, as implied in the report of an “ASQA process review”, undertaken by PricewaterhouseCoopers, also released by MacFarlane:

A key role of a regulatory authority is its responsibility to effectively monitor those whom it is charged to govern, and ensure ongoing compliance with rules. To achieve this, the regulator must continually monitor the sector…. Those that breach the regulatory requirements will likely be exposed to a formal sanction or penalty, which must be legally enforceable under governing legislation. The ability to enforce sanctions among those determined to be non-compliant is critical to effective regulation (pp. 24-25).

As you would expect in a process review, this report is mainly about ASQA processes and how they might be improved; for example, by upgrading ASQA’s information technology system, which are depicted as inadequate , and improving its communications with providers, which are widely decried in the sector as being located on a continuum somewhere between hopeless and abysmal.

Most of what the report recommends is eminently sensible and will make the regulatory system more transparent and navigable and serve to foster a culture of co-operation between the regulator and the regulated to ensure appropriate quality standards.

Likewise, much of what the minister had to propose is sensible, such as reducing the burden arising from the quite maddening (for anyone working in the sector) constant updates to training packages. He said

We are looking to batch the release of training package updates — say to once a year. We are also looking to ensure that the downstream impacts of changes are fully considered at the development phase.

Macfarlane also proposes to keep a lid on ASQA’s fees “for the foreseeable future”, which is obvious recognition of PwC’s observation that full cost recovery isn’t a currently feasible option.

But it is a possible move away from rigorous “gateway control” that has grabbed attention (quite understandably).  In an almost passing observation at the end of the Executive Summary, the PwC report states that as the sector has matured, there may be potential to progress toward a more responsive model of regulation and ASQA could consider:

  • Shifting the balance of regulation more toward monitoring and compliance. Moving the focus of regulation of the sector from entry control, where providers are regulated as they enter the market or commence offering new services within the market, towards a model where the quality of outcomes produced by a regulated organisation is assessed and monitored on an ongoing basis.
  • Transitioning to an outputs based regulatory focus. Australia’s VET system is based on the achievement of competencies as determined by assessment. While entry control will always be important, refocusing ASQA’s effort toward the monitoring of the key output (assessment) helps to ensure a high quality VET sector….

Just to put this into perspective, in the first place, this was a review of process, not policy or regulatory principles (although ASQA’s “approach to regulation” was within the scope of the review). Second, the observations on “responsive regulation” comprise just 3 paragraphs in a report running to 100 pages, with no supporting analysis or argument and not at all covered in the 21 findings.

It sits rather uneasily with the observations of the Productivity Commission, quoted in the PwC report, that

….the national standards for the registration and auditing of RTOs should be more rigorously enforced by vocational education and training regulators to ensure quality and consistency in course delivery and learner outcomes.

And it sits rather uneasily as well with the report’s own observation that

Entry control encompasses activities that are required to gain entry to participate in a particular industry. From a regulatory perspective, entry control activities are those that one must comply with to legally operate within a certain industry/sector. Properly designed entry control requirements are critical to maintaining a competitive, high quality market. (p.25)

There is also the question as to who or what is making the standards these days, which, as the report notes, is typically made by a third party, with assistance and support from the regulator. That third party was the NSSC, now abolished. It with perhaps this in mind that Gavin Moodie, adjunct professor of education at RMIT University, described the proposed changes  as “piecemeal, ad hoc, internally inconsistent and the result of privileged involvement of favoured interest groups”.

ACPET, on the other hand, says the draft standards are a step in the right direction. According to ACPET ceo Claire Field:

They come off an evidence base from ASQA’s three years of regulating the sector, and will significantly tighten up on poor practices without introducing ridiculous changes. Minister MacFarlane is clearly focused on building a less complex, more responsive training sector focused on improving the employment prospects of graduates. Those are exactly the right goals for these reforms.

TAFE Directors Australia said the new draft standards laid out “a higher expectation for Australia’s open skills training market”. But chief executive Martin Riordan said he was concerned that financial viability appeared to have “slipped as a priority”.

Industry-led VET reform to drive productivity gains
The Australian Skills Quality Authority Process Review
ASQA urged to abandon ‘entry control’ approach


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