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Mark Paterson joined the Australian Skills Quality Authority in May 2016 as the Commissioner of Regulatory Operations. He assumed the role of Chief Commissioner on 1 January 2017. Previously, he served as Secretary of the Department of Industry, Tourism and Resources (Cth), and later, as Secretary of the Department of Innovation, Industry, Science and Research (Cth). We spoke to Mark about recent changes to the auditing model used by ASQA to assess compliance of RTOs with the national standards.
Mark, in a nutshell, what is the main reason ASQA is changing its approach to audits of RTOs?
I think “evolving” is probably a better way to describe it. And any regulatory agency will have its regulatory approach and want to evolve over time, and respond to the changing landscape in which it operates. What we’re trying to do is to focus on the behaviour and the performance, on what happens on the ground. To date, a lot of the audit activity has been driven by applications, such as an application to create or renew an RTO, or change its scope — rather than looking at the risks to the system — both provider risk and systemic risk. Our regulatory approach is evolving over time to look more at performance and how RTOs deliver within the framework, not just on how they respond to applications.
Obviously the whole industry was shaken up by the revelations of the last couple of years. Now that ASQA is modifying, and to some extent, tightening the compliance requirements, are you expecting an overall decrease in the number of RTOs in Australia in 2017 and beyond?
Look, we’ve seen a progressive decline in recent years, both by changing market circumstance and regulatory action. When ASQA was formed, on referral there were about 5000 RTOs. We need to keep the VET FEE-HELP in context. You’re looking at a number less than 300 receiving VET-FEE-HELP, when there are 4600 RTOs across Australia. That number has declined by about 10%. Presently, I think there’s a very large number of RTOs; many with a very narrow scope, and RTOs that don’t actually deliver training at all. It wouldn’t surprise me if we saw a continued reduction in numbers, and that might be healthy in relation to the system overall.
As part of the auditing process, are you extending the capabilities for students to provide their feedback or lodge complaints directly with ASQA, or are you going to use existing channels that are there already?
We will be surveying students as part of the audit process. And individuals can lodge complaints at the present time. But when ASQA was created, it was created by a referral of powers by the majority of states to the Commonwealth. What they did not refer were the consumer protection powers. The Australian Competition and Consumer Commission at the federal level, and the fair-trading agencies at the state level, retain their powers to investigate consumer-led issues. Many of the student style complaints might be about misrepresentation or students not getting what they were offered. These tend to be matters that are rightly in the province of the fair-trading agencies. ASQA only operates in the powers that were referred –largely, the regulation of RTOs, and the regulation of the system.
Does that mean that while you’re moving away from the application phase of RTOs, you’ll still be focusing on business compliance and regulatory compliance rather than students’ complaints?
Well, as I said, we respond to complaints at the present time because a student complaint will be an indicator of provider risk; i.e a poor performance by a provider, or a provider not meeting the appropriate standards, or not training in the way that is expected by the standards, or not assessing in the way expected. We’ve always had those kind of complaints; we investigate those, and they can lead to a further more detailed examination of provider behaviour.
We’re not moving solely away from applications, but we’re not going to be driven by applications per se. It’s about risk associated with the provider. What is the nature of the risk? Is it a provider risk, or a broader system risk? The biggest systemic risk that the system faces is people having qualifications that suggest they have particular skills and competencies that they don’t actually hold. So it’s about making sure that the quality and training is up to speed, and evaluating the nature and quality of the assessment. Looking at the system, that’s where the risks are; in poor quality training and poor quality assessment.
Given that the clients of RTOs are not only students but also employers, we assume you get a reasonable number of complaints from employer groups or even specific enterprises.
Absolutely. There are a number of people with interest in this area. Employers are key. It’s a vocational education and training system, so we are focused on skills for the workplace. Employers have a strong interest, students clearly have a strong interest, and in many cases, their families have a demonstrable interest, because they’re assisting young people who are making career choices while they undertake their studies. So there are a number of interests. Governments — as major providers of vocational training — clearly also have an interest in the quality of the training and the quality of the assessment.
In regards to employers, do you have a similar survey for employers to gauge the ongoing training that is being delivered generally by RTOs
That’s not something we’ve focused particular priority to at the present time. We do get complaints — because an employer will see a pattern of behaviour quite often. Sometimes employers will know whether a person presenting with a qualification does have the skills or doesn’t have them. But they’re not always in a position to assess the trainer or the organisation providing the training. Our focus is on those who are directly engaged, looking at the RTO in the delivery and assessment, and the students’ experience of the trainer. This gives us a better sense of the risks associated with the system. It’s about the quality and confidence that all stakeholders can have in the credentials offered by the system.
Is ASQA’s practice to request from RTOs a list of students in order to survey student satisfaction directly, or instead to require the RTO to conduct the survey on ASQA’s behalf?
We’ve done both. We’ve run the surveys directly. And we’ve had the RTO undertake the survey of students with the responses coming to us. And its horses for courses. We’ll make a judgment associated with a particular audit. What are the things we’re looking at? What do we want to raise? It might be complaints. It might be issues raised by other regulatory authorities. It could be that they’re in a risky sector, that there’s been some bad practice and we’re looking at providers in that particular sector. It depends on the nature of the risk, and the nature of the issue we’re looking at.
So Mark, just reading the social media, and speaking with RTO consultants and RTO owners, there’s a perception that it’s not an even playing field, that the audit requirements placed on private RTOs are different than those placed on TAFEs and public sector RTOs. Would you care to comment on that?
It wouldn’t surprise you to hear, but we don’t see that there’s an un-level playing field in terms of the nature of ownership of RTOs. We regulate public and private through the same lens, with the same audit approach and structures. But we do have a system of delegation. And we delegate our powers of extending scope; for example, changing items of scope. We delegate those powers, in some circumstances, to providers that have a demonstrated track record and the capabilities and internal systems to be able to properly manage that regulatory tract themselves. Now in many cases, public providers have that delegation, but there are many private providers that also have that delegation as well.
If you were talking to RTO owners, if you could help them to focus on 2 or 3 key things, where success would help get them 80 to 90% there of being compliant, what are the recommendations you would be giving them in your experience?
We apply the standards for registered training organisations. And we provide guidance to all RTOs in relation to those standards. And I think it is unfortunate that the area that RTOs seem to fall down in the most is in relation to their training and assessment strategy and practices, and the quality of assessment. So, for me, If I was talking to a room full of RTOs, I would be saying to them, “focus on the main game. Focus on what you are here to do.”
Yes, many of them will be there for the purposes of getting a commercial return on the investment of their effort. But they are still registered training organisations with obligations to deliver quality training and assessment processes, and that’s where they should focus their attention. In the past, you could buy a set of books essentially from a consultant, that superficially indicated you had all of the systems and processes in place, but sometimes those books just stayed on the shelf. So you had a compliance set of procedures manuals, and a compliance set of materials, but what did you do with them on the ground?
For me, talking to RTOs, I would be saying “focus your attention on what you do on the ground.” Focus your attention on how you deliver quality training to meet the competencies that are outlined in the training packages. Because predominantly our system is built on training packages. How do you deliver those outcomes, and how do you properly assess them? Because these are the two areas where we might find non-compliance with the standard.
In relation to trainer competency, because that’s a big piece of the puzzle, I understand there have been some changes, tightening up of the requirements in that area as well. How will training organisations be affected moving forward?
There’s a new training and assessment package. All deliverers of that package will need, by October this year, to have gained registration with that TAE ‘Qualification on Scope’. There won’t be an automatic transfer from the old qualification to the new. Trainers will need to ensure that they are able to meet those standards. So there has been, by the system broadly, much greater attention given to the training and assessment qualifications filled by trainers.
We’re not a heavy-handed regulator. We understand that people are in the business to run a business, but there are risks associated with it. If you’re training someone to look after somebody’s young children, or if you’re training someone to wire up a switchboard, you want to know that the person has the competencies that the qualification asserts they have. That they just don’t have a piece of paper. You want to be confident in the system, that they know how to deal in the business that they’re operating. The same would apply in transport industries, fishing, hospitality, whatever it might be. In food service, you want to know that they understand cleanliness and proper handling of food. All of those things people take for granted when they accept the fact that these people have qualifications. What ASQA needs to be satisfied with, especially with the large number of RTOs, is that the training that they offer and the assessment processes that they put people through are fit for purpose.
Rogue RTOs and consultants have been accused of targeting vulnerable sections of the community to generate student numbers. With the ACCC and state bodies handling consumer complaints, and ASQA looking at RTO behaviour and performance, is there a risk that exploited students might slip through the cracks?
Look, everything’s possible. We work very closely with the fair-trading agencies and the ACCC, and it’s not uncommon for somebody who has a series of complaints to also have shortcomings about an RTO meeting their obligations under the ASQA standards. So it’s not uncommon for complaints to come to us as well as a fair trading agency. We work closely with these agencies. Under our regulatory regime; we apply an appropriate level of rigour, depending on the nature of the risk. We don’t want to apply a heavy-handed regulatory burden on everybody, irrespective of the nature of the risk they represent. A high-quality provider, who meets all the standards, who consistently meets the standards, consistently delivers high-quality training, shouldn’t have a burden imposed on them that is the equivalent imposed on the least capable. You want to make sure it’s an appropriate regulatory burden having regard to the nature of the risk.
Does that mean for those organisations that in your opinion are less of a risk — to the market or their students — that there’s going to be more of a hands-off approach?
I’d expect a higher level of compliance activity in the area where risk is elevated. I wouldn’t use the term ‘hands off.” But when we scope an audit, or compliance activity, we have regard to the nature of the risk. We have regard to the complaints. We develop profiles of risk associated with individual providers. And that then informs our framework. We have regard to investigations to audit, to evidence analysis, all of those sorts of things will inform the activity. But you want it fit for purpose. You don’t want a burdensome regulatory regime. You can stop all risk by stopping all activity, and we don’t want to do that. We want the compliance regime to reflect the nature of risk, both provider risk and systemic risk. And we’ve worked very hard to get that balance right.