Senate debates

Monday, 16 March 2015


National Vocational Education and Training Regulator Amendment Bill 2015; Second Reading

5:22 pm

Photo of Kim CarrKim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | | Hansard source

Labor supports the Vocational Education and Training Regulator Amendment Bill 2015, although we wish the government had moved much sooner to ensure appropriate regulation of the VET sector.    The bill aims to prevent shonky operators from exploiting vulnerable people by offering inducements to undertake courses of dubious worth. Labor has been warning about these schemes for almost 18 months. Beyond that, the government must be aware that there is a long history of dodgy private providers with flimsy credentials—or none at all—in higher and vocational education. We have had to clean up this sort of mess before. The former Labor government did so and, as I think is recognised, there are now no more shopfront degree mills. We introduced the regulators which cover these areas to stamp out these practices. There are no more purported universities run out of diving shops on Norfolk Island, whisky wholesalers in Adelaide, or post-office boxes in the vicinity of the black stump.

There is now, however, renewed cause for concern. Some of these fly-by-nights may be poised to fly back if the Abbott government succeeds in deregulating higher education fees and opening up that sector to more private provision. But at least the government has finally decided to act against the unscrupulous amongst the registered training organisations, or RTOs, and their agents in the VET sector. It could hardly have done otherwise. At Senate estimates, the national regulator of the sector, the Australian Skills Quality Authority, indicated that it was investigating 23 providers. The authority reports that it has received almost 4,000 complaints and conducted 3,000 audits since it was established by the former Labor government in 2011.

Last year the member for Cunningham and I called on the Auditor-General to investigate VET FEE-HELP to ensure that skills funding was being used in accordance with the intent of the legislation. The Auditor-General has requested that a performance audit be included in his office's 2015-16 work program. There have been a spate of media reports about the practices of VET operators.    I draw the attention of senators to a report published in The Australian today concerning students enrolling in a one-year, part-time diploma in salon management at the Australasian College in Sydney. This course costs students $27,880. That is more than the cost of a three-year arts degree at the nearby University of Technology, Sydney, which is $18,456 after federal government subsidies. But graduates of the salon management course are not qualified to work as hairdressers or beauticians. At least they know that—or they should.

Some dodgy operators whose activities have been reported over the past 18 months, however, do not tell their students what they need to know about the courses being spruiked. They prey on the unsuspecting, signing them up for large VET FEE-HELP debts. In many cases, new students are not even aware that they have signed up for a course, let alone a debt that is often about $20,000. The problem is exacerbated when these RTOs employ brokers to recruit students on their behalf and then attempt to distance themselves from those operators.

The bill contains no specific consumer protection provisions, but it does allow the minister to respond more rapidly on issues of quality control. The minister will be able, through legislative instrument, to declare quality standards. This bill also takes some steps towards making registered training organisations responsible for the actions of their brokers. It prohibits a person from advertising or offering to provide all or part of a VET course without including the name and registration code of the responsible RTO; it makes satisfying the quality standards a condition of registration; it extends the operation of penalty provisions to trading corporations; and it clarifies the definitions of 'quality standards', 'registered training organisation', 'registration code', 'VET information' and 'ministerial council'.

Last week the Assistant Minister for Education and Training announced further changes to deal with rogue providers. They will come into effect on 1 April under the new National Standards for Registered Training Organisations. Providers will be banned from offering inducements—such as cash, meals, laptop computers or other prizes—to get people to sign up for courses they do not need. It will be impossible for providers to levy all fees in a single, up-front transaction. This will ensure that students have a chance to consider their options before incurring a VET FEE-HELP debt. Providers will also be required to give students clear information explaining that VET FEE-HELP loans are real debts that they must repay and which may affect their credit rating. It will be easier for the government to cancel student debts generated by providers who breach the guidelines. Miraculously short 'diploma' or 'advanced diploma' courses will be banned and a requirement for a minimum number of units imposed. Brokers and marketing agents will be prevented from freelancing—signing up as many students as possible—without the training provider being held responsible for their actions. Labor is pleased that the government has finally heeded our warnings about shonky operators. We look forward to receiving details of the new measures and to supporting them if it is clear that they will operate as the minister has indicated.

Dodgy operators load not only their immediate victims with debt; in many cases the debt is borne by the taxpayer and increases pressures on the federal budget. The report in The Australian that I mentioned earlier states that some private colleges are charging up to four times as much as government-run TAFE courses. The nation's student debt bill is ballooning. This is another respect in which the experience of part-privatisation of the VET sector provides a cautionary tale for what might happen in a deregulated higher education sector.    In 2013, $709 million was spent on VET FEE-HELP. Last year that figure had blown out to $1.6 billion.    A report by the Grattan Institute has warned that 40 per cent of these loans will never be recovered. Therefore, they are a burden on the Commonwealth and on the taxpayers of Australia.

The government has an opportunity to learn from the intervention that it has had to make in the VET sector. What we are seeing is how open markets can easily get out of control. Where there is deregulation and subsidisation of private providers, people will charge whatever they think they can get away with. That is what has been happening in the VET sector. The changes are undermining the traditional, publicly owned and operated TAFE colleges, which train people in skills that are vital to the economy. The changes are allowing private operators to transfer to the nation the cost of boutique courses that may be briefly fashionable but which do not offer students long-term career prospects and which add little or nothing to the national skills base. This is already a disaster. If the government succeeds in its goal of allowing the higher education sector to suffer the same fate, this disaster will become far worse.

5:31 pm

Photo of Lee RhiannonLee Rhiannon (NSW, Australian Greens) Share this | | Hansard source

The National Vocational Education and Training Regulator Amendment Bill 2015 will provide greater transparency in the marketing of VET courses. There are some positives in this bill; we do acknowledge that.

Greater transparency in the marketing of VET courses by requiring marketers and salespeople to be explicit about which organisation will be responsible for issuing the qualification or statement of attainment is clearly needed. There are now so many examples on the record where companies that have moved into the private education sector have failed to do that, and they demonstrate the need for this. The bill also seeks to improve quality standards by responding to emerging issues. We again acknowledge that that is needed.

While the Greens will support these new measures, it is obvious that there is much more that needs to be done to improve the private VET sector and protect vulnerable consumers. There have been so many abuses in this area. We note that Senator Birmingham, who is responsible for this area, has publicly stated that there will be higher standards and more requirements put in place to try and tighten up on the shonky providers that are moving into this area.

This is something that the Greens have been warning about. We have watched closely what has happened in Victoria, and that really has demonstrated the dangers when for-profit companies come into the education sector. What needs to be reiterated in this debate is that high quality in our VET system comes about when we have an adequately funded public TAFE system which is free to focus resources on higher-cost training and education, which we know that the private operators are reluctant to address. Why are they reluctant to address that? Because their job is to make profits. If you are a for-profit company, then that is what you are required to do by the standards that those companies operate under. Their job is also to seek to increase their profits. They do that by cutting corners, by cutting costs, by running courses that may just go for a few days or for a few hours and, with free iPads or free laptops, by inducing people to sign up. We have heard from the minister that the government are going to tighten up on this, and that is welcome. But the Greens' concern remains that, as these companies have to make a profit, they will continue to look for loopholes and ways to cut corners. This is a challenging area. As I have said, the Greens certainly do not oppose these measures.

The growth in private VET providers in Australia has mainly focused on low-cost courses and program. That is how the private sector operates. This has detracted resources from the public TAFE system. We know that TAFE provides an enormous benefit to our society by delivering a great diversity in programs. We see pathways into learning. We see courses for second chancers. Those who missed out on gaining qualifications at school now want to re-enter the education system, and TAFE can assist them to do that. There are courses that require community infrastructure and expensive high-tech equipment, and TAFE provides those. TAFE provides this enormous diversity for people to come into the education sphere in a variety of ways, and that is a huge asset.

In a debate like this—particularly as we are essentially dealing with the issue of private for-profit companies that abuse the system, abuse the standards and so often get away with it—we need to look at what is going on with TAFE. TAFE is putting massive resources into training. We often have very high cost programs, which include the latter stages of apprenticeship training and high-tech digital courses. These are becoming essential to ensuring that Australian workers are well educated and well trained for the challenges that lie before them as individual workers and the challenges that lie before our whole society. Many of these workers will change jobs many times, and the skill base that they take out into the workforce will be absolutely essential in order to help keep them in well-paid, satisfying work that also benefits our community. Again, so many of those companies are not interested in providing courses that are based on complex infrastructure and need to be well funded to be able to provide the considerable complexity that is required to take forward this type of education and training.

In this debate, we need to remind ourselves of the importance of a robust public TAFE system. It is more important than ever to ensure that we have a sustainable economy. This is very relevant when talking about standards for private operators, because so many of these private operators are actually undermining our economy—because, when you undermine the standards in our training and education, it means that people may not even be able to enter the workforce because they have blown their opportunity to be able to gain a successful degree. So the consideration of the role of TAFE is very important here. There is a lot of work to be done, which means lots of jobs require technical expertise. Often that will only come by having a well-funded public TAFE system. I have to bring in the issue of climate change here. The challenges that we are facing and the need to transition to a clean economy require training and education to be provided in a very comprehensive, very thorough way. That is something that for-profit companies basically step away from. Yes, we are supporting this bill—the standards need to be improved—but just increasing a few standards is not going to address the problems that we have with how some of these for-profit companies are operating.

Again to emphasise: the Greens do recognise that at times there is a role for private providers, but that should not include for-profit companies. When you bring the for-profit motive in, you have immediately got problems with people cutting corners. How the Greens see it is that those private companies should only come into the running of the courses when TAFE is unable to provide the course itself, either because of the location or, in some cases, because of the resources that are available. We need to emphasise, when we are considering these matters, that private providers so often cherry-pick the low-cost courses, because that is where they can make more money. We need to ensure that TAFE is able to continue to deliver high-quality and higher cost training and is able to provide that diversity of courses.

The Greens have serious concerns about the direction the VET systems are heading in. This bill that we are debating now is a small step forward, but, as the ministers' comments just last week revealed, the problems with the standards with so many companies here are so enormous. This is something that needs to be dealt with much more thoroughly. We will clearly be revisiting this with much more legislation. But it needs to be injected into this debate that one of the best ways to handle the issue of the low standards that private, for-profit companies bring to vocational education and training is to ensure that we have a well-funded, publicly owned TAFE system that is the dominant provider of vocational education and training programs.

5:40 pm

Photo of Helen PolleyHelen Polley (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary for Aged Care) Share this | | Hansard source

I rise today to speak on the National Vocational Educational and Training Regulator Amendment Bill 2015. Vocational education and training covers the provision of education, training and assessment exercises leading to accredited qualification offered by registered training organisations. It may occur in workplaces, TAFE and higher education institutions, colleges and schools, trade training centres and adult and community education providers. Vocational education and training is practical, hands-on learning with an industry and trade focus. It is vital for ensuring that Australians receive the required qualifications to achieve an acceptable standard of living and provide for their families.

In Tasmania, most of the vocational education and training is undertaken by the Tasmanian Academy, the Tasmanian Polytechnic and the Tasmanian Skills Institute. The Tasmanian Academy incorporates the eight senior secondary colleges and provides a wide range of vocational educational training, including institution based apprenticeships and enrolment in trade training centre courses. The Tasmanian Polytechnic is Tasmania's largest registered training organisation and offers over 300 courses in areas such as disability services, community services, building and construction, metal trades, agriculture, engineering and mining, and automotive building and maintenance. The Tasmanian Skills Institute provides training for employers looking to up-skill their employees. It provides a wide range of training opportunities targeted to industry needs.

Vocational education and training can be the key to unlocking the door to a range of new opportunities in life. I see the benefits that people, particularly in my home state of Tasmania, get from vocational education. It gives them the confidence they need to go out and get a job with. It also gives them knowledge and skills and empowers them in life to be positive contributors to the community.

Australia has some great education providers who have built up reputations both domestically and internationally as offering the world's best education. These are excellent examples of vocational training and education providers. There are many others as well, such as the Australian Apprenticeships Access Program, which provides vulnerable job seekers who experience barriers to entering skilled employment with nationally recognised prevocational training, support and assistance, or the Australian Film Television and Radio School, with new opportunities for emerging writers and producers to develop their skill sets and prepare themselves for the workplace.

Unfortunately, though, the standard of training in the national vocational education and training system has been allowed to deteriorate. This sector has often been populated by dodgy providers who have harmed Australia's education and training reputation. There have been an enormous number of cases of unscrupulous registered training organisations preying on vulnerable students and signing them up to large VET FEE-HELP debts. They have fundamentally damaged the people who took up many of these dodgy courses. Students have had their careers hurt, or they have even been so discouraged by their treatment and the debts that they have accumulated that they have become less employable. These represent wasted and missed opportunities. That is a great tragedy for the Australian community. Often the students are not even aware that they have been signed up for a course, let alone VET FEE-HELP debts running in to the tens of thousands of dollars.

The problem is made worse by registered training organisations employing brokers to recruit students on their behalf and then attempting to distance themselves from the actions of the brokers. The brokers usually come in the form of door-to-door salesmen, employing aggressive sales tactics to con people in disadvantaged areas into signing up. This is a particular problem in some parts of my home state of Tasmania, and I am sure there would be others from other parts of the country who could make contributions as well. As reported on 7.30 earlier this year, one institution in particular billed taxpayers for approximately $110 million in VET FEE-HELP loans.

One of the victims was a Tasmanian single mother of three, Nola Smith. She was talked into signing up to a $20,000 double diploma of counselling and community services by a salesman from Careers Australia last year. The salesperson then gave her a 'free' laptop before completing the entrance requirements on behalf of the victim. In another case reported on ABC News Jake Wright, from another of Tasmania's poorest communities, was talked into signing up to a double diploma of business and management, also with Careers Australia. He thought it would be a chance to make something of himself and to get out of his current set of circumstances. Unfortunately he was unable to complete the work. After being pushed away by the institution, he dropped out. Now all he has left is an $8,000 debt.

Labor has been warning about shonky operators for almost 18 months, but our warnings and calls to action have been largely ignored. Last week, the Abbott government voted down our amendment calling on this government to act with more urgency to ensure the protection of students is made a priority, to support tougher measures including an investigation by the Auditor-General into the misuse of VET FEE-HELP, and to introduce an education campaign by the ACCC. Shame on those on the other side for not supporting those amendments.

In addition to this, the Abbott government recently axed $43.8 million and over 10,000 training places from the Skills for Education and Employment program. The Skills for Education and Employment Program helped job seekers to develop speaking, reading, writing and basic maths skills to improve their chances of getting, and keeping, a job. These cuts represent an enormous blow to the vocational education sector. The Abbott government has also abolished the Workplace English Language and Literacy program which provided English language and literacy training to help workers with their current and future employment and training needs.

Now Jake, along with many people just like him, will be unable to find a training place and will struggle to build a future for himself. We are now seeing a greater amount of short courses and larger class sizes, with very little support for struggling students or those students who have disabilities. I know that some private training companies are making huge profits and sometimes these profits are made from cutting corners on quality.

In 2011, in order to maintain quality in the VET sector, Labor established the national regulator, the Australian Skills Quality Authority. Since its establishment in 2011, the Australian Skills Quality Authority has received more than 4,000 complaints and conducted 3,000 audits. That is 4,000 complaints in less than four years—an astonishing record of failure. Since the Abbott government came to power teachers, advocates and other institutions have claimed that the complaints being directed to the authority seem to be falling on deaf ears. The Abbott Liberal government has taken its eye off the ball and lost control of the vocational education and training sector.

It is not the only policy area where we have seen evidence that they are just not up to governing. The Abbott government has also removed many other forms of support for students in the vocational education sector. This chaotic government has taken the axe to the skills portfolio, cutting $2 billion since the last budget. Programs such as Tools For Your Trade are now gone. Also cut under the Abbott government are the mentoring and access programs, with the Joint Group Training program in the process of being abolished. Each of these programs helps apprentices start and complete an apprenticeship.

I ask those opposite: how are our apprentices now supposed to establish their careers? How are they supposed to provide for their families? How are they supposed to live? Shame on the Abbott government. It goes to the record of the Howard government, which never invested in the skills; that is why we ended up with the skills shortage after 11 years of the Howard government. Without skilled people able to enter the workforce, how are we to build infrastructure for tomorrow? How are we supposed to build the roads, the schools, the bridges and the hospitals for tomorrow? This demonstrates yet again how this government has abandoned the Australian skills training sector and the future of this country. Skilling our workforce is not a priority for this chaotic government.

Tony Abbott keeps talking about how he cares for and supports small business. He even made an election promise. Through measures such as supposedly cutting red tape and abolishing the carbon tax, the Prime Minister claimed he had the best interests of small business at heart and that he wanted to grow small business to build a better future. But this broad narrative runs against what has been allowed to take place under his watch in vocational education. It therefore represents yet another broken promise. It is another example of how what Tony Abbott said before the election is very different to what he has done since he has been in government.

Small businesses know they have been let down by this government. I have spoken to many small business employees in Tasmania who are outraged that many of their apprentices will drop out of their trade because vital government funding support has gone under this government. These small businesses feel betrayed by Tony Abbott and his government. The Prime Minister is abandoning vital trades in this country and leaving enormous skills shortages at a time when many people are struggling because they are on an apprentice's wage and need support to maintain a reasonable standard of living. For apprentices of a mature age it is even more difficult. Older apprentices have been dealt a crushing blow by the Abbott government which has abolished their payments under the Support for Adult Australian Apprentices program, a program which was put in place to encourage upskilling for adult workers over the age of 25. Adult apprentices studying a certificate III or IV could receive $150 per week, up to $7,800 per year, in the first year and $100 per week, up to $5,200 per year, in the second year of their apprenticeship. This investment assisted those who wanted to continue to build on their skills so that they could continue to make a contribution to our economy.

The government also cut the Apprentice to Business Owner program, which provided training in a nationally recognised qualification in small business management and included business mentoring and support for up to 12 months. Many tradespeople operate as subcontractors, sole operators or small businesses. To establish a successful business in addition to their trade-specific competency, they also need to develop small business management skills to ensure they meet business and employment regulations.

It is extremely important that the Abbott government understands that support for vocational education and training is critical to ensuring that we are skilling our workforce. We do not want to go back, as I said before, to the bad days of the Howard years when there was no government investment in skilling. Labor believes in skilling our workforce and we on this side believe in appropriate regulation of all education sectors to ensure that there is integrity in the system. Labor believes more must be done to protect students and young Australians to provide them with the proper support they need to improve their knowledge, to get a better job, to contribute to the future of their families and communities and, ultimately, to ensure that our nation becomes more productive because all of this helps our economy and it makes us a stronger community.

As I previously stated, education is the key to unlocking the door to a range of new opportunities in life. On that basis, Labor supports these increased transparency and regulatory measures. We believe that there should be greater fairness in the marketplace so people can decide which course is right for them. Growth of VET FEE-HELP debt has exceeded all projections with more than $1.6 billion allocated last year. The Grattan Institute has warned that 40 per cent of vocational loans will never be repaid.

This government seems determined to strip funding from the higher education sector at the same time. This is not the sign of a government that knows what they are doing. This is a sign of a government that are more concerned about governing for themselves and in protecting their own jobs than in governing for all Australians. This has in turn threatened the viability of our TAFE sector. Our TAFE sector has played an invaluable role in educating our community and has been responsible for producing some superbly qualified tradespeople whether in the building sector or in the manufacturing sector. But if they have to compete with a registered training organisation offering courses at a fraction of the price then obviously the registered training organisations will win out. That is why we need the adjustments made in the National Vocational Education and Training Regulator Amendment Bill 2015.

We have an opportunity to start again and weed out the dodgy providers who have made themselves a lot of money posing as vocation education and training providers in our education sector. It will extend the registration period for registered training organisations from five to seven years but we will not have to wait until their re-registration before we can look closely at how they are performing. We will be able to look at their performance, their quality, the experience of their students and their courses well before they are up for re-registration.

We are going to enable the Australian Skills Quality Authority to focus its attention on investigating and acting upon high-risk and poor quality providers. The authority will be given additional resources and focus to do that. It will be empowered to ensure a greater level of standard. We are going to be able to protect the community and ensure that it does not fall victim to these unethical salesmen preying upon the weak and the innocent.

We cannot rely on this government to properly administer the vocation education sector in its current format. As I said before, this is not the only policy area that the government has taken its eye off the ball since it has been in government. We have had a change in the responsibility of this sector but we need to do more. This legislation will assist us in ensuring that those who have the skills, those that provide the quality courses will be there to ensure that we are able to invest in the skills and upskilling of the Australian workforce, which we all know goes a long way to support our economy. That strengthens our economy so productivity increases—all are very good measures to ensure the prospective this country.

We on this side will always speak up for quality in education. We will stand up to this government when they try and tear down the education sector as they are trying to do currently, which we are debating in this place this week. But the Australian people will stand firm and oppose the Americanisation of our universities in this country. So while those opposite are trying to tear down the sector of higher education, we cannot afford on this side and on the crossbenches to take our eye off the ball and allow them to further run down the TAFE and vocational education sector of this country because it is an essential element of our education sector. It is vital to the prosperity of this country. It is vital to the people I represent in Tasmania and I want to do everything I can, along with my colleagues, to ensure that there is transparency.

Senator Bilyk interjecting

Yes, Senator Bilyk, you are very strong on this legislation. You know first-hand from the sector from which you came—that is, early childhood education—how important this sector is to our community. As you say many times in this place, there are times when those opposite act like the children that you used to care for. In fact, I think those children were better behaved than those on the opposite side.

We on this side are always going to stand up for the weak and the innocent in our community, for those who are vulnerable, for those who are desperate to have a new start in life. We will ensure that those people that are working and educating through the vocational education sector are of the highest standard. I support the National Vocational Education and Training Regulator Amendment Bill 2015 because it actually supports each of those things I have outlined in my contribution today.

5:59 pm

Photo of Catryna BilykCatryna Bilyk (Tasmania, Australian Labor Party) Share this | | Hansard source

I too rise to speak today on the National Vocational Education and Training Regulator Amendment Bill 2015.

Vocational education is an issue that I have had a particular interest in for many years, through my employment background as an early childhood educator—as mentioned by Senator Polley—and as a former member of the Senate Employment and Workplace Relations Committee, along with the now Deputy President, currently in the chair. I was also a member of a number of industry training boards when I represented workers through the Australian Services Union.

Labor believes that quality education is the way that we can improve the lives of individuals and communities. We also believe that a quality vocational education sector is vital to ensuring Australia's future growth and for training our next generation of workers. In 2007, the Howard government extended the use of FEE-HELP to include the VET sector for approved diploma and advanced diploma courses. VET FEE-HELP commenced in 2009. Labor amended the legislation in 2012 to increase the coverage of VET FEE-HELP to all diplomas and associate diplomas, and conducted a trial to extend VET FEE-HELP to certificate IV courses. This was to allow the greatest number of students to gain worthwhile qualifications.

We on this side believe that access to education should not be based on your postcode. However, growth of VET FEE-HELP has exceeded all projections, with more than $1.6 billion allocated last year. In the 2014-15 budget, the government estimated that 172,300 VET FEE-HELP places were needed. However, in the Department of Education additional estimates statement this year the figure was revised to 225,500. The Grattan Institute has warned that 40 per cent of vocational loans would never be repaid. Obviously, this becomes a financial burden to the Commonwealth and it needs to be addressed.

Unfortunately, we have unscrupulous RTOs signing up people for near-worthless qualifications that they do not have the ability to complete. The number of RTOs—or registered training organisations—in Australia has grown over the past few years. Evidence given in Senate estimates earlier this year shows that as of 31 December the number of RTOs was 4,573, with the Australian Skills Quality Authority, or ASQA, regulating 3,898 of these. So it is important that we get the regulatory framework right, and that brings us to the bill we are debating today.

The bill contains amendments to the National Vocational Education and Training Regulator Act 2011. It supports ongoing reform measures. These measures include protecting the integrity of the VET system, giving the regulator capacity to respond to emerging issues and technical amendments to improve the efficiency and operation of the act and, consequently, the regulator. While Labor is supportive of the aims of this bill, what it fails to do is to address the damage to individuals that has already occurred or to propose any action to engage with the community to minimise future problems,

Under VET FEE-HELP, students are able to access up to $97,728 in total for most courses offered by eligible registered training organisations. This leaves students at risk of running up large debts for potentially worthless accreditations. Already, the actions of unscrupulous RTOs and brokers have had serious impacts on vulnerable individuals. My office was approached only last week by constituents who are concerned by the tactics of some registered training organisations in trying to sign up vulnerable people for qualifications.

Volunteers at the local Men's Shed were approached by recruiters to sign up for courses. Tactics included telling the potential students that they would get $30 more per week because they would change from Newstart allowance to study assistance. They were told not to worry about the debt as, 'You'll only have to pay it back after you earn $53,000, so that won't be a problem.' Recruiters were evasive, particularly when one potential student asked to see the contract they were signing up to.

In addition to this case, there has been an explosion in media reports of unscrupulous RTOs preying on vulnerable students and signing them up for large VET FEE-HELP debts. In many cases the students were not even aware that they had signed up for a course, let alone a significant debt—often at around $20,000.

I would like to expand on one example that Senator Polley gave about a Tasmanian student. This was reported by ABC Online, on 23 December. The article reads:

Former student Jake Wright was excited when he signed up for a double diploma of business and management with Careers Australia.

But he was out of his depth and contacted a tutor who advised him to watch YouTube videos.

"I found them quite hard to understand and when I actually asked him if he could assist me at all he just told me to watch the videos and I said, 'I've watched them, I can't do the work'," he said.

Jake's mother Lexia Brown helped him un-enrol, but not before he had racked up a VET debt of more than $8,000.

"Even under supervision he would not be able to do it. He can do many other things but not a double diploma in business and management," she said.

Students deserve a lot better—a lot better—than to be told to watch YouTube videos for a course they are racking up debts of thousands of dollars for. And RTOs have a responsibility to make sure that the students they enrol have the ability to undertake the course they are enrolled in. I am pleased to say that after this story was broadcast the RTO responsible contacted Jake and agreed to waive his debt, although there are thousands of students who have not been so fortunate.

Unfortunately, Jake is not alone; media reports seem to indicate that low-socioeconomic areas in Tasmania in particular are being particularly targeted by unscrupulous RTOs. The problem is exacerbated by RTOs employing brokers to recruit students on their behalf and then attempting to distance themselves from the actions of the brokers. Potential students have been offered inducements by brokers like laptops, iPads, meal vouchers and other tangible goods for signing up. This bill takes some steps to put responsibility on the RTO for the actions of their brokers. There is also a change to allow more rapid response to quality standard issues by the minister and the regulator. These are worthwhile aims, and build upon the work done by Labor when we were in government.

In order to maintain quality in the VET sector, in 2011 Labor established a national regulator—ASQA. ASQA is working hard to clean up the sector. ASQA Chief Commissioner, Mr Chris Robinson, said the regulator has cancelled, suspended or refused the registration of 350 colleges since 2011. Mr Robinson said:

We've been very busy and we've taken strong actions against that minority of RTOs that are poorly compliant with the required standards. I would say the training sector is in better shape than it was in the past.

Even though this government has a habit of cutting funding, in this case they allocated $68 million in additional funding in October 2014 to support the important work of ASQA.

However, I am extremely disappointed that the Abbott government has abolished the Australian Workforce and Productivity Agency, which was established in 2012 by the former Labor government, replacing Skills Australia, to provide expert, independent advice to government on current, emerging and future skills and workforce development needs. AWPA brought together the peak national bodies, such as ACCI, AiGroup and the ACTU, to achieve industry leadership. It also took a tripartite approach to skills and training where industry, training providers and unions had a strong voice. Labor is also deeply concerned about the Abbott government's plans to further narrow down access to advice by completely abolishing Industry Skills Councils.

Last year shadow ministers Kim Carr and Sharon Bird called on the Auditor-General to investigate VET FEE-HELP to ensure that skills funding is being used in accordance with the intent of the legislation. I am pleased to say that the Auditor-General has requested that a performance audit be included in the Australian National Audit Office's 2015-16 work program. In addition, at Senate estimates, ASQA indicated they were going to conduct an investigation into a further 23 providers.

The Abbott government's new national standards for registered training organisations will come into effect on 1 April 2015. The new standards will require RTOs to declare sales relationships with sales brokers and allow the regulator to hold RTOs accountable for the actions of their sales brokers. A national training complaints hotline was established by the Abbott government in January 2015.

The bill contains amendments to the National Vocational Education and Training Regulator Act 2011 that supports ongoing reform measures, including: protecting the integrity of the VET system, giving the regulator capacity to respond to emerging issues, and technical amendments to improve the efficiency and operation of the Act and consequently the regulator.

The bill also extends the period of registration able to be granted by the regulator from five to seven years. Specifically, schedule 1 of this bill would make amendments to the NVETR Act to address a range of issues, including: extend the operation of penalty provisions to trading corporations; create a new offence of prohibiting a person from advertising or offering to provide all or part of a VET course without including the name and registration code of the responsible registered training organisation; extend the period of registration able to be granted by the regulator from five to seven years. And there are other areas in that schedule.

On 5 March 2015, in the House, Labor moved a second reading amendment to this bill. The amendment would have: immediately sought a consumer protection information campaign by the ACCC, including advice for people who need to seek redress, and considered other mechanisms available to strengthen consumer protections; supported Labor's call for the Auditor-General to conduct an audit on the use of VET FEE-Help. But this was voted down by the government, who used their numbers to block Labor's sensible amendment.

Once again, the Abbott government has come late to the party on this important issue. Labor has been warning about shonky operators for almost 18 months. But, only now, after their bill has passed the House, has Senator Birmingham announced legislative and other changes to better protect students.

From Senator Birmingham's media release of 12 March the government will now: ban providers from offering inducements or incentives to students—like cash, meals, prizes or laptops—to get them to sign up to courses that they do not need; make it impossible for providers to levy all fees in a single transaction up front, giving students more opportunity to consider their options before VET FEE-HELP debts can be incurred; ban miraculously short diploma or advanced diploma courses, instead requiring a minimum number of units of study; protect vulnerable students by requiring providers to properly assess students for minimum prerequisite educational capabilities before enrolment; eliminate insidious practices like nursing home enrolments; stop marketing agents and brokers freelancing to sign up as many students as possible, without the training provider being held responsible for their actions; give students clear information that helps them understand that VET FEE-HELP loans are real debts that impact their credit rating and are expected to be repaid; ensure students sign off on high visual impact statements making it explicit the total debt they will incur should they proceed with a particular course; and further issues.

I am glad that the government has finally heeded our advice to help protect vulnerable people. But, had they really cared about this issue, the changes that require legislative action would be in the bill we are debating today, not some future bill for this place. It is disappointing that they have come to agree with Labor for the necessity of these changes only at the eleventh hour, and after their legislation has already passed through the other place. It is another sign of this disorganised and dysfunctional government. This government is so focussed—and they probably need to be—on their own internal leadership squabbles that they cannot sort out their legislative program. Those legislative changes could have passed the House almost two weeks ago, had they got their act together.

This government has demonstrated a clear disregard for vocational education during their time in government. The Abbott government has cut almost $1 billion from support for apprentices. They have abolished the Tools for Your Trade program which provided up to $5,500 in direct assistance to apprentices to help them purchase tools, equipment, uniforms and vehicles for their trade. The Abbott government has also cut mentoring and access programs and are in the process of abolishing Joint Group Training—all of which help apprentices to start and complete an apprenticeship.

Older apprentices have been dealt a devastating blow by the Abbott government abolishing their payment under the Support for Adult Australian Apprentices program which was put in place to encourage upskilling for adult workers over the age of 25. Under the now axed program, adult apprentices studying a certificate III or IV could receive $150 per week, or up to $7,800 per year, in the first year, and $100 per week, or up to $5,200 per year, in the second year of their apprenticeship. The government has also cut the Apprentice to Business Owner, or AtoB, Program, which provided training in a nationally recognised qualification in small business management and included business mentoring support for up to 12 months. Many tradespeople act and operate as subcontractors, sole operators or small businesses. To establish a successful business, in addition to their trade-specific competencies they need to develop small-business management skills to ensure they meet business and employment regulations. But, now that the AtoB Program has been cut, they will find it a lot harder to run their businesses effectively. So much for a government that allegedly cares about small business.

The Abbott government has also axed $43.8 million from the Skills for Education and Employment, or SEE, program, abolishing over 10,000 training places. The SEE program helps job seekers to develop speaking, reading, writing or basic maths skills to improve their chances of getting and keeping a job. The Abbott government has abolished the Workplace English Language and Literacy Program, which provided English language and literacy training to help workers meet their current and future employment and training needs. In its first budget, the Abbott government abolished the National Workforce Development Fund, which was a matched dollar-for-dollar partnership between government and employers to help employers upskill their workers to face the challenges of the future and to improve productivity. The list of cuts that the government has made shows it cares little about skills and training.

Labor support the changes in this bill and the other changes announced recently, albeit belatedly, as I said, by the minister. We support changes that improve the quality of RTOs and we support changes that help students to be protected from unscrupulous practices. But it would have been nice if the government could have got its legislative program in order so we could pass those changes today.

6:16 pm

Photo of Deborah O'NeillDeborah O'Neill (NSW, Australian Labor Party) Share this | | Hansard source

This is the second occasion today on which I am pleased to stand and speak on matters educational in this chamber. Earlier in the day we saw a series of questions to the government around the higher education reform bill, which has changed somewhat in shape today but not in intent. As much as I recognise that the bill currently being debated, the National Vocational Education and Training Regulator Amendment Bill 2015, is worthy of consideration and that I see it—along with Senator Bilyk, as she has just indicated—as a step forward in redressing the concerns that are very alive in the community, we cannot forget that the Labor and Liberal views about the value of education and the access to education that Australians deserve across this country are very different, as are their views on what that might look like.

What we are seeing here this afternoon, like the backflip we saw on higher education reform, a government responding to incredible pressure because it simply cannot see for itself that it should not be constructing education in the way that it is. This is a government that, through its decision before to completely backflip on its commitment to the electorate regarding Gonski, is completely going back on what it said: 'We are on a unity ticket with Labor. We will fund schools on the basis of need right across this country. You can rely on us.' But the minute they were elected they walked away from that completely because their hearts are not in it. Their ideology is not in it. They simply do not believe in equitable access to education. They do not believe in equality. They believe in creating a two-tier, American system.

In a way it is extraordinary that the government are at the point where they have come forward with this piece of legislation, but it is only because they have changed their minds. Last week, the government voted down Labor's amendment, when we called on the government to act with more urgency to ensure the protection of students. We saw it as an issue that needed to be prioritised. We needed support for tougher measures. We were calling for an investigation by the Auditor-General into the misuse of VET FEE-HELP and we wanted an education campaign to be introduced by the ACCC to look at the sharks that are circling young, vulnerable people and mature-age students, who are also vulnerable and susceptible to the sort of seduction that was outlined by Senator Bilyk in her speech, which preceded mine. Following a common theme we are seeing at the moment, the government back-flipped. Last week they would not do it, but this week they decided to heed our advice. At last, they were dragged kicking and screaming to the legislative table to do something to protect vulnerable people. I will congratulate them on that.

As always, Labor will be happy to support good measures that provide protection for vulnerable people, and we look forward to receiving the details of these new measures. At this stage, there has been an announcement, but I have learnt that we should be a little careful about announcements from this government, because you might get an announcement on Thursday and it can look a whole lot different on Tuesday. We found that out with the announcement with regard to the registration of financial advisers. Education was on the register one minute and, in a press release a few days later, it had miraculously disappeared. So we need to be really careful. The government were not with us last week; they are with us today; let's see what the story is tomorrow. We have the announcement but we have little detail.

The Assistant Minister for Education and Training, Senator Birmingham, who I acknowledge is here in the chamber, announced that the government is going to introduce a rolling—I thought that was an interesting term—campaign of legislative and other changes to deal with rogue training providers and to better protect students. To deal with rogue training providers and to better protect students, and I agree with that, there will be a 'rolling campaign'. Labor has been warning about these dodgy operators for 18 months—

Photo of Simon BirminghamSimon Birmingham (SA, Liberal Party, Assistant Minister for Education and Training) Share this | | Hansard source

Happy to explain in a minute.

Photo of Deborah O'NeillDeborah O'Neill (NSW, Australian Labor Party) Share this | | Hansard source

I look forward to assessing Senator Birmingham's rolling campaign as it comes down the hill! I was trying to figure out what a rolling campaign could be. We have those old sayings: 'a rolling stone gathers no moss' and 'roll out the barrel'. There is 'rolling in it', which often refers to rolling in money. But I wonder if what we will have from this government is the joy of a press release one day and students rolling in debt the next. Let us see what this rolling campaign actually looks like.

We know that many students have been left vulnerable and exposed as a result of the failure to properly regulate the provision of training to young people. Labor has a strong record on investing in skills and helping students and workers to obtain the skills they need to participate and compete in the modern workforce, as well as introducing regulation and quality assurance. For over a year, Senator Birmingham has talked tough about action against unscrupulous RTOs, but the government have not done anything to stop the problems. Finally—

Photo of Simon BirminghamSimon Birmingham (SA, Liberal Party, Assistant Minister for Education and Training) Share this | | Hansard source

They were only sworn in on 23 December.

Photo of Deborah O'NeillDeborah O'Neill (NSW, Australian Labor Party) Share this | | Hansard source

it is good to have you on board, Senator Birmingham, but this change that is happening now is happening in a context. I want to explore that context in terms of the state that I represent here in the federal parliament, the great state of New South Wales, and see what smiling Mike Baird, the Premier there, has been up to.

I was at the launch for the Labor Party campaign with our leader, Luke Foley, at the Catholic club in Campbelltown. That is actually where I grew up in my teen years. I went to St Patrick's College in Campbelltown, and I am very proud to be the duty senator for the great seat of Macarthur. Mr Foley said at that launch that he had nothing against Mr Baird in principle. He seems like a nice fellow with a lovely smile. But he is a Liberal, and they have a different set of values from the Labor Party, which I represent here.

Across New South Wales and on the Central Coast, where I live, under the Liberal government of Barry O'Farrell and now Mike Baird, TAFE courses have absolutely taken a hiding. Courses have just been completely axed, with students saying, 'I'm part-way through a diploma or qualification and unable to complete it.' They have been arbitrarily shut down. Special assistance measures for students with disabilities have been wound back. If you have a visual impairment or a hearing impairment, that is the support that you need to be successful—and I have taught many of these students who transitioned from the TAFE system into the university. I have taught many of these students, and all they needed was a little hand for a little while to get the skills that they needed. That kind of support has been ripped away by a Liberal government. Do you get the pattern here?

And, of course, there has been a predatory fee increase. This has happened in 2015, and it is hitting students hard. Again, students who had planned for how much it might cost them to study are being hit with incredibly high fees, doubling the cost, for example, of a certificate III in hairdressing. It now costs $2,000, an increase of $998. For young people who certainly do not get very high wages even when they become qualified, overall the increase to fees on TAFE courses under Premier Baird's change is simply going to put vocational training out of reach of many young people in New South Wales and push them into the hands of unscrupulous RTOs that would bring them in the door, load them up with debt and leave them with a qualification worth nothing. This is a construction of the Liberal government: the decimation of TAFE, creating that empty space in which these young people and mature-age workers who are seeking retraining are now vulnerable participants.

The massive hikes are also going to have a very negative impact in terms of the long-term skill shortage that they will create for many industries, not to say anything about the quality—and I would like to make some more remarks on that if time permits. But the fee increases we are seeing to the TAFE sector are not only going to hurt our economy; they are going to compromise the future jobs of thousands of people across the great state of New South Wales. I am a resident of the Central Coast, where we have incredible pressures in terms of unemployment. This plan of the Liberal government in New South Wales is devastating for the Central Coast.

There is a contrast. Labor has a $100 million TAFE rescue plan on the table to reverse the Baird government fee hikes that have happened for apprentices. That will be a saving of $990 for these apprentices. It makes a difference—because Labor has a different view about access to education from those in government here federally and in New South Wales. The Baird government, no friend of education, cut $1.7 million from the education system. What has it done to teachers? It has axed the jobs of 1,100 teachers and staff.

Courses have been lost at Wyong TAFE. One of the hot spots for youth unemployment in New South Wales is on the northern part of the Central Coast. What have they cut? They have cut the second-chance HSC—it is just gone. So, if anything happens to you—if you have an identity crisis, you have anxiety, you are unwell in any shape or form, there is a crisis in your family, or a parent or sibling dies—if anything traumatic or dramatic happens to you as you are approaching the HSC, your second chance to have a go at the HSC is gone. And young people's lives are up in smoke because of a short-sighted government. They have cut tourism, which is an easily accessed industry in our area. They have cut hospitality. In doing so, they have cut the links between well-equipped schools and the local TAFE. And they have cut IT. Gosford TAFE has had cuts in maths. It has had cuts in metal fabrication, and it has had cuts in welding. This is really, really bad for the coast, where trades are a vital part of our economy.

These cuts are actually called—a great misnomer—'Smart and Skilled'. It is dumb and broken. That is the kind of New South Wales that Mike Baird wants to create, and that is an expose of the Liberal policy. Hollowing out TAFE into a business is the first step towards privatising it entirely. What we are seeing in New South Wales is the construction of a completely private sector—and they are in cahoots with this federal government; make no mistake.

Liberals, both federal and state, just do not get it. The TAFE system actually changes the lives of many, many Australians. It provides for people of all ages and from all walks of life. It gives people the opportunity to learn a trade, to begin a career or to make a change when their career choice when they first left school is in an industry that later no longer exists.

Unfortunately, in New South Wales, the Baird government has just spent four years cutting the TAFE system to shreds. This is madness—absolute madness—when you have unemployment growing and you have unemployment on the coast climbing to 7.2 per cent. For 15- to 19-year-olds on the Central Coast, youth unemployment is at 21 per cent. But the Liberal government goes ahead with the cutting, the slashing, the burning. 'Oh, it'll be good for you; just trust us,' it says. We have kids who are devastated, whose lives are falling apart right now. They cannot wait for the Liberal government to wake up to the fact that it is killing off the opportunities for young people.

Labor and Liberal: two very different views of education. Luke Foley's Labor has committed to rebuilding TAFE. It will invest an additional $100 million into TAFE, and that is the sort of money that is going to allow Gosford and Wyong to reinstate vital courses that have been cut.

Sitting suspended from 18:30 to 19:30

Prior to the dinner break, I was making some remarks with regard to the National Vocational Education and Training Regulator Amendment Bill 2015 and pointing out the very different set of values that Labor and Liberal members of this parliament and also of the New South Wales parliament have with regard to education, particularly the TAFE sector. Labor have committed to rebuild TAFE and invest $100 million into TAFE. That will allow places like Gosford and Wyong campuses to reinstate some of the vital courses that, as I articulated, have been pulled out, including a second chance to do the HSC and metal fabrication courses, taking away the opportunity to learn and build a future. We need to see this restoration of student support, and the reason that has to happen is that Labor is seeking government on the back of a four-year Baird-O'Farrell government, with cutbacks and massive rounds of fee increases to our students.

The shadow minister for education, Ryan Park, visited my home region of the Central Coast recently. He visited Wyong TAFE, which has been so savagely attacked by the Liberal ideology, with places taken away from young people, and he said what is apparent to me as a Labor person and to any fair-minded Australian: that a strong vocational education and training system is absolutely vital for the future of this nation, and it is certainly vital on the Central Coast, where unemployment is rising and four out of 10 students do not complete year 12. Where are they going to go after the Liberal Party have finished killing off the TAFE system? They are going to go to these RTOs that we are seeing this legislation brought forward to try to contain. We need to call on this government for Mr Abbott to talk to his mate Mr Baird and say: 'Get your hands off TAFE. Leave TAFE standing. Give it some status. Give it some funding. Let it stand as the one thing that will provide the bridge between unemployment and a future for millions and millions of Australians.'

Labor has committed that in one term we would abolish the very misnamed Smart and Skilled Liberal policy of TAFE privatisation; we would reverse the Baird government's TAFE fee hikes, including the savage increases that have commenced this year; and we would guarantee funding to TAFE by capping the amount of public funds that can be contestable by private operators at 30 per cent. If this government is serious about making a backflip that is actually worth something, it might make some sort of similar commitment, saying that it will not support the states that do not limit the capacity of the RTOs to take over more than 30 per cent. We need TAFE. Australians know it has been a quality deliverer of education for decades. We need it. We would also commission a landmark review of education and training in New South Wales after year 10, with an action plan to develop Central Coast TAFE into a world leader.

Mr Shorten was on the coast last week, and he reiterated Labor's commitment to and concern for TAFE. He said:

There is a role for private providers in training and there are some private provider organisations doing outstanding work, but I think there is mounting community concern that on the one hand we've seen the Liberals dismantling and attacking TAFE, and on the other hand, we've seen the 'leave it to the market' attitude of private providers in training and we're seeing a long tail of underperformance and indeed in some cases scandalous behaviour.

That could not be any more clear than in Victoria, where people have undertaken courses that were so badly delivered by private training organisations that their qualifications are null and void—people who have been through the terrible experience, paid the money and got a certificate not worth the paper it was printed on. We know that the behaviour of some of the private providers has served to undermine confidence in vocational qualifications. It has taken advantage of students unable to make informed decisions.

We know that disadvantaged students are under-represented in the for-profit VET sector. TAFE continues to enrol most early school leavers, regional students and students with a disability. It is doing the heavy lifting of helping young people and those who find themselves unemployed to transition to work. But we know that the VET for-profit providers are avoiding offering the skills for areas of shortage, like trades, because it would cost them too much money. They are focusing on high-volume, high-profit areas like business studies, but we do not need more business studies; we need people with the trades that match our needs in the community. If Mr Baird and Mr Abbott have another surfing fest on the Northern Beaches and get their way, we will have a totally privatised model and a large-scale abandonment of trade training opportunities.

The record of this government is pretty appalling. They have cut $2 billion from the skills portfolio since the budget—$2 billion. Apprentices should feel rightly betrayed by Mr Abbott and this government. There was a promise before the election: 'Oh, the coalition will provide better support for Australia's apprentices.' That is an absolute load of rubbish. What Mr Abbott did when he got in was cut direct assistance to apprentices; he cut Tools For Your Trade. So, instead of being able to buy a small ute in regional Australia for $5,000, now they will help you out with a $20,000 loan. That is the Liberals' idea of support for people who need access to TAFE. They have abolished the mentor and access programs. They have abolished Apprenticeship to Business Owner. They have abolished the joint training funding. They have cut funding to Australian apprenticeship centres.

Tradies on the Central Coast are the second largest employment group we have. They need proper training for the ones that they want to train up. These are vital parts of our community. They are great employers. They contribute amazingly to sponsorship of surf lifesaving clubs, to Lions, to Rotary and to work experience. Kids growing up know that we need tradies. They want to be tradies. They want TAFE so they can become tradies. They want to become hospitality workers or IT workers. They want to get on and do their HSC and access uni when they could not before. Only Labor will deliver these things, and this government, with this backflip, is very, very slowly approaching a crisis that it has continued to assist in making in every state, and particularly in the great state of New South Wales, by its appalling treatment of those who want to study and work in TAFE. (Time expired)

7:37 pm

Photo of Simon BirminghamSimon Birmingham (SA, Liberal Party, Assistant Minister for Education and Training) Share this | | Hansard source

I thank contributors to this debate somewhat half-heartedly because it is an awful lot of sanctimonious claptrap that I have heard in my time in the chamber during the debate on this legislation.

Photo of Stephen ConroyStephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | | Hansard source

You've spent a lot of time listening to Christopher Pyne!

Photo of Simon BirminghamSimon Birmingham (SA, Liberal Party, Assistant Minister for Education and Training) Share this | | Hansard source

Senator Conroy knows a bit about sanctimony!

But I will touch on some of the issues that those opposite have raised, because I would hate for anybody who pained themselves to read the Hansard of contributions to this debate to be misled as some of the Labor senators have clearly sought to do through their contributions. Firstly, Senator O'Neill has given a speech that was mostly a speech about the New South Wales election campaign. She is welcome to do that; that is not an unusual thing in this place when a state election campaign is underway. I am not going to go over all of the aspects of New South Wales policy, but I think it is important to put on the record that the policy reforms of the New South Wales government in relation to vocational education and training have created additional opportunities for students in New South Wales and that there are more than 60,000 additional students who are able to be trained through the vocational education and training system in 2015 than would have been the case without the reforms of the Baird government.

You hear often in some of these debates, it seems at present—we have heard it in several state elections—this argument of TAFE versus private providers, this seeming argument from those opposite that contestability is the problem with the system today. Contestability is not new and private providers are not new. Private providers have been in existence for decades in the vocational education and training market, and contestability has been part of the New South Wales VET market for the last 20 years or so, so it is not a new thing that has been brought about; it is a change in the way some of these policies have been managed.

The New South Wales government's policy—Smart and Skilled, as I understand it is known—includes significant additional support for students with special needs, quite to the contrary of what Senator O'Neill was claiming and including generous fee exemptions, concessions and loadings to providers to fund additional support needs. Once again, it is important to note here that, when TAFE is the body providing support for those students with special needs, TAFE gets the additional loadings, fee exemptions and concessions flowing through to TAFE. If it is a private provider providing those extra services, they presumably get exactly the same level of support under that scheme. There is as well additional community service obligation funding provided to TAFE and adult community education to provide support services, specialist staff and hire equipment costs, once again notice that the government in New South Wales has acknowledged that there are some courses that require more expensive equipment, that are more expensive to run, and therefore there is support in place for that.

You would also be forgiven for thinking that the only fee increases ever seen have occurred in the last four years in New South Wales, yet under the previous New South Wales Labor government fee increases in excess of 200 per cent were seen over all award levels and certificate IVs had increases in excess of 500 per cent. So it is quite the height of hypocrisy for Senator O'Neill to come in here and claim that fee increases are something new.

But we are not here tonight to debate the New South Wales election campaign. Senator O'Neill can do that in an adjournment speech if she wants to. We are here to deal with some legislation that is before the House which is part of a number of reforms our government is taking to strengthen the operation of vocational education and training in Australia. But I do want to make sure that those reforms are put in context and that we acknowledge the point that we started from firstly in relation to the debate around contestability and secondly in relation to VET FEE-HELP.

The situation around contestability of training services in Australia is one that has been informed most markedly in recent years by the 2012 national partnership agreement that was entered into between the Commonwealth and the states. It was that 2012 national partnership agreement that set in train waves of reforms relating to contestability and indeed provided funding that encouraged such activity. And who was in government in 2012 when those arrangements were put in place? It was the former Labor government that existed—the government that Senator O'Neill, Senator Bilyk, Senator Brown and other contributors to this debate were all members of. They put in place the framework around contestability that has been applied in recent years. Contestability is not a bad thing, but it is how you do it and how you regulate it that matters most to making sure you get the optimal outcomes for students and for our training system.

In the space of VET FEE-HELP, the income-contingent, HECS-style loan that is available for vocational education and training students operating at a diploma or advanced diploma level, it is, of course, an even more contemptible approach we have seen from the Labor Party. While it was the Howard government that established VET FEE-HELP in 2007, it was established with very tight parameters and regulations around it. It was established in a way that you could only access VET FEE-HELP for courses where there were established credit transfer arrangements in place to ensure that your diploma or advanced diploma work would be recognised by a university were you to proceed on to university. It was a perfectly sensible and correct policy decision to step away from credit transfers as the only test for VET FEE-HELP, and in that sense I support the policy decision taken by the previous government to abandon the link to credit transfers. The problem was that, in taking away that link, the previous government left absolutely no regulatory safeguards in place whatsoever in relation to VET FEE-HELP.

Just as when they decided to roll out home insulation across the country and basically said, 'Free money to install home insulation systems around the country,' it seems they did the same when it came to providing diplomas or advanced diplomas through vocational education institutes. They basically put up a flashing sign that said: 'Free money. Come and take as much as you want under whatever terms if you happen to sign somebody up to start a vocational education diploma or advanced diploma.' No matter whether that person had the capabilities to do it and the intention to complete it or whether the diploma was of sufficient standard to be able to be completed, they just put in place an open honeypot to which they encouraged all the bees to come and take as much seemingly as they wanted.

We have taken steps to address this and taken steps to address real concerns about the quality of training in Australia at present. Overwhelmingly, it is my view and the government's view that private training providers, public training providers and not-for-profit community sector training providers are providing high-quality training in the vast majority of instances, giving millions of Australians worthwhile qualifications to take through their employment careers and lives. But there are a number who have been rorting the system who are not producing sufficient high-quality outcomes, and we are taking action to fix that. The reason we have this problem is due to the complete inadequacy and incompetence of those opposite in setting up the training systems that this government have inherited.

We have not been sitting around doing nothing until my announcements in relation to VET FEE-HELP last week. This government have taken a series of steps to make sure that we strengthen quality in our training system, that we protect the taxpayer from waste of money and that we look after vulnerable Australians and ensure that they are not taken advantage of. Firstly, when the Minister for Industry had responsibility for the skills portfolio, he put an additional $68 million of funding into the Australian Skills Quality Authority, ASQA, the national regulator. He did that to step them away from what the previous government had said needed to be a self-funding model. If it had been a coalition government that had said that ASQA needed to move to a self-funding model, in making her contribution in this debate, Senator O'Neill would say: 'That's the difference between the Labor Party and the Liberal Party. The Liberal Party just think that you need to self-fund all these things and will not invest in quality. The Labor Party believe that you should invest in quality, that funding should not be taken out and make them self-funding.' Of course, the Labor Party were the ones that took funding out of ASQA and said: 'You must become self-funding. You must focus on how you can charge fees through the training system and on how you can generate revenue. They are the priorities you need to worry about, National Regulator.'

We have said that we think there is a problem in the system and that the national regulator needs to be funded to focus on auditing problem areas, that it needs to direct its resources wherever it possibly can to risk-based approaches—generating the datasets where they can identify where high-risk activities are taking place and undertake the auditing and assessment in those high-risk areas. That is why this government have proudly put an extra $68 million into ASQA to make sure that they have the resources required to stamp out bad practice.

Minister Macfarlane also recognised that there was a significant problem in the sector where brokers and third-party agents were representing training providers and those representational arrangements had no transparency around them. So he put in place new regulations which commenced on 1 January this year for new providers and will commence from 1 April this year for existing registered training organisations. Those new regulations require that they have a transparent, contractual arrangement between any third party broker and any registered training organisation so that the public, the regulator or anybody else is able to identify very clearly who a broker is acting on behalf of and who is ultimately responsible through the training system for those actions—namely, the registered training organisation. Those are two significant reforms this government have already taken. The third is the legislation we are debating today to which I will return shortly. The fourth are the reforms to VET FEE-HELP that I announced last week.

The reforms to VET FEE-HELP attempt to break the business model of those who are rorting the VET FEE-HELP system. I am quite unashamed about the fact that I hope that those reforms will drive some third-party brokers and agents out of the system, and potentially out of business, and drive out of business as well any RTOs registered for VET FEE-HELP who are overly reliant on dodgy marketing practices and who are offering inadequate training. We have taken a strong stand there.

We will have in place by 1 April complete bans on up-front incentives and on free giveaways—no more free iPads, no more free laptops, no more meal vouchers and no more cash incentives to sign up. There will no longer be the ability for a broker, a third-party agent or an RTO to doorknock at the homes of vulnerable people and say, 'Just sign on here, you'll never have to pay off that loan' or 'This is actually a free grant and you'll get a free iPad or some other giveaway.' If Australians are signing on for a VET FEE-HELP loan, if Australians are signing on to register in a training course then the only thing they should expect to get from that training course is quality training, not any giveaway as a result. We will outlaw the giveaways effectively from 1 April.

We are also taking steps through the VET FEE-HELP reforms to make sure that those who offer miraculously short courses are no longer able to do so. If it is transparently obvious to anyone that the competencies and skill sets that should underpin a course cannot be met within the time then that will not be possible. In particular, there must be multiple units of study attached to a course and, with that, there must be multiple options for a student who is not progressing or does not wish to progress through each of the units of study to opt out before incurring a debt with the other units of study. No longer will it be possible for somebody to have the entire cost of their diploma or advanced diploma billed up-front to their VET FEE-HELP account. The fact that it ever was is quite a remarkable oversight by those who originally designed the system. It is worth noting that complaints about some of these practices were received way back in the days of the previous government, who failed to act in any regard. Those opposite have said: 'The coalition have acted belatedly in this area. They have not taken action fast enough. We are pleased to see they have adopted the Labor Party's approach.' The Labor Party's approach is an inquiry by the Auditor-General. I welcome that inquiry. I look forward to what it says. It may provide further ideas about how we make sure that this sector is regulated adequately.

Before the announcement I made last week, however, never had I heard the Labor Party say it was their policy to ban up-front inducements or incentives. Never had I heard them say that they were going to make changes to deal with the levying of fees in one hit up-front. Never had I heard them say they would eliminate the miraculously short courses. The Labor Party had a policy for an inquiry—but no courage to deliver the necessary reforms.

Senator O'Neill also tried to make light of the fact that, in announcing these reforms, I had said we would have a rolling campaign to implement them. I promised her that I would explain that statement. It is a fairly simple explanation. Some of the reforms I announced last week, such as the banning of inducements, can be put in place through changes to the VET FEE-HELP guidelines. They can be enacted quite quickly. Some of them require changes to regulations, which will take a little longer as they require some legal drafting. Finally, there is the tougher penalty regime I want to put in place. This regime will ensure we have a suite of penalties available to us. At present, we have only the relatively crude options of either saying to the RTO, 'You have been a naughty boy—please correct your behaviour', or deregistering them, which means throwing out all the students who are studying there. In between those options, we need some financial penalties and we need to be able to ensure that all the laws are enforced. Those changes will require legislation—which, as all in this place know, can take a little while to get through. That is the rolling campaign. But I am determined that all of the reforms announced last week will be in place by 1 January next year, with the last, I expect, being those components that require legislation.

That brings me back to the legislation before the parliament tonight. This is the third of the government's four pillars of reform to strengthen quality in vocational education and training. The reforms in this bill are relatively straightforward. Firstly, the bill will provide for the minister of the day to make a quality standard. The quality standard will allow far more rapid responsiveness in relation to RTOs than do the current arrangements. At present you have to go through a cumbersome process of getting formal agreement from all of the states before a regulation can be adopted. We will of course consult with the states about the making of any quality standard, but this provision will allow faster action on any identified problems.

Secondly, this bill will strengthen arrangements relating to brokers and third parties. It will make sure that they have to clearly identify the RTO that is providing the qualification. Thirdly, it will extend the registration period for registered training organisations from five years to seven years. This will enable ASQA to spend less time undertaking reregistration audits, which are entirely predictable and which RTOs can plan for, and more time dedicating the extra resources this government has given them to targeted, risk based audits in areas they believe to be of high vulnerability. Finally, there a range of minor consequential amendments.

This government is committed to the vocational education and training sector. We will spend about $6 billion this year supporting VET activities. It is a record sum when you include the income-contingent loans that are being made available and it will continue to grow over the forward estimates—even with the changes we have made today to ensure we stamp out the rogue operators and those who are doing the wrong thing. We know that VET can change people's lives and that some three million Australians access VET courses every year. Our determination is to make sure that, unlike those opposite, we provide quality in the system and the appropriate regulation to guarantee that quality—to ensure that everyone who is in training receives quality training that benefits their future employment prospects and our economy. (Time expired)

Question agreed to.

Bill read a second time.