Echelon National Security Agency Pty Ltd and Australian Skills Quality Authority - [2014] AATA 438

[2014] AATA 438

Division GENERAL ADMINISTRATIVE DIVISION

File Number(s)

2013/3715

Re

Echelon National Security Agency Pty Ltd

APPLICANT

And

Australian Skills Quality Authority

RESPONDENT

DECISION

Tribunal
The Hon R J Groom AO (Deputy President)

Date 3 July 2014

Place Hobart

The Tribunal decides that:
(a)The applicant continues not to comply with SNR4.5 (a) and (b) of the Standards for NVR Registered Training Organisations 2012. The Tribunal affirms the decision not to grant initial registration to the applicant.
(b)The Tribunal is not satisfied, for the purposes of Section 23 of the National Vocational Education and Training Regulator Act 2011, that the applicant is not a “fit and proper person”.

........................................................................
(Deputy President)
CATCHWORDS
Vocational Education and Training - National Vocational Education and Training Regulator Act 2011 (Cth) - application for initial registration as an RTO - whether applicant complies with standards for NVR registered training organisations - whether applicant satisfies Fit and Proper Person Requirements - continuing non-compliance with standards - Tribunal not satisfied that applicant not a “fit and proper person” - decision not to grant initial registration affirmed
LEGISLATION
Administrative Appeals Tribunal Act 1975 S42A (1)
National Vocational Education and Training Regulator Act 2011 (Cth) ss 2A, 3, 16, 17, 21, 22, 23, 185, 186.
Fit and Proper Person Requirements 2011.
Standards for NVR Registered Training Organisations 2012.
CASES
Echelon National Security Agency Pty Ltd and Australian Skills Quality Authority [2014] AATA 151.
Shi v Migration Agents Registration Authority [2008] HCA 31.
Briginshaw v Briginshaw (1938) 60 CLR 336.
Hanna v Migration Agent’s Registration Authority [1999] FCA 1657.
Sullivan v Civil Aviation Safety Authority [2013] FCA 1362.
REASONS FOR DECISION
The Hon R J Groom AO (Deputy President)
INTRODUCTION

Echelon National Security Agency Pty Ltd (“Echelon”) has applied for a review of a decision made by the Australian Skills Quality Authority (“ASQA”) refusing its application for initial registration as a Registered Training Organisation (“RTO”).
BACKGROUND
Vocational Education and Training (“VET”) enables trainees to gain recognised qualifications and skills for a wide range of occupations. ASQA is the National Regulator for Australia’s VET sector.
The VET sector in Australia was originally regulated by state- based authorities but from July 2011 onwards responsibility for regulating the sector was gradually transferred from the various state regulators to the National regulator ASQA. ASQA became the regulating authority for the VET sector in Tasmania in February 2012.
ASQA assesses organisations wishing to be registered as an RTO, or to have their registration renewed, against the conditions of registration set out in the National Vocational Education Training Regulator Act 2011 (“the Act”). (See Part 2 Division 1 sections 21-30 of the Act).
Two conditions of registration are:
(1) compliance with the requirements of the VET Quality Framework (Section 22) and
(2) satisfying the “Fit and Proper Person Requirements” (Section 23).
For some years Echelon has operated a security business in Tasmania. It employs inquiry agents and also manages on licence some 270 security guards. In addition it provides crowd control services in the Launceston area.
An important arm of Echelon’s business has been the provision of VET services for people wishing to enter the security industry in Tasmania or to upgrade their skills and qualifications in order to remain employed in the industry. This section of the business operates under the business name “Echelon Training Services”.
Echelon Training Services commenced operating in June 2005. It was registered as an RTO by the then Tasmanian VET regulator. It continued to be an RTO until early in December 2012 (the exact date in December is in dispute between the parties). A significant number of people in the security industry in Tasmania received training and obtained qualifications from Echelon in the period between June 2005 and December 2012.
After ASQA became the regulating authority for Tasmanian RTOs in 2012 it was then necessary for Echelon to apply to ASQA for renewal of its registration.
Following a site audit conducted by auditors from ASQA on the 16 and 17 May 2012 Echelon was found to be “critically non-compliant” with the Vocational Education Training (VET) Quality Framework. That Framework includes Standards for NVR Registered Training Organisations (“Standards” or “SNRs”). A Notice of Non-Compliance was sent to Echelon on the 29 May 2012. In accordance with the usual procedure an opportunity was provided by ASQA for Echelon to submit rectification data. Echelon did provide some rectification data on the 22 June 2012.
The rectification data which Echelon had provided was then assessed by ASQA. Following that assessment it was determined that Echelon remained non-compliant and so on the 16 August 2012 ASQA decided to refuse Echelon’s application for renewal of its registration.
Echelon sought a review of that decision by this Tribunal (AAT application number 3733 of 2012). Following a conciliation conference the parties consented, subject to undertakings by the respondent, to the dismissal of that application. On the 4 December 2012 the Tribunal dismissed the application pursuant to Section 42 A (1) of the Administrative Appeals Tribunal Act 1975.
In the Tribunal’s order of 4 December 2012 dismissing the application it is noted that the respondent agreed to the following terms :
(a)Pursuant to the requirements of Section 16 and Section 17 of the National Vocational Education and Training Regulator Act 2011 (the NVR Act), it will expedite any Initial Application for Registration the Applicant may submit to the Respondent (“ the Initial Application”).
(b)For the purposes of paragraph 3(a) and on the basis that the Applicant has provided all relevant documents required for the Initial Application, it will schedule the audit required under Section 17 (3) of the NVR Act on or around 14 February 2013.
(c)Pursuant to Section 16 (3) (a) of the NVR Act, it accepts the evidence relating to Financial Viability and Fit and Proper Person received from the Applicant in 2012 as being compliant for the purposes of the Initial Application.
(d)Any audit or other assessment conducted by it under Section 17 (3) of the NVR Act regarding the Initial Application will be conducted in accordance with the threshold standards applicable to initial applications.
(See respondent’s Tender Documents Volume 1 Tab 1).
Consistent with those understandings Echelon then made an application for “initial” registration rather than “renewal” of registration which it had applied for in early 2012. It should be mentioned that initial registration is said to be less stringent than the renewal of registration and is based upon the organisation establishing appropriate intent rather than an assessment of its actual performance as an RTO.
A site audit was conducted by Ms Jennine Cochrane and Mrs Christine Williams, both auditors employed by ASQA, on the 18 and 19 February 2013. The audit was conducted at the applicant’s premises at 3/63 Paterson Street, Launceston, Tasmania. Following that audit Echelon was once again found to be “critically non-compliant” with the VET Quality Framework. At that stage the alleged non-compliance concerned SNRs 4.2, 4.3, 4.4, 4.5, 5.6, 6.2, 10.1, 11.2, and 12.1.
ASQA again gave Echelon an opportunity to provide evidence that the non-compliance as identified had been rectified. Further rectification data was then provided by Echelon. ASQA analysed the further information and determined that the rectification data satisfied SNRs 5, 6, 10, 11 and 12 but there continued to be non-compliance with SNRs 4.2, 4.3, 4.4 and 4.5. On the 21 June 2013 ASQA refused Echelon’s application for initial registration. By letter dated 2 July 2013 Echelon was advised of ASQA’s decision in the following terms :
“Dear Mr Bramich
Outcome of initial registration application – rejected
I refer to your application to register as a national VET regulator (NVR) registered training organisation ( RTO).
In deciding whether to grant an application for registration, the Australian Skills Quality Authority (ASQA), as the national VET regulator, must consider whether the applicant complies with the VET Quality Framework and the conditions of registration set out in Sections 21-28 of the National Vocational Education and Training Regulator Act 2011 (the Act)). Only applicants that meet these requirements can be registered.
In accordance with the provisions of the Act, your application for registration has been rejected on the grounds that one or more of these requirements has not been met. The decision to reject the application was made by the ASQA Commissioner Compliance on 21 June 2013.
Reasons for Decision
(as particularised on pages 5 to 12 of the ASQA

Audit Report, a copy of which is attached):
oSNR 4.2 – No strategy for training and assessment for DPP20212 Certificate II in Security Operations.
oSNR4.3 – Insufficient training and assessment resources to meet the requirements of CPP07 Property Services Training Package.
oSNR4.4 – Failure to demonstrate competence of the only nominated trainer/assessor, Mr Kevin Bramich.
oSNR 4.5 – Assessment tools did not meet the requirements of CPP10107 Certificate in Security Operations, CPP20212 Certificate II in Security Operations, CPP30411 Certificate III in Security and CPP40707 Certificate IV in Security Risk Management and Operations.
Submit new application
You may choose to address the issues that ASQA has identified and submit a new application for registration.
You can seek a review of this decision as it is a reviewable decision under section 199 of the NVR Act…………”
Mr Bramich of Echelon provided the following response to ASQA’s decision of 2 July 2013:
“IN RESPONSE TO 2^ND JULY FINDINGS
SNR 4.2 No strategy supplied for CPP20212 is incorrect:
On day of audit it was pointed out that the number CPP20211 needed to be changed by one digit and it was accepted. The material (strategies) were lodged prior to the change of the code from CPP20211 to CPP20212.
SNR4.3 We have the same material as other already registered RTO’s and had produced receipts for and all materials for said training. On the day of the audit it was okay.
SNR4.4 This finding is absurd to the point that there is reference to one unit not on the certificate supplied (CPPSEC3034)
My qualifications were not questioned previously as I am the highest qualified security trainer in Tasmania and one of a handful nationally that are degree qualified.
It should be noted that the unit in question appears on another certificate anyway and that ASQA is giving a 4 hour certificate III unit greater value than say the unit “Technical Applications” which is one of the 24 subjects in my BA InfoSys degree which took 13 weeks of study. This is also aside from the fact that I am highly qualified in software engineering and other areas beyond security operations.
Consider that I also have an Advance Diploma in Security and Risk Management, Diploma in Security Risk Management and Certificate IV in Security Risk Management, CIV in Training and Assessment (currently doing Diploma in Training and Assessment) Plus qualification in Investigations III, Technical Security II & III, Security Operations I, II & III.
If I am not competent because of one unit then who is?
SNR4.5 Assessment tools are from CPSISC resources and are industry standard. I need to show intent on the day but showed the actual material which now is apparently no good. This material was and is still used by other RTO’s for Assessment. I provided the rectification data which in terms of Assessment material was purchased and compliant at the time and still is in all qualifications mentioned in the final response.
Also the person making the final decision has no name therefore one cannot be certain of the competency of the person as we have no way of checking except they failed in assessing what the assistant auditor submitted as the lead audit passed the material for her part. Not open, consistent, transparent nor a fair process”.
As it was dissatisfied with the decision as detailed in ASQA’s letter of 2 July 2013, on the 29 July 2013 Echelon applied to this Tribunal for a review of the decision of ASQA as set out in its letter.
In paragraph 15 of its “Statement of Reasons” dated the 26 September 2013 (see exhibit R5) the respondent conceded that Echelon would have a further opportunity, because of the “merits review character” of the Tribunal’s review, to provide further material in the course of the proceedings to demonstrate compliance.
Echelon’s attempts to satisfy the Standards did not end with material provided at the various audits but continued during the course of the hearing of this matter. Echelon’s solicitor Mr Boland tendered further written material in an endeavour to achieve full compliance. It is not in doubt that the Tribunal can and should generally consider new information of relevance to the decision being reviewed. (see Shi v Migration Agents Registration Authority [2008] HCA 31).
Quite apart from the issue of compliance a further important issue was raised after these proceedings had commenced. Some three months after Echelon had lodged its application for review with the Tribunal the respondent’s solicitor Mr Lloyd informed the Tribunal that an entirely new issue had arisen which he contended would prevent Echelon becoming registered as an RTO. Mr Lloyd stated in writing :
“In its preparations for the proceedings the respondent has only recently been informed of conduct by the applicant that the respondent believes is in serious breach of the fit and proper person standard made under Section 186 (1) of the NVR Act, for the applicant to become a registered training organisation, RTO”.
Mr Lloyd added:
“If the applicant does not satisfy the standards of a fit and proper person then it is in breach of Section 23 of the NVR Act”.
It then became apparent that the respondent was now not only alleging a failure to satisfy the Standards specified in the letter of the 2 July 2013 but also claimed that Echelon did not satisfy the Fit and Proper Person Requirements made pursuant to the Act.
At a telephone directions hearing on the 28 November 2013 I queried whether the Tribunal had jurisdiction to consider the new allegation and invited submissions both from Mr Lloyd and Echelon’s solicitor Mr Boland. After considering those submissions I subsequently decided that the Tribunal had jurisdiction to determine whether the applicant satisfies the Fit and Proper Person Requirements made pursuant to the Act (see Echelon National Security Agency Pty Ltd and Australian Skills Quality Authority [2014] AATA 151).
THE LEGISLATION
Section 16 of the Act provides in part as follows :
“16.     Application for Registration
(1)A person may apply to the National VET regulator for registration, including renewal of registration as an NVR registered training organisation”.
Section 17 of the Act relevantly states :
“17.     Grant of application for registration
(1)       The National VET Regulator may grant an application for registration.
(2)In deciding whether to grant an application, the National VET Regulator must consider whether the applicant complies with:
(a)       the VET Quality Framework; and
(3)       When considering the application, the National VET Regulator may conduct an audit of any matter relating to the application……..”
Subdivision B in Division 1 of part 2 of the Act provides in part as follows :
“Subdivision B – Conditions of registration
21.       Complying with conditions
An NVR registered training organisation must:
(a)       comply with the conditions set out in sections 22 to 28; and
(b)       comply with any conditions imposed on the organisation’s registration under subsection 29 (1).
22.      Condition – compliance with the VET Quality Framework
(1)An NVR registered training organisation must comply with the Standards `for NVR Registered Training Organisations.
(2)An NVR registered training organisation must comply with the Australian Qualifications Framework.
(3)An NVR registered training organisation must comply with the Data Provision Requirements.
23. Condition – satisfying Fit and Proper Person Requirements
An NVR registered training organisation must satisfy the Fit and Proper Person Requirement”.
Sections 185 and 186 of the Act provide as follows :
“185. Standards for NVR Registered Training Organisations
(1)The Minister may, by legislative instrument, make standards for NVR registered training organisations, as agreed by the Ministerial Council.
(2)The agreed standards are to be known as the Standards for NVR Registered Training Organisations.
186. Fit and Proper Person Requirements
(1)The Minister may, by legislative instrument, make requirements for assessing whether a person is a fit and proper person, as agreed by the Ministerial Council.
(2)The agree requirements are to be known as the Fit and Proper Person Requirements.
On the 26 June 2011 the then Minister for Tertiary Education, Skills, Jobs and Workplace Relations by legislative instrument made requirements for assessing whether a person is a “fit and proper person”. That instrument at 3.2 states :
“3.2The requirements of this legislative instrument apply to NVR registered training organisations. The National VET Regulator will also consider these requirements when deciding whether to grant an application for initial registration or renewal of registration”.
FPPR4 of the Fit and Proper Person Requirements relevantly provides :
“FPPR4 Criteria for suitability for registration
In assessing whether a person, who is an applicant for registration as an NVR registered training organisation, an applicant for renewal of registration as an NVR registered training organisation or who is an NVR registered training organisation, meets the Fit and Proper Person Requirements, the National VET Regulator must have regard to the following considerations….”.
The matters which the decision maker must have regard to are then set out in paragraphs (a) to (k) of FPPR4. During the course of the hearing Mr Lloyd indicated that he would be principally relying on (j) which states:
“(j)whether the public is likely to have confidence in a person’s suitability to be involved in an organisation that provides or assesses national qualifications”.
FPPR5 states as follows:
“FPPR5 Persons subject to Fit and Proper Person Requirements
A person mentioned in FPPR4 does not meet the Fit and Proper Person Requirements if the National VET Regulator is satisfied that, having regard to the matters provided in paragraph FPPR4 (1) to (K), one or more of the following people do not meet the Fit and Proper Person Requirements:
(a)an executive officer of the person referred to in FPPR4;
(b)a high managerial agent of the person referred to in FPPR4; OR
(c)any person or entity which exercises a degree of control or influence over the management or direction of the registered training organisation.
The meaning of “executive officer” and “high managerial agent” are defined in section 3 of the Act
THE ISSUES
The principal issues for determination by the Tribunal are as follows :
(a)whether the applicant complies with the relevant Standards for initial registration as an NVR registered training organisation; and
(b)whether the applicant satisfies the Fit and Proper Person Requirements made pursuant to the Act.
DOES THE APPLICANT SATISFY THE STANDARDS REQUIRED FOR INITIAL REGISTRATION?

ASQA and the National statutory and regulatory regime that now applies to RTO’s were established to ensure the quality and consistency of VET training throughout Australia. This is evident from the objects set out in Section 2 (A) of the Act. That section provides as follows :
“2A Objects
The objects of this Act are:
(a)to provide for national consistency in the regulation of vocational education and training (VET); and
(b)to regulate VET using:
(i)      A standards-based quality framework; and
(ii)     Risk assessments, where appropriate; and
(c)to protect and enhance:
(i)      Quality, flexibility and innovation in VET; and
(ii)     Australia’s reputation for VET nationally and internationally; and
(d)to provide a regulatory framework that encourages and promotes a VET system that is appropriate to meet Australia’s social and economic needs for a highly educated and skilled population; and
(e)to protect students undertaking, or proposing to undertake, Australian VET by ensuring the provision of quality VET; and
(f)to facilitate access to accurate information relating to the quality of VET.
In an application for initial registration eleven separate Standards must be satisfied (see Part 2 of the Standards for NVR Registered Training Organisations 2012).
As mentioned above following the site audit conducted on the 18 and 19 February 2013 rectification data was provided by Echelon. ASQA then assessed that material and decided that all the relevant Standards for initial registration were satisfied except SNR’s 4.2, 4.3, 4.4 and 4.5.
The Standards (or SNR’s) which it is contended remain non-compliant following the February 2013 audit and rectification processes are set out in Part 2 of the Standards for NVR Registered Training Organisations 2012 in the following terms:
“4.2Strategies for training and assessment meet the requirements of the relevant Training Package or VET accredited course and have been developed through effective consultation with industry.
4.3Staff, facilities, equipment and training and assessment materials to be used by the app0licant meet the requirements of the Training Package or VET accredited course and the applicant’s own training and assessment strategies and are developed through effective consultation with industry.
4.4The applicant has a defined strategy, procedures and measures to ensure training and assessment services are conducted by trainers and assessors who:
(a)have the necessary training and assessment competencies as determined by the National Skills Standard or its successors;
(b)have the relevant vocational competencies at least to the level being delivered or assessed;
(c)can demonstrate current industry skills directly relevant to the training/assessment being undertaken; and
(d)continue to develop their vocational education and training (VET) knowledge and skills as well as their industry currency and trainer/assessor competence.
4.5The applicant has a defined strategy and procedures in place to ensure that assessment, including Recognition of Prior Learning (RPL):
(a)will meet the requirements of the relevant Training Package or VET accredited course;
(b)will be conducted in accordance with the principles of assessment and the rules of evidence;
(c)will meet workplace and, where relevant, regulatory requirements; and
(d)is systematically validated”.
In considering whether or not the above Standards have been met it is obviously most helpful to the Tribunal to have the benefit of evidence from witnesses who have a sound knowledge of these Standards and how they are to be interpreted and applied in practice. ASQA called, amongst others, two witnesses, Ms Jennine Cochrane and Ms Kim Daly, both of whom hold relevant qualifications and are experienced auditors with a good working knowledge and understanding of the applicable Standards and of the written material and practices which had to be assessed against those Standards.
The Tribunal found both Ms Cochrane and Ms Daly to be competent and credible witnesses and their analysis of the relevant information and their oral evidence about non-compliance to be persuasive.
The difficulty for the applicant is that apart from some very limited evidence from Mr Bramich no expert evidence was called by the applicant to counter the opinions expressed by ASQA’s auditors. It is interesting to note that in Ivy Education Group Pty Ltd and Australian Skills Quality Authority [2013] AATA138 the applicant in that case called two experts, described as “the applicant’s auditors”, who were education and training consultants and who gave expert evidence for the applicant on the question of whether or not the applicant complied with the relevant SNR’s.
In his affidavit of 25 February 2014 (exhibit A2) Mr Jason Clarke said he was a consultant to Echelon in its application for reregistration and also for initial registration. Although Mr Clarke states in his affidavit that his own RTO had used similar written material in its own application to ASQA as was presented by Echelon he was not called as a witness. Mr Clarke did not provide any expert analysis of Echelon’s written material or more generally of its efforts to achieve compliance with the requisite Standards.
The evidence before the Tribunal indicated that SNR4.3 and SNR4.5 were essentially “linked” and that if 4.5 was satisfied then the applicant could also be considered compliant with 4.3. Compliance with 4.5 was described by Ms Cochrane as “critical” (transcript page 224).
Consultation with industry is a central element in SNR4.2. It is obviously important for a new RTO seeking initial registration to gain a good understanding of the needs of industry and of the skills and competencies that are in demand in the industry. The reality is that Echelon has itself operated a security business for a significant number of years. Mr Bramich, already an experienced trainer, has wide knowledge of the security industry in Tasmania. The Tribunal agrees with Ms Cochrane that at the very least the consultative element in SNR4.2 is satisfied.
It is not now in dispute between the parties that Mr Bramich, who intends to perform most of the training for Echelon and has done so in the past, and who actually continues to train people on behalf of another RTO in Tasmania, has the necessary education, training and vocational competence and also current industry skills to carry out the role of trainer and assessor. The Tribunal finds that SNR4.4 is satisfied and indeed the respondent has conceded that to be the case (see transcript page 588).
It follows that the central compliance question remaining is whether Echelon now complies with SNR4.5.
On the 16 January 2014 Ms Daly completed a detailed analysis of the assessment material submitted by the applicant. Ms Daly’s audit on that occasion was limited to an audit of Standards 4.5 (a) and (b) against five units of competence sampled from the Training Package. It concluded that at that stage the applicant remained non-compliant with Standards 4.5 (a) and (b).
Ms Daly also provided a further report on one unit of competence (CPPSEC201A Communicate Effectively in the Security Industry). Again the only Standards audited were 4.5 (a) and (b). Once again, and consistent with earlier audits, Ms Daly reported non-compliance with those Standards.
A further detailed report was completed by Ms Daly following a request from Mr Boland at the hearing of this application on Friday 28 February 2014 (see exhibit R30). It is an audit by Ms Daly involving six units of competency. The audit was conducted after Mr Boland provided two documents with a request to report whether those documents satisfied the Standards in 4.5 (a) and (b). The Tribunal has carefully considered that report in all of its detail. The report is lengthy and comprehensive. It is not intended to include in these findings passages from the report. Ms Daly’s report is a very thorough comparison of the material provided by the applicant with the requirements of Standards 4.5 (a) and (b). Once again Ms Daly expresses the view that there are significant areas of continuing non-compliance with those Standards.
In her report at pages 10 to 17 Ms Daly provides numerous examples of non-compliance relating to the assessment materials provided for the six units of competency. In those pages of her report Ms Daly cites many areas of continuing failure to satisfy the Standards in 4.5 (a) (b). The detailed results of that audit which were tendered in evidence to the Tribunal on the 29 May 2014 are left largely unchallenged by the applicant.
Ms Cochrane is a Principal Compliance Auditor with ASQA and is based in Melbourne. She provided an opinion on Echelon’s alleged continuing non-compliance with Standard 4.5. Ms Cochrane also provided to the Tribunal a helpful one page summary of her opinion (see exhibit R31). That summary is as follows:
“The organisation is required to demonstrate its compliance with SNR4.5 of the Standards for NVR Registered Training Organisations 2012.
It states:
‘The applicant has a defined strategy and procedures in place to ensure that assessment, including Recognition of Prior Learning (RPL):
(a)will meet the requirements of the relevant Training Package or VET accredited course;
(b)will be conducted in accordance with the principles of assessment and the rules of evidence;
(c)will meet workplace and, where relevant, regulatory requirements; and
(d)is systematically validated’.
The organisation has not demonstrated that it has defined strategies and procedures in place to ensure assessment
(a)will meet the requirements of the relevant Training Package or VET accredited course;
(b)will be conducted in accordance with the principles of assessment and the rules of evidence;
The documents it proposes to use to gather sufficient evidence to demonstrate that a student is ##competent:
·Lacked instructions (fairness, reliability and sufficiency) – to instruct both the candidate and the assessor as to what was to be performed in the assessment activity so the candidate can demonstrate competency and the assessor sufficiently understands what minimum performance must be demonstrated and recorded as evidence.
·Failed to meet the minimum requirements of the following units of competency, in particular the mandatory skills, knowledge and specified evidence requirements:
oCPPSEC2001A Communicate effectively in the security industry
oCPPSEC2002A Follow workplace safety procedures in the security industry
oCPPSEC2003B Work effectively in the security industry
oCPPSEC2004B Respond to security risk situation
oCPPSEC2005A Work as part of a security team
oCPPSEC2006B Provide security services to clients
·Were incomplete – didn’t have all the documentation for the assessor to use to complete the assessment tasks, for example:
oThere were no documents in place to record any assessment for CPPSEC3003B (page 11).
oDidn’t have any skills based tasks to be performed for CPPSEC3009A Prepare and present evidence in court.
·Proposed assessment wasn’t fair.   The assessment checklists to be used by the assessor that record what the student is to do for assessment contained criteria that is not relevant to any of the assessment tasks that the student is to perform.
The organisation had not strategy in place for the delivery and assessment of CPPSEC3002A Manage conflict through negotiation.   It downloaded a document from the Industry Skills Council website but did not review and adapt it to ensure it reflected its own proposed practices. The website clearly instructs organisations that ‘CPSISC has developed these Delivery and Assessment Guides to help with implementation of the CPP07 training package. These resources are intended to provide guidance only.   It is up to trainers to design and customise a delivery and assessment process which meets the required standards and the individual needs of the learner and their work requirements’.
##Competency means the consistent application of knowledge and skill to the standard of performance required in the workplace.   It embodies the ability to transfer and apply skills and knowledge to new situations and environments.”
The Tribunal finds Miss Cochrane’s opinion on Echelon’s continuing non-compliance, including the above summary, to be sound and persuasive.
In his closing address to the Tribunal on 30 May 2014 Mr Boland stressed that Echelon had only applied for initial registration and “can only demonstrate what it intends to do”. It is suggested that it is not possible to effectively audit “intent alone”. He also submitted that the documents his client was using were actually from the NVR Smart Guide Package which had been provided to many other training organisations. During the course of the hearing Mr Boland contended a number of times that other RTO’s had gained registration using the same written material as Echelon. There is however insufficient reliable evidence before the Tribunal to satisfy it of that contention. Mr Boland also emphasised that Echelon had previously been registered as an RTO and had conducted training for a period in excess of “seven and a half years”. He considers that experience has not been given proper recognition by ASQA in assessing the application for initial registration.
The Tribunal is satisfied, noting the objects in section 2A of the Act and the important role RTO’s play, that is entirely appropriate for ASQA when considering an initial application for registration to audit the written material provided by an applicant and the actions it intends taking to establish itself as a fully compliant RTO. There is insufficient cogent evidence before the Tribunal to satisfy it that other RTOs have been granted initial or renewed registration after providing to ASQA the very same written material as Echelon has provided. The fact that Echelon was registered by the previous Tasmanian state regulator does not mean that registration should necessarily be granted by ASQA. Applicants must now comply with new national standards which apply to RTO’s throughout Australia.
Although Echelon satisfies many of the Standards that must be met to obtain initial registration there remains before the Tribunal most persuasive evidence, particularly the evidence provided by Ms Cochrane and Ms Daly, that it continues not to satisfy the requirements of SNR4.5 (a) and (b).
It is noted that whereas section 22 of the Act states that an RTO “must comply” with the Standards, section 17 requires the decision maker only to “consider” whether the Applicant complies with the applicable conditions of registration, which include the relevant Standards, when deciding whether to grant an application for registration.
As Standard 4.5 is an important Standard for initial registration, in so far as the Tribunal has any discretion, the Tribunal finds that the continuing non-compliance with that Standard warrants affirmation of the decision made by ASQA not to grant initial registration to the Applicant. It should be mentioned that is also likely that at least some elements of Standards 4.2 and 4.3 also continue not to be satisfied however it is not necessary for the Tribunal to make a final determination about compliance with those two additional Standards.
Conclusion
Section 22(1) of the Act provides that a NVR registered training organisation must comply with the Standards for NVR Registered Training Organisation. SNR 4.5 (a) and (b) have not been complied with by the applicant. The Tribunal concludes that in the circumstances the applicant should not be granted initial registration.
IS THE APPLICANT NOT A FIT AND PROPER PERSON?
As the Tribunal has decided that the applicant is not to be granted initial registration as an RTO it is strictly unnecessary for it to proceed to make a decision on this issue. In the circumstances however it would be unreasonable not to also decide this issue as much of the hearing time was devoted to the question of whether or not the applicant is a “fit and proper person”.
It is noted that in the terms agreed by the respondent when the Tribunal made its order of 4 December 2012 (see paragraph 11 above) was an acceptance by the respondent that the applicant was then a “fit and proper person”. However new information later came to the attention of the respondent which caused it to decide to pursue the allegation that the applicant was now not a “fit and proper person” to be registered as an RTO.
The respondent’s allegation that the applicant is not a fit and proper person for the purposes of the Act was summarised by Mr Lloyd in his opening address before the Tribunal as follows:
“…The applicant’s Chief Executive Officer, Mr Kevin Bramich, whilst knowing and understanding that he was not an NVR registered training organisation and without providing instruction or training or conducting any assessment at all, on or about 25 January 2013 knowingly provided an NVR qualification and statement of attainment to Mr John Falk in return for a payment of $500. On the basis of that evidence, the respondent says that the public could not have confidence in Mr Bramich’s suitability to be involved in an organisation such as the applicant that provides or assesses national qualifications.
And, therefore, the applicant is not a fit and proper person to be the owner, major shareholder, chief executive officer and sole trainer of an NVR registered training organisation. (see transcript page 11)”.
The matters which the Tribunal must have regard to when assessing whether an applicant for registration meets the Fit and Proper Person Requirements and, as indicated in paragraph 25 above are set out in FPPR4 of those Requirements.
Mr Lloyd said that the respondent seeks to rely on FPPR4 (j) which provides, as one of the considerations:
“(j)whether the public is likely to have confidence in the person’s suitability to be involved in an organisation that provides or assesses national qualifications”.
Mr Lloyd had indicated at the hearing that the respondent would also be relying on 4 (k) – “any other relevant matter” – but when pressed for particulars did not pursue a reliance on that particular consideration.
It is necessary however for the Tribunal to have proper regard to all of the matters set out in FPPR4 in deciding whether Echelon is not a “fit and proper person” to be registered as an RTO. That list of matters is not exhaustive as indicated by (K) – “any other relevant matter”.
The question is whether Echelon, as a corporation, is not a “fit and proper person”. It will not be a “fit and proper person” if a person with sufficient seniority and influence in the company and who satisfies the descriptions in (a), (b) or (c) in FPPR5 has committed one of the specified wrongdoings or otherwise comes within the meaning of (a) to (k) of FPPR4.
As Hill J said in Davies v Australian Securities Commission (1995) 59 FCR 221 at 232:
“…the content of what is necessary to constitute a fit and proper person to occupy a particular office or pursue a particular vocation will vary having regard to the office or vocation under consideration.”
The Tribunal will now consider the particular circumstances which form the basis of the respondent’s allegation that Echelon is not a “fit and proper person”.
Mr John Falk works as a guard in the security industry. In early December 2012 he applied to the Tasmanian Department of Justice for the renewal of his security licence. By letter dated the 21 December 2012 the Department of Justice advised Mr Falk that he had to undergo further training before his licence could be renewed.
Mr Falk then applied to the Hobart based RTO, EDA RTO Pty Ltd, to obtain the necessary training. He paid a fee for the training but apparently shortly afterwards was advised that the training would take some time and could not be completed before his licence lapsed.

Mr Edward Harding, who is the owner and Director of TAS Security Services Pty Ltd, a security business operating in Tasmania, included in his affidavit of the 1 November 2013 the following:
“1.Since 1997 I have been the owner and Director of TAS Security Services Pty Limited.
2.I have known John Falk since 2007 when he became an employee of my company a position he currently holds.
3.In early January 2013 John advised me that he was going to have to undertake some additional training in order to renew his security license.
4.I immediately referred John to my company’s preferred registered training organisation, EDA-RTO Pty Limited (“EDA-RTO”).
5.To the best of my knowledge and understanding John then enrolled to do the further training with EDA-RTO.
6.However, a short while later I recall that John came to see me and advised me in words to the following effect, “I won’t be able to complete the required training with EDA-RTO before my current security license lapses but I have heard about an RTO called Echelon based in Launceston that may be able to deliver the training faster.
7.Later in January John advised me that he had received his upgraded qualification and renewed his license even though he had not received any training in relation to the qualification but merely paid Echelon $500”.
Mr Patrick Kearney is the Chief Executive Officer of EDA-RTO Pty Ltd. He said, in part, in his affidavit of the 13 December 2013 as follows:
“5.On 10 January 2013 Mr Falk attended the EDA-RTA Office at Moonah and completed and signed an EDA-RTO Enrolment Form. I then gave him the necessary training manuals, assessment materials and a CD-Rom.
6.Around that time I also prepared a working Document describing the units of required training that I believed Mr Falk needed to complete in order to have his licence renewed. Attached to his affidavit and identified as Annexure “B” are true and accurate copies of Mr Falk’s EDA-RTO Enrolment Form and the working Document.
7.An EDA-RTO Client Enrolment Report was then prepared in relation to Mr Falk’s enrolment. Attached to this affidavit and identified as Annexure “C” is a true and accurate copy of the EDA-RTO Client Enrolment Report.
8.On 10 January 2013 an EDA-RTO Tax Invoice for the training fee owed by Mr Falk was prepared in the amount of $400. Attached to this affidavit and identified as Annexure “D” is a true and accurate copy of the Tax Invoice.
9.On 14 January 2013 and by electronic funds transfer Mr Falk paid the $400 training fee owed to EDA-RTO. Attached to this affidavit and identified as Annexure ”E” is a true and accurate copy of a printout from EDA-RTO income Receivables Account showing the payment received.
10.On 13 February 2013 I recall having a telephone conversation with Mr Falk where he advised that he did not want to continue with his training course at EDA-RTO and required a refund of the training fee he paid”
Echelon has a markedly different version of its involvement with Mr Falk. Its version of events is explained in Mr Bramich’s affidavit of 25 February 2014. Mr Bramich states as follows:
“1.On or about 17^th October 2012 Echelon sent to Mr Falk, following his enquiry and request, Echelon’s enrolment form. It is headed “Echelon Training Services Enrolment Form 2012”.
2.On or about 25^th October 2012 Mr Falk returned Echelon’s enrolment form duly completed and signed by him but which omitted the year 2012 reference. I have no explanation for this.
3.On or about 30^th October 2012 Echelon sent to Mr Falk its training material and tax invoice number 120212 for $500.00 for its services provided and to be provided.
4.At about the same time of Mr Falk’s initial enquiry, his name was added to Echelon’s client list. I attach a true copy of that document. It is not possible to amend or alter that document.
5.My usual practice is to assess training material within a couple of days of receipt. I deal with literally hundreds of enquiries each year. I do not specifically recall Mr Falk and relied upon what Mr Corbett suggested to me such that I thought I must have assessed his material and as per my usual practice. Following Mr Corbett’s admissions I now know this was not the case.
6.At all material time Echelon was an RTO. It remained registered until 11^th December 2012 upon presentation of its initial Application for Registration to ASQA. Therefore, Echelon at all material times was registered and authorised to provide the training required by Mr Falk, assess him on his training material and issue certificates of attainment, as appropriate, which it did not.
7.In or about mid/late January 2013, while I was on leave, and in reliance on Mr Corbett’s admissions, Mr Falk rang Echelon and spoke with Mr Corbett, an employee who held no office in Echelon and was not in any way involved in its management, and requested that a copy of Echelon’s tax invoice be resent to him so that payment could be made.
8.On or about 23^rd January 2013 Mr Corbett, in an endeavour to comply with Mr Falk’s request, sent a regenerated tax invoice. When a tax invoice is regenerated, as opposed to photocopied, the date of re-printing and a new invoice number appears on the document. Mr Falk, by his evidence implies that he lost or misplaced the original tax invoice.
9.On 25^th January 2013 Mr Falk paid the training fee, in full, by direct deposit to Echelon’s account.
10.On or about 25^th January 2013, upon receiving full payment outstanding, Mr Corbett sent to Mr Falk his C11 & C111 Security Operations Certificates, as issued in the circumstances attested to by him. He did not send a receipt. There was no requirement for Echelon to do so”.
A most concerning feature of this matter is that copies of the same Echelon enrolment form which had been signed by Mr Falk included two different dates. One copy provided by the applicant has the date 25 October 2012 on it and the identical document (except for the date) provided by the respondent has the date 25 January 2013 written on it. (See attachments ‘A’ and ‘B’ to affidavit of Stewart Alexander Mills – exhibit R3). The other writing apart from the date, in the two versions of the document appears to be the same. It would appear that someone may have altered the date on one of the copies to suit their case. If that is so then it is a most serious matter.
Mr Bramich was adamant that he believed Mr Falk did enrol at Echelon in 2012 and had undertaken training although he said he could not actually recall Mr Falk. There is an absence of cogent and reliable corroborative evidence supporting the contention that Mr Falk enrolled with Echelon in October 2012 and was then trained by the organisation. After considering all of the affidavits, the oral evidence given at the hearing and other material, the Tribunal considers it most unlikely that Mr Falk did in fact undertake training with Echelon in 2012. It is however most difficult for the Tribunal to make a positive finding on that issue because it has not had the benefit of hearing directly from the man at the very centre of this controversy.
The central figure in these events is Mr Falk himself. He was the person who decided to approach Echelon after a discussion with Mr Harding (see paragraph 6 of Mr Harding’s affidavit). Mr Falk knows why he chose to discuss that option with Mr Harding. It is most surprising to the Tribunal that Mr Harding, the owner of a security business which had employed Mr Falk, was unable to persuade Mr Falk not to do his training with Echelon particularly as Mr Harding already had formed a strong belief that Echelon was not a suitable RTO to be involved in training people in the security industry. Mr Falk is the person whose evidence could confirm or deny that he enrolled with Echelon in October 2012 as claimed by Echelon or whether the only approach he made to Echelon occurred in January 2013. There are many relevant questions that Mr Falk, as the person directly involved in the events could be asked, and would be in the best position to answer.
The difficulty for the Tribunal is that this central figure in this unusual and disputed series of events did not give sworn oral evidence and was not subject to cross examination. He swore two affidavits but they were not received into evidence. Mr Falk apparently suffered an exacerbation of a pre-existing illness shortly before he was due to appear at the Tribunal. This exacerbation occurred, it would appear, after a brief discussion with Mr Boland. For some reason Mr Boland decided to make contact with Mr Falk to discuss the case. Whether that conversation was a cause of the exacerbation of the illness (as suggested in one of the medical reports), or whether the cause was stress associated with having to appear to give evidence before the Tribunal or there was some other cause remains unclear. It should go without saying that any contact by a lawyer with another party’s witness who is due to give evidence before this Tribunal must be approached with the utmost caution.
Medical reports were provided by Mr Lloyd to explain Mr Falk’s absence. The Tribunal is satisfied on the evidence before it that Mr Falk was admitted to a Hobart Hospital suffering serious illness and was receiving specialist medical treatment. The respondent did not pursue the option of seeking a further adjournment so it could then call Mr Falk to give oral evidence when he had recovered from his illness.
In the absence of oral evidence from Mr Falk and the opportunity it would afford to properly assess the content, accuracy and reliability of his evidence it is most difficult for the Tribunal to make findings, to a sufficient standard of satisfaction, about these events.
To make a finding that a person is not a “fit and proper person” to carry on business as an RTO is a most serious matter. In this case it would prevent Echelon from being registered as an RTO with significant consequences. When considering a serious finding that a person is not a “fit and proper person” it has been held that the Bringinshaw standard of proof should apply (see Briginshaw v Briginshaw (1938) 60 CLR 336, Hanna v Migration Agent’s Registration Authority [1999] FCA 1657 and Sullivan v Civil Aviation Safety Authority [2013] FCA 1362. The following passage from the judgment of Dixon J in Briginshaw explains how a Tribunal should approach the proof of facts when allegations are made that, if proven, would lead to very serious consequences for those involved. His Honour said at pages 361 and 362:
“The truth is that, when the law requires the proof of any fact, the tribunal must feel an actual persuasion of its occurrence or existence before it can be found. It cannot be found as a result of a mere mechanical comparison of probabilities independently of any belief in it reality. No doubt an opinion that a state of facts exists may be held according to indefinite gradations of certainty; and this has led to attempts to define exactly the certainty required by the law for various purposes. Fortunately, however, at common law no third standard or persuasion was definitely developed. Except upon criminal issues to be proved by the prosecution, it is enough that the affirmative of an allegation is made out to the reasonable satisfaction of the tribunal. But reasonable satisfaction is not a state of mind that is attained or established independently of the nature and consequence of the fact or facts to be proved. The seriousness of an allegation made, the inherent unlikelihood of an occurrence of a given description, or the gravity of the consequences flowing from a particular finding are considerations which must affect the answer to the question whether the issue has been proved to the reasonable satisfaction of the tribunal. In such matters “reasonable satisfaction” should not be produced by inexact proofs, indefinite testimony, or indirect inferences.”
Some aspects of the evidence before the Tribunal do suggest the possibility that Mr Falk may have been encouraged to approach Echelon hoping to quickly obtain qualifications without proper training so that Echelon might then be found to be in breach of its responsibilities as an RTO. The fact that Mr Falk enrolled and went to the trouble of paying a fee to one provider and then suddenly, after a discussion with Mr Harding, makes an approach to Echelon does raise certain questions. Had he given oral evidence those questions could have been put to Mr Falk in the witness box. His answers may well have removed a degree of unease the Tribunal has about the true motives for Mr Falk’s approach to Echelon. The difficulty is that the Tribunal had no opportunity to hear and consider Mr Falk’s evidence.
The Tribunal is satisfied that Mr Falk did approach Echelon in January 2013 to obtain qualifications and after discussions with Mr Corbett and paying a $500 fee was issued with Statements of Attainment without undertaking any training at all. Mr Corbett however said in his affidavit of the 27 December 2013 that he was placed under a degree of pressure to issue the Statements of Attainment. It is likely that these Statements were issued by Mr Corbett without Mr Falk undertaking any training. He said in his affidavit:
“5.In January 2013 I did receive two phone calls from Mr Falk. The first call was on the 23^rd January 2013 wherein Mr Falk identified himself and asked if I could send him a copy of his tax invoice, as he had lost the original, so he could make payment and get his certificates. He said he had done his bookwork and needed his certificates quickly. He then asked how long it would take. I said I don’t know as Kevin was on leave and not due back for about three weeks.
6.Mr Falk was most insistent but at the same time sounded disappointed. He said at his age he needed to keep working. Our conversation concluded by me saying to him that I would look into it for him.
8.I truly believed what Mr Falk had told me and, in wanting to help out an elderly gentleman, in the circumstances that he had explained to me, I took it upon myself to look at the office data available to me, which was extremely limited and did not contain any information on any trainee, and printed fresh Tax Invoice no 130015 dated 23^rd January 2013. This is why I remember the actual date of Mr Falk’s first call. The only relevant data available to me was Echelon’s pro forma, enrolment form for the year 2012, tax invoice and the certificates. The certificates contained the dates that Mr Bramich had last printed them. I simply proceeded to insert Mr Falk’s name on two similar certificates that Mr Falk required. I sent the fresh Tax invoice no. 130015 to Mr Falk by ordinary post on 23^rd January 2013”.
Mr Corbett said in his affidavit that Mr Falk told him he had “done his bookwork and needed his certificates quickly”. There is no evidence from Mr Falk to dispute that statement. If Mr Falk did inform Mr Corbett that he had completed the necessary bookwork required to qualify for the Statements of Attainment then members of the public are most unlikely to conclude that as a result of this one error by Mr Corbett Echelon should be declared not to be a “fit and proper person” to carry out the functions of an RTO.
The respondent’s “fit and proper person” allegation was initially directed at the conduct of Mr Bramich. However Mr Bramich was on leave at the time and was not directly involved in the events concerning Mr Falk. There was no contact between Mr Corbett and Mr Bramich prior to Mr Corbett issuing the Statements of Attainment. Late in the hearing Mr Lloyd submitted that the principal wrongdoing by Mr Bramich was leaving unsecured and already signed Statements of Attainment at Echelon’s premises. Mr Lloyd said:
“what we say is that Mr Bramich deliberately left unsecured important, transferrable certificates of qualification, statements of attainment, which could be used by anyone to advise applicants of their supposed competency”.
Mr Lloyd was asked “is that the alleged occurrence which causes Mr Bramich to be not fit and proper?”
Mr Lloyd: “yes”. (transcript of 30 May 2014 page 45).
As indicated at the hearing the Tribunal is not satisfied that the mere presence of signed pro-forma Statements of Attainment in the computer at Echelon’s business premises is a sufficient basis for making the serious finding that the applicant is not a “fit and proper person”.
Again later in the hearing the respondent appeared to direct its attention to Mr Corbett as the main offender. Mr Corbett’s duties were essentially that he “…collected and issued uniforms to Echelon’s security guards, maintained the company vehicles in a presentable manner and helped out with basic office duties such as reception duties, photocopying, laminating and filing”. (see paragraph 2 of Mr Corbett’s affidavit).
At the time Mr Falk made contact with Mr Corbett, Mr Corbett was then minding the business for Mr Bramich during January and early February which was a very quiet time of the year. Mr Bramich is the owner of the business and plainly on the evidence the principal manager and operator of the business. The Tribunal is not satisfied that when the Statements of Attainment were issued by Mr Corbett he was then a “high managerial agent” of Echelon. He may have been for a brief period an executive officer of the organisation within the meaning of that term in the Act. However it is important to recognise that Mr Corbett is no longer employed by Echelon. He resigned his position in December 2013. The fact that he is no longer involved in any way with Echelon is an important factor when considering whether Echelon is now not a “fit and proper person” to be registered as an RTO.
The reality is that the “fit and proper person” allegation made by the respondent is considerably weakened by the absence of sworn evidence from the person who actually approached Echelon, spoke with Mr Corbett and obtained the Statements of Attainment.
In the absence of sworn evidence from Mr Falk the Tribunal is not satisfied, to the standard of satisfaction required, that any of the considerations in FPPR4 (a) to (k) are established in this case.
CONCLUSION
The Tribunal is therefore not satisfied, for the purposes of section 23 of the Act, that the applicant is not a fit and proper person.
It should be mentioned that in correspondence received by the Tribunal since the hearing concluded Mr Boland has indicated that he wished to seek an order requiring the respondent to pay Echelon’s legal costs “….on a full indemnity basis”. It must be pointed out that the Tribunal has no power to award costs in an application made under the National Vocational Education and Training Regulator Act 2011.
DECISION
(a)The applicant continues not to comply with SNR4.5 (a) and (b) of the Standards for NVR Registered Training Organisations 2012. The Tribunal affirms the decision not to grant initial registration to the applicant.
(b)The Tribunal is not satisfied, for the purposes of Section 23 of the National Vocational Education and Training Regulator Act 2011, that the applicant is not a “fit and proper person”.

I certify that the preceding 83 (eighty -three) paragraphs are a true copy of the reasons for the decision herein of The Hon R J Groom AO (Deputy President)
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Administrative Assistant
Dated

Date(s) of hearing 25, 26, 27, 28 February and 27, 28, 29, 30 May 2014
Solicitors for the Applicant Mr C Boland, Chris Boland Lawyers
Solicitors for the Respondent Mr T Lloyd, Australian Skills Quality Authority

Division	GENERAL ADMINISTRATIVE DIVISION
File Number(s)	2013/3715
Re	Echelon National Security Agency Pty Ltd
APPLICANT
And	Australian Skills Quality Authority
RESPONDENT

Tribunal	The Hon R J Groom AO (Deputy President)
Date	3 July 2014
Place	Hobart