Mantra Training and Development Pty Ltd and Australian Skills Quality Authority - [2019] AATA 66

Mantra Training and Development Pty Ltd and Australian Skills Quality Authority [2019] AATA 66 (23 January 2019)
Division:GENERAL DIVISION
File Number(s): 2018/5416
Re:Mantra Training and Development Pty Ltd
APPLICANT

AndAustralian Skills Quality Authority
RESPONDENT

DECISION
Tribunal:Member Mark Hyman
Date:23 January 2019
Place:Canberra

The decision under review is affirmed.
........................................................................
Member Mark Hyman
Catchwords
VOCATIONAL EDUCATION AND TRAINING – where applicant failed to pay the fee for renewal of registration more than 90 days before registration was to expire – whether the application was complete if the fee was not paid – whether the applicant should be allowed to apply for renewal within a shorter period than 90 days – relevant principles – explanation for the delay in payment – prejudice to respondent – whether the applicant did its best to abide by the requirements of the legislation – consequences for the applicant if the shorter period is not granted – offer by the respondent – decision under review affirmed
Legislation
Acts Interpretation Act 1901, s 15AB
Administrative Appeals Tribunal Act 1975, ss 29, 37
Administrative Decisions (Judicial Review) Act 1977, s 11
Aged Care Act 1997, s 8-2
Agricultural and Veterinary Chemicals Code Act 1994, ss 10, 164
Gene Technology Act 2000, ss 40, 43
National Vocational Education and Training Regulator Act2011, ss 2A, 3, 16, 17, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 158, 185, 186, 187, 189, 200, 201, 202, 203, 231A, 232, 232A, 232B
National Vocational Education and Training Regulator (Charges) Act 2012
Ozone Protection and Synthetic Greenhouse Gas Management Act 1989, ss 14, 16
Patents Act 1990, s 29A
Plant Breeder’s Rights Act 1994, ss 26, 30
Safety, Rehabilitation and Compensation Act 1988, s 62
Therapeutic Goods Act 1989, ss 22C, 22D, 23B, 24, 24B, 24C, 41EA, 41EB
Cases
Hillman and Australian Postal Corporation [2017] AATA 1411
Hunter Valley Developments v Minister for Home Affairs and Environment (1984) 58 ALR 305
Lucic v Nolan (1982) 45 ALR 411
Secondary Materials
National Vocational Education and Training Regulator Regulations 2011
Standards for NVR Registered Training Organisations 2012
Standards for VET Regulators 2015
REASONS FOR DECISION
Member Mark Hyman
23 January 2019

Mantra Training and Development Pty Ltd (Mantra) is a small business providing training and education in the vocational education and training (VET) sector. It is a registered training organisation (RTO) under the National Vocational Education and Training Regulator Act 2011 (the NVR Act). In October 2017 Mantra applied to the respondent, the Australian Skills Quality Authority (ASQA) to expand the scope of its operations by adding a qualification in training and assessment to the range of education and training services it offered. This application was denied and Mantra applied for review before this tribunal. That application is matter number 2018/2442. Mantra’s registration as an RTO was due to expire on 26 September 2018; Mantra sought renewal of its registration, but was late in paying the fee that is to accompany its application. The NVR Act provides a discretion for ASQA to allow an applicant a shorter period in which to seek renewal of registration, but on 19 September 2018 ASQA refused to exercise that discretion. The refusal is a reviewable decision under the NVR Act, and Mantra applied for review before this tribunal on 24 September 2018. That has brought the current matter before the tribunal. For reasons which will become apparent, it is being heard separately.
The effect of ASQA’s refusal is that Mantra’s registration would expire and it would no longer be able to operate as an RTO. That would clearly be difficult given Mantra’s ongoing operations as a provider of VET services, including to currently enrolled students. Mantra sought a stay of the decision, and ASQA did not oppose the application. I granted that stay on 26 September 2018; the effect of my decision was to allow Mantra to continue operations pending determination of its application for review. ASQA subsequently sought to impose conditions on the stay, noting that if Mantra enrolled students but was unsuccessful in its substantive application, those newly enrolled students would be left unable to continue; Mantra opposed the imposition of conditions. I did not agree to impose the conditions (see Mantra Training and Development and ASQA [2018] AATA 4586) but it was clear that the matter needed resolution quickly to avoid disruption both to Mantra and to students who might seek VET services from Mantra in the new academic year. Accordingly, I requested the Registrar to list an expedited hearing.
A hearing was held on 9 January 2019. Ms Donna Moulds, who is CEO, represented Mantra; Ms Sarah Wright of the Australian Government Solicitor appeared for ASQA, instructed by Ms Louise McDermott of ASQA. The tribunal had available the documents provided under section 37 of the Administrative Appeals Tribunal Act 1975 (the “T-documents”); attachments to Mantra’s submission provided in advance of the hearing (Exhibit A1); letters of commendation from some of Mantra’s students (gathered together as Exhibit A2); documents relating to an application for renewal of registration by a different RTO, WISE Academy (gathered together as Exhibit A3); and an email exchange with the ACT Government relating to its financial dealings with Mantra, tendered by ASQA at the hearing (Exhibit R1). It will be necessary in the course of the decision to refer to various parts of Exhibit A1 in particular. Most of that document was supplied without pagination. It has now been paginated as follows: the first section, identified as “Annexure A” is folios 1-4; Annexure B is folios 5-14; Annexure C is folios 15-16; and Annexure D is folio 17.
ISSUES
The issues before the tribunal are
·whether an application for renewal of an RTO’s registration has been made if the required fee is yet to be paid; and
·if not, whether Mantra should be allowed a period shorter than 90 days to make its application for renewal.
If the first of the issues were to be decided in the affirmative – that is, if I were to conclude that Mantra’s application for renewal was effective despite the accompanying fee not having been paid until very late – then Mantra would have no need of the shorter period in which to lodge its renewal application.
LEGISLATION
The NVR Act establishes a framework for the provision of vocational education and training (VET) in Australia. Section 2A sets out the objects of the Act, which include providing for national consistency in the regulation of VET; regulating VET using a standards- based quality framework and risk assessments where appropriate; protecting and enhancing quality, flexibility and innovation in VET and Australia’s reputation for VET nationally and internationally; providing a regulatory framework that encourages and promotes a VET system to meet Australia’s need for a highly educated and skilled population; and protecting students undertaking or proposing to undertake VET in Australia.
Part 2 of the NVR Act sets out the requirements for registration of RTOs. Section 16 provides for applications for registration, 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.
(2) A body that is part of a State or Territory may apply to the National VET Regulator for registration, including renewal of registration, of the body as an NVR registered training organisation.
(3) An application for registration must be in a form approved by the National VET Regulator and must be accompanied by:
(a) any information or documents that the Regulator requires; and
(b) the application fee determined by the Minister, by legislative instrument, under section 232.
Section 17 sets out how an application is granted:
17 Registration
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
(b) the applicable conditions of registration set out in Subdivision B of this Division.
(3) When considering the application, the National VET Regulator may conduct an audit of any matter relating to the application.
(4) The National VET Regulator may charge a registration assessment fee for considering the application.
Period of registration
(5) If the National VET Regulator grants an application, the Regulator must also determine the period for which the applicant is registered. The period must not be more than 7 years.
Conditions of registration
(6) If the National VET Regulator considers it appropriate to do so, the Regulator may impose one or more conditions under subsection 29(1) to which an organisation’s registration is subject.
Sections 21 to 30 deal with the imposition of conditions on registration of an RTO. Section 21 requires an RTO to comply with any conditions imposed; section 22 requires an RTO to comply with relevant standards including the Quality Standards and the Australian Qualifications Framework; section 24 provides that an RTO must satisfy the Financial Viability Risk Assessment Requirements; section 25 obliges an RTO to notify ASQA of specified events and changes in the organisation; section 26 obliges an RTO to respond to notices from ASQA seeking any information that body may seek in writing; section 27 requires an RTO to cooperate with ASQA to the extent necessary for ASQA to perform its functions or to facilitate that performance; and section 28 obliges an RTO to comply with any general directions made by ASQA about how conditions are to be complied with.
Section 31 deals specifically with the renewal of registration. It reads as follows:
31 Renewal of registration
(1) The National VET Regulator may renew an NVR registered training organisation’s registration under section 17 if the organisation makes an application for renewal:
(a) at least 90 days before the day the organisation’s registration expires; or
(b) within such shorter period as the Regulator allows.
(2) An application must be accompanied by the application fee determined by the Minister, by legislative instrument, under section 232.
(3) An NVR registered training organisation’s registration is taken to continue until the organisation’s application is decided.
(4) An NVR registered training organisation may apply for renewal of registration during a period when all or part of its scope of registration is suspended.
Section 199 of the NVR Act sets out those decisions of the National VET regulator which are reviewable decisions. Among the reviewable decisions listed in the section is a decision under section 31 of the NVR Act not allowing a shorter period for making an application for renewal of an RTO’s registration. Under sections 200 to 203 a person affected by a reviewable decision may seek review; reviewable decisions are internally reviewed if taken by the staff of ASQA; decisions taken by a commissioner and decisions that have been internally reviewed are subject to review by this tribunal.
Section 15 of the National Vocational Education and Training Regulator Regulations 2011 specifies that the National VET Regulator may also be known as the Australian Skills Quality Authority. It follows from the above that ASQA’s decision to deny a shorter period for lodgement of an application for renewal of registration is reviewable; and because it was taken by ASQA’s Chief Commissioner, it is reviewable by this tribunal.
When was Mantra’s application for renewal made?
Mantra’s registration expired on 26 September 2018. The default period provided in section 31 of the NVR Act for lodgement of an application for renewal is 90 days before expiry, i.e. the requirement was to lodge a complete application by 28 June 2018. The actual course of events was that Mantra made an online application on 15 March 2018[1] but did not pay any fee at that time. ASQA asserts that the online process has the effect of generating an invoice for the fee to be paid, but Ms Moulds asserted at the hearing that no invoice appeared online, nor did she see a prompt or other online mechanism for obtaining one. Whether that is so or not – and I have no way of determining the facts of that aspect – ASQA sent Mantra an email on 20 April 2018 with an invoice attached.[2] The amount of the invoice was $9,930.00.[3] Ms Moulds said in evidence that she had determined that the latest date for payment was 26 June 2018, and that it was good small business practice to make the payment on the last possible date.
[1] T4, folio 14.
[2] T6, folio 22.
[3] T5, folio 19.
Mantra did not, however, pay the invoice on 26 June. Ms Moulds said that this occurred through a system error, by which the invoice was deleted from Mantra’s financial system. She explained that this occurred because there were two invoices from ASQA at the one time – one the annual invoice, which was paid, and the other the renewal invoice, which was deleted in error (Ms Moulds appeared to suggest that this had occurred by human error, through an assumption that one of the invoices was a duplicate of the other). Ms Mould said that she had other problems to contend with at the same time – her mother had become seriously ill and there were family problems involving her son, also affecting her own mental health; and end of financial year pressures in the business.
On 3 September 2018 ASQA apparently contacted Mantra by telephone, and Ms Moulds sent ASQA an email that same day[4] acknowledging that Mantra was now aware of the need to pay the application fee; stating that she had not previously been aware that the application was not effective until the fee was paid; acknowledging the error in not paying the invoice received on 20 April; asking for more time (“I am seeking additional time to have this Application reviewed…”); noting the serious impact of expiry of registration on 26 September 2018, should that occur; and foreshadowing an application to this tribunal should registration not be renewed. The email also includes, in bold, the following statement: “Remittance – I am in the process of having our Accountant confirm the payment was made and provide the remittance advice” [sic].
[4] T8, folio 26.
ASQA’s records show that an internal check on whether or not payment had been received was made over the next fortnight.[5] ASQA emailed Ms Moulds on 17 September 2018 noting that no payment had been received.[6] Ms Moulds emailed ASQA on 18 September 2018 confirming that the payment had not yet been made and adding “I will pay this immediately should we be afforded the opportunity to correct this without having to apply to the AAT”.[7] The payment was made on 21 September 2018, with the payment appearing in ASQA’s account on the following day.[8] Two days previously the Chief Commissioner of ASQA (Mr Mark Paterson AO) made the decision not to allow the shorter period for Mantra to seek renewal of its registration.[9]
[5] T8, folio 25;
[6] T9, folio 27.
[7] Ibid.
[8] T11, folio 32.
[9] T13, folio 39.
From the above sequence of events it is plain that there was a long gap between the date on which Mantra lodged its renewal application (15 March 2018) and the date on which it paid the fee (21 September 2018). The deadline set by section 31 of the NVR Act for Mantra to make a renewal application was 28 June 2018. That brings into focus the first issue to be decided, which concerns the construction of section 31 of the NVR Act. It is ASQA’s contention that the application process is not complete until the fee has been paid. Therefore the submission of an application by Mantra on 15 March 2018 did not meet the requirements of the section and the application was not valid and complete until the fee was paid on 21 September 2018. As noted above, if that construction of section 31 is in error, and an application is made when the form is lodged, regardless of when the fee is paid, then Mantra lodged an application within the 90 day limit and the question of whether a shorter period needs to be granted would not arise.
Ms Wright advanced submissions in support of ASQA’s preferred construction. These submissions were, in summary:
·subsection 31(2) requires that an application be “accompanied by” the application fee, implying that the two steps – application and payment of the fee - were necessary before the application could be regarded as complete;
·this is reinforced by the drafting of section 16; subsection 16(3) specifies that an application must be in a particular form and must be accompanied by required information and the application fee; the implication is clearly that all those requirements must be met before a valid application has been made;
·section 232A of the NVR Act imposes the annual registration fee on RTOs. The section applies (relevantly) to RTOs continuing to be registered under the Act: such RTOs “are liable to pay the national VET Regulator annual registration fee”; that drafting is consistent with ASQA’s construction of section 31;
·the purpose of charging the fees is to allow ASQA to recover the costs of auditing the applicant RTO; logically the fee precedes the work it is raised to fund;
·the legislative instrument setting the fees, made under section 232 of the NVR Act (the Australian Skills Quality Authority Instrument Fixing Fees Amendment Determination (No. 1) 2018 (the Fees Instrument)), requires lodgement fees to be paid on application, even where fees paid for assessment of an application are paid on invoice.
Ms Moulds is not herself legally trained and did not appear to have obtained legal advice. She did not put forward any submissions regarding the point at issue.
Not all of Ms Wright’s submissions seem to me to carry weight. What might be said in the Fees Instrument, for example, could have been inserted to reflect administrative preference as much as the intention or meaning of the statute; and in any case the drafting adopted in the Instrument can at best reflect the understanding of those drafting it. The NVR Act might be used to understand the Instrument, which is delegated legislation, but not the reverse. Second, although the purpose of the fees is indeed to cover the cost of the audit, as submitted by ASQA, it does not automatically follow that non-payment of the fee would necessarily prevent the application from being regarded as valid. Nor does section 232A lend much support to ASQA’s case, as the model adopted in that provision (liability established through issuing a notice) is distinct and different from that in sections 16 and 31.
The Commonwealth operates many different regulatory schemes, and it is very common that the costs of the regulatory process are covered by a fee charged to applicants. I invited Ms Wright to make submissions in regard to other Commonwealth regulatory schemes in light of the drafting of similar applications sections, and to comment in particular on any decisions that the courts might have taken touching on when an application might be valid and complete. Ms Wright was reluctant to do so, noting that the language used from one statute to the next is likely to be different, leading to difficulties in generalising from one regulatory scheme to another.
That point is well taken, but a brief look at a few Commonwealth regulatory schemes tends to show that the imposition of cost recovery under these schemes falls into a clear pattern. Frequently the fee which is imposed at the beginning of a process must be paid before the regulatory process can begin, whereas fees imposed part way through the process are created by notice to the applicant and become debts due to and recoverable by the Commonwealth. Sometimes both systems operate within the one regulatory scheme.

Thus the Therapeutic Goods Act 1989 (the TG Act), which regulates therapeutic goods including medicines and medical devices, creates a complex and thorough assessment process for regulated classes of goods. A variety of fees may be payable, depending on the kind of application made and the kind of assessment required. Section 22C of the TG Act allows a person to apply for a provisional determination relating to a medicine of a specified kind. Subsection 22C(2) provides that an application must be on an approved form, be accompanied by the prescribed application fee and contain specified information. Subsection 22D(1) provides that if a person makes an application in accordance with subsection 22C(2) the Secretary must determine the application. In that case, it is clear that unless the application is complete in the terms specified in subsection 22C(2), the obligation to process the application is not triggered.
The TG Act also contains other examples, each of which is to the same effect, but adopts different drafting. Section 23B, which relates to the registration of therapeutic goods, sets out a process for assessing applications for registration; subsection 23B(2) lists the requirements that must be met, including payment of the prescribed application fee, and subsection 23B(3) allows the Secretary (the decision-maker under the Act) to decide that an application passes preliminary assessment if all the requirements of subsection 23B(2) are met. Part 4.4 of the TG Act deals with conformity assessment certificates for medical devices, and section 41EA provides for applications for such certificates to be made. Subsection 41EB(2) states that an application is not effective if the application fee is not paid.
Applications for registration of a therapeutic good, once they have passed preliminary assessment, are subject to evaluation. Subsection 24(1A) provides for an evaluation fee to be imposed; section 24B provides that the fee is payable on the day on which notice is given; section 24C states that an evaluation fee may be recovered as a debt due to the Commonwealth; and paragraph 24(2)(a) provides that an application lapses if any part of the evaluation fee remains unpaid after two months.
Other regulatory schemes include similar provisions, under which a fee must be paid before an application can proceed, for example:
·Sections 14 and 16 of the Ozone Protection and Synthetic Greenhouse Gas Management Act 1989;
·Section 29A of the Patents Act 1990;
·Sections 26 and 30 of the Plant Breeder’s Rights Act 1994;
·Sections 40 and 43 of the Gene Technology Act 2000;
·Sections 10 and 164 of the Agricultural and Veterinary Chemicals Code Act 1994 (although under subsection 164(7) the decision-maker has discretion whether or not to consider an application if the fee has not been paid).
The above examples all specify explicitly that the fee must be paid before the application can be regarded as properly made (with the exception noted above for agricultural and veterinary chemicals). Section 8-2 of the Aged Care Act 1997, covering applications for approval as an aged care provider, is similar to sections 16 and 31 of the NVR Act: it specifies that the application must be accompanied by the fee, but does not state explicitly that the application cannot proceed in the fee’s absence.
It is obviously problematic to generalise from a clear legislative scheme in other statutes to one that is less clear in the NVR Act. Nevertheless, the regulatory schemes outlined above suggest that the Commonwealth adopts a limited number of models for application processes. The language used in the NVR Act in section 16 in particular, and section 31 perhaps less persuasively, suggests that the application is complete and valid only when the fee is paid, and that accords with the pattern established in other statutes. The use of the phrase “must be accompanied by” in both provisions is strongly suggestive of that construction. Section 16 sets out the basic procedure, and while less explicit than the examples identified in other regulatory schemes, it nevertheless implies conformity with the pattern that payment is necessary before an application can proceed. Section 31 then appears to mirror the same regulatory procedure. This conclusion is reinforced by the treatment of annual charges for RTOs: sections 232 and 232A refer to liabilities for such charges; the charges are imposed under the National Vocational Education and Training Regulator (Charges) Act 2012; and section 232B of the NVR Act states that such charges are recoverable as a debt due to the Commonwealth. The latter provision evidences the clear intention to prevent RTOs escaping their obligations to pay fees by providing for the recovery of a debt.
The alternative to the construction of section 31 of the NVR Act outlined above is that an RTO could submit an application but ASQA would have no way of ensuring that the application fee was ever paid. That cannot be the preferred construction. The better view is that the application fee specified in section 31 must be lodged before an application under that section is complete and valid and can be processed. I find that Mantra’s application for renewal of registration was made on 21 September 2018.
Should a shorter period for lodgement of the renewal application be granted?
A decision regarding the grant of a shorter period under paragraph 31(1)(b) of the NVR Act is similar to the grant of an extension of time for the making of an application under legislation such as the AAT Act, or under substantive legislation, e.g. section 62 of the Safety, Rehabilitation and Compensation Act 1988 (the SRC Act), which relates to requests for a reconsideration determination under that Act. The discretion to grant an extension of time established by subsection 29(7) of the AAT Act or subsection 62(3) of the SRC Act is given in the broadest terms. Similar discretion is typically available to the courts where provision is also made for extensions of time. A body of case law has developed that sets out, non-exhaustively, the considerations that influence how the discretion is exercised. Among the best known of the cases dealing with these matters is Hunter Valley Developments v Minister for Home Affairs and Environment (1984) 58 ALR 305 in which Wilcox J set out a number of principles (that case related to an extension of time to seek judicial review of a decision under section 11 of the Administrative Decisions (Judicial Review) Act 1977 but the principles apply equally in other contexts).These principles include:
·the starting position is that an application made outside time will not in general be entertained, so there must be an acceptable explanation for the delay;
·the applicant must not have “rested on his rights”; an attempt by the applicant to continue agitation of the matter will be to advantage and a shorter rather than longer delay before the application is lodged is therefore to the advantage of the applicant;
·any prejudice to the respondent will militate against the grant of an extension, but mere absence of prejudice is not enough of itself to warrant a grant of extension;
·the merits of the substantial application are to be taken into account;
·fairness between the applicant and others in a similar position is also relevant.
The discretion given to ASQA under section 31 of the NVR Act is perhaps even broader, in the sense that the section does not set the 90-day deadline as a default, with the regulator granting a shorter period only if there are particular reasons to do so. There are also plainly differences between a procedural matter dealt with in interlocutory proceedings under the AAT Act and a substantial review under the NVR Act in the current matter. But it is not clear whether in practice that means that the considerations that should be taken into account are different, although the question of whether Mantra rested on its rights would need to be recast. Ms Wright attempted to argue that the considerations would be different but conceded that the explanation for the delay in payment, prejudice to the parties and prospects of success in the application for renewal would all be relevant. The major difference that I see is that an applicant seeking a shorter period for applying for renewal under section 31 of the NVR Act would need to make a positive case why a shorter period should be granted, and demonstrate a continuing commitment to the scheme set up by the NVR Act and the instruments made under it.
Ms Wright also drew attention to some extrinsic materials for which she claimed relevance, namely the explanatory memorandum and second reading speech for the National Vocational Education and Training Bill 2010, the Bill for the NVR Act. The second reading speech, given by Senator the Hon Joe Ludwig, then Minister for Agriculture, Fisheries and Forestry, was delivered on 26 November 2010. Following the hearing ASQA also provided an extract from the second reading speech for the Education Services for Overseas Students Amendment (Re-registration of Providers and Other Measures) Bill 2009, given by the then Prime Minister, the Hon Julia Gillard MP, on 19 August 2009. Those materials were advanced in support of a proposition energetically put forward by Ms Wright that the expectation had been clearly created for more than a minimal compliance with the standards set for the VET sector; and that RTOs were expected to exceed those standards, indeed to exceed them significantly. Thus the former Prime Minister referred to the expectation that international students could be assured that “their courses are the highest possible quality”. Ms Wright also pointed to the very significant enforcement and compliance provisions in the NVR Act, including provision for criminal and civil penalties. The relevance of these arguments to the matter at issue is not immediately clear, but I understand the contention to be that:
·there is an expectation of a high standard in the VET sector;
·achieving that high standard is entrusted to ASQA;
·part of the means of achieving that high standard is a strong compliance regime; and
·the action taken to deny Mantra the shorter period for renewal of registration is an example of the strong compliance regime at work and therefore part of achieving a high standard in the VET sector.
Those arguments, however, are clearly nonsensical. In the first place it is the statute, and the instruments made under it, that sets the standard for the VET sector: the suggestion that extrinsic material such as second reading speeches somehow leads to a requirement to impose a higher standard of compliance implies the application of a test – an arbitrary test - other than that set by the statute. If there is an expectation of a high standard of services in the VET sector, that expectation is given effect by the statute and the standards set under it; if the standard is lower than that desired, the solution is for the standards to be raised, not to create some unstated and vague administrative practice of demanding that RTOs overachieve against existing standards. Further, section 15AB of the Acts Interpretation Act 1901 permits the use of extrinsic materials to construe a statute to confirm its meaning or where the statute is of uncertain meaning; I do not see that kind of uncertainty in section 31 of the NVR Act. The compliance and enforcement provisions in the NVR Act are indeed comprehensive and entrust significant powers to ASQA, but that does not have any necessary implication for the penalty to be exacted in any particular case: each such case is to be decided on its merits.
In my view, in the contentions put to me, ASQA has misconceived the scheme of the NVR Act. Subsection 17(2) of the NVR Act requires that, in deciding whether or not to grant an application for registration as an RTO, ASQA “must consider” whether the applicant complies with the VET Quality Framework and the applicable conditions in Subdivision B, i.e. with sections 21-30. The latter sections set out a list of further requirements, which must all be met under each of the sections. The VET Quality Framework is defined in section 3 of the NVR Act as follows:
VET Quality Framework means the following:
(a) the Standards for NVR Registered Training Organisations;
(aa) the Quality Standards;
(b) the Australian Qualifications Framework;
(c) the Fit and Proper Person Requirements;
(d) the Financial Viability Risk Assessment Requirements;
(e) the Data Provision Requirements.
In the above list, paragraphs (a), (aa), (b), and (e) are called up by section 22, paragraph (c) is called up in section 23 and paragraph (d) is called up in section 24. The standards in (a) are set out in a legislative instrument made under section 185 of the NVR Act, the Standards for NVR Registered Training Organisations 2012, which sets out eleven standards for initial registration and eleven for renewal of registration. These standards cover such matters as quality of education and assessment, access and equity, responsiveness, governance, legislative compliance, insurance and financial management. Others of the standards and requirements listed above are set in separate instruments under other provisions of the NVR Act – the Quality Standards under section 231A; the Fit and Proper Person Requirements under section 186; the Financial Viability Risk Assessment Requirements under section 158; and the Data Provision Requirements under section 187. The effect of all these provisions, taken together, is to establish a very large range of compliance requirements: in most if not all cases an audit is likely to throw up some form of minor compliance failure, even in the best of RTOs. But subsection 17(2) does not make it a requirement of registration that an applicant RTO must comply with all of these requirements; rather, the drafting of subsection 17(2) provides the regulator with sufficient flexibility to register an RTO while tolerating minor departures from complete compliance, provided it is clear that the RTO is able to deliver VET services that meet the requirements as a whole in the light of the objects of the NVR Act set out in section 2A. And while the very significant compliance and enforcement powers conferred on ASQA certainly support the conclusion that the legislature expects high levels of compliance, they offer no guidance on what might be the appropriate action in any particular compliance context. That is to be decided on the basis of the particular facts of the matter; and significant powers come with significant responsibility to ensure that the powers are exercised carefully and proportionately.
Explanation for delay
Ms Moulds told the tribunal that the delay occurred because of a combination of factors: there was an administrative oversight; she was coping with personal matters (her mother and her son); and it was a busy and demanding time for the business. That, if her evidence were accepted, might explain the delay up to 3 September 2018, although subsequently Ms Moulds suggested that her mother’s illness extended well into September. Ms Wright suggested that Mantra’s record displayed a pattern of non-compliance with the financial requirements of the NVR Act over an extended period, pointing to material recording Mantra’s failure to make payments on invoices dated 4 August 2015, 20 October 2015, 30 March 2016 and 24 February 2017. ASQA further asserted that in the period from 3 September to 21 September 2018 Ms Moulds was well aware of the unpaid invoice but nevertheless continued to withhold payment; as CEO of a small business she must have been aware of an unpaid invoice for over $9,000, so that her explanation of the delay lacks credibility; and an issue that had arisen with the ACT Education Department (as shown by Exhibit R1) suggested that this was not behaviour that was confined to Mantra’s dealings with ASQA.
I am not entirely persuaded by Ms Wright’s arguments. The earlier non-payment issues arose as disputed payments. ASQA waived the debts referred to above, recognising gaps in its policy and processes, tardiness in correspondence and performance issues in the finance area which were held to “boarder on behavioural arrogance” [sic].[10] I think this earlier material is too mired in dispute for me to be sure that a pattern of financial mismanagement has been established. Similarly, Ms Moulds raised issues regarding non-payment of the debt to the ACT Government, and the evidence is too sketchy and incomplete for me to draw a conclusion about where the rights and wrongs lie.
[10] Ex A1, folio 2.
That is not true, however, of the period from June to September 2018. Ms Moulds stated that Mantra’s bank account – or one of the accounts – had about $36,000 in it; I think Ms Wright is correct when she says that a small business owner with a bank account at that level is unlikely to lose sight of an invoice for $9,000. Even more conclusive is Ms Mould’s reluctance to make a payment after 3 September 2018. Ms Moulds said that her email of that date was a request for more time to pay. It is true that it includes the words “I am seeking additional time to have this Application renewed…” but as Ms Wright pointed out, that falls well short of an undertaking to pay and is by no means a clear request for additional time to make a payment. I do not accept that the email obliged ASQA to respond either granting or denying additional time, on the basis of that sentence. The email also included (in bold) the statement “I am in the process of having our Accountant confirm the payment was made” despite having earlier acknowledged that only the annual fee had been paid. What I think is likely is that Ms Moulds, during the middle of 2018, was looking to manage Mantra’s finances and, probably for reasons of cash flow, sought to defer payment of a large invoice to the extent possible. Ms Moulds admitted in giving her evidence that she was unwilling to pay the invoice after 3 September unless she was sure that ASQA would agree to the shorter period for making the application.
For those reasons, I do not find Mantra’s explanation for the delay persuasive. The company was given adequate notice of the requirement to pay but did not act to do so. By not doing so the company failed to meet section 27 of the NVR Act, which requires the company to cooperate with ASQA. I further note that from time to time Mantra appears to have used the prospect of review by this tribunal as a bargaining chip; I give no weight to that, but merely note that it is unfortunate and misconceives the tribunal’s role as an independent decision-maker.
In the context of extension of time applications, one of the issues that arises is whether applicants have “rested on their rights”. The equivalent issue in the present context is whether Mantra made appropriate efforts to comply with the NVR Act and to bring its affairs into proper alignment with the obligations under the Act once alerted to its failure to make the payment for its renewal application. The above discussion demonstrates, quite persuasively to my mind, that at least in respect of meeting its financial obligations, Mantra failed to do so.
ASQA stated during the hearing that it wishes to undertake a financial viability audit or assessment, given the problems in getting Mantra to pay its fee, and that this required that Mantra make an initial registration application. Mantra pointed to material suggesting that such an assessment could also occur during a renewal audit.[11] ASQA’s powers to audit Mantra and to assess financial viability are identical under either an initial or renewal assessment process (even if its normal practice is different under the two processes); the need for a financial viability assessment has no material bearing on whether or not to grant the shorter period for a renewal application.
[11] T13, folio 37.
Prejudice to the respondent

It was only after payment of the renewal application fee that ASQA would begin the audit of Mantra’s operations, an essential step in the renewal process (and one provided for in section 17 of the NVR Act). Clearly allowing a shorter period would present ASQA with an unscheduled and possibly compressed requirement to make an assessment of whether Mantra meets the requirements of the NVR Act and the various instruments made under it. Thus such an action does potentially prejudice ASQA by leaving it with insufficient time for the audit, and throwing an otherwise ordered process into confusion. For reasons that will become clear I cannot find in this instance, however, that there is any prejudice to ASQA on that basis.
A further aspect of prejudice, however, arises from the need for ASQA to establish a proper basis for the operation of section 31 for all RTOs. It is apparent that it will be common, if not almost universal, that an RTO that misses the 90-day deadline for applying for renewal and then seeks the benefit of the shorter period for making an application will face dire consequences if that shorter period is denied, just as Mantra did. In virtually every case, it seems, the RTO will be faced with the expiry of its registration, with the consequence that it could not continue operating. This may well happen at the most inopportune time, when students are enrolled and part way through their courses. Faced with that outcome in virtually every case (except perhaps cases where an RTO’s registration expires just as the academic year ends), ASQA is clearly in a difficult position: grant the shorter period for making an application, and the 90-day period allowed by the legislation disappears and other RTOs come to learn that they can rely on ASQA to allow the shorter period in every case; deny it and the RTO may fall by the wayside with severe consequences for students and staff. That choice is a difficult one unless it is obvious that the RTO has in any case no chance of success in the renewal process. But in a case such as the present, where Mantra’s departure from what is expected is quite apparent, if the shorter period is granted every RTO will know that an exception is likely in every case, not just those where there is a good reason for granting it. For those reasons, there is significant prejudice to ASQA were the shorter period to be granted.
The prospects of success
No evidence was led by either side regarding the broader question of Mantra’s compliance with the array of requirements for RTOs set out in the NVR Act and the instruments made under it (apart from the letters of commendation provided by Mantra, referred to below). I have no foundation for a conclusion that Mantra is well placed to continue its registration, nor for a conclusion that it is poorly placed. But ASQA has made an offer to Mantra, as explored below, which appears to imply that there is no insurmountable obstacle in the way of Mantra’s continued registration.
Ms Moulds provided 13 letters of commendation by former students regarding the provision of training and education services by Mantra. These all speak highly of the VET services provided by Mantra. I cannot attach great weight to these letters, given that they represent anecdotal opinion from a selection of former students. There is no way of knowing, for example, whether the opinion is representative of student opinion generally. In any case, the letters only offer a limited window into the range of criteria with which an RTO is expected to comply.
Fairness between Mantra and others
Mantra pointed out that another RTO with which Ms Moulds had some association – WISE Academy – had been granted the shorter time when it missed the payment for renewal of its registration earlier this year.[12] In that instance WISE’s CEO, Dr Dion Klein, wrote to ASQA, acknowledged his oversight in not paying, undertook to pay, and eventually made the payment – apparently after WISE’s registration had expired. Ms Moulds argued that the difference between the treatment accorded Mantra and that accorded WISE Academy meant that the two companies were not being treated consistently and equitably. Consistency of treatment would require that Mantra too be granted the shorter time for lodging its renewal application.
[12] Exhibit A3.
ASQA pointed out that when WISE Academy became aware of its failure to pay by the deadline, there was an undertaking made to complete the payment. Ms Wright noted the contrast with Mantra’s case.
Details of the WISE decision are not available to me. I note that consistency implies similar outcomes for those in similar positions, but I do not have sufficient evidence to know whether WISE’s position is truly similar to Mantra’s. What I can be sure about is that there are significant differences; in particular I note the contrast between the promise made by Dr Klein of WISE to make the payment and the hedging and contradiction engaged in by Ms Moulds. I also make the point that in any case the practice of tribunal decision-making obliges me to decide this matter on its own merits. The fact that another decision-maker, in another matter, on the facts of that particular matter, came to a particular decision does not of itself have a bearing on the merits of the case I am now considering.
Consequences for Mantra
As discussed immediately above, the denial of the shorter period for lodging the application would have severe consequences for Mantra. Those consequences in early 2019 are not so severe as in September 2018, when students were enrolled in courses, but they are nevertheless severe in that Mantra would need to seek initial registration (rather than renewal), and could only continue operations if and when that were granted. In recognition of those severe consequences, ASQA made an offer to Mantra in the lead up to and during the hearing, whereby if the decision to deny the shorter period were affirmed, ASQA could make arrangements to allow Mantra’s registration to continue.
The elements of ASQA’s offer are as follows, made on the basis that the decision is affirmed:
(a)Mantra would lodge an application for initial registration as soon as the tribunal’s decision is handed down;
(b)ASQA would immediately grant Mantra registration for a period of 60 days;
(c)ASQA would undertake a rapid audit of Mantra;
(d)on the basis of that audit and any other relevant considerations ASQA would take a decision on registration within the 60-day period (this is very rapid as normally, according to Ms Moulds, it might take ASQA 12-18 months to process an application for initial registration);
(e)in order to ensure that Mantra’s registration would not be interrupted, the affirmation decision would take effect after a week, allowing Mantra to lodge its application for initial registration and receive its 60-day registration before the decision had the effect of leaving it unregistered (under clause 1.5 of the Standards for VET Regulators 2015, a legislative instrument made under section 189 of the NVR Act, Mantra must maintain registration for two years continuously if it is to extend the scope of its registration); and
(f)the fee for the registration application would be $8,500, which is less than the amount Mantra has already paid; the amount overpaid would be refunded.
This is a generous offer. It was made to Mantra during the hearing, but Ms Moulds did not accept it. It effectively takes away the dire consequences of affirming the decision under review, an affirmation which would flow fairly naturally from the considerations raised above were it not for those consequences.
ASQA brought forward two cases that Ms Wright suggested might have a bearing on my decision, namely Hillman and Australian Postal Corporation [2017] AATA 1411 and Lucic v Nolan (1982) 45 ALR 411. The former case gives me no help; it was decided on the same principles outlined above, under section 62 of the SRC Act; but it establishes no general principle beyond those already outlined, and, like most such cases, turned on its own particular facts. Much the same is true of the second case: as Fitzgerald J notes in the course of the case “Each individual case should be dealt with individually”.[13] The case provides a somewhat stern assessment of its particular fact matrix, and places an emphasis on the need for an applicant to make a case for a departure from the default timing set for making an application – a need that does not arise in this case; but to my mind the reasoning discloses no principle beyond those already outlined from which I can draw a conclusion in the particular circumstances of the present matter.
[13] At 417.
The reasoning above – the inadequate explanation for delay, the failure of Mantra to meet the financial requirements of the NVR Act even when aware that its fee was overdue, the prejudice to ASQA - lead towards affirming the decision under review, and in light of the offer made to Mantra, affirmation becomes more acceptable because the severe consequences of such a decision are avoided. ASQA’s offer requires that there be a period between the taking of the decision and its coming into effect, so that Mantra can have time to lodge an application for initial registration. That is not the usual practice in this tribunal; but in light of the advantages to Mantra, and the inclusion of that element in ASQA’s offer, I can see no reason why the decision should not be made accordingly.
The decision under review is affirmed. The terms of ASQA’s offer are not within the scope of this decision, but my affirmation is made in light of that offer and on the same basis the date of effect of this decision is a week from the date the decision is finalised and circulated to the parties
I certify that the preceding 54 (fifty-four) paragraphs are a true copy of the reasons for the decision herein of Member Mark Hyman.
……………………………………………………
Associate
Dated: 17 January 2019
Date of hearing: 9 January 2019
Applicant: In Person
Counsel for the Respondent: Ms Sarah Wright, Australian Government Solicitor
Solicitor for the Respondent: Ms Louise McDermott, Australian Skills Quality Authority