Western Institute of Technology Pty Ltd and Australian Skills Quality Authority
[2017] AATA 187
•16 February 2017
Western Institute of Technology Pty Ltd and Australian Skills Quality Authority [2017] AATA 187 (16 February 2017)
Division: GENERAL DIVISION
File Number: 2016/0940
Re: WESTERN INSTITUTE OF TECHNOLOGY PTY LTD
APPLICANT
And:AUSTRALIAN SKILLS QUALITY AUTHORITY
RESPONDENT
File Number: 2016/0941
Re: WESTERN INSTITUTE OF TECHNOLOGY PTY LTD
APPLICANT
And:MINISTER FOR EDUCATION AND TRAINING
RESPONDENT
DECISION
Tribunal Deputy President S A Forgie
Senior Member A Nikolić AM CSCDate 16 February 2017
Place Melbourne
The Tribunal decides to:
1.by consent set aside the reviewable decision of the respondent dated 20 January 2016 and made under ss 36(2)(e) and 38 of the National Vocational Education and Training Regulator Act 2011 and s 83(3)(b) of the Education Services for Overseas Students Act 2000; and
2.decline to make the applicant’s registration subject to a condition:
(1)under s 29(1) of the National Vocational Education and Training Regulator Act 2011 that:
“the Applicant shall retain and present to the Respondent on request all completed assessment materials for all VET students for all VET courses on the Applicant’s scope of registration under the National Vocational Education and Training Regulator Act 2011 for two (2) years from the date of the final assessment decision for each unit of competency or module.”; or
(2)under s 9AE of the Education Services for Overseas Students Act 2000 that:
“the Applicant shall retain and present to the Australian Skills Quality Training Authority (as a delegate of the Respondent) on request all completed assessment materials for all VET students for all VET courses in respect of which the Applicant is registered under the Education Services for Overseas Students Act 2000 for two (2) years from the date of the final assessment decision for each unit of competency or module.”
……[sgd]……………….
Deputy President
CATCHWORDS – VOCATIONAL EDUCATION AND TRAINING – suspension of part of scope of registration – parties in agreement that decision should be set aside – respondent requested that suspension be set aside and that registration be subject to condition that the applicant retain and present on request to the respondent all completed assessment tasks for two year period – condition not imposed
LEGISLATION
Administrative Appeals Tribunal Act 1975 ss 42C, 42C(1), 42C(2), 42C(3), 43
Education Services for Overseas Students Act 2000 ss 5, 4A, 7A, 5, 9A, 9AD, 9AE, 9AE(4), 21, 21(2B), 21(2C), 21(3), 21A, 33, 33(1), 33A, 83(3)
Education Services for Overseas Students Regulations 2001 r 3.04
National Vocational Education and Training Regulator Act 2011 ss 3, 17(1), 21 to 28, 28(1), 29, 29(1), 30, 35, 36, 36(1), 36(2), 37, 38, 39, 55, 56, 56(1), 56(2), 57, 58, 59, 62, 62(1), 62(5), 155, 185
National Vocational Education and Training Regulator Regulations 2011 s 15
Tertiary Education Quality and Standards Agency Act 2011SECONDARY MATERIAL
General Direction – Retention requirements for completed student assessment items
National Code of Practice for Providers of Education and Training to Overseas Students
Standards for NVR Registered Training Organisations cll 1.8, 1.9 and 1.10
REASONS FOR DECISION
Although the Western Institute of Technology Pty Ltd (WIT) maintains that it was never non‑compliant with its obligations under the National Vocational Education and Training Regulator Act 2011 (NVR Act) and the Education Services for Overseas Students Act 2000 (ESOS Act), it and the Australian Skills Quality Authority (ASQA) have agreed that it met all of them as at the date of their agreement. As a consequence, they have further agreed that the Tribunal should set aside ASQA’s decision to impose sanctions under that legislation. What they do not agree upon is whether, following the restoration of WIT’s registration as a result of the decisions’ being set aside, a condition should be imposed on that registration. That condition would be to the effect that WIT retain, and present to ASQA when requested, certain material. That material comprises all completed assessment materials for all VET students for all VET courses within its scope of registration under the NVR Act and for those for which it is registered under the ESOS Act. The period of retention would be a two year period from the date of the final assessment decision for each unit of competency or module.
We have decided that we should set aside the decisions but that WIT should not be subject to that condition and that it should continue to be subject to the condition applying to all such providers i.e. that it retain such assessment materials for six months.
BACKGROUND
There was no disagreement between the parties as to the events leading to the proceedings in the Tribunal. We will summarise them in this section of our reasons.
WIT was registered by the National VET Regulator, which is ASQA,[1] as a registered training organisation (RTO) under the NVR Act. It is also a registered provider under the ESOS Act. As an approved provider for a course at a location or at locations, WIT was approved by a relevant designated authority, being ASQA,[2] to provide that course at that location to overseas’ students.
[1] The National VET Regulator is the body established by s 155 of the NVR Act (NVR Act; s 3) and known as the “Australian Skills Quality Authority” (ASQA) (National Vocational Education and Training Regulator Regulations 2011; s 15).
[2] The identity of a “designated authority” in relation to a provider is identified by reference to s 7A of the ESOS Act: ESOS Act; s 5. In the case of a provider that is an RTO under the NVR Act and that is seeking to provide courses to overseas students at locations within a non-referring State, the designated authority is the National VET Regulator i.e. ASQA: ESOS Act; s 7A, Item 2A.
In the period from late July to October 2015, ASQA undertook an audit of WIT’s compliance with the Standards for NVR Registered Training Organisations (RTO Standards).[3] Those standards are made under s 185 of the NVR Act and the National Code of Practice for Providers of Education and Training to Overseas Students (National Code) as well as under s 33(1) of the ESOS Act. ASQA prepared audit reports following its audit.
[3] See relevant provisions of RTO Standards at [21]-[23] below.
On 24 November 2015, ASQA wrote two letters to WIT giving notice of its intention to make two decisions. In them, ASQA gave WIT notice that it intended to make a decision imposing a sanction on it under the NVR Act and another under the ESOS Act. In particular, the sanctions of which ASQA gave notice and the reasons for its deciding to do so were:
(1)Cancellation under ss 36(2)(f) and 39 of the NVR Act of WIT’s registration as an RTO or some lesser sanction.
(a)The reasons were:
(i)WIT had been assessed as not having complied with the RTO Standards for the following qualifications:
∙CPC30611 Certificate in Painting and Decorating
∙CPC50308 Diploma of Building and Construction Management
∙BSB40212 Certificate IV in Business
∙BSB60407 Advanced Diploma in Management
∙CPC 30611 Certificate III in Painting and Decorating and
∙CPC50308 Diploma of Building and Construction Management.
(ii)Complaint number 1006149 has been partially substantiated in relation to the provision of insufficient training and assessment.[4]
(2)Cancellation under s 83(3)(c) of the ESOS Act of WIT’s registration as a registered provider or some lesser sanction.
(a)The reasons were:
(i)ASQA found WIT not to have complied with the RTO Standards or with the requirements of the ESOS Act of with the National Code.[5]
[4] T documents; T5 at 28-29
[5] T documents; T6 at 30-31
In response to ASQA’s invitation, WIT responded by providing various material to address the areas in which it had been identified as non-compliant. On ASQA’s analysis of the material, WIT had addressed some of the areas of non-compliance but not all. In ASQA’s view, it continued to be non-compliant with the RTO Standards and with the National Code in certain aspects. As a result, ASQA made a further and reviewable decision on 20 January 2016:
(1)under ss 36(2)(e) and 38 of the NVR Act, ASQA suspended the following part of WIT’s scope of registration:
(a)BSB40212 Certificate IV in Business;
(b)BSB40215 Certificate IV in Business;
(c)CPC50308 Diploma of Building and Construction (Management); and
(d)any new training package products that would be automatically added to the scope of registration because it is equivalent to one which appears above;
(2)under s 38(2) of the NVR Act and during the period of the suspension required WIT not to:
(a)enrol a student in a suspended VET course of part of a suspended VET course;
(b)allow a VET student to begin a suspended VET course or part of a suspended VET course;
(c)publish or broadcast an advertisement relating to a suspended VET course or part of a suspended VET course; or
(d)cause to be published or broadcast an advertisement relating to a suspended VET course or part of a suspended VET course; and
(3)under s 83(3)(b) of the ESOS Act, to suspend the following part of WIT’s registration:
(a)BSB40212 Certificate IV in Business;
(b)BSB40215 Certificate IV in Business;
(c)CPC50308 Diploma of Building and Construction (Management); and
(d)any new training package products that would be automatically added to the scope of registration because it is equivalent to one which appears above.
These decisions were to come into effect on 2 March 2016 but the Tribunal granted a stay of their operation, first until 8 April 2016 and then until it otherwise determines.[6] In accordance with the Tribunal’s directions, WIT lodged further material. ASQA reviewed that material and proposed the terms of a settlement that would lead to their asking the Tribunal to set aside its decisions made on 20 January 2016. In the place of the decision under review, ASQA proposed that each of the two decisions be set aside and that others be substituted:
(1)In respect of the reviewable decision under the NVR Act:
“the Applicant shall retain and present to the Respondent on request all completed assessment materials for all VET students for all VET courses on the Applicant’s scope of registration under the National Vocational Education and Training Regulator Act 2011 for two (2) years from the date of the final assessment decision for each unit of competency or module.”
(2) In respect of the reviewable decision under the ESOS Act:
“the Applicant shall retain and present to the Australian Skills Quality Training Authority (as a delegate of the Respondent) on request all completed assessment materials for all VET students for all VET courses in respect of which the Applicant is registered under the Education Services for Overseas Students Act 2000 for two (2) years from the date of the final assessment decision for each unit of competency or module.”
[6] Orders made on 24 February 2016 and 7 April 2016
OUTLINE OF SUBMISSIONS
In essence, Mr Pritchard submitted on ASQA’s behalf that the imposition of the retention condition was warranted. A longer period of retention would enhance its ability to scrutinise WIT more closely than would otherwise be the case. Greater scrutiny is required in view of WIT’s history of non-compliance. ASQA’s ability to scrutinise WIT and its activities would be enhanced by the requirement that WIT present materials to it simply when called upon to do so rather than having to do so in the context of an audit. The requirement to retain materials from a period that is longer than usual would enable ASQA to verify WIT’s compliance with its obligations, including those relating to assessment of students, over a much longer period.
On behalf of WIT, Mr Whelen of counsel submitted that, in so far as there had been any previous non-compliance with the standards relating to assessment and identified by ASQA, and it was not admitted that there had been, that non-compliance was not critical or even substantial or serious. WIT had submitted material to address what ASQA had identified as shortcomings and had alleged to be non-compliance but it did not concede that they had been non-compliant. It had, Mr Whelen submitted, been generally compliant during the course of its operation as an RTO and had acted promptly to address any alleged instances of non-compliance.
WIT opposes the condition because it will appear as a restriction or sanction on its registration when it is recorded on ASQA’s website: training.gov.au. This will be prejudicial to WIT’s operations and the degree of that prejudice will be disproportionate to the benefit that ASQA seeks to gain from the imposition of the condition. WIT is likely to suffer loss and damage by its imposition.
THE TRIBUNAL’S POWER TO MAKE A DECISION
Section 43 of the Administrative Appeals Tribunal Act 1975 (AAT Act) provides that:
“For the purpose of reviewing a decision, the Tribunal may exercise all the powers and discretions that are conferred by any relevant enactment on the person who made the decision and shall make a decision in writing:
(a)affirming the decision under review;
(b)varying the decision under review; or
(c)setting aside the decision under review and:
(i)making a decision in substitution for the decision so set aside; or
(ii)remitting the matter for reconsideration in accordance with any directions or recommendations of the Tribunal.”
There are occasions when the legislation that provides for review of decisions limits the powers of the Tribunal on review. Neither the NVR Act nor the ESOS Act provides any such limitation.
Section 42C of the AAT Act provides for the situation in which the parties reach an agreement as to the terms of a decision in relation to the proceeding, a part of a proceeding or a matter arising out of the proceeding. They may set out the terms of their agreement in a written document signed by or on behalf of them and lodge that document with the Tribunal. If the Tribunal is satisfied of two matters, it may make a decision in accordance with those terms in relation to the proceeding, part of a proceeding or matter arising out of the proceeding, as the case may be. The first of those two matters is that:
“the Tribunal is satisfied that a decision in those terms or consistent with those terms would be within those powers of the Tribunal …”[7]
The second is that it “appears … appropriate to …” make the decision in accordance with the terms of the agreement.[8]
[7] AAT Act; s 42C(1)(c)
[8] AAT Act; s 42C(1)
If satisfied of those two matters, the Tribunal may act in accordance with either ss 42C(2) or (3). In this case, s 42C(3) is the appropriate section as the agreement relates to a part of the proceeding and not to the whole of the proceeding as is the case in s 42C(2). Section 42C provides that:
“… the Tribunal may in its decision in the proceeding give effect to the terms of the agreement without, if it has not already done so, dealing at the hearing of the proceeding with the part of the proceeding or the matter arising out of the proceeding, as the case may be, to which the agreement relates.”
THE EVIDENCE
In his affidavit, Mr Intaj Khan, who is WIT’s Chief Executive Officer, raised three areas of concern should the condition be imposed. The first related to its Funding Contracts with various States. He said that almost half of WIT’s income is derived from a Funding Contract with Victoria. It has held such a contract since 2010 and has a similar contract with Queensland. Negotiations are taking place for a similar contract with New South Wales. Mr Khan expressed concern that the imposition of the condition would be seen as a restriction on its registration and lead to its being in breach of its contracts with Victoria and Queensland and disqualifying WIT from obtaining further contracts.
The second area of concern raised by Mr Khan relates to WIT’s reputation. Agents, students and others with whom WIT engages as part of its core business will see the condition as signifying that WIT has a problem with its assessment materials. That will lead to WIT’s suffering substantial financial harm because students will not be referred to it by overseas agents. He supported his evidence on this point by reference to ASQA’s having incorrectly published a statement on its website to the effect that WIT’s registration had been suspended. The information was posted on 3 June 2016 and quickly removed by ASQA when its error was pointed out to it. Its error was not pointed out to it until on or after 7 June 2016 when the first contact was made with WIT by an overseas referring agency. That agency notified WIT that it had cancelled seminars relating to courses offered by WIT. The second email was sent to WIT a few days later on 10 June 2016 by another overseas referral agency that had been informed of the suspension by a colleague. That email required WIT to refund the fees of eligible students. Both emails were forwarded by one WIT officer to another on 27 June 2016 but we are satisfied that WIT would have been in contact with either on or shortly after 7 June 2016 when the matter was drawn to its attention in the first email.
NVR ACT
The objects of the NVR 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 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.
Note 1:…”
Scheme of regulation
The scheme of regulation provided in the NVR Act centres on three essential features: the registration of training organisations; the VET Quality Framework (VETQF), which provides for national standards against which RTOs are regulated; and ASQA which is an independent statutory body having responsibilities as part of the regulatory scheme as well as reporting obligations to the Ministerial Council for Tertiary Education and Employment. The provisions relating to the registration of training organisations illustrates the way in which the features interact. Under s 17(1) of the NVR Act, ASQA may grant an application for registration but, in doing so, must consider whether the training organisation meets the VETQF and the applicable conditions of registration set out in ss 21 to 28. Section 26 provides that an RTO must give ASQA such information as it requests in writing and for the purposes of the NVR Act. The notice requesting that information must specify the period within which the information is to be given.
Registration means that an RTO may do those things for which it is registered. The scope of registration allows an RTO to:
“(a) both:
(i)Provide training and assessments resulting in the issue of VET qualifications or VET statements of attainment by the organisation; and
(ii)provide assessments resulting in the issue of VET qualifications or VET statements of attainment by the organisation; or
(b)provide assessments resulting in the issue of VET qualifications or VET statements of attainment by the organisation.”[9]
[9] NVR Act; s 3
Unless a course is on its scope of registration, an RTO may not deliver that course. It may apply to ASQA to change its scope of registration if it wishes to offer all or part of a VET course that is not within that scope. In deciding whether to grant the application, ASQA must look at the RTO’s ability to provide the VET course, or relevant part, in accordance with the VETQF, at the other VET courses it offers and whether it complies with the VETQF and the other conditions imposed on its registration.
Relevant obligations of an RTO
Once registered, an RTO must comply with certain conditions, one of which is to include a condition to comply with the VETQF.[10] Of relevance in this case are the RTO Standards. Standard 1 provides that:
“The RTO’s training and assessment strategies and practices are responsive to industry and learner needs and meet the requirements of training packages and VET accredited courses.”
[10] That obligation is gleaned from a reading of ss 22 to 26 and the definition of “VET Quality Framework” in s 3 of the NVR Act. Under that definition, a VETQF means “(a) the Standards for NVR Registered Training Organisations; (b) the Australian Qualifications Framework; (c) the Fit and Proper Person Requirements; (d) the Financial Viability Risk Assessment Requirements; (e) the Data Provision Requirements.”
There then follow 27 paragraphs setting out the criteria that an RTO must meet in order to satisfy Standard 1. We are concerned only with cl 1.8 which requires an RTO to implement an assessment system that ensures that assessment (including recognition of prior learning) has two features. The first is that the system complies with the assessment requirements of the relevant training package or VET accredited course. The second is that assessment is conducted in accordance with the Principles of Assessment set out in Table 1.8.1 and with the Rules of Evidence in Table 1.8.2.
The Principles of Assessment expand upon four principles: Fairness; Flexibility; Validity and Reliability. The Rules of Evidence develop a further four principles, which we will set out:
“Validity
The assessor is assured that the learner has the skills, knowledge and attributes as described in the module or unit of competency and associated assessment requirements.
Sufficiency
The assessor is assured that the quality, quantity and relevance of the assessment evidence enables a judgement to be made of a learner’s competence.
Authenticity
The assessor is assured that the evidence presented for assessment is the learner’s own work.
Currency
The assessor is assured that the assessment evidence demonstrates current competency. This requires the assessment evidence to be from the present or the very recent past.”
The RTO must implement a plan for ongoing systematic validation of assessment practices and judgments. That plan must relate to each training product on an RTO’s scope of registration with each product being validated at least once every five years.[11]
[11] RTO Standards at cll 1.9 and 1.10
Returning to the NVR Act, s 27 provides that an RTO must cooperate with ASQA at least to the extent that it is necessary for ASQA to perform, or facilitate, its functions.[12] Section 29(1) provides that:
“The National VET Regulator may impose other conditions on an NVR registered training organisation’s registration. Such conditions need not be imposed at the time of registration.”
ASQA may vary those conditions.[13] If ASQA decides to impose or vary a condition, it must give an RTO written notice of its decision and do so within 30 days of its decision to do so.[14]
[12] NVR Act; s 27
[13] NVR Act; s 27(2)
[14] NVR Act; s 30
Section 29 is concerned with the imposition of a condition on a particular RTO. While s 28 requires compliance by each RTO, it gives ASQA a power to make general directions given to all training organisations. Section 28(1) expresses the power in this way:
“An NVR registered training organisation must comply with any general directions given by the National VET Regulator, in writing, to organisations on the way in which a VET Quality Framework or other conditions of this Subdivision are to be complied with.”
ASQA must publish a general direction on its website.
Acting under s 28(1), ASQA has issued a direction known as the “General Direction – Retention requirements for completed student assessment items” (General Retention Direction). Its purpose is said to be to provide guidance to RTOs regarding the retention of evidence demonstrating the validity of their judgments of their students’ competence. After referring to cl 1.8 of the RTO Standards, the General Retention Direction states that:
“While the examination of assessment tools at audit will determine whether an RTO has a plan in place to ensure the valid assessment of students, only the review of completed student assessment items will confirm the extent to which those plans have been implemented.
Therefore, ASQA will generally examine a sample of completed student assessment items at all audits except initial registration audits.”
In addition to any that might apply to specific training and assessment activities, the retention requirements are that:
“An RTO is required to securely retain, and be able to produce in full at audit if requested to do so, all completed assessment items for each student, as per the definition above, for a period of six months from the date on which judgement of competence for the student was made.”
The expression “completed student assessment items” is defined to mean:
“The actual piece(s) of work completed by a student or evidence of that work, including evidence collected for an RPL [recognition of prior learning] process. An assessor’s completed marking guide, criteria, and observation checklist for each student may be sufficient where it is not possible to retain the student’s actual work. However, the retained evidence must have enough detail to demonstrate the assessor’s judgement of the student’s performance against the standard required.”
The expression “securely retain” means:
“To retain records in a manner that safeguards them against unauthorised access, fire, flood, termites or other pests, and which ensures that copies of records can be produced if the originals are destroyed or inaccessible. Records may be in hard copy or electronic format.”
ASQA’s powers of audit and review
ASQA may, at any time, conduct a compliance audit of an RTO’s operations in order to assess whether it continues to comply with the NVR Act or with the VETQF. It may also review or examine any aspect of those operations in order to determine any systemic issues relating to the quality of vocational education and training.[15] Section 36 gives ASQA power to impose certain sanctions on an RTO. Unless exceptional circumstances arise, ASQA must follow the natural justice requirements set out in s 37.[16] The sanctions which ASQA may impose are set out in s 36(2). Under them, it may do one or more of the following:
“(a) give a written direction to an NVR registered training organisation requiring the organisation to rectify a breach of a condition on the organisation’s registration;
(b)give a written direction to an NVR registered training organisation requiring the organisation to notify its VET students, in writing, of a matter set out in the direction;
(c)shorten the period of an NVR registered training organisation’s registration;
(d)amend an NVR registered training organisation’s scope of registration;
(e)suspend all or part of an NVR registered training organisation’s scope of registration under section 38;
(f)cancel an NVR registered training organisation’s registration under section 38.”[17]
[15] NVR Act; s 35
[16] NVR Act; ss 36(1) and 37
[17] NVR Act; s 36(1)
Provision is made in Part 3 for the accreditation of courses as VET accredited courses. Part 4 is concerned with ASQA’s power to issue a VET qualification to a person who is a current or former VET student in the circumstances set out in s 55. Section 56 provides for the situation in which ASQA may cancel a VET qualification or a VET statement of attainment issued to a person by an RTO or a former RTO. Among the situations in which ASQA may exercise its power are those that occur when:
“(a) the organisation did not provide, or arrange for another person to provide, all or part of the assessment necessary for the person to achieve the learning outcomes or competencies required for:
(i)the qualification; or
(ii)the units of competency or modules specified in the statement; or
(b) …
(c)it was outside the organisation’s scope of registration to issue the qualification or statement to the person; or
(d)it is appropriate, in all the circumstances, because of the action the Regulator has taken, or is taking, in relation to:
(i)the VET course, or part of the VET course, to which the qualification relates; or
(ii)the organisation, in respect of the VET course, or part of the VET course, to which the qualification relates; or
(iii)part of the VET course to which the statement relates;
(iv)the organisation, in respect of part of the VET course to which the statement relates.”[18]
[18] NVR Act; s 56(1)
ASQA may only exercise its power if it has directed the relevant RTO to cancel the VET qualification or VET statement of attainment and to notify the person concerned in writing but the RTO has failed to do so.[19] It must then follow the procedures relating to notification in ss 57 and 58. Cancellation takes effect within the times calculated by reference to s 59 but, unless the person applies for review of ASQA’s decision, cancellation is effective seven days after being given notice in circumstances requiring urgent action or 30 days otherwise.
[19] NVR Act; s 56(2)
ASQA has investigative powers under Part 5 of the NVR Act. Those powers are quite extensive and include the power to enter premises by consent or under warrant. We are concerned only with the power to request information under s 62. Section 62(1) provides that:
“For the purposes of this Act, the National VET Regulator may request a person who is, or was, connected with an NVR registered training organisation or former registered training organisation:
(a) to give the Regulator the information specified in the request; or
(b) to produce to the Regulator the documents or things specified in the request;
if the Regulator has reason to believe that the person is capable of giving the information or producing the documents or things.”
The person to whom the notice is given must give the information or provide the documents or things within the time specified by ASQA in a notice or within such further time as ASQA allows.[20]
[20] NVR Act; s 62(5)
ESOS ACT
The principal objects of the ESOS Act are:
“(a) to provide tuition assurance, and refunds, for overseas students for courses for which they have paid; and
(b)to protect and enhance Australia’s reputation for quality education and training services; and
(c)to complement Australia’s migration laws by ensuring providers collect and report information relevant to the administration of the law relating to student visas.”[21]
[21] ESOS Act; s 4A
Like the NVR Act, the ESOS Act provides for a scheme of registration of those providing courses but they are now called “approved providers” or, when registered, “registered providers”. The features of the scheme of registration has some features bearing some similarity to those provided for in the NVR Act. The Secretary provides for the registration of approved providers under s 9A of the ESOS Act and does so on the recommendation of the “designated authority”. For the purpose of an RTO under the NVR Act, the designated authority is ASQA.[22] In the case of a registered higher education provider within the meaning of the Tertiary Education Quality and Standards Agency Act 2011, it is TEQSA and, if it is neither, the person responsible under the law of the State for approving providers to provide courses to overseas students for the State.[23]
[22] ESOS Act; s 7A, Item 2
[23] ESOS Act; s 7A, Items 3 and 4
Section 9AD of the ESOS Act provides that the Secretary may impose a condition on a registered provider’s registration if the designated authority (in this case, ASQA) has imposed a condition on its registration relating to the provision of certain courses. Under s 9AE, the Secretary may, on his or her own initiative, impose a condition on a provider’s registration. The Secretary may act any time and may act either generally or in respect of any one or more specified courses for any one or more specified locations. Section 9AE(4) provides that:
“The Secretary must use a risk management approach in deciding whether to impose a condition under this section.”
Section 21 of the ESOS Act is concerned with record keeping in relation to an “accepted student”. An “accepted student” is a student whom a registered provider has accepted for enrolment in a course it provides and who is, or who will be, required to hold a student visa to undertake or continue the course.[24] A registered provider must keep records of a student’s current residential address, mobile phone number, email address and other information required by the regulations.[25] For the purposes of that requirement, r 3.04 of the Education Services for Overseas Students Regulations 2001 (ESOS Regulations) provides that:
[24] ESOS Act; s 5
[25] ESOS Act; s 21(2)
“Details of which a registered provider must keep records
For subsection 21(2) of the Act, the records of each accepted student who is enrolled with a provider or who has paid any tuition fees for a course provided by the provider must include the following details:
(a) the amount of money that the student has paid to the provider, including the separate identification of tuition fees and non-tuition fees;
(b) for an amount of tuition fees that the student has paid to the provider for a course:
(i) whether the amount was paid for the full course or part of the course; and
(ii) if the amount was paid for the full course, the duration of the course; and
(iii) if the amount was paid for part of the course, the duration of that part of the course;
(c) copies of written agreements to which the provider and student are parties;
(d) any amounts that:
(i) have become payable, directly or indirectly, to the provider by the student for the student to undertake a course; and (ii) have not been paid;
(e) the amount that a student will be charged to access the student’s records.”[26]
[26] Education Services for Overseas Students Regulations 2001; r 3.04
If an accepted student of a registered approver completes an approved unit of study for a course and his or her progress in that unit is assessed, the provider must record the outcome of the his or her assessment for the unit.[27] That record must be kept in accordance with the regulations and kept up to date.[28]
[27] ESOS Act; s 21(2B)
[28] ESOS Act; s 21(2C)
Section 21(3) of the ESOS Act provides that the records retained under s 21 must be kept for at least two years after the person ceases to be an accepted student. The provider, however, is not required to further update that information.
Under s 33, the Minister may make a national code by legislative instrument. The purpose of that national code is to provide nationally-consistent standards and procedures for registered providers in, among other matters, providing courses to overseas students.[29]
[29] ESOS Act; s 33A
It provides, for example, for registration of registered providers and the courses on the Commonwealth Register of Institutions and Courses for Overseas Students (CRICOS). The Standards that they must meet are set out in Part D of the National Code. Compliance with the National Code is assessed at the point of registration and, for those which are not self-accrediting registered providers, during the period of registration by either the designated authority (ASQA in this case) or the Department of Education, Science and Training (DEST). Self-accrediting providers must undertake an independent external audit once every five years in order to assess its compliance with the National Code. That audit must include an inspection of its premises.
CONSIDERATION
The parties have reached an agreement as to the terms of the Tribunal’s decision regarding part of the proceeding arising from WIT’s application for review of ASQA’s decisions to suspend its scope of registration under the NVR Act and to suspend its registration under the ESOS Act in relation to the following courses:
(a)BSB40212 Certificate IV in Business;
(b)BSB40215 Certificate IV in Business;
(c)CPC50308 Diploma of Building and Construction (Management); and
(d)any new training package products that would be automatically added to the scope of registration because it is equivalent to one which appears above;
ASQA made that decision after coming to the view that WIT had not complied with certain of its obligations under the NVR Act and the ESOS Act and particularly those in relation to assessment of students. WIT does not concede that it has failed to comply with its obligations but has, in any event, rectified what ASQA sees as failures to comply. As at the date of their agreement, ASQA agreed that WIT is fully. On that basis, we are satisfied that it is appropriate to exercise the power that we have been given under s 43 of the AAT Act to set aside the decision.
The question then becomes whether we should simply leave matters at that or whether we should make the condition sought by ASQA. If we were to decide simply to set aside ASQA’s decision, the practical effect would be to remove the suspension and to restore WIT’s registration to the position it was in before the reviewable decision was made on 20 January 2016. ASQA would continue to use its audit powers to monitor WIT’s compliance with its obligations.
If we set aside the decision and decide to add a condition to WIT’s registration, we would be using ASQA’s powers under s 29 of the NVR Act and complementary powers under s 9AD or under s 9AE of the ESOS Act to do so. The practical effect of the condition sought by ASQA is to enable it to check WIT’s compliance with its registration obligations more easily and efficiently than would otherwise be the case. There can be no question that this would be so. The audit provisions place a much more onerous burden on ASQA. Onerous though they may be, they do have certain checks and balances for an RTO but bypassing those particular checks and balances would not relieve ASQA of having to act with procedural fairness in reviewing the material produced by WIT on request.
The audit processes place an impost on WIT as they do on any RTO or registered provider but WIT is quite properly not making any complaint about any such impost. Those processes are part of the checks and balances necessary to ensure that the two schemes provided for under the NVR Act and the ESOS Act meet their objectives. What concerns WIT is the damage to its reputation and to the consequent loss of business. We accept that both are likely to follow. Certainly, a condition is not a suspension of a registration but it is a condition that does not generally apply to other RTOs. That necessarily raises a question mark against an RTO that is the subject of a condition applying only to it. The actual reputational damage or loss or business is difficult to ascertain. The emails attached to Mr Khan’s statement, though, lead us to conclude that there is likely to be some damage. Even though the condition is not a suspension, the speed with which the two overseas agents acted to cancel presentations promoting WIT’s courses and to withdraw students when notice of a suspension of WIT’s registration was incorrectly placed on ASQA’s website, is indicative of their being prepared to act quickly and without further enquiry regarding matters that might have put a suspension in context. We are satisfied that a similar reaction could be expected of the imposition of a condition on WIT’s registration and particularly when it can lead to the consequences for students that we identify in the following paragraphs.
We are satisfied that both WIT and ASQA have legitimate concerns regarding the condition both as to its need and as to its effect. What we think is of even greater concern is the effect of the condition on the students who undertake WIT’s courses and who are given VET qualifications or VET statements of attainment by it. Under the General Retention Direction, an RTO is required to retain and, if requested, to produce in full at an audit all completed assessment items for each student for a period of six months from the date on which the judgment of competence of the student was made. If ASQA finds that an RTO that is subject to the General Retention Direction has not complied with the assessment criteria, the students who may be affected by that finding are limited to those in the six month period preceding the date of the request. Potentially, those students may find that ASQA has exercised its powers under s 56 of the NVR Act to cancel a VET qualification or a VET statement of attainment issued to him or her by that RTO.
If WIT’s registration were subject to the condition that ASQA seeks, the practical effect is that no student could be assured of the VET qualification or VET statement of attainment conferred by WIT until two years had passed from the final assessment decision for that particular unit of competency or module. That would seem to us to be contrary to a system that is directed, in part, to a VET system designed to deliver valued skills, knowledge and competences to members of the Australian community as well as to the international education market. Australia’s social and economic needs will not be met unless there is some measure of confidence that the system will deliver those educated and skilled persons. Its reputation as a provider of quality education and training services to overseas students will be damaged.
In this case, the risks of non-compliance must be measured against the risk that WIT will not be able to deliver the services it is registered to deliver. As s 9AE(4) of the ESOS Act provides, a risk management approach must be used in deciding whether to impose a condition on a provider’s registration. It seems to us that the proper balance between the risk of non-compliance and the attainment of the objects of the NVR Act and the ESOS Act lies in WIT’s being subject to the General Retention Direction but not in being subject to the condition sought by ASQA.
DECISION
For the reasons we have given, we decide to set aside the decisions made by ASQA on 20 January 2016 and in relation to WIT’s registration under the NVR Act and the ESOS Act.
I certify that the forty nine preceding paragraphs are a true copy of the reasons for the decision herein of
Deputy President S A Forgie and
Senior Member A Nikolić AM CSC.
Signed: ……….......[sgd]................................
Associate
Date of Hearing: 31 January 2017
Date of Decision: 16 February 2017
Counsel for the Applicant: Mr J Whelen
Solicitors for the Applicant: Mr N Galatas
GPZ Legal
Solicitor for the Respondent: Mr J Pritchard
Australian Skills Quality Authority
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