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Monday, 6 November 2000
Page: 19145

Senator CARR (4:25 PM) —I move:

At the end of the motion, add "but the Senate:

(a) notes that:

(i) the broadest possible access to quality training opportunities is a vital part of Australia becoming a Knowledge Nation;

(ii) demand for vocational education and training is likely to increase by at least 2.8% a year over the next four years; and

(b) condemns the Government for:

(i) failing to provide any funding to support this growth;

(ii) failing to negotiate a fair and reasonable new ANTA Agreement with the States and Territories; and

(iii) pursuing policies which damage the quality of training and put at risk the nation's skills base".

Australians have a right to expect high-quality services from their governments. They have a right to expect that vocational education undertaken anywhere in the country will result in qualifications that are recognised throughout the country. They have a right to expect that the quality of vocational education is of a uniformly high standard and that the regulations governing the provision of that education are nationally consistent. Neither workers nor employers should be disadvantaged by regional inconsistencies affecting the standards and the provision of vocational programs.

Unfortunately, these rights and expectations are not being met at present. There have been countless examples of rorts in the VET system, of unethical behaviour by registered training organisations and of appalling administrative practices with regard to audits. There have been numerous examples of slipshod attitudes by regulatory authorities. It is disappointing that some within the government and ANTA have sought to defend these practices with arguments that have included the need for flexibility, `teething problems' that they say are inherent in the new reforms, and suggestions that in a free market environment people have the right to choose.

The legal definition of `fraud' employed in this context is so vague that it has become possible to argue that, since fraud cannot be demonstrated, the criticisms must be overstated. In fact, the VET system has become so flexible that it is almost impossible for even the most unscrupulous providers to be found to have defrauded the Commonwealth. The administrative arrangements are so loose that, in spite of the rhetoric, very few providers have been deregistered. This is despite the widespread acknowledgment by state authorities that such inappropriate and unethical behaviour should never have occurred.

In the past, most complaints have arisen from workers who have been mistreated while undertaking so-called traineeships. Their opportunities to voice complaints are always set against the prospect of losing their employment. Therefore, most complaints are received only after the trainees have lost their jobs or the training has concluded. All too often trainees receive training and qualifications that are less than they had hoped for or expected, and thus their opportunities are narrower than they had been led to believe. It is interesting to note the increasing number of complaints coming from ethical employers—specifically, those who are committed to the long-term future of their industries. They resent the unfair competition presented by those who are using vocational education subsidies to provide little more than cheap labour. They are concerned at the long-term prospect of skills shortages and the problems of poorly qualified workers who are not properly trained to meet the demands of quality production across the whole industry.

One state government report documented that one in five trainees who allegedly received their full training on the job received no training at all. Many employers are also annoyed that the failure rate for New Apprenticeships in some areas has risen to well over 50 per cent and that, according to one detailed study by the Queensland government, up to 60 per cent of trainees were not completing training. Despite the optimistic public relations from ANTA, DETYA and the minister's office, despite the expenditure of millions of dollars on slick television advertising and other marketing strategies, and despite the expenditure of $354 million per annum on employer subsidies, we now see the government in crisis management due to the disastrous decline in quality and confidence.

The Commonwealth government's response has been to accept second best—to urge the states to accept yet another agreement, while there is no funding for growth, and to enter into new protocols and new committees, in the hope that the hard decisions on quality assurance can be avoided. The truth is now emerging that the complaints made by Labor have had a very sound basis indeed. This government has finally realised that it has no means of disciplining recalcitrant and poor quality training providers, yet it does nothing to address the fundamental problem.

In an age of increasing global integration there is a legitimate demand, from both business and workers, that qualifications be nationally applicable. If there is also an expectation that workers will be more flexible and more mobile, then it must be accompanied by an obligation to ensure that vocational qualifications are appropriate and recognised across state boundaries. Quality assurance is the critical component of a genuine national vocational education system. Australia's system has undergone significant reform in recent years. The Commonwealth government and the states have entered into a series of agreements to underpin a national policy framework. The core principles of the Australian training framework is that all states and territories mutually recognise each other's decisions on the registration of training organisations.

Recently the government received legal advice from the legal firm Minter Ellison that demonstrates what has long been suspected: that the legal foundations for the Australian vocational education system are seriously flawed. This advice was confirmed in a separate report in September. So one was first received in May, and one was received in September. Neither report has yet been made public. The legal advice was sought as a result of a legal challenge by a registered training organisation that faced deregistration because of its interstate operations. The advice demonstrates that the contractual arrangements for interstate registration or deregistration have no legal basis. This has profound significance for Australia's 4,000 registered training organisations.

For three years Labor has been drawing public attention to the inconsistencies in the provision of vocational education, with specific examples of deteriorating quality to prove the point. States, such as Queensland under Minister Braddy, have long warned of the deteriorating national response to quality control. The response from DETYA, Minister Kemp and ANTA has until recently been dismissive. Now there is a panic response, with calls by Dr Kemp for urgent action on national consistency. Calls for action now sound hollow, coming as they do from the same authorities that for years have been in a state of denial. It is the failure of the Commonwealth to take action on quality assurance and its insistence on marketing that now demand an explanation. It is the Commonwealth that drives the vocational education system, with financial incentives and the control of the purse strings. It is up to the Commonwealth to face up to its responsibilities.

Evidence presented to the Senate committee of inquiry into vocational education has demonstrated that neither employers nor unions perceive that the Australian vocational education system is producing consistently high-quality outcomes. Widespread concerns have been voiced about the registration of training organisations, the delivery of training and its assessment and the ongoing monitoring of registered training organisations. The Minter Ellison advice confirmed what witnesses to the Senate inquiry have reported: that qualifications earned in one state are not necessarily accepted in another state. For example, a hairdresser who qualified in Melbourne is not necessarily recognised as a qualified hairdresser in Sydney.

Drawing upon the evidence presented at the Senate committee, the ANTA Chief Executive Officers' Committee has recently stated in a report to MINCO that the current legislative framework provides no assurance that qualifications will be recognised by all registered training organisations. The report states:

There is a lack of confidence in the monitoring of registered training organisations and in auditing decisions. The criteria and subsequent outcomes of the monitoring and auditing processes have varied between states and territories as the majority operate under administrative arrangements rather than legislative requirements. As a result there is a perception that the efficacy and rigour of the auditing and monitoring process to which registered training organisations are subject varies between jurisdictions. This perception undermines confidence in the outcome of the auditing and monitoring processes.

Nevertheless, the Australian Recognition Framework has determined that an organisation registered in one state should automatically be able to claim registration in another. Minter Ellison has highlighted that the inconsistencies in the application of registration requirements have led to circumstances where the training organisations have shopped around for, and become registered in jurisdictions with, the least demanding requirements and standards. In this way, the so-called national standard for registration—the current administrative arrangements—has become, by default, the least rigorous standard being applied in Australia. A similar situation exists on the question of deregistration.

States and territories are the prime monitors and auditors for the registration of training organisations operating within their jurisdiction. The statutory basis for the exercise of such powers, however, differs from state to state. There are now enormous inconsistencies in the monitoring and the audit arrangements between the states and territories. Inconsistencies exist across all dimensions of audit and, as Minister Ellison has identified, of planning the conduct and reporting of audit results. Differences also exist in the rigour, the approach and the scope of monitoring and the audit of each of the stages. It is little wonder that there is a growing lack of confidence amongst employers and training organisations that operate in different states and territories, under different conditions.

There are currently broad systems operating in regard to registration, and I can identify at least four. In the Northern Territory there is automatic recognition of the decisions of another state, but this does not flow to formal registration in the Northern Territory. Queensland automatically registers training organisations registered in other states; nonetheless, there is a requirement technically for another registration to be listed in that state. In Victoria, New South Wales, Western Australia and South Australia, re-register organisations are required to replicate the original registration process but without the need for independent assessment for suitability. In the Australian Capital Territory and Tasmania, organisations must both re-register and subject themselves to independent assessment and compliance with the state statutory criteria. Similar inconsistencies arise with the registration of training packages and the recognition of qualifications. Training agreements are also treated differently in various states and territories. However, the most serious problem still centres on the question of deregistration and the applications of sanctions to organisations engaged in unethical or inappropriate behaviour. Serious questions therefore arise about the government's recent attempts to address these problems by a series of so-called `risk management protocols'.

Managers of the VET system now acknowledge that a great deal more work is immediately needed to comprehensively strengthen the existing national standards, particularly in regard to auditing and monitoring; RTO delivery and assessment, especially in circumstances where conflicts of interest arise; certification of competencies; the competence of registered training organisations, particularly for assessment purposes; and the need to ensure that adequate resources are available for the provision of quality training. All of this will no doubt be on the agenda for next month's ministerial council meeting, where all the stakeholders will undoubtedly be told once again that they are to commit themselves to new arrangements to deal with the habits that have developed in recent years. Yet, as with so many of the agreements entered into in the past, many employers and unions will remain sceptical about the prospects of seeing any real change. Such change is unlikely to result as long as each state and territory must meet these challenges on its own and invariably strikes out in its own direction in response to what it perceives to be its unique circumstances.

A recent study undertaken by Global Learning Services entitled `Review of the state and territory legislation for new apprenticeships' has demonstrated that, despite agreements reached at Minco—some of which are now three years old—very little has been done to implement them legislatively. It may well be that piecemeal legislation at the state and territory level will never be an adequate way to respond to the new technological developments, such as online delivery and virtual providers. Certainly, the current administrative arrangements are clearly inadequate to meet the demands that participants in the VET system have a right to expect—namely, high levels of quality and consistency across the states when it comes to quality assurance.

Frankly, what has occurred is simply that the minister has been told for years that there is a serious problem with quality assurance under this system, but he has chosen to ignore that advice until this legal opinion and two separate reports have come along and showed him just how wrong he has been. His response has been to go into a state of panic and sack committees, re-establish committees and call for urgent action, but fundamentally he has not addressed the central problem—that is, his responsibility as the driver of the system through the Commonwealth parliament in terms of the incentive payments that are made and the marketing strategies that are developed. It is no good blaming the states for this; this is a Commonwealth responsibility and he ought to face up to it.

The quantum leaps in technology and in capital and labour mobility have meant that the old administrative arrangements are no longer appropriate. We have to find a genuinely national legislative framework that reflects the realities of a knowledge based economy in a period of globalisation highlighted by dynamic technologies and an escalating pace of change. Only in this way can quality assurance be guaranteed. Only in this way can the full potential of a fully integrated national vocational education system be realised. Only in this way can the rhetoric of reform be translated into the actual experience of workers, employers and those students seeking to join and contribute to a dynamic Australian economy and society.

This government has an obligation to face up to its responsibilities. It is simply not good enough for it to be the first government since the 1970s to fail to meet its responsibility to make its contribution towards funding growth within this sector. It is little wonder that the quality of the system has deteriorated so much where resources are being squeezed and the states are given the same amount of money to provide for additional places. It is totally inappropriate for this government to try to turn away from its commitments of the past. It is totally inappropriate that this government fails to acknowledge its leadership role in the development of quality vocational education services which all Australians have a right to enjoy. Minister Ellison, I trust that in the committee stage of this bill you will be able to explain to us why the government has failed so completely to provide those additional resources in this bill. I trust that you will be able to explain to us why it has taken advice from Minter Ellison in two separate reports before this government chose to act to try to address the quality assurance agenda which so apparently has affected the confidence of the system to such a widespread level.