Stronger protections for VET students commence

Media Release

Tough new rules to protect vocational education and training students from unscrupulous training providers commence today.

 

Minister for Vocational Education and Skills, Luke Hartsuyker, said the new rules will help stamp out the predatory behaviours that have seen some training providers deliberately target vulnerable people in order to exploit the VET FEE-HELP student loan scheme.

 

“From today, training providers and their agents will be prevented from approaching people and using high-pressure sales tactics to get people to sign up for a VET FEE-HELP loan,” Mr Hartsuyker said.

 

“Training providers and their agents will be prevented from cold-calling people in their homes or approaching people in shopping centres or outside Centrelink and using VET FEE-HELP as the hook to get people to sign up for a training course they do not want or need.

 

“If you are a quality training provider you do not door-knock housing estates, hang outside Centrelink or harass people in the privacy of their homes in order to boost your enrolments and get your hands on taxpayer’s money.

 

“The Government is putting an end to these dodgy practices and banning cold-calling and other forms or unsolicited contact which promotes VET FEE-HELP.

 

“These changes build on the reforms the Government has already introduced to prevent the use of inducements such as laptops and gift vouchers to get people to sign up for a VET FEE-HELP loan.

 

“From today, we have also made it easier for students to have their VET FEE-HELP debt cancelled where the training provider has misled the student and for the Government to re-coup the money from the training provider.

 

“Training providers are on notice that if they persist with unscrupulous marketing and enrolments practices they will face tougher consequences including new fines and the loss of their VET FEE-HELP provider status.

 

“As the recent actions by the Australian Competition and Consumer Commission, the Australian Skills Quality Authority and the Department of Education and Training has shown, dodgy training providers are being held to account for their actions.

 

“We have also introduced stronger rules to pause payments for new enrolments to providers and move to payment in arrears where there are concerns about the provider’s performance.

 

“The Government is serious about lifting the standard of the providers in the VET-FEE HELP scheme.

 

“The suite of reforms the Government has introduced will strengthen the integrity of the current VET-FEE HELP scheme ahead of a fundamental redesign of the scheme for 2017.

 

“My priority for the year ahead is to work with students, employers and reputable training providers who want to build a better VET FEE-HELP scheme for the future.

 

“It is regrettable that the VET sector as a whole has suffered because of the actions of the few.

 

“There are many training providers out there who are genuinely committed to their students and who are delivering quality training that helps people gain the skills they need to find and keep a job.

 

“I encourage anyone thinking about undertaking training in 2016 to first visit the myskills.gov.au  website to compare courses and also the studyassist.gov.au website to learn more about VET FEE-HELP scheme,” Mr Hartsuyker said.

 

A summary of the Australian Government’s reforms to strengthen the VET FEE-HELP scheme follows.

 

Summary of the Australian Government’s VET FEE-HELP Reforms

 

1 April 2015

The banning of inducements to entice students to enroll under the VET FEE‑HELP scheme.

1 July 2015

Tighter rules regarding VET marketing and recruitment practices, such as not marketing courses as ‘free’ when students are required to repay their VET FEE-HELP loan to the Commonwealth

 

Stronger disclosure requirements regarding student rights and obligations

 

Banning of withdrawal fees to prevent a student withdrawing from a unit of study.

1 January 2016

Providers must apply a student entry procedure to ensure a prospective student is academically suited to the course.

 

Providers must issue a student with a VET FEE-HELP Invoice Notice at least 14 days prior to each census date for a VET unit study.  (The census date is the date when the student fee becomes payable).

 

A provider must determine at least three fee-periods for charging purposes for each course to ensure the debt is incurred in line with progress.

 

A provider must not accept a Request for a VET FEE-HELP loan form from a person who is under the age of 18 unless a parent or guardian has co-signed the form.

 

A provider must not accept a Request for a VET FEE-HELP loan from a student until a two-day ‘cooling off’ period has elapsed after enrolment.

 

A person may apply to the department for a remission of their VET FEE‑HELP debt where the person was subject to inappropriate behaviour by a provider or its agent or associate that occurs from 1 January 2016.

 

The total loan limit for existing providers will be frozen at 2015 levels.

 

Certain providers will be paid in arrears.

 

Where there are concerns about a provider’s performance, payments will be paused for new enrolments.

 

Infringements or civil penalties will apply where a provider breaches certain requirements.

 

More stringent financial assessment criteria for providers and applicants for VET provider approval.

 

Registered Training Organisations seeking approval to offer VET FEE‑HELP will require a minimum 5 year trading history and must have delivered the relevant courses for 5 years or more.

 

Trustees of a trust cannot be approved as a VET FEE‑HELP provider.

 

Providers must generate a minimum of 20 per cent of total revenue through non‑HELP sources.

 

Applicants and providers may be required to provide evidence of access to cash or cash equivalent assets equalling a certain proportion of their annual expenses.

 

Unsuccessful Applicants will not be able to re-apply for six months.

 

 

For more information

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