How the cost of non-compliance is higher than investing in compliance
I absolutely cringe when it comes to the pervasive scaremongering in the VET sector, which includes throw away comments about ASQA being difficult—that the government has an agenda to close down small RTOs and that managing compliance is hard. But one thing that’s for certain is the day of ignorance within your RTO is gone!
In the past, many RTO owners often ran their businesses in a way they thought was okay, looking at what others were doing and taking comfort when observing their competitors taking similar shortcuts. So often I hear clients say, ‘…but they’re doing it and they’re complaint, so why can’t I?”
Realistically (and some may argue this comment), until this year, many RTOs ‘got away’ with running their RTO how they wanted to, until they got audited. Then depending on the outcome of the audit, and sadly the auditor, the RTO would then ‘fix’ the non-compliances within the rectification period, and would continue along this dysfunctional cycle.
So what’s changing? After all, the legislation remains the same—the National Vocational Education and Training Regulator Act 2011—and as a general rule, the Standards for Registered Training Organisation haven’t changed either, yet the possibilities and implications of fines and penalties are finally real.
The Australia Skills Quality Authority (ASQA) has always had the legislative power to impose fines and penalties, but has been limited by the process and manpower to implement them. Under the legislation and following the ASQA Authorised Officer Requirements 2012, ASQA now has Authorised Officers who have much more power than an Auditor, or Regulatory Operations Officer, as they’re now called.
Under Part 5 of the National Vocational Education and Training Regulator Act 2011, ASQA’s investigative powers are very broad. Under the Act, Authorised Officers may enter your RTO premises for the purpose of finding out whether the Act has been, or is being complied with, or to assess the correctness of information provided under the Act. So in short, without evidence or even a suspicion that you’ve contravened the Act, an ASQA Authorised Officer can turn up and access your RTO to determine if it complies with the Act.
Basically, this also means that ASQA has the power to land on your doorstep and conduct an on-the-spot audit. It also has the right and ability to issue fines.
There are a range of offences and civil penalties under Part 6 of the Act including, but certainly not limited to:
- falsely claiming to be an NVR registered training organisation,
- providing, or offering to provide, all or part of a VET course without registration,
- advertising or offering VET course without identifying issuer of VET qualification or statement of attainment, and
- issuing VET qualification without providing adequate assessment.
These penalties for these four breaches range from 60 penalty units for advertising or offering VET course without identifying the issuer of the VET qualification or statement of attainment, through to 600 penalty units for falsely claiming to be an NVR Registered Training Organisation. Currently, under the Crimes Act 1914, one penalty unit for an individual is $180. This means that a simple ‘oops’ moment by an organisation promoting a course for an RTO, and not identifying that RTO, could cost the individual $10,800, or if someone ‘falsely’ claims to be an RTO, the penalty could be as high as $108,000.
If you’re using assessments that don’t quite hit the mark, and you issue a qualification, a 120 penalty unit, or a possible $21,600 penalty should be enough to make you think twice about not checking your tools before use.
Many RTO owners talk about the cost of compliance. Compliance should not be a cost within an organisation if systems are in place, staff are educated and quality materials are used. Compliance should be an investment in the smooth running of the RTO.
Compliance should be an investment into the smooth running of the RTO. In reality, compliance is simply common sense. There are numerous checklists and tools available to help you tick off all your compliance requirements. Compliant organisations are successful organisations, as are accountable and knowledgeable owners.
So step up, take ownership of your RTO’s compliance commitments, and reap the rewards of a successful organisation, which has mitigated its risk. Your RTO’s level of compliance will directly relate to your attitude to compliance, and it’s time for owners to be accountable for the state of their businesses. Failure to comply in the future could cost you more than a couple of nights’ sleep, rectifying the non-compliance.
Visit the ASQA website to find out more or to download a fact sheet about infringement notices: http://www.asqa.gov.au/media-and-publications/infringement-notices.html