Chapter 2Key issues
Overall views on the bill
2.1The National Vocational Education and Training Regulator (Data Streamlining) Amendment Bill 2023 (bill) was broadly supported by stakeholders. The need to modernise the way that Vocational Education and Training (VET) activity data is collected and used was recognised by participants, including the Australian Skills Quality Authority (ASQA), Australian Education Union (AEU), and Master Builders Australia (MBA).
2.2Indeed, Jobs and Skills Australia (JSA) argued that the proposed amendments would support the work of the JSA to provide advice to government on current and emerging skills and training needs:
Flexible and responsive VET data collection and disclosure will assist JSA to provide evidence-based advice on the adequacy of the VET system in meeting Australia's skill needs as well as to conduct impactful analysis of the pathways and outcomes of VET.
2.3While generally supportive of the VET Data Streamlining (VDS) program, some stakeholders highlighted concerns about the impact of the bill on independent registered training organisations (RTOs), particularly the potential inappropriate collection and release of RTO level data. These stakeholders called for further engagement with the independent VET sector to address these concerns.
Need for better data, faster
2.4Underpinning support for the bill was the need for more accurate and consistent provision of VET activity data, with several stakeholders pointing to the limitations of the current system. For example, the AEU noted that VET 'student activity data collection is currently published annually, which can result in a time lag of up to twenty months before the data is made publicly available'.
2.5This view was echoed by the JSA, which observed that the 'current data lag makes it difficult to respond and provide timely and accurate advice to inform both government and business decisions on investments'. JSA went on to state:
… the time lags make it challenging to identify current VET activity and which qualifications students are enrolling in. Particularly in the aftermath of the COVID-19 lockdowns, it would have been useful to have seen how RTOs and students were responding, and whether any new skills shortages were emerging. As it stands, total VET Activity data is still only available for 2021 and may not be reflective of where the market is now.
2.6The National Centre for Vocational Education Research (NCVER) noted that 'the single biggest issue is timeliness and frequency of the data' and went on to explain the need to modernise the way data is collected:
… it will absolutely help to have new technology and new data standard to assist that, so in every respect we think this is a good initiative and an appropriate one. We have been operating under our current technologies for about 25 years. As you would all appreciate, data moves on very quickly in this world, so it is a timely change to make, and we fully support it.
2.7The Department of Employment and Workplace Relations (DEWR) indicated that the 'current legislative framework does not permit the department on behalf of the Secretary to release information collected in accordance with the DPRs Instrument'. DEWR argued that this 'information could otherwise be shared publicly to support regular and ongoing assessment and review of the VET sector and to inform a student's decision to undertake VET study'.
Improved monitoring and evaluation of skills programs
2.8Stakeholders argued that the proposed amendments would improve existing processes for reporting, monitoring, and evaluating skills training programs in the VET sector. For example, MBA indicated that improved RTO level data 'will assist governments to better align funding decisions with measures of quality that align with their policy priorities and jurisdictional needs'. MBA argued:
Information on quality at the RTO level will also provide assurance to industry and governments paving the way for less prescriptive, more flexible, and more responsive training products, that are better able to meet current and emerging training and skills needs.
2.9Similarly, the AEU strongly supported the publishing of RTO level 'student activity and qualification records to government and the regulator as soon as milestones are achieved'. The AEU noted:
This is particularly important given the Commonwealth's commitment to increasing funding to TAFE, the provision of 480,000 fee free TAFE places including 180,000 in 2023 (120,000 existing places made free and 60,000 new free places) as part of the interim one year National Skills Agreement.
2.10In addition, the National Indigenous Australians Agency submitted that the proposed changes would 'allow for timely, accurate and consistent data regarding VET to inform policy and program development and management' and this would provide 'more flexibility to work in partnership with First Nations people regarding data governance and use'.
2.11DEWR indicated that, overall, the bill would support greater transparency and responsiveness to the needs of students and providers in the VET sector. MrMatthew Hardy, First Assistant Secretary, VET Data, Loans and Compliance Division, told the committee:
I think the key thing here with the whole [VDS] program is, as we mentioned earlier, about 'collect once and use many times'. It's about trying to reduce the burden on RTOs, and it's about trying to provide more information in a far more timely way. Of course, as we've heard, data can be up to 20 months out of date to actually have a full picture of what's actually going on. What this will allow is for information and, importantly, prospective information to be provided on websites for students.
Concerns about the bill
2.12While broadly welcoming the VDS program, some stakeholders expressed concern about potential unintended consequences of the bill, including the impact of some measures on independent RTOs, which support most students undertaking skills training.
Release of RTO level information
2.13The Independent Tertiary Education Council Australia (ITECA) and the Australian Chamber of Commerce and Industry (ACCI) expressed concern that the proposed amendments could allow the release of RTO level information in inappropriate contexts.
2.14Indeed, ITECA argued that the bill would 'empower the DEWR Secretary, and by extension the Department, to use data collected via the [VDS] program for performance reporting at an RTO level'. It claimed that this 'not only seeks to use activity data inappropriately for performance monitoring, it does so in a manner in which there are no safeguards with respect to either data integrity or source context'. ITECA argued that:
Independent RTOs are a diverse range of small and large providers with different ownership structures and business models that support different student cohorts. Australian Government initiatives to improve data quality and timeliness across the sector for policy making purposes is welcome; however, these data need to be appropriately collected, require expert analysis and contextualisation often using multi-factor techniques. These data cannot be utilised – let alone published – outside the appropriate context lest improper and irrelevant conclusions are drawn.
2.15The ACCI expressed similar concerns and claimed that the bill appeared to authorise the release of RTO-specific information, which could be perceived by independent RTOs as commercially sensitive. Likewise, ITECA argued that 'the Parliament should consider issues associated with the publication of commercially sensitive data to ensure that the release of information does not harm the interests of those independent RTOs, their student cohorts and relevant employers'.
2.16In response, DEWR pointed out that the measures in the bill would 'not increase the range of personal information that may be shared under the National Vocational Education and Training Regulator Act 2011 (NVETR Act)' and noted the 'VDS program will be implemented in accordance with the Privacy Act 1988 and the Australian Privacy Principles to ensure that the personal information of VET students is appropriately protected'. DEWR also stated:
Similar to the current requirements for the department to consult in relation to the release of other types of RTO unit record data (i.e. not information collected under the DPRs Instrument) under the National VET Data Policy 2020, the department, on behalf of the Secretary, would undertake comprehensive consultation with the VET sector before settling on the information to be released.
2.17In addition, Mr Hardy pointed out that the Ministerial Council would continue to remain the ultimate decision maker when determining what delegations are given to another person or body under the DPRs Instrument:
They are the ones responsible, and nothing changes under the introduction of this bill. For instance, if the department, in this case, wanted to provide more information than it does right now, it would have to seek ministerial agreement to do that, and additionally we would have to consult. Taking on ITECA's particular point about performance data or anything else like that—which, of course, hasn't happened; we're talking about 'ifs'—what the department would have to do is seek agreement from ministers…
Parliamentary oversight and accountability
2.18In relation to the release of information under the VDS program, ITECA expressed concern that independent RTOs 'will have no recourse to prevent this disclosure from happening, for example, in instances that may be commercially sensitive or in cases relating to the delivery of programs of national significance'. ITECA suggested that '[g]iven the new scope of activities (e.g. publication of commercially sensitive information), that decisions made under the [DPRs Instrument] be subject to a merit review'.
2.19However, DEWR maintained that the proposed changes would provide 'a strong and appropriate level of ministerial oversight which reflects the intergovernmental scheme under which VET activity data is collected'. DEWR argued that 'this change ensures that the Ministerial Council remains the ultimate decision maker that can determine what decisions can be agreed to by another person or body in relation to the DPRs Instrument'.
2.20Further, DEWR observed that the amendment would 'remove any ambiguity about the legislative basis for ASQA to exempt an RTO from providing required data under the DPRs Instrument' and noted that the measure 'will not change the way ASQA operates in relation to decisions to grant exemptions to RTOs from their data provision obligations'.
2.21The ACCI raised additional concerns in relation to the proposal to allow DEWR to make determinations permitting the collection, use or disclosure of information for the purposes of designing, building, operating, maintaining, or testing a VET data system. The ACCI argued:
… the delegation of these powers may impose compliance costs on independent RTOs and the value of collected data, and any requirements associated with mandatory reporting obligations should be established through regulations that allow for parliamentary oversight and accountability of the regulatory process. This will enhance transparency and ensure that if the regulations are not in the public interest, they can be challenged and disallowed by parliament.
2.22However, in its submission, DEWR indicated:
The National VET data system contract will include appropriate measures relating to the handling of personal information, including standard comprehensive terms incorporating contractors' and the Commonwealth's statutory obligations in relation to privacy, information and security. This will ensure that personal information is handled in accordance with the Privacy Act 1988 and the Australian Privacy Principles.
Potential financial and regulatory impact
2.23Some stakeholders called for further consultation in relation to the potential regulatory and financial impacts on independent RTOs, particularly in relation to the broader VDS program. For example, the ACCI argued that:
The legislation, however, lacks specific requirements on the method and frequency of data collection, thus making it difficult to estimate the associated costs. RTOs (many of which are small businesses) are likely to experience a financial impact. As noted in the Explanatory Memorandum, the additional compliance burden will come at a cost to RTOs, yet the Financial Impact Statement suggests no financial impact. This burden will ultimately be reflected in potentially higher fees for students.
2.24Similarly, ITECA indicated that the 'Australian Government consider the financial impacts of the bill in more detail, and also in the context of the broader [VDS]program'. ITECA argued that:
… there is no certainty for RTOs on what the new arrangements will be like in terms of frequency of reporting and thus cost to RTOs are impossible to account for. These costs are critical to account for as they can directly affect the bottom line for RTOs, which affects peoples' jobs.
The direct costs to small RTOs, many of which are not-for-profit family-run entities, will add significant administrative burden and cost, which can be challenging for them to manage alongside their task of delivering quality training for students without corresponding cost increases to students.
2.25In response to these concerns, DEWR indicated that the bill itself would have no financial or regulatory impact on RTOs. Mr Hardy told the committee:
For the introduction of this bill, we've actually not changed or introduced the data provision requirements. It's the subordinate legislation which talks about what could be collected and how often that information will be collected. Therefore, there's no cost or regulatory impact from the introduction of this bill. As I mentioned, the department is undertaking an extensive consultation process through our external user reference group. This is where we're talking directly to RTOs, to the student management system providers—the ones that actually help with the transfer of that data. And, of course, we're undertaking an impact analysis.
2.26Notwithstanding this, some stakeholders called for additional resourcing for the implementation of reforms under the VDS program. For example, the AEU called for additional funding beyond that provided by the TAFE Technology Fund for technological improvements to TAFE campuses. AEU argued that this would be 'required to ensure that funds proposed for general technological improvements to TAFE campuses through the TAFE Technology Fund are not diverted to the technological upgrades required by the [bill]'.
2.27Similarly, Mr Simon Walker, Managing Director of NCVER, noted that extra resources would be required to implement the proposed changes from the perspective of data collection and analysis:
…. just the sheer fact that you might be reporting more frequently, particularly for us because we report statistical collections. It's not just a case of data in and data out. We've got to make sure it's all quality assured. We've got to make sure it's statistically desirable and the like. If you're moving from an annual collection to some other frequency, then clearly you've got extra work to do. On the technology side, as you might be aware, that's currently being filled by the Commonwealth, and the intention is to pass that over to us once it's fully implemented.
Committee view
2.28The committee notes the broad support for the bill, particularly those amendments which would assist data collection and other related measures being implemented as part of the VET Data Streamlining (VDS) program. The proposed changes will help to modernise the way that TAFEs and registered training organisations (RTOs) manage the collection, validation, and submission of VET activity data.
2.29Most stakeholders indicated that the proposed amendments would help to reduce the burden on RTOs and provide information in a more timely way, which would assist students and authorised users alike. The bill would also help improve monitoring and evaluation of skills programs in the VET sector, particularly for organisations such as Jobs and Skills Australia, which is expected to play a critical role in addressing Australia's workforce skills and training needs.
2.30The committee acknowledges the concerns raised by the Australian Chamber of Commerce and Industry and the Independent Tertiary Education Council Australia, regarding the appropriate use and release of RTO-specific data. However, the committee believes that these concerns are misplaced and notes the evidence of the Department of Employment and Workplace Relations (DEWR) that the Ministerial Council would continue to remain the ultimate decision maker when determining what delegations are given to another person or body under the proposed changes.
2.31Indeed, the committee is satisfied that the measures proposed in the bill do not increase the range of personal information that may be shared under the National Vocational Education and Training Regulator Act 2011 and the current requirements for DEWR to consult in relation to the release of RTO level data by the department, would continue to involve comprehensive consultation with the VET sector before determining the type of information to be released.
2.32Further, the committee notes that DEWR is undertaking an extensive consultation process through its external user reference group and is conducting a best practice impact analysis in relation to these changes. DEWR has also indicated that it will continue to work with states and territories, the National Centre for Vocational Education Research, Australian Skills Quality Authority, and training providers to improve the timeliness and quality of VET activity data through the VDS reforms. The committee is confident that any implementation issues, including the costs and benefits, will be identified and addressed through this process.
2.33Overall, the committee believes the proposed changes will complement the Australian Government's reforms in the VET sector, including the delivery of 180,000 Fee-Free TAFE and VET places, upgrading of infrastructure through the TAFE Technology Fund, and by supporting the New Energy Apprenticeships. Therefore, the committee recommends that the Senate pass the bill.
2.34The committee recommends that the Senate pass the bill.
Senator Tony Sheldon
Chair