2.1
At the outset, the committee rejects the need for and rationale behind this inquiry. It is an unnecessary political exercise and a blatant attempt by the Coalition Government to damage the South Australian Labor Government. Evidence received during the inquiry clearly demonstrates that the current situation with TAFE SA is not an extraordinary, isolated incident, but is instead symptomatic of the deeper problems afflicting the Australian vocational education and training (VET) sector.
Background
2.2
The Australian Skills Quality Authority (ASQA) is the national regulator for Australia’s VET sector. It seeks to maintain the sector's quality through the effective regulation of VET providers, accredited VET courses, and Commonwealth Register of Institutions and Courses for Overseas Students (CRICOS) providers.
2.3
One of ASQA's core functions is to carry out compliance audits of Registered Training Organisations.
2.4
In May 2017, ASQA commenced a routine audit into TAFE SA's operations. As a result of the audit, in December 2017, ASQA suspended 10 qualifications from the scope of registration of TAFE SA.
2.5
According to a 6 December 2017 statement from ASQA:
TAFE SA was subject to routine regulatory scrutiny in May 2017 which identified some non-compliance with the requirements of the Vocational Education and Training (VET) Quality Framework.
As a result, in September the provider was issued with a notice of intention to remove or suspend a total of 16 qualifications from its scope of registration.
ASQA considered the response provided by TAFE SA to the notice of intention, however it did not address all of the non-compliances identified. On Monday, 4 December [2017] ASQA formally advised TAFE SA of its decision to suspend 10 qualifications from its scope of registration as a provider of vocational educating and training.
2.6
The 10 qualifications suspended were:
AMP20316: Certificate II in Meat Processing (Abattoirs)
AUR32416: Certificate III in Automotive Refinishing Technology
AUR30816: Certificate III in Motorcycle Mechanical Technology
CHC33015: Certificate III in Individual Support
CHC43415: Certificate IV in Leisure and Health
CPC32413: Certificate III in Plumbing
CPC50210: Diploma of Building and Construction (Building)
SHB30415: Certificate III in Hairdressing
SIR50212: Diploma of Visual Merchandising
SIT30816: Certificate III in Commercial Cookery
2.7
ASQA emphasised that the May 2017 audit of TAFE SA was part of routine regulatory scrutiny:
We did not undertake the audits of TAFE SA on the basis of a perception of risk. It was because the institutes of TAFE in South Australia were amalgamated in September 2014 from three separately registered organisations into a single entity, and there's a requirement in our legislation to do a post‑initial audit, which is the audit we undertook in [May] 2017 that resulted in our regulatory decisions at the end of 2017.
2.8
On 18 December 2017, ASQA agreed to a request from TAFE SA for an extension of time until 2 March 2018 to lodge a reconsideration application. ASQA's submission provided further detail on this request:
Such extensions are considered on a case-by-case basis, with ASQA having regard to any impact a delay in progressing the regulatory action might have on stakeholders.
Consistent with usual practice, ASQA also agreed that the decision to suspend qualifications will not take effect until the reconsideration review process is complete.
When ASQA receives the TAFE SA reconsideration application, it will make a decision about the application and notify TAFE SA of the outcome within 90 days. If AQSA affirms its original decision, TAFE SA may apply to the AAT [Administrative Appeals Tribunal] for a review of ASQA's decisions.
2.9
The committee was also advised that in comparative terms, the rate of compliance demonstrated by TAFE SA was better than some TAFEs in other states and also better than the average compliance rate for non‑TAFE providers. Mr Mark Paterson, Chief Commissioner and Chief Executive Officer for ASQA explained:
In terms of comparison, TAFE SA's rate of non-compliance in relation to the audit was 66.67 per cent. Other TAFEs have been as high as 79.38 per cent, and the average for non-TAFE providers is about 68.19 per cent. So, in relative terms, TAFE SA has not demonstrated the same rate of non-compliance as other TAFEs and is comparable to non-TAFE providers.
Moving forward
2.10
During the inquiry ASQA informed the committee that it would audit TAFE SA again in 2018 as part of its ongoing compliance activities:
ASQA will undertake another compliance audit of TAFE SA during 2018 (it was initially proposed that this compliance audit would be undertaken in the first quarter of 2018, however due to the reconsideration process and the extension of time allowed for TAFE SA to submit further evidence as part of that process, it would be unreasonable for ASQA to undertake the audit during that period).
2.11
The committee was also advised of the steps TAFE SA had taken to rectify the issues identified by ASQA. Mr Craig Robertson, Chief Executive Officer of TAFE Directors Australia (TDA) outlined:
We recognise that ASQA has given TAFE SA until 2 March [2018] to address the issues raised, as the commissioner mentioned earlier. TAFE SA is working hard on dealing with that. In fact I'm advised that about 350 of their lecturers and staff volunteered and came in over the summer break, when they would normally be on entitled leave, to respond to the issues that have been raised. This has included contracting top auditors from around Australia to come and provide that advice. These are auditors that are experience in assisting ASQA in their work, as well. I'm told that at times there are about 120 people in a room dissecting and responding to the issues that ASQA has given. They've also commissioned a quite comprehensive staff professional development program, and they have mandated a new set of contemporary assessment tools that will need to be used right across the institute.
2.12
TDA also informed the committee that TAFE SA would offer its 2018 courses as usual:
Senator HANSON-YOUNG: …Is it your understanding that some [TAFE SA] courses have been delayed to start, and may not even start until term 2?
Mr Robertson: My dialogue with TAFE SA is indicating that, under the arrangements Mr Paterson [ASQA Chief Commissioner and Chief Executive Officer] gave, they intend to open all courses that were subject to the ASQA decision.
Senator HANSON-YOUNG: At what point?
Mr Robertson: At a normal opening time, which is during February. They're in the middle of enrolment now, and they would start those courses. There is one small element of delay for apprentices and trainees in terms of liaison with employers, but they're working hard to rectify that.
2.13
The South Australian Government took prompt and decisive action to address the concerns raised in the ASQA audit. On the day the ASQA findings were published, South Australian Minister for Higher Education and Skills, the Hon Susan Close MP stated:
I am extremely disappointed with the findings in the ASQA report and I will be seeking an independent review of TAFE which will include all courses currently being provided.
My main priority is to restore the faith of South Australians in TAFE while ensuring students are kept as informed as possible, with minimal disruption to their studies.
2.14
Management consulting firm Nous Group was appointed by the South Australian Government on 5 December 2017 to undertake a wide-ranging review of TAFE SA, to be finished as soon as possible. Additionally, public sector reform and education specialists Mr Terry Moran AC and Mr Kim Banikoff were appointed to conduct a strategic capability review of TAFE SA, with the report to be provided to Minister Close by early April 2018.
2.15
A statement from the office of Minister Close on 5 December 2017 outlined:
The Terms of Reference for the [Nous Group] review include improving the effectiveness of TAFE SA's internal quality assurance mechanisms to ensure it delivers high quality training that is compliant with national standards for training providers, and restoring confidence in the public provider.
The ASQA findings have prompted a raft of changes within the corporation, including the Minister [for Higher Education and Skills] recommending to the Governor in Executive Council to dismiss the Chair of the TAFE Board, Peter Vaughan, and the resignation of the Chief Executive of TAFE SA, Robin Murt.
2.16
Ms Alex Reid was appointed interim Chief Executive of TAFE SA immediately after the resignation of Mr Robin Murt, and Ms Pauline Denley was appointed as Chair of the TAFE SA Board of Directors on 5 December 2017.
2.17
Business SA commended the actions taken by the South Australian Government in addressing the concerns raised by the ASQA report:
TAFE [SA] is undergoing a number of reviews at the moment, of which you are probably aware. We applaud the strategic review because the strategic review and the terms of reference will look at all of what we perceive to be the key issues that have resulted in TAFE being in its current position. It needs to look at the board composition, it needs to look at the leadership and the executive appointment, it needs to look at its entire governance structure so that the state government has transparency, and it needs to understand that it's a registered training organisation with a significant scope of registration.
2.18
Business SA also indicated that it considered the actions taken immediately after the ASQA audit to be appropriate. As Mr Anthony Penney, Executive Director, Government and Industry Engagement stated:
We would have expected that the information was communicated up the chart and addressed accordingly. People need to be held accountable. Specifically, the CEO and the chair of TAFE, who have operational direction over TAFE, were addressed accordingly, just like any other small business or publicly listed company.
Committee view
2.19
The committee considers this inquiry to be a purely politically motivated exercise orchestrated by the Coalition Government in order to attack the South Australian Labor Government ahead of the South Australian election on 17 March 2018.
2.20
The committee notes that when Careers Australia went bankrupt in May 2017, pocketing millions of dollars in Commonwealth funding and leaving 15 000 students out of pocket, the Coalition Government did not push for a Senate inquiry.
2.21
The committee is of the opinion that TAFE SA and the South Australian Government have taken prompt and appropriate steps to address the concerns raised in the ASQA audit report.
2.22
The committee draws attention to ASQA's observation that TAFE SA's rate of non‑compliance was comparative to, or lower than, rates of non-compliance found in other TAFEs and private providers.
2.23
Far from viewing the current TAFE SA situation as an isolated incident, the committee considers it to be symptomatic of a broader crisis within the vocational education and training system, in large part due to the significant, sustained funding cuts to the sector. The following chapter will examine these broader issues in more detail.