House of Representatives

National Vocational Education and Training Regulator Amendment (Governance and Other Matters) Bill 2020

Second Reading Speech

Mr IRONS (Swan - Assistant Minister for Vocational Education, Training and Apprenticeships)

I move:

That this bill be now read a second time.

Today I introduce the National Vocational Education and Training Regulator Amendment (Governance and Other Matters) Bill 2020.

The Australian vocational and education training (VET) sector is a vital engine that drives the Australian economy. The VET sector supports millions of students each year to obtain skills and expertise for success in future employment and further education.

It provides agile pathways for people to enter the workforce, upskill or reskill.

VET qualifications and training need to be of a high standard to ensure they are trusted by students and employers and benefit the wider Australian community.

Delivering excellence in training lies at the heart of the Australian government's skills agenda. That is why in October 2019, this government announced reforms to the agency responsible for regulating the VET sector - the Australian Skills Quality Authority (ASQA).

The government has committed $18.1 million towards reforms to enhance ASQA's engagement with the VET sector and ensure its regulatory approach is fair, transparent and effective. The reforms respond to the Braithwaite and Joyce reviews, which both called on ASQA to adopt a greater educative role and improve its regulatory approach.

The first phase of reform is a rapid review of ASQA's governance, culture and processes, which commenced in November 2019. The review is evaluating the effectiveness of ASQA's internal regulatory practices and processes, including how ASQA makes and reviews decisions. The review is due for completion in March this year and will inform a longer-term program of improvements to support ASQA's continued evolution as a modern and effective regulator.

While the review is ongoing, initial work focused on ASQA's governance. The regulatory experts undertaking the review evaluated the alignment of ASQA's current governance arrangements with best practice guidelines and arrangements of comparable bodies across Australia and recommended a revised model for ASQA to support effective, modern, fit-for-purpose governance.

The revised governance model in the bill draws on best practice for Commonwealth regulators. It replaces the existing three commissioner structure with a single agency head, to be known as the Chief Executive Officer (CEO) of ASQA. This will enable the CEO to perform a role more consistent with that of the head of an agency, including leading ASQA's long- and short-term strategy and making top-level managerial decisions that determine the organisation's objectives, resources and policies. This will be supported by a revised organisational structure which will better allocate and clarify operational responsibilities and improve regulatory decision-making.

Further, the bill establishes a statutory expert advisory council to advise the CEO of ASQA. The advisory council fills a gap at the strategic level. Rather than representing particular stakeholder or jurisdictional interests, the council will provide ASQA with access to expert strategic advice to help it to continuously improve as a regulator while maintaining its independent regulatory decision-making. The council will also create a mechanism for meaningful sector engagement and demonstrate ASQA's commitment to ongoing improvement and learning from the expertise of others.

The members of the advisory council will bring to the table diverse skills, such as expertise in regulation, communications, delivering training, and experience operating a training provider. To ensure the right mix of people and skills, I will seek out the views of the Ministerial Council for Skills before appointing the chair or members to the advisory council.

The advisory council will not be a decision-making body but rather a valuable source of strategic advice, a vehicle for confidential information-sharing and a strong foundation for stakeholder confidence in the regulator.

The revised governance model will enhance ASQA's organisational capability and support best-practice regulation, continuous improvement and effective engagement with the VET sector. The changes will facilitate a shift towards a regulatory approach which focuses on combining educating and engaging with registered providers to foster excellence, and compliance monitoring and enforcement. The revised governance arrangements will hold ASQA in good stead to address future challenges such as changes to its internal practice, enhancements to ASQA's educative role and the significant reform anticipated in the VET sector over the coming years.

To ensure that the minister responsible for VET is able to respond effectively to sector issues, the bill clarifies the nature of directions the minister may issue to ASQA to improve its regulatory processes. The bill provides for the minister to give a broad direction to the national VET regulator in relation to the performance of its functions or powers.

In order to maintain ASQA's independence as a regulator, the amendment specifies that the directions must not be in relation to a particular regulatory decision. This will assist the minister to support and direct ASQA without impinging on the statutory independence of the regulator.

The bill also includes information-sharing arrangements that support use of data collected by the National Centre for Vocational Education Research, or NCVER, under the act.

Improved information sharing will support governments and regulators so that the diverse needs and requirements of all Australians, including groups with different needs, such as people with disability and those where English is not a first language, are considered in policy, funding and regulation.

Promoting quality in the system will ensure that VET is valued as a legitimate and reliable pathway enabling individuals to achieve personal and professional development and industry to access a work-ready skills base with consistent, relevant and nationally recognised knowledge and skills.

Quality regulation is integral to ensuring that the training system is equipped to deliver high-quality student outcomes and to efficiently adapt to changing skill needs, labour market fluctuations and developing technologies. These reforms will benefit not only ASQA but also the providers they regulate, VET students, graduates, employers and the Australian economy at large.

This bill is another critical step in the government's reform process to support ASQA's continued evolution as a transparent and balanced regulator that engages effectively with stakeholders and builds quality in the VET sector.

Debate adjourned.