The implications of ASQA being moving to a full cost recovery agency

September 30, 2019

ASQA and TEQSA are required by the Australian Government to transition from partial cost recovery to full cost recovery by 2020-21 making charging activities more consistent with the  other areas of Government and Australian Government Charging Framework. 

 

Currently, neither regulator recovers the full cost of their regulatory operation or the full cost of legislative activities. The regulators recover only the costs of regulatory activity for outputs that are initiated/requested by the providers and not costs associated with compliance, monitoring, enforcement, and investigations. Under these updated provisions that will change.

 

Background: 

 

In December 2009, the Council of Australian Governments (COAG) agreed to ASQA’s establishment as a cost recovery agency, and announced that ASQA would over a period of years move from partial to full cost recovery. On 1 July 2011 ASQA was established by the enactment of the NVR Act and supplementary legislation. In the 2014–15 Portfolio Additional Estimates Statements, the Australian Government confirmed ASQA’s continued operation as a partial cost recovery entity.

 

The Australian Government Budget 2018–19 announced that ASQA will transition from partial cost recovery to full cost recovery by 2020–21.

 

During the transition to full cost recovery by 2020–21, ASQA will engage in public consultation with all VET sector stakeholders before any changes are made to ASQA’S fees and charges. ASQA will detail any proposed changes, the rationale and anticipated cost-recovery outcomes of the proposal, and provide all stakeholders with the opportunity to provide input and feedback. ASQA will allow adequate time not only for this consultation to take place, but also for reconsideration and revision of the proposal based on stakeholder input received during the consultation.

 

Public consultation on ASQA’s fees and charges for 2018–19 took place from 1 August to 3 September 2017. For more information on this consultation process, see section 5—Stakeholder engagement.

 

ASQA recovers costs by imposing fees and charges on providers for various tasks ASQA performs as part of regulating the VET sector. ASQA receives budget appropriations from the Australian Government, and cost recovery revenue is returned to the Australian Government’s Consolidated Revenue Fund to offset budget funding

 

ASQA’s collection of fees and charges 

 

 

ASQA’s authority to impose fees is provided in section 232 of the NVR Act.

 

 

ASQA’s authority to impose charges is provided in sections 7–12 of the National Vocational Education and Training Regulator (Charges) Act 2012 (the Charges Act).

 

ASQA mainly imposes and collects fees and charges on three key groups:

 

  • Registered Training Organisations (RTOs)

  • Commonwealth Register of Institutions and Courses for Overseas Students (CRICOS) providers—including those that deliver English Language Intensive Courses for Overseas Students (ELICOS)

  • VET accredited course owners.

 

ASQA’s business activities 

 

ASQA is required to support all its business activities and operations under the full recovery model. The business activities and operations include: 

 

 

ASQA’s partial cost recovery model 

 

ASQA currently receives an annual budget appropriation for operating and capital activities from the Australian Government and returns cost recovery revenue to the Consolidated Revenue Fund to offset their budget funding. The cost of some of ASQA’s regulatory activity is partially recovered through fees and charges. Some of ASQA’s regulatory activity is funded by ASQA’s annual budget appropriation.  

 

Implications: