Resource requirements for change to scope applications – Dangerously easy!

In December 2018, the National VET Regulator released its first general direction in two a half years. In this post, I will talk about this new general direction and I will also talk about the changes the regulator has made to the process for submitting an addition to scope application. It would seem that this process has been made a whole lot easier to complete; however, the changes have also introduced a significant statutory obligation on those making applications. So, it is easier, but you need to make sure you have your ducks in a row first. Here we go!

The general direction

Firstly, a general direction that is published on the regulator’s website is not the same as a fact sheet or a guide. A general direction is issued under the authority of the National Vocational Education and Training Regulator Act 2011, Part 2, Division 1, Section 28 Condition which requires an RTO to comply with any general directions given by the National VET Regulator. Complying with directions whether they be a written direction issued directly to an RTO or a general direction published on the regulator’s website is a condition of registration. Obviously, if you don’t comply with a written or general direction issued by the National VET Regulator then it is a problem. At the very least, you would be made non-compliant with clause 8.2 and 8.5 of the RTO standards and would need to rectify this. At the very worst your registration can be cancelled for breaching your conditions of registration and you could be prosecuted under Part 6, Division 1, Section 111 which relates to breach of condition of registration. I realise that all sounds fairly dramatic, but it is a fact.

So, the new general direction is titled: Resourcing requirements—for applicants seeking initial registration or change to scope of registration. Here is a link for your convenience (click). Whilst the direction relates to applicants seeking initial registration, it also relates to existing RTO’s seeking to change their scope of registration. It applies to both domestic courses and CRICOS delivery. I won’t regurgitate the entire general direction in this post as you can access it and review it for yourself.

These are the highlights:

The general direction specifies that applicants seeking to change their scope of registration are expected to have access to all required resources for each training product included in the application at the time of submitting the application. When it says “resources” it is referring to the following:

  • Trainers and assessors
  • Educational and support services
  • Learning resources
  • Facilities
  • Equipment
  • Assessment systems

The interesting part about this general direction is that it does provide some helpful guidance on how applicants should interpret these requirements. We have already had a number of discussions with ASQA about the interpretation of the general direction, so there are some areas where it is a little vague. Overall though, it is quite a useful document in defining the requirement and particularly helpful for those people who have basically no idea, which can include those seeking initial registration. This is a summary of the helpful guidance:

Trainers and assessors. The applicant must have sufficient trainers and assessors to deliver training and conduct assessment for the initial cohort. The document defines the initial cohort as the number of learners the provider intends to deliver when it first commences the delivery of the training product. This probably seems straightforward, but it is important to make sure that the number of trainers and assessors aligns with your forecast student numbers. As an example, if you are only within your first two years of registration, then an application for addition to scope requires you to also submit a new financial viability risk assessment with a revised business plan. If you make outrageous claims in your business plan in regard to the number of learners, you expect to train then you need to make sure you have a sufficient number of trainers and assessors to accommodate this. For an RTO that has been registered longer than two years, this evidence requirement does not apply, but you still need to make sure you have sufficient trainers for the number of learners you plan to commence with. The helpful piece of clarification in this section is that, if the trainer is not currently employed by the RTO, at a minimum the RTO must have formally offered the employment (or contract service) to the trainer and assessor and you must have evidence of acceptance. Having the CV or resume only for a potential trainer is not sufficient.

Educational and support services. Education support services have the same definition as the RTO standards. The general direction does not provide any spectacular guidance about this other than you need to have sufficient support services for your planned initial cohort. Just as an aside, I wrote a post mid last year about identifying education and support services as third-party arrangements (click). It is interesting that the fact sheet relating to third party arrangements has been taken down from the regulator’s website some time ago now and has not been replaced.

Learning resources. The applicant must have in their possession all learning resources for all units of competency identified in its training and assessment strategy. The general direction provides a clarification that having a quote to purchase or an invoice for a planned payment is not sufficient and does not constitute the learning resources being in your possession. To make it real simple, if you don’t have all of the learning resources for the course you want to deliver then don’t apply for it. By learning resources, we mean things like PowerPoint presentations, learning content, session plans, handouts, learner guides, self-paced learning activities, et cetera.

Facilities. Of all of the guidance in this general direction, the guidance provided in regard to facilities is the most significant. The general direction basically says that if you are applying for a new training product then you need to have suitable facilities that align with the requirements of the training product. Make sense. It then goes on to talk about what that evidence might look like and includes things like evidence of a purchased premises, a current lease, a written agreement to rent a site pending registration and plans to hire premises on an as required basis. I recently put this to the test in regard to a CRICOS registration where I spoke with ASQA about how these requirements will apply to a CRICOS application. They advised over the phone that not all of these options would be suitable for a CRICOS application (even though the general direction says otherwise). I concluded that for a CRICOS application the client would really need to have a purchased premises or a current lease. If you are a domestic RTO and just submitting an addition to scope application, then the other options would certainly be suitable.

Okay, this is where it gets really interesting because, for the first time since the beginning of domestic VET regulation, we now have a requirement specified in regard to the adequacy of the facilities used by the RTO. Of course, CRICOS RTOs have always had this but there has never been anything that made it a statutory requirement for a domestic provider. Some might say that this is governed under local government legislation and that is true, but it has always been strange to me that there was nothing in the standards that ever specified the standard of facilities. I remember running a site audit back in the day for VETAB and the RTO’s premises was absolutely disgusting and by the time morning tea came around all of the audit team was scratching due to the lice infestation, so I stopped the audit. Fun days! Anyway, the general direction specifies that facilities must be large enough to accommodate the initial cohort, must have sufficient amenities such as break rooms and toilets and interestingly needs to take account of other organisations who may be using the same facilities.

The other interesting part of the general direction is that the RTO’s facilities must have approval from the local government authority approval for a educational use. This is a big deal. Some might say that this has always been a requirement according to local government legislation but it’s not something that the regulator has consistently required and it has certainly not previously been specified. It has always been a requirement for CRICOS but never a specified requirement for a domestic RTO. I could seriously write an entire post on the requirements around this but essentially it means that the RTO needs to approach its local council to ensure that the building or property where training is being delivered has appropriate local government zoning consent/approval. I have not yet come across a council (on behalf of clients) who does not have a requirement around this. The general direction says “where this is a requirement of the local government authority” but in my experience, all councils have a requirement. Some councils have their own specified standard for educational premises and some rely on a 9B building certification. It’s just a matter of determining what your council requires. The thing I would say is this, the general direction makes it explicitly clear that this is a requirement. If you submit an application and have not dealt with this, then technically you are in breach of your conditions of registration. I know that sounds harsh and many will choose to ignore this and let a sleeping dog lie, but that is the requirement. It’s also interesting that for CRICOS applications, you now only need local government approval of the facility to deliver education and not necessarily a 9B certification. If your local government authority does not require 9B certification then this may make the process of finding a suitable premises all the easier.

Equipment. No surprises here, the general direction specifies that the applicant must have all of the equipment, either owned or leased, to deliver the units of competency included in the strategy. There is sometimes a tendency for an RTO to apply to put a training product on scope before they actually have a market. Of course, if you follow the requirements of this general direction then this means that you are incurring quite significant cost in equipment and resources before you can generate any revenue. I would strongly recommend that instead of RTOs putting qualifications on scope in the hope that a market will appear, that you only apply for a qualification where you are certain you can start generating revenue as soon as it is on the scope and can advertise. The requirement in the general direction is very straightforward but I do think the consequence is that RTOs should not be applying for training products unless they absolutely have a market and are ready to go.

Assessment systems. The general direction makes the obvious statement that you need to have all of your assessment tools and supporting system for all units of competency included in the training and assessment strategy. It provides a clarification that having a quote to buy these materials is not sufficient. The definition specifies that the assessment system, obviously needs to comply with the RTO standards as specifically clause 1.8. No surprises there.

Application to change scope

Another change that happened about the same time as this general direction was released, is a significant change to the evidence requirements for a change to scope application. The change is essentially this:

Unless you are applying for a TAE training product, ELICOS application or your RTO has not been registered longer than two years, then you do not need to upload any evidence for an addition to scope application.

Let me be clear, if you are not applying for TAE or ELICOS and have been an RTO longer than two years then no evidence is required for an addition to scope application. You don’t need to upload a training and assessment strategy, a staff matrix, evidence of industry consultation, et cetera. Some of you will find this really hard to believe, but it is true. The application is very clear and simply asks the question if you fall in to one of these categories and required to upload evidence Yes or No? If your answer is No, then you skip straight through to uploading a declaration and check out with your credit card. Bingo, items will be on scope in a matter of days. It has certainly made the process significantly easier, but, and this is a big but, the requirement of the general direction puts all of the statutory obligation on you. To make it absolutely clear that you understand this, the regulator has introduced a new declaration for the appointed CEO to complete and submit with the application. This requires the CEO to sign away that you have everything you need to deliver the training product which you are applying for. You can access the declaration at the following link (click).

This is where I give you a big word of caution. Yes, the regulator has made it very easy to process an application for addition to scope and to be honest, it has also made their job significantly easier. Instead of wasting audit resources on reviewing applications for addition to scope, they have put the entire onus of responsibility on you to make sure you are compliant. The consequences of not being compliant could be significant to your RTO. I personally think it is a really smart move by ASQA. It is a win / win for them and you, as long as everyone follows the rules! So, it is easier, but you really need to make sure you have everything in place and can sign off on that declaration with confidence. This does worry me a little. I have already encountered clients where I have told them about the no evidence requirement for this application and their reaction has been “You beauty, I will submit tomorrow”! My reaction is, “Noooooooooo, hold on, you can do that if you want, but here is the specified requirement and these are the consequences”.

I am concerned about RTOs who do not have access to that type of honest advice. Hence, the reason for this post. I just want everyone to know that the process for adding items to your scope is dangerously easy! There will be those who will “risk manage” this and those who are suitably cautious and take a planned and deliberate approach. I would absolutely recommend the latter.

Good training,

Joe Newbery

Published: 28th February 2019

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