Vocational Education and Training Recruitment Agents

The Hon. T.T. NGO (15:17): I seek leave to make a brief explanation before asking the Minister for Employment, Higher Education and Skills a question about recruiters.

Leave granted.

The Hon. T.T. NGO: On 10 September I read with interest an article in The Australian about agents or recruiters who recruit students for vocational education training courses on behalf of colleges, similar to what they have done over recent years for prospective higher education students. It seems that in some instances there have been some questionable practices relating to how courses are marketed, such as advertising or marketing that there are no up-front costs for a course but not acknowledging that students may be incurring a debt for the course they are undertaking. Can the minister tell the chamber about the situation in South Australia?

The Hon. G.E. GAGO (Minister for Employment, Higher Education and Skills, Minister for Science and Information Economy, Minister for the Status of Women, Minister for Business Services and Consumers) (15:18): I thank the honourable member for his most sensible question. It appears that there has been a surge in the number of recruitment agents and brokers marketing VET courses in recent times. I am advised that at the national VET conference on 11 September the Hon. Ian Macfarlane said:

…some brokers who act unscrupulously are undermining the reputation of the training system. This must stop.

The article states that during the Australian Skills Quality Authority's year's marketing audit last year, in which they examined 400 college websites, they found that between 60 to 70 turned out to be brokerage firms rather than training providers. While on the one hand there is nothing new about recruiters or brokers—they have been involved in the international higher education sector and other training sectors for some time—it is when companies use misleading information, or act in not quite an up-front manner, that problems can occur.

As well as the example given by the honourable member in the explanation to this question, a third party, such as a broker, may be able to work around some of the contractual obligations placed on an RTO, such as not offering inducements for people to study with a particular training organisation. So, different provisions apply to RTOs than they do to brokers and we see that some are using these broker arrangements to get around the higher standards required of them in relation to their behaviour.

Since the beginning of Skills for All the department has closely monitored and taken action should there be issues regarding the practice of brokers. For example, Skills for All contracts have actually prohibited subcontracting to non-Skills for All providers. In addition, clause 30.3 of the contract states that a 'training provider must not engage in any misleading or deceitful marketing practices…'

To underpin this, the department routinely reviews print advertising websites and social media to ensure prospective students are receiving clear and correct information about Skills for All funded courses. This is measuring compliance with the Skills for All contracts, as well as requirements under Consumer Law. To date, I can advise that nine organisations who appeared to be brokers have been formally contacted regarding their marketing practices requesting that they cease from making representations regarding Skills for All.

I can advise that in one case, following on from a student's complaint, Skills SA reported a company to Consumer and Business Services on the grounds of false and misleading representation in association with Skills for All funded courses. Consequently, the Consumer Affairs Commissioner gained written assurances from the company directors that they would refrain from making false and misleading representations with respect to the process of goods and services. As part of this process these assurances were published.

I think all in the place would agree it is important that we ensure that prospective students are fully and honestly informed of all details relating to course studies, including costs. The Department of State Development will continue to monitor the behaviour of brokers and Skills for All training providers here in South Australia's training market.

I noticed recently this is an area the federal minister Ian Macfarlane has also focused national attention on. He raised this issue in his capacity as Minister for Industry and Training. I know that he and the federal government are looking at ways of tightening up provisions federally as well, because we know that these training providers do not usually operate just within a single jurisdiction. They are regularly offering their training services across borders, so it is not just a matter for state governments. I was very pleased to see the comments from a media release that came out of the Hon. Ian Macfarlane's office recently taking up this issue as well at a federal level, so I look forward to working with him in relation to this particular issue.