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FAQs—Proposed schedule of fees and charges

Why is ASQA reviewing its fees and charges?

ASQA is an Australian Government agency that is required to operate on a cost-recovery basis.

Currently ASQA is required to recover approximately 50 per cent of the costs of regulating the VET sector (i.e. to undertake partial cost recovery).

Since inception in 2011, ASQA has evolved from an application-based regulator to a risk-based regulator. Restructured operations, improved systems and changed processes have also delivered operational efficiencies.

Reflecting these changes, ASQA is proposing a fee and charges structure that has been designed to:

  • allow ASQA to fully realise its move to a risk-based regulation
  • ensure ASQA continues to comply with the Australian Government’s Cost Recovery Guidelines
  • incentivise compliance by providing fee relief to compliant providers, and
  • recognise improvements in ASQA’s systems and processes.

What is cost recovery?

'Cost recovery' means that ASQA must recover the costs of performing regulatory activity through fees and charges, in accordance with the Australian Government Cost Recovery Guidelines.

Cost recovery broadly encompasses fees and charges related to the provision of government goods and services (including regulation) to the private and other sectors of the economy.

As a partial cost-recovery agency, ASQA must partly cover the costs of performing regulatory activities through fees and charges.

The Australian Government Cost Recovery Guidelines require that a Cost Recovery Implementation Statement (CRIS) be prepared whenever a government agency proposes significant changes to an existing cost recovery arrangement.

What is a CRIS?

The Australian Government Charging Framework requires that ASQA produce a Cost Recovery Implementation Statement (CRIS) to outline ASQA’s approach to cost recovery.

Cost Recovery Implementation Statement (CRIS) describes how charging on a cost-recovery basis for a specific government regulatory activity is implemented.

Each regulatory activity that is cost recovered, regardless of financial value, must be documented in a CRIS before new or revised charges commence.

ASQA’s draft 2017 CRIS provides information on how ASQA intends to implement cost recovery for regulation of the VET sector.

The CRIS also reports financial and non-financial performance information for these regulatory activities and contains financial forecasts for the next four years.

What are the key elements of the proposed fees and charges?

The key elements of the proposed fee schedule include:

  • simplifying application fees
  • attributing compliance audit cost recovery to the audited provider (rather than distributing total costs evenly across all RTOs)
  • removing separate charges for travel costs, and
  • aligning course accreditation application fees with provider application fees.

How did ASQA design the new fees and charges outlined in the CRIS?

When designing the new fees, ASQA developed a revised cost model. The revised cost model reflects changes to ASQA’s organisation structure, as well as the continued transition to a more risk-based regulatory model that seeks to reduce regulatory and cost burden for providers that demonstrate a high degree of compliance.

To inform this cost model, ASQA:

  • considered data collected through previous regulatory experience
  • considered existing stakeholder feedback about fees and charges, and
  • validated the time and cost associated with a range of regulatory and corporate activity (and other overheads).

What are the benefits for providers?

The new fees and charges aim to reduce the financial burden of application processes for providers who provide quality outcomes for students. As ASQA shifts to a model where fewer providers will be audited as a result of submitting applications—and a greater proportion of providers will be subject to compliance audits based on their risk profile—the fees and charges have been updated to reflect this shift.

To support this revised model, audit costs are charged at the point of audit rather than being incorporated into application fees. For providers that consistently deliver quality outcomes, this is likely to translate into a reduction in fees and charges related to their registration.

Is ASQA using the revised fees and charges to raise revenue?

ASQA does not receive any direct benefits from the fees and charges it collects, as they are returned to an Australian Government consolidated fund. In the 2018 Fees and Charges Schedule it should be noted ASQA has significantly reduced its fees for the RTO sector, rather than increasing them.

As an Australian Government partial cost recovery agency, ASQA must partly cover the costs of performing regulatory activities through fees and charges and it must do so in accordance with to Australian Government Cost Recovery Guidelines.

Why have some fees been reduced?

ASQA has restructured its operations and efficiencies have been realised through ASQA’s upgraded business systems and improved processes. This has reduced associated costs.

Further, as ASQA shifts to a model where fewer providers will be audited as a result of submitting applications—and a greater proportion of providers will be subject to compliance audits based on their risk profile—the fees and charges have been updated to reflect this shift. To support this revised model, audit costs will now be charged at the point of audit, rather than being incorporated into application fees.

Why has the hourly audit charge gone up?

ASQA’s current audit charge rate, as set out in the 2015-16 Cost Recovery Implementation Statement, does not factor in time for planning and scheduling audits. These costs have been factored into the hourly audit rate in the proposed ASQA Schedule of fees and charges 2018.

In addition, ASQA currently charges separately for auditor travel time and travel costs; in response to stakeholder feedback, these costs will be built into the audit charge.

As a result of these changes, the audit charge has increased from $250 an hour to $275 per hour.

ASQA’s costs are typically lower for audit work that does not involve a site visit; for this reason, such audits (often referred to as evidence reviews) will continue to be charged at $250 per hour.

Is the hourly audit charge equivalent to ASQA auditors’ hourly rate?

No. ASQA’s hourly audit charge rates reflect a range of direct and indirect costs associated with auditors, including office administration overheads.

Why is ASQA proposing to change the way audits are charged?

ASQA’s RTO and CRICOS application fees currently include a partial audit cost, meaning that all applicants contribute to the costs of audits that ASQA conducts in regard to processing applications.  

ASQA is completing its transition to an audit approach based on risk intelligence (which is possible now the authority’s systems have matured and greater efficiencies have been achieved) rather than an approach where audits follow the receipt of applications.

ASQA will continue to assess all applications; however, ASQA will only conduct audits where risk intelligence data indicates that an audit is required. The proposed change will result in those providers now being subject to the full audit cost. This will result in costs being recovered where they are actually incurred, rather than the costs being shared across all providers.

How will the costs of compliance audits be calculated?

Audit charges are calculated based on the time taken to complete a compliance audit process.

There is no standard audit charge, because the time taken to complete an audit may vary significantly due to:

  • RTO compliance
  • whether the RTO is prepared to be audited (for example, whether the auditors can easily access information required for the audit)
  • issues found during the audit process, and
  • the number of training products included in the scope of the audit (as a larger RTO is likely to have more training products included in the scope of the audit).

A fixed hourly rate allows ASQA to accurately attribute costs for audit activity—the charge reflects the regulatory effort involved.

ASQA’s audit charges involve a mix of auditor and non-auditor effort.

The non-auditor costs comprise:

  • time of staff involved in identifying and planning the need for and breadth of the audit
  • time of managers and commissioners in providing oversight and review of the audit, and
  • time of administrative support staff (who reduce the time required of higher cost staff).

ASQA’s costs are typically higher for audits that involve site visits; for this reason, such audits will be charged at a rate of $275 per hour. 

ASQA’s costs are typically lower for audit work that does not involve a site visit; for this reason, such audits (often referred to as evidence reviews) will continue to be charged at $250 per hour.

Why is the annual registration fee now an annual registration charge?

This change was passed in the Australian Parliament in June 2017. The annual registration charge replaces the annual registration fee. The calculation method and structure remain unchanged, and as such this change does not affect providers.

The annual registration charge is designed to recover ASQA’s costs of regulatory activities to the same extent that was previously recovered by annual registration fees.

Why is the course accreditation application fee being split into two fees?

Approximately 25 per cent of course accreditation applications (initial and renewal) submitted to ASQA do not satisfy the necessary requirements to proceed to a full evaluation. Currently, a full refund is provided when applications do not proceed.

Introducing a lodgement fee will contribute to the cost of the work that ASQA undertakes during the lodgement process. Applicants whose application is insufficient will not be required to then pay the assessment fee, but ASQA’s initial costs will still be recovered. The Application Lodgement Fee will be non-refundable.

The application assessment fee will be charged once applicants have satisfied the prerequisites required at lodgement. This assessment fee is reduced to offset the introduction of the $500 lodgement fee.

What is the difference between the course accreditation minor amendment and major amendment?

Under ASQA’s current fee schedule all course owners currently pay the same fee to amend a course.

However, ASQA receives a number of amendment applications for courses each year requiring imported training package units to be updated to subsequent equivalent versions. In response to feedback from course owners, the 2017 Cost Recovery Implementation Statement proposes to distinguish between applications for ‘minor’ and ‘major’ amendments to accredited courses. These ‘minor’ amendments will be charged the lower fee, as minimal processing times are involved.

The cost for all other amendments where the intended outcome of the course remains the same are now termed ‘major amendments’.

More substantial changes to the course outcomes (such as removal or deletion of core units, changing the packaging rules/title/streams) are not considered amendments. These changes require the course to be accredited as a new course.

Do the revised fees and charges still reflect the size of change of scope applications, and charge less for smaller applications?

No. ASQA’s revised fee structure reflects ASQA’s actual costs.

This means that under the revised fee structure, applicants seeking to add training products to their scope of registration will be charged a decreased fee $500 per application, regardless of the number of training products applied for. (Previously, applicants were charged $920 to add a single qualification and additional amounts for any other training products applied for).

If a change of scope application involves one of the risk factors that triggers an audit–such as entering a new industry area—and a compliance audit is required, the compliance audit will be charged at $275 p/h.

What does the consultation process involve?

ASQA is seeking feedback from the VET sector on the proposed schedule of revised fees and charges.

The CRIS outlines the rationale for the revised schedule of fees and charges that ASQA proposes to implement from 1 January 2018. The CRIS also demonstrates that ASQA’s cost recovery arrangements are consistent with the Australian Government Cost Recovery Guidelines.

ASQA is undertaking a range of consultation activity with key sector groups, and all interested stakeholders are invited to make a submission between 14 August 2017 and 12 September 2017.

How do I make a submission to ASQA on the 2017 CRIS?

Online:

VET sector stakeholders can provide feedback by filling out the online feedback form on the ASQA website (submissions have now closed).

Feedback can be submitted using the online feedback form—either by entering text into the free-text field, or uploading an attachment.

The free-text field in feedback form has a limit of 1000 words, and cannot be saved before submission. If your feedback is longer than 1000 words, please attach it as a single Word or PDF document.

If you choose to provide your email address, a copy of your submission will be forwarded to you with a confirmation of receipt. Please note that you will not receive an individual response to your submission.

If you have trouble using the feedback form, please contact the ASQA Info Line on 1300 701 801.

By post:

You can also post your feedback to:

2017 CRIS Consultation on Fees and Charges
Australian Skills Quality Authority
GPO Box 9928
Melbourne VIC 3001

Please note that you will not receive an individual response to your submission.

Is my submission confidential?

Individual submissions will be treated as confidential. While ASQA plans to include a summary of the feedback received during the CRIS in the final CRIS document, individual submissions will not be publicly available.

However, ASQA may provide a list of individuals and organisations that have submitted feedback to third parties requesting copies of submissions. You can indicate on the feedback form whether you approve of your name and contact details being released in this instance or not.

You may also choose to make an anonymous submission.

What will happen to my submission?

ASQA will review all feedback received about the proposed fees and charges and incorporate any necessary changes as a result of feedback received. This will be limited to changes that are consistent with the Australian Government Cost Recovery Guidelines.

A summary of the views expressed during the CRIS consultation will be included in the final CRIS, alongside any changes to the fees and charges and an explanation of the changes.

How will the proposed fees and charges be approved?

Following the consultation:

  • ASQA will review the feedback received to determine if any changes will be made to the proposed fees and charges.
  • A summary of the feedback received and an explanation of the changes will be included in the final Cost Recovery Implementation Statement.
  • Agreement on the final fees and charges will be sought from the Assistant Minister for Vocational Education and Skills and the Council of Australian Governments (COAG) Industry and Skills Council.
  • The new fees and charges will be established as a legislative instrument.
  • The approved fees and charges and final Cost Recovery Implementation Statement will be published on the ASQA website.
  • The new fees and charges will apply from the approved date (which is proposed to be 1 January 2018).

How will the revised schedule of fees and charges be implemented?

Following COAG and Ministerial approval on the final fees and charges, the schedule of fees and charges will be established as a legislative instrument.

The approved CRIS and fee schedule will then be published on the ASQA website. ASQA will advise stakeholders by email of the new fees and charges schedule in December 2017. The new fees and charges will apply from 1 January 2018.