Economics Legislation Committee
Estimates hearings, 15 February 2012
Dr Carol Nicoll, Chief Commissioner, Tertiary Education Quality and Standards Agency
Senator RHIANNON: You have answered a number of my questions, Dr Nicoll. I understand that formal risk assessments for all providers are required and I just wondered when they are due to occur?
Dr Nicoll: We are undertaking initially what we are calling a risk scan, because at this stage we have a limited data set. We intend to undertake a full risk assessment by later this year, probably in October or November. At that point we will have collected enough data from providers to be able to do a full risk assessment. Part of our challenge is that whilst the universities have provided, particularly the department, with a rich range of data for their performance, their inputs, outputs and to some degree outcomes, TEQSA covers universities and other higher education providers, and that other part—the private provider part of our scope of responsibility—has not provided data, except for those that were engaged in fee help.
It is not that they do not have the data. In fact, their peak bodies, ACPET and COPHE, have both been at pains to say to us that it is not that most providers do not have it, it is just that it has never been asked of them. Under our act we have the scope and capacity to seek that data and we will be doing that later this year. We have had a consultation about the risk assessment and we have taken on a number of pieces of feedback that we received. We think that we have an instrument and a risk approach which will evolve over time, but which will be a very good start.
Senator RHIANNON: From what you have just explained, is that how it is rolling out for the smaller private CRICOS registered providers?
Dr Nicoll: CRICOS is a register for providers to be able to have international students, so I am not quite sure as to the nature of your question?
Senator RHIANNON: So you do not cover them?
Dr Nicoll: Yes, we do. At the moment, from 29 January, TEQSA took over the CRICOS responsibility of the states and territories for the ESOS, the Education Services for Overseas Students Act. From 1 July we will have the delegated authority for some of the responsibilities that the Commonwealth department currently undertakes. We have responsibility for ESOS, but I am not quite sure what the nature of your question is.
Senator RHIANNON: It was really in the context of the previous questions with regard to moving to formal risk assessments, so what you described in your first answer.
Dr Nicoll: You actually identify a challenge for us. The TEQSA Act sets up one approach and the approach to risk assessment, that is the framework for the way we are operating, has really come out of that. The ESOS Act sets up a slightly different nuanced approach to risk and our role, our job, is going to have to be in some ways to accommodate those differences, but to still stay faithful to the primary act which sets us up, which is the TEQSA Act. We believe, in the longer term, that in the interests of streamlining for all providers in higher education, the coming together of the ESOS functions and the other regulation functions in TEQSA will be a much better outcome for providers. We will look at risk in terms of the ESOS Act, but it is a different construct from the way risk is looked at under the TEQSA Act. We are still coming to terms with how we are going to work through that.
Senator RHIANNON: I understand that prior to the establishment of TEQSA there was concern raised about its fee schedule, given the full cost recovery model in place. What concerns have been raised about TEQSA fees and by which type of providers?
Dr Nicoll: I would like to correct you first of all. We do not have a full cost recovery regime to implement. The way TEQSA has been set up is partial cost recovery. We have put out a fee schedule on 29 January after consultation with the sector, given the fact that cost recovery should be based on an understanding of how costs are derived. We are a brand new agency; we have no data of what the costs are going to be and how we would go about activity costing those. We have had to use historical data, including basing it on the fees of the states and territories, but it is very important to recognise that many of the states and territories significantly subsidised their approaches to this and were not working on full cost recovery. In some states it is fair to say that our fees will be higher. There are other states where full cost recovery was attempted, they were much higher than what we have set.
In response to the feedback we had we made changes to the draft schedule that we put out for consultation and we have undertaken to review the fee schedule later next year, after we have had a good year of actual operations—and we will be collecting data from now about how our operations work. It may be that the sector is either pleasantly or unpleasantly surprised by the outcome of that, but we will undertake a review.
Senator RHIANNON: So there is no particular grouping that is complaining at the moment? Is it the case that we have not got to that stage?
Dr Nicoll: We had responses. I can actually go through them.
Senator RHIANNON: I am not asking you to do it now. I was trying to see the trends. I am trying to get my head around how all this works. Is there any particular group in your providers that is exploring this with you and raising concerns?
Dr Nicoll: Given the time restraints of the committee, I would be happy to take it on notice and we could give you a summary of the issues that were raised through the consultation. We would be very happy to provide you with those.
Senator RHIANNON: Thank you.