VET Education Institutions

[Ron0z]

With the introduction of VET Student Loans from the beginning of 2017 the Commonwealth govt introduced legislation at the same time that gives the government the power to require educational institutions to pay the Commonwealth a fee. I believe (though, not 100% sure) it was VET Student Loans (Charges) Regulations 2017. I believe the fee was to cover the cost the Commonwealth spends on recovering debts from unscrupulous training providers. It seems to me that those costs should be covered by the govt alone and not passed on to training providers, particularly when most training providers’ sole purpose is education and not that of taking advantage of students. Legitimate education institutions shouldn’t be forced to pay a fee to rid the community of rogue organisations.

Is such legislation unconstitutional and is there a case for it to be challenged?

 

[Rob Legat - SBPL]

Short answer without looking into it: No, and no.

There are many pieces of legislation which has this effect, and government is increasingly moving towards an "industry pays" model. For example, the ASIC has just moved to such a model where all entities which are ASIC governed will now be paying an additional yearly fee to cover the costs of ASIC's regulatory activities.

Government's rationale is that the average taxpayer shouldn't be footing the bill, it should be the people in the industry in question.

 

[Ron0z]

Short answer without looking into it: No, and no. .

A disadvantage is that non profit organisations (eg. TAFE) have no way of absorbing the cost which must then be passed on to students. Tuition fees can be high and adding to students’ burden with an unnecessary extra cost is unfair.

 

[Rob Legat - SBPL]

Effectively all businesses pass their costs on to consumers. Unless someone is making a high mark up on the price of courses, there's little capacity to absorb the costs. Regulators usually don't know/don't care what level of profitability the operators have.