ASQA & TEQSA Full Cost-recovery Advocacy

Date —

10 Sept 2019

Industry Sector/s —
Higher Education, Vocational Education & Training

Summary —

In budget papers, the Australian Government has planned for the Tertiary Education Quality and Standards Agency (TEQSA) and the Australian Skills Quality Authority (ASQA) to move towards a full cost-recovery model from 1 January 2020 and 1 July 2020 respectively. The Independent Tertiary Education Council Australia (ITECA) is taking the lead advocacy role to mitigate the impact for independent tertiary education providers.

Key Issues —

The Australian Government has taken the decision to move current partial cost-recovery arrangements of both TEQSA and ASQA, considered appropriate during each regulators’ formative years, to full cost-recovery arrangements from 2020, consistent with the Australian Government Charging Framework.

Presently, neither regulators recover the full cost of their operations or the full cost of regulatory activity. The regulators recover only the costs of regulatory activity for outputs that are initiated / requested by the providers, and not costs associated with compliance, monitoring, enforcement, and investigations. That will change under these revised arrangements.

Advice to ITECA from Ministerial and Departmental sources is clear: over-turning the decision to implement full-cost-recovery is not an option given it was made in the context of the Budget, its parameters and forecasts, and is also consistent with the Australian Government Charging Framework. The proposal was introduced to deal with what are existing inconsistencies in Government charging activities and to help determine when it is appropriate to charge for Government activity.

The approach from ITECA has been to ensure that the implementation of full cost-recovery by TEQSA and ASQA is fully consistent with the Australian Government Charging Framework – based on the principles of transparency, efficiency, performance, equity, simplicity and policy consistency.

Importantly, at a Ministerial level ITECA has presented the case that there are several legitimate functions of the two regulators that should not be cost-recovered and should continue to be met by the taxpayer. These include costs associated with policy reform implementation, public information and regulatory action taken against non-compliant providers.

The argument for the latter is strong, in its most simple sense, there is no basis for quality independent providers meeting cost associated with enforcement or compliance against providers that set out to avoid meeting their obligations.

ASQA’s and TEQSA’s move towards full cost-recovery presents some practical challenges for independent providers in the tertiary education sector, particularly independent higher education providers with self-accrediting status. These providers will face significantly higher compliance costs and ITECA has raised this issue with the Minister.

ITECA notes that increased charges from TEQSA and ASQA will inevitably result in those increases being passed onto students by way of higher course fees. There is broad agreement across the independent tertiary education sector that it is highly regrettable that students will end up paying for regulatory activity. This point will resonate when ITECA raises it again at the 2019 ITECA Parliamentary Round Table meeting on Wednesday 11 September 2019.

Ensuring that the interests of independent tertiary education providers are fully considered in the context of the move to full cost recovery has been a high priority for ITECA. Recognising the considerable and adverse financial effects of this policy decision, ITECA has been keen to ensure that there is appropriate consultation and transparency as Cost-Recovery Implementation Statements (CRIS) are prepared for both new charging regimes. These documents provide key information on how cost recovery charging 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.

ITECA’s work, undertaken with the support of our members, will ensure that as ASQA and TEQSA’s cost-recovery arrangements are developed in a manner consistent with the consultation framework set out in the Australian Government Charging Framework. This places emphasis on ASQA and TEQSA embarking on a robust consultation that takes into account the position of stakeholders including the independent tertiary education sector.

Ensuring that ITECA’s members’ concerns on ASQA’s and TEQSA’s move towards full cost-recovery is understood by the Australian Government is a major advocacy priority. It will be a key issue raised at the 2019 ITECA Parliamentary Round Table in September 2019. Here ITECA will outline the concerns to more that fifty Ministers, Shadow Ministers and parliamentarians as they attend an event convened by ITECA that raises the profile of Australia’s independent tertiary education system and the issues that impact its ability to deliver quality outcomes for students.


Member Engagement:

ITECA’s ability to play a lead role in matters associated with this issue rests on the advice and guidance of individuals serving on the ITECA Vocational Education and Higher Education Reference Committees.

Further Information:

For more information on this issue please send an email to policy@iteca.edu.au or telephone 1300 421 017.  Stay up to date via Twitter @ITECAust or via Facebook at www.facebook.com/ITECAust.

Disclaimer & Copyright:


The material published on this website page is intended for general information only and is not legal advice or other professional advice.  It may not be reproduced without ITECA’s prior written consent.

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