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Crackdown on Vet-Fee Help Scheme

180,000 students were enrolled under the VET FEE-HELP scheme, with more than $1.6 billion in loans, last year

Melbourne, May 6: The Andrews Government has welcomed the announcement of a plan to stop the massive waste of taxpayers’ money from the Turnbull Government’s VET-FEE Help debacle.

The plan, outlined during Opposition Leader Bill Shorten’s Budget reply speech last night, features a loan cap of $8,000 a year in the VET-FEE Help program.

Last year more than 180,000 students were enrolled under the VET FEE-HELP scheme, with more than $1.6 billion in loans.

Victoria has been pushing for more realistic loan levels for the last year in a bid to stop cowboy operators exploiting vulnerable students.

According to a Victorian government statement, massive loans have been issued with little benefit to show. Factors include:

  • a lack of funding limits,
  • an inappropriate upper limit on loans,
  • a disconnect with industry and
  • a lack of emphasis on competition

It is estimated that up to 15,000 Victorians may have been pulled away from the state training system into the disastrous VET-FEE Help system.

Under Abbott-Turnbull, VET FEE-HELP loans have escalated from $699 million in 2013 to $1.7 billion in 2014.

The Study Now Pay Later scheme may have used loans over $3 billion in 2015, according to the Victorian government.vet-help-

The Victorian Government is weeding out dodgy training providers in the State system with an extra $39 million to conduct more on site audits, for closer scrutiny of high-risk providers and for greater control and oversight in the use of outsourced training providers.

This will be conducted by the Department of Education and Training’s compliance department.

258 training providers are registered to receive VET FEE-HELP of which 73 organisations are based in Victoria.

Minister for Training and Skills, Steve Herbert welcomed the proposed plan for “realistic loan levels.

“Victoria is in the middle of an unprecedented crackdown on dodgy training providers and it’s about time a Federal Government did the same.”

“We welcome the announcement from Bill Shorten, Kim Carr and Sharon Bird about their plan to put students first.”

The Victorian government has called the entire system a ‘rip-off’ and the shamed the federal government for allowing the rip-off to proliferate since 2013, while many Victorians have been left without any qualification or skills for a real job.

“The Turnbull Government had a chance to right this wrong in this week’s Federal Budget, but instead they cut $8 million from the national regulator ASQA, despite unprecedented concerns with about VET-FEE Help rorting”, the statement added.

However, a total of $68 million in additional funds has been allocated to strengthen ASQA’s powers and under the new infringement scheme further random audits will be conducted into training providers to ensure they are doing the right thing.

Earlier ASQA has only been able to write warning letters or take regulatory action such as cancelling or suspending a provider’s registration; however with the new measures ASQA to take action against a Registered Training Organisation where they, or a marketing agent, fail to provide clear information to a prospective student.

This measure was instituted last month by the federal government amongst others; wherein dodgy training providers would face immediate fines upwards of $100,000 as a crackdown on the consistent rorting under the VET FEE-HELP scheme.

There have been cases where even nursing home resident and elderly people were signed up by unscrupulous training providers, while clawing in on the generous fee support from the government.

Training providers have offered cash and free laptops as incentives to enrol in courses, which signees would never use.

Assistant Minister for Education and Training Simon Birmingham said he hoped the fines would act as a significant deterrent for training providers taking part in unscrupulous practices.

While industry leaders had welcomed the tightening of the scheme, many voiced that such measure should have been in place from the outright.

On the heels of this announcement, education experts say that almost $273m have gone in red and will be claimed by education providers.

Ramakrishna VenuGopal

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