3.1.1 This chapter sets out, for the purposes of clause 7 of Schedule 1A to the Act, in respect of the VET tuition assurance requirements:
a) the requirements which a body must fulfil to be approved by the Minister as a VET provider under clause 6 of Schedule 1A to the Act;
b) the requirements which a VET provider must continue to comply with in order to maintain their approval as a VET provider under subclause 20(1) of Schedule 1A to the Act;
c) the obligations on VET providers in their capacity as second providers;
d) the conditions which apply to an exempt provider, concerning the collection of information about VET students who are enrolled in VET units of study with the exempt provider; and
e) re-crediting FEE-HELP in the instance that a VET student withdraws from a replacement unit under special circumstances.
3.2 VET TUITION ASSURANCE
3.2.1 The VET tuition assurance requirements have four parts:
a) Part 1: VET Course Assurance Requirements;
b) Part 2: VET Tuition Fee Repayment Requirements;
c) Part 3: General Requirements; and
d) Part 4: Administrative and Activation Requirements.
3.2.2 In order to be approved as a VET provider, and in order to maintain approval, the body, if it is not an exempt provider, must satisfy the Secretary that it complies in every respect, with all four parts of the VET tuition assurance requirements.
3.2.3 If a VET provider ceases to provide a VET course of study, a VET student, who is currently enrolled in that VET course of study, has the option to choose to access either the arrangements described in Part 1 (VET course assurance) or those described in Part 2 (VET tuition fee repayment).
3.2.4 In this chapter a reference to VET provider includes a body corporate that was previously a VET provider.
3.3 PART 1: VET COURSE ASSURANCE REQUIREMENTS
3.3.1 The VET provider must demonstrate to the Secretary’s satisfaction that it complies with the VET course assurance requirements, by having in place, for each VET course of study it provides that meet the requirements under subclause 45(1) of Schedule 1A to the Act, one or more of these arrangements:
a) membership of a VET tuition assurance scheme that is:
i) operated by a legal entity (“VET course assurance TAS operator”); and
ii) approved by the Minister for this purpose;
b) a legally-binding agreement with one or more second providers (subject to paragraph 3.3.2);
c) a legally-binding guarantee provided by a legal entity (“VET course assurance guarantor”) that is a body corporate incorporated under, or in accordance with, a law of the Commonwealth or of any Australian state or territory (not necessarily a VET provider). The VET course assurance guarantor may only provide a guarantee if:
i) it has the necessary financial and administrative resources to fulfil such a guarantee; and
ii) should the VET provider cease to provide a VET course of study, it can make all arrangements necessary to ensure that the VET student is enrolled in a similar VET course of study, which meets the requirements under subclause 45(1) of Schedule 1A to the Act, with a second provider.
3.3.2 If a second provider is not approved as a VET provider at the time of entering a legally-binding agreement referred to in subparagraph 3.3.1(b), it must obtain approval as a VET provider within 12 calendar months after the VET provider is approved as a VET provider.
3.3.3 If the VET provider ceases to provide a VET course of study, and as a result ceases to provide a VET unit of study which forms part of the VET course of study, a VET student who is enrolled in the VET unit of study at that time, chooses the VET course assurance option in respect of the VET unit of study, that VET student:
a) must be able to enrol in a similar VET course of study which comprises VET units of study which meet the VET course of study requirements under subclause 45(1) of Schedule 1A to the Act and which leads to the same or a comparable qualification with another VET provider (the “second provider”);
b) must receive from the second provider for any successfully completed VET units of study undertaken with the VET provider as part of that VET course of study:
i) full credit towards the same or a comparable qualification; or
ii) if the Secretary agrees, in relation to a submission from the second provider, that the course, or its components, that the VET provider provided was of such a specialised nature, that full credit transfer cannot be arranged - as much credit as possible towards a similar VET course of study; and
c) must not be required to:
i) pay the second provider a VET tuition fee for any replacement unit; nor
ii) give the second provider a request for Commonwealth assistance in relation to any replacement unit.
3.4 PART 2: VET TUITION FEE REPAYMENT REQUIREMENTS
3.4.1 The VET provider must demonstrate to the Secretary’s satisfaction that it complies with the VET tuition fee repayment requirements, by having in place, for each VET course of study it provides that meet the requirements under subclause 45(1) of Schedule 1A to the Act, one or more of these arrangements:
a) membership of a VET tuition assurance scheme that is:
i) operated by a legal entity (“VET repayment TAS operator”); and
ii) approved by the Minister for this purpose;
b) a ‘VET tuition fees in arrears’ agreement that is offered by the VET provider to VET students and under the agreement, those VET students enrol on the basis that VET tuition fees for each VET unit of study of their VET course of study are paid in arrears;
c) a legally binding guarantee provided by a legal entity (“VET repayment guarantor”) that is a body corporate incorporated under or in accordance with a law of the Commonwealth or of any Australian state or territory (not necessarily a VET provider) which has the necessary financial and administrative resources to fulfil such a guarantee.
3.4.2 If the VET provider ceases to provide a VET course of study and as a result ceases to provide a VET unit of study which forms part of the course, a VET student who is enrolled in the VET unit of study at that time, chooses the VET tuition fee repayment option in respect of the VET unit of study, then, within 20 business days (or a longer period agreed in writing by the Secretary) after receiving notification of that choice, the VET provider must:
a) re-credit the VET student’s FEE-HELP balance in respect of the VET unit of study as required under subclause 51(1) of Schedule 1A to the Act; and
b) immediately notify its VET repayment TAS operator or VET repayment guarantor (whichever is applicable) to that effect.
(Under subclause 51(2) of Schedule 1A to the Act, the Secretary may re-credit the VET student’s FEE-HELP balance if the VET provider is unable to do so, in which case the Secretary may give the notice referred to in subparagraph 3.4.2(b)).
3.4.3 The VET repayment TAS operator or VET repayment guarantor (whichever is applicable) must, within ten business days after receiving notification from the VET provider or the Secretary under paragraph 3.4.2:
a) pay the VET student the total of any up-front VET tuition fee payments paid to the VET provider for that VET unit of study (other than payments received from the Commonwealth); and
b) pay the Commonwealth, any amounts paid for that VET unit of study by the Commonwealth to the VET provider in discharge of the VET student’s VET tuition fee for the VET unit of study.
3.5 PART 3: GENERAL REQUIREMENTS
Corporate separation
3.5.1 Subject to paragraph 3.5.2, the relationship between a VET provider and each of its VET tuition assurance administrators must be such that at all times:
a) they are legally separate entities;
b) they are not related to each other within the meaning of section 50 of the Corporations Act 2001;
c) they are not associated entities within the meaning of section 50AAA of the Corporations Act 2001;
d) they are not in a position where one is able to control the other within the meaning of section 50AA of the Corporations Act 2001; and
e) they do not have in common one half or more of the persons who are directors or officers of either entity, where the terms “director” and “officer” have the meanings given to them in section 9 of the Corporations Act 2001.
3.5.2 If at any time the relationship between a VET provider and any of its VET tuition assurance administrators ceases to meet the requirements of paragraph 3.5.1, then the VET provider must immediately notify the Secretary to that effect in writing, and include with that notification either a proposal for changed VET tuition assurance arrangements which meet the corporate separation requirements of paragraph 3.5.1, or a proposal which is additional to the existing VET tuition assurance arrangements for the Secretary’s approval. Where an additional proposal is made, this should include:
a) detailed reasons for the non-compliance with paragraph 3.5.1;
b) detailed reasons explaining why the VET provider and the VET tuition assurance administrator are prevented from changing the relationship between them so as to comply with paragraph 3.5.1; and
c) details of any alternative arrangements proposed to apply between the VET provider and the VET tuition assurance administrator which, while they will not result in a relationship that meets the requirements of paragraph 3.5.1, the VET provider reasonably believes meet the remainder of the VET tuition assurance requirements.
By way of example only, and without prejudice to the Secretary’s consideration of the proposal, the alternative arrangements may include any one or more of the following:
i) a separate unconditional financial guarantee from a third person (who may be a natural person or a body corporate);
ii) a trust arrangement with an independent, third party trustee;
iii) a specifically established trust account with a bank or other financial institution.
Meaning of “ceases to provide a VET course of study”
3.5.3 For the purposes of this chapter of the VET Guidelines, a VET provider ceases to provide a VET course of study to a person who is entitled to VET FEE‑HELP assistance under clause 43 of Schedule 1A to the Act if:
a) the VET course of study does not start on:
i) the date the VET course of study was scheduled to start and the person has not withdrawn before that day; or
ii) a later date that has been agreed between the VET provider and the person enrolled in the VET course of study and the person has not withdrawn before that day;
and an arrangement has not previously been made between the VET provider and the person enrolled in the VET course of study to undertake a suitable alternative VET course of study; or
b) the VET provider commences providing the VET course of study to a person and then, before the person has completed the VET course of study, ceases to provide that VET course of study for any reason, other than that the person has withdrawn from the VET course of study; or
c) the Minister has suspended or revoked approval of the VET provider as a VET provider under the Act and has not made a determination pursuant to subclauses 35(1) or 37(1) of Schedule 1A to the Act in respect of that VET course of study; or
d) notice is served on the VET provider or proceedings are taken to cancel the VET provider’s incorporation or registration or to dissolve the VET provider as a legal entity; or
e) the VET provider comes under one of the forms of external administration referred to in chapter 5 of the Corporations Act 2001 or equivalent provisions in other legislation, or an order has been made to place the VET provider under external administration; or
f) the VET provider ceases to be a registered training organisation as listed on the National Register under the NVETR Act; or
g) the Secretary makes a declaration, under subparagraph 3.5.5(b), that the VET provider has ceased to provide the VET course of study.
Other circumstances that may amount to ceasing to provide a VET course of study.
3.5.4 If:
a) a VET provider fails to comply with a statutory demand within the meaning of section 459F of the Corporations Act 2001; or
b) a VET provider is unable to pay all of its debts when they become due; or
c) proceedings are initiated to obtain an order for a VET provider’s winding up or any shareholder, member or director convenes a meeting to consider a resolution for the winding up of the VET provider;
then the VET provider must immediately notify the VET provider’s VET tuition assurance administrators and the Secretary to that effect.
3.5.5 If the Secretary becomes aware (whether by notice under paragraph 3.5.4 or otherwise) that any of the events described in subparagraphs 3.5.4(a), 3.5.4(b) or 3.5.4(c) apply, or may apply, to a VET provider, then:
a) the VET provider must, within a period specified in writing by the Secretary, provide the Secretary with such information that the Secretary may reasonably request by notice in writing in relation to that event;
b) the Secretary may, after considering any information provided by the VET provider under subparagraph 3.5.5(a), declare in writing that, for the purposes of this chapter 3 of these VET Guidelines, the VET provider has ceased to provide one or more VET courses of study specified in the declaration; and
c) the Secretary must give a copy of the declaration to the VET provider and the VET provider’s VET tuition assurance administrators.
3.6 PART 4: ADMINISTRATIVE AND ACTIVATION REQUIREMENTS
Statement of VET tuition assurance
3.6.1 A VET provider must publish to all enrolling VET students, a complete and unambiguous “statement of VET tuition assurance” explaining the VET tuition assurance requirements and the VET tuition assurance arrangement that is in place for each of its VET courses of study.
3.6.2 Exempt providers must publish to all enrolling VET students a “statement of VET tuition assurance exemption” explaining the exemption/s they have been granted from complying with the VET tuition assurance requirements and what this means in the event the exempt provider ceases to provide the VET course(s) of study.
3.6.3 Both the statement of VET tuition assurance and the statement of VET tuition assurance exemption are to be published on the VET provider's website.
3.6.4 The VET provider must also ensure that at enrolment, each enrolling VET student is provided with clear information about where either the statement of VET tuition assurance or the statement of VET tuition assurance exemption (whichever is applicable) may be obtained.
3.6.5 The statement of VET tuition assurance must explain to VET students that, if the VET provider ceases to provide the VET course of study in which the VET student is enrolled, then:
a) the VET provider has a VET tuition assurance arrangement in place to meet the VET tuition assurance requirements and the nature of that VET tuition assurance arrangement;
b) the VET student will have the choice of:
i) an offer of a place in a similar VET course of study which comprises VET units of study that meet the requirements of subclause 45(1) of Schedule 1A to the Act with a second provider without any requirement to pay the second provider any VET tuition fee for any replacement units (the “VET course assurance option”); or
ii) a refund of their up-front VET tuition fee payments and/or a re‑crediting of any FEE-HELP balance for any VET unit of study that the VET student was enrolled or commenced but did not complete because the VET provider ceased to provide the VET course of study of which the unit forms part (an “affected unit”) (the “VET tuition fee repayment option”); and
c) if a VET student chooses the VET course assurance option and the VET Provider’s tuition assurance administrator is a second provider or a VET course assurance guarantor:
i) the nature of the similar VET course of study which comprises VET units of study that meet the course requirements under subclause 45(1) of Schedule 1A to the Act that would be offered to VET students;
ii) the name of the second provider that would be providing this similar VET course of study;
iii) the qualification to which this similar VET course of study would lead and how much credit a VET student would receive for the VET units of study they have completed with the VET provider towards the similar VET course of study [Note: This will be full credit unless otherwise approved by the Secretary under subparagraph 3.3.3(b)(ii)];
iv) that the tuition fees for VET units of study at the second provider may be different to the VET tuition fees VET students would have paid for VET units of study which were part of the VET course of study the VET provider ceased to provide;
v) that VET students are not obliged to enrol in the VET course of study offered with the second provider under the VET course assurance option; and
vi) if the VET student elects to enrol with a subsequent VET provider that is not the second provider as provided for under subparagraph 3.6.5(c)(v), the subsequent VET provider is not obliged to offer the full amount of credit for the VET units of study the VET student completed with the VET provider or to offer a replacement unit free of charge.
d) if a VET student chooses the VET course assurance option and the VET provider’s tuition assurance administrator is a VET course assurance TAS operator:
i) the name of the VET course assurance TAS operator;
ii) that the tuition fees for VET units of study at the second provider may be different to the VET tuition fees VET students would have paid for VET units of study which were part of the VET course of study the VET provider ceased to provide;
iii) that VET students are not obliged to enrol in the VET course of study offered with the second provider under the VET course assurance option; and
iv) if the VET student elects to enrol with a subsequent VET provider that is not the second provider as provided for under subparagraph 3.6.5(c)(v), the subsequent VET provider is not obliged to offer the full amount of credit for the VET units of study the VET student completed with the VET provider or to offer a replacement unit free of charge.
Information for VET tuition assurance administrators and the Commonwealth
3.6.6 The VET provider must keep up-to-date enrolment information on VET students who are enrolled with the VET provider. In addition, the second provider must keep up-to-date enrolment information on VET students who are enrolled in replacement units with the second provider. This information must include:
a) each VET student’s full name and contact details;
b) the name of the VET course of study and the VET unit(s) of study in which the person is currently enrolled;
c) the VET tuition fees for each VET unit of study in which the person is currently enrolled and the nature of that payment (i.e. up-front VET tuition fee payments and/or an amount of VET FEE-HELP assistance);
d) details of the VET unit(s) of study successfully completed with the VET provider to date; and
e) for second providers, details of credits granted under subparagraph 3.3.3(b).
3.6.7 The VET provider must ensure that, if its VET tuition assurance arrangement is activated, the information described in paragraph 3.6.6 can be given to the Commonwealth and, the VET provider’s VET tuition assurance administrators.
3.6.8 The VET tuition assurance arrangement must provide that, if it is activated, each VET tuition assurance administrator will:
a) immediately seek to obtain the information described in paragraph 3.6.6 from the VET provider; and
b) if such information is not readily available, make all reasonable efforts to fulfil the obligations it has assumed under the VET tuition assurance arrangement.
Written VET tuition assurance offer to VET students
3.6.9 The VET tuition assurance arrangement must provide that:
a) if the VET provider ceases to provide a VET course of study that comprises VET units of study that meet the course requirements under subclause 45(1) of Schedule 1A to the Act, the VET tuition assurance administrator(s) for that course must provide a VET student, for that course and who is enrolled in that course, with written advice (the “written VET tuition assurance offer”), that he/she may choose either the VET course assurance option or the VET tuition fee repayment option;
b) where the VET tuition assurance administrator is a second provider referred to in subparagraph 3.3.1(b), the written VET tuition assurance offer must make a direct offer of enrolment as specified in subparagraph 3.6.5(c);
c) where the VET tuition assurance administrator is a VET course assurance guarantor, the written VET tuition assurance offer must name the course(s) and second provider(s), the VET student may choose to enrol in as specified in subparagraph 3.6.5(c);
d) where the VET tuition assurance administrator is a VET repayment TAS operator or VET repayment guarantor, the written VET tuition assurance offer must make a direct offer of repayment as specified in subparagraph 3.6.5(b)(ii);
e) the written VET tuition assurance offer must refer to, and enclose a copy of the VET provider’s statement of VET tuition assurance referred to in paragraph 3.6.1, and, in relation to the VET Guidelines:
i) refer to where an electronic copy of the VET Guidelines can be obtained; and
ii) include contact details of the VET provider’s personnel from whom a copy of these VET Guidelines can be obtained;
f) the written VET tuition assurance offer must include directions that the VET student must follow in order to notify the VET provider, the VET provider’s VET tuition assurance administrator(s) and the General Manager of the choice that the VET student has made under subparagraph 3.6.5(b)for each affected unit;
g) the written VET tuition assurance offer must completely and unambiguously comply with all of the requirements specified in paragraph 3.6.9; and
h) the VET tuition assurance administrator responsible for providing any written VET tuition assurance offer must do so within 20 business days after it knows, or should know by reasonable enquiries (including enquiries of the VET provider and of the Department), that the VET provider has ceased to provide the VET course of study.
3.7 EXEMPTION
3.7.1 Any body corporate seeking to be approved by the Minister as a VET provider, or any VET provider which considers that adequate grounds exist for it to be exempted from complying with the VET tuition assurance requirements under subclause 20(1) of Schedule 1A to the Act, should apply to the Minister in writing setting out those grounds.
3.8 REQUIREMENT FOR SECOND PROVIDERS UNDER LEGALLY BINDING VET COURSE ASSURANCE AGREEMENTS
3.8.1 A second provider must meet its obligations under the legally-binding agreement referred to in subparagraph 3.3.1(b) and the requirements placed on a second provider under this chapter of these VET Guidelines.
3.9 COMPLIANCE WITH THE VET TUITION ASSURANCE REQUIREMENTS FOR EXEMPT PROVIDERS
3.9.1 An exempt provider under subclause 20(2) of Schedule 1A to the Act, must keep up-to-date enrolment information on VET students who are entitled to VET FEE-HELP assistance under clause 43 of Schedule 1A to the Act and who are enrolled with the exempt provider as though it were a VET provider, as specified in paragraph 3.6.6.
3.10 STUDENTS WITHDRAWING FROM REPLACEMENT UNITS UNDER SPECIAL CIRCUMSTANCES
3.10.1 If the second provider receives an application from any person under paragraph 46(2)(d) of Schedule 1A to the Act in relation to a replacement unit which meets the course requirements under subclause 45(1) of Schedule 1A to the Act, and in which the person is enrolled with a second provider, the second provider must:
a) immediately notify the VET provider and the General Manager of the application;
b) ensure that the up-to-date information kept by it under paragraph 3.6.6 of these VET Guidelines can be accessed by the Commonwealth and, in order to effectively meet its obligations under the arrangements, the VET provider’s VET tuition assurance administrators;
c) deal with the application in accordance with subclause 50(1) of Schedule 1A to the Act; and
d) immediately after having dealt with the application, notify the persons referred to in subparagraph 3.10.1(a) as to whether, in respect of the replacement unit it is satisfied that the requirements of subclause 46(2) of Schedule 1A to the Act are met.
Note: Under subclause 46(3) of Schedule 1A to the Act, the Secretary may act for certain purposes where the relevant VET provider is unable to do so, in which case the Secretary may give the notice referred to in subparagraph 3.10.1(d).
3.10.2 If a notice under subparagraph 3.10.1(d) of these VET Guidelines states that the second provider is satisfied that the requirements of subclause 46(2) of Schedule 1A to the Act are met:
a) the second provider and the persons referred to in subparagraph 3.10.1(a) must liaise and do all things reasonably necessary to effect re-crediting of the VET student’s FEE‑HELP balance in relation to the replaced unit within 20 business days after the VET provider receives the notice; and
b) the VET provider must immediately after the re-crediting has been effected, notify its VET repayment TAS operator or VET repayment guarantor (whichever is applicable) to that effect.
Note: Under subclause 46(3) of Schedule 1A to the Act, the Secretary may effect the re-crediting if the relevant VET provider is unable to do so, in which case the Secretary may give the notice referred to in subparagraph 3.10.2(b).