Would you get on a plane with a pilot if they didn't have the right qualifications?

Would you hire an electrician that didn't meet the licensing requirements?

Would you go to an unqualified doctor for treatment?

The majority of people would say 'Absolutely Not!' to all three of these questions, yet, many continue to use VET Support Services whose qualifications and experience either don't exist or have never been verified.  Some of those service providers don't have an ABN, some don't have professional indemnity insurance, some have just decided to do their own thing because they had their employment terminated and couldn't get another job. Yet RTOs every day are placing the organisation's future in the hands of people who fit into these categories. In a sector where there is no regulation of service providers that support the millions of dollars invested in registered training organisations, one has to question why due diligence isn't conducted more thoroughly on the service providers that people engage. Through a range of real case studies by RTO Doctor clients and prospects, we explain why undertaking due diligence on anyone you contract is so critical.

Case 1

 "An RTO engages an independent, external Consultant to conduct their internal audit in preparation for their re-registration audit.  The RTO is provided with a report that demonstrates excellent practice with relatively few non-compliances and those that have been identified are minor in nature.  The RTO undertakes their re-registration audit and on day 1 of the audit, it becomes apparent that the internal audit upon which they had relied as being conducted by a qualified auditor was very, very wrong.  The RTO is deemed critically non-compliant for the sample qualifications (27 in total) and receives 20 working days to rectify the non-compliance's identified at audit by the regulator."

What went wrong?  The RTO concerned used the services of a well known Consultant to undertake the internal audit and thus prepare them for the re-registration audit.  Despite the many years experience that this person may have had, they do not hold the Diploma of Quality Auditing yet this is a core part of their business.  They do not hold the same qualifications as the regulator auditing them.  Approximate cost of the rectification result - $75K.

Case 2

"Sam Jennings (not his real name) wanted to start an RTO with CHC30212 - Certificate III in Aged Care and CHC30312 - Certificate III in Home and Community Care on scope.  He contacted a range of Consultants for quotes to help him get started.  After calling around, he contacted someone he found on social media who offered a cheaper service and could do it in a shorter time frame.  The application was submitted, and the Consultant suggested that the client purchase training and assessment resources from ABC Resources (real name withheld) at a cost of approximately $15K for the 2 qualifications.  The site visit occurs and Sam Jennings is found critically non-compliant because he has not met the standards for registration and critically, amongst the range of non-compliances identified by the regulator, does not have all of the training and assessment materials available.  Sam had also applied for a medication unit as part of the CHC30212 - Certificate III in Aged Care for which he had no training and assessment resources and another medication unit which didn't meet the packaging rules.

Sam quickly contacts the Consultant who assisted him who won't return his calls or emails and due to the 20 working day period closing fast, he contacts another Consultant to assist him with the rectification work.  The Consultant provides another set of policies and procedures (approximately $900) and suggests the purchase of another set of training and assessment materials, review of others, approximate total of the rectification work - $10K and the CEO submits the evidence.

Several weeks later, Sam receives notification from the regulator that based on the resubmission of evidence, the application remains critically non-compliant and therefore, he has been denied initial RTO registration.  He can re-apply but he must submit a whole new application.  Given that Sam has already paid an accountant to help with his financial viability documentation (and he now has to do this again), the costs for the application (approximately $8,500), the lease he has on the premises and lost rent, he decides that he has too much to lose to not reapply.  He learns his lesson this time and engages a full time Training Manager whose CV says that they have experience in this area.  He engages them on an annual salary of $75K, they commence work on a new application for re-registration.  After 6 months, the Training Manager advises that they are now ready to submit the new application and they pay another $8,500 for a new application.  

After a couple of months, another site visit occurs and the non-compliances are significant this time instead of critical. The client has 20 working days to fix the issues identified.  The CEO asks the Training Manager how this is possible and why the materials are still non-compliant when this was supposedly their area of expertise.  The Training Manager advises the CEO that this auditor must have got it wrong because they purchased the resources  from XYZ Publications (a different service provider to the original purchase) and were told that they were compliant. The CEO submits a letter to the regulator stating that they have made the required changes, purchased new resources and submits the evidence. Several weeks later, the CEO receives a letter from the regulator again saying that the application had been denied.  The applicant is now in no financial position to reapply for initial RTO registration and has lost all of the money invested into this project.  In this particular case, the CEO had remortgaged their home to cover the costs of starting an RTO and with no money left, he was at risk of losing his home also if he didn't return to the workforce to cover the debts incurred through his bad experience.

What is the role of the AVQPCA in all of this?
The AVQPCA was established to set a benchmark for what the VET sector in Australia believed were suitable qualifications and experience for each of its member categories.  With no legal requirement to have any qualifications or skills to be able to practice in this sector as a VET Support Service, industry identified that more and more people were being exploited by non-qualified members of the public purporting to have the required skills and knowledge to support RTOs.  THE AVQPCA is an Australian based Not For Profit with Board members in each jurisdiction to help you save money and get the job done properly the first time.  As an RTO, it costs you nothing to use the AVQPCA.  RTOs and the public have access to our members directory free of charge.  Why wouldn't you use a service that is free to complement the accountable decision making that you perform in your business?

What is our application process?
Each member, regardless of the category of membership, has to complete the same process.  We have a preliminary 'desktop' assessment of the application which will include:

  • Confirming that they have 'on paper' the qualifications, experience, knowledge & skills relevant to their membership type;
  • Acceptance of the AVQPCA Code of Conduct;
  • Permission to release information form allowing us to verify the applicant's qualifications;
  • Acceptance that the AVQPCA has a complaints and appeals process available to those who access the products and services of our members;
  • A commitment to maintaining their professional development and currency;
  • Where required, the applicant must also have professional indemnity insurance.

Once an applicant has been successful in completing this phase of the application process, they proceed to the second stage which is a phone/video interview.  This interview has a set of pre-defined questions and scenarios applicable to the applicant's membership type, proposed experience and proposed product and service delivery.  If successful, the applicant's membership application is forwarded to the Board for approval.  Once approved, the new member is required to provide details of their products and services for the AVQPCA members directory.  These details are carefully reviewed by the Board prior to loading on to the Member's Directory to confirm that they are consistent with the member's application.

Until RTOs and those seeking to start an RTO demand accountability from the VET Service Providers they are working with, unscrupulous and unethical VET service providers will continue to exploit vulnerable members of the industry and continue to get away with it.  Until now, there has not been a way to ensure the standard and quality of VET Service Providers in Australia.  It costs very little for a VET service provider to apply for membership and have their knowledge, experience and skills assessed against the criteria that your industry demanded, so why haven't your service providers sought membership yet?  They stand to gain a significant financial reward for your business, in some cases, up to $100K and all you are asking is that they pay up to $470 ($250 per year) to confirm that they meet the requirements of your industry.  If they're not prepared to invest in your ability to perform your due diligence, do you really want them providing products and services to your company?

Would you really get on a plane with a pilot if they didn't have the right qualifications?

Would you really hire an electrician that didn't meet the licensing requirements?

Would you really go to an unqualified doctor for treatment?

Then why would you engage a Consultant who doesn't hold the same qualifications and experience as the regulator?  Why would you continue to spend thousands of dollars on products when those service providers have not sought to meet the industry standard?  Why would you engage a Compliance Manager to be responsible for the governance of your organisation if you haven't conducted a due diligence check on them?  They're already employed by you?  Fantastic!  Ask them to submit their application today so that you can be assured that they meet the standard and will continue to meet the standard.  With a built in professional development requirement for each year's re-registration, there is no easier way to ensure that your staff continue to meet the requirements of industry.  It's also an easy way to support your performance management planning as a business.  What's more, if everyone who is eligible for membership in your RTO is an approved member, you get free company membership.

With the upcoming changes to the regulatory framework, we are already seeing many VET Service Providers sending out special offers to help you achieve X, Y and Z, new RTO Management Systems that already meet the new standards (even though the Minister hasn't signed off them yet)...How accurate and ethical is their marketing?  Next time you're offered a VET product or service, ask the question, are you a member of the AVQPCA?

This month's article is focussed on the importance of conducting due diligence on the VET Support Service Providers engaged by RTO's, public and private.  

While being the Founding Director of RTO Doctor, Raelene Bartlett is also the Chair of the Australian VET Quality Practitioners & Consultants' Association (AVQPCA) and declares this relationship in writing this feature article.