The Australian Skills Quality Authority (ASQA) has released the findings from its VET FEE-HELP audit project.
The project was launched in April after the authority recorded an increase in the number of complaints it had received against registered training organisations (RTOs) approved to participate in the VET FEE-HELP scheme.
Chief Commissioner Chris Robinson said the number of complaints received by ASQA pointed to a potential systemic issue and, as a result, the authority undertook 21 targeted audits and interviewed more than 400 students.
"There has been a range of allegations of unethical and inappropriate action taken by training providers in relation to the VET FEE-HELP loan scheme," Mr Robinson said.
"While ASQA does not manage or administer this scheme, it is concerned with any risks which have the potential to negatively impact on the delivery of high quality training and assessment in Australian's vocational education and training (VET) sector."
Mr Robinson said eight of the 21 providers were able to demonstrate full compliance with the requirements at the conclusion of the audit, however ASQA's Commissioners had determined that the imposition of certain conditions was warranted, based on the issues examined during the audit and the commitments made by these providers to address these issues.
Six providers are still the subject of ongoing regulatory scrutiny, with ASQA still determining the outcome of the audit process for these providers.
The final seven providers were able to demonstrate full compliance with the relevant requirements at the conclusion of the audit and, as a result, ASQA does not intend to impose any additional conditions on these providers.
Mr Robinson said the authority would continue to closely monitor and target VET FEE-HELP-approved RTOs for regulatory scrutiny where complaints and other industry intelligence indicated cause for concern.
"ASQA will also enhance its cooperation and coordination with the Australian Competition and Consumer Commission, Australian consumer law agencies and the Department of Education and Training to share regulatory intelligence and coordinate regulatory action to ensure poor-quality providers are penalised to the full extent of the respective laws," he said.
"ASQA will also use the findings from its project to develop a range of communication material aimed at helping providers improve their understanding of, and compliance, with the requirements of the relevant standards and giving students relevant information and assist them to make informed decisions."
