VET Sector needs a national ombudsman: Consumer Action

Consumer Action Law Centre welcomes reforms announced today by the Federal Government for the vocational education and training (VET) sector and calls for the establishment of a national ombudsman scheme.

“Today’s announcement by the Minister for Vocational Education and Skills should address many of the major issues we’ve seen in vocational education,” says Gerard Brody, CEO of Consumer Action Law Centre.

“We’ve helped countless students who have been exploited by unscrupulous operators in vocational education. Today’s reforms to VET FEE-HELP will go a long way to curbing predatory behaviour and protecting students, but problems will continue unless we also fix the messy and complicated dispute resolution options available to students. Currently, resolving an issue with a vocational education provider can be a confusing mess and a national ombudsman would go a long way to addressing this.”

Consumer Action is also calling on the Turnbull Government to initiate a widespread remediation program, which would provide for loans to be wiped where individuals were subject to unscrupulous practices.

“The Government’s reforms allow for re-crediting VET FEE-HELP debts, but this shouldn’t rely on individual complaints. Many people will not even know they have debts and private operators have been allowed to milk the system. The proposed new audit powers announced today need to be used proactively to require VET FEE-HELP funds to be repaid and student debts to be wiped where there has been misconduct. Legacy debt may prevent vulnerable individuals from accessing training and work opportunities in the future.”

The Centre has written to the Senate Standing Committee on Education and Employment detailing why a national ombudsman is an important tool in ensuring students are supported when they have a dispute with a provider. The submission also calls for the banning of commission-based sales by brokers and agents and for the banning of unsolicited and door-to-door sales of VET FEE-HELP loans.

“The Government’s recent response to the Harper Competition Policy Review indicated that market-based reforms will be brought to other social services, as it has to the VET sector. If the Government proceeds with this, it should improve consumer protection by banning unsolicited sales. Choices about complex loans and social services should not be made under pressure.

“The Minister should be congratulated for the additional measures announced today and we look forward to working with him to ensure consumer protection in the new VET FEE-HELP model”, says Mr Brody.


Editors notes:

Consumer Action has published a guide to complaints in the VET sector which shows the complexity of dispute resolution for students: Today’s reforms will not address this issue.

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