EDUCATION providers will be banned from enticing potential students with inducements in a bid to stop vulnerable people signing up to long-term debt.
The Federal Government has proposed a new policy targeting VET FEE-HELP scammers, with assistant minister for education and training Simon Birmingham announcing a “rolling campaign” against “rogue training providers” over the next decade.
The inducement ban – to begin on 1 April – comes after recent concerns about the unethical marketing practices of third-party brokers, who have been approaching Latrobe Valley residents.
“After closely reviewing some of the dodgy practices being deployed, it is clear that further reforms are needed to break the business model of those unscrupulous training providers who prey on vulnerable students,” Mr Birmingham said.
VET FEE-HELP loans are available to assist students to further complete their studies with approved vocational education and training providers.
Last year, more than 180,000 students used the program to receive more than $1.6 billion worth of loans.
“But unethical behaviour meant too many students were signed up for courses that didn’t meet their needs or lead to job outcomes,” he said.
Over the past month, door-to-door salespeople have been circling the Latrobe Valley, offering online courses at an inflated price, albeit with a free laptop.
Federal Member for Gippsland Darren Chester welcomed the stronger regulations, after reports the region’s most vulnerable people were being targeted.
“The very large majority of registered training organisations provide outstanding education to people who seek careers in areas like business, health, general education and trades,” Mr Chester said.
“However, there is a small minority of training providers that are not doing the right thing.
“This is why we need these extra measures to protect vulnerable people and the taxpayer from unscrupulous training providers.”
Mr Birmingham urged future students to fully consider their options before signing up to any contracts on the spot.
He promised a further $18.2 million to support regulation activities, including increased random audit checks on both training providers and students.
“We will be monitoring the effectiveness of these measures closely and reviewing the program again within two years,” he said.
“Training providers should consider themselves to have been placed on notice that further abuse of the program will result in even harsher measures.”
