The “student guarantee” first became pertinent in the early days of CRICOS (Commonwealth Register of Institutions and Courses for Overseas Students) as a government bid to protect students’ rights, with the idea that service providers who have already received payment must meet the conditions of the service contract agreed upon by both parties. Failing to do so would result in a full or partial refund of fees advanced by the customer (i.e. the student), depending on the amount of service provided.

Today, the Australian Skills Quality Authority (ASQA) is taking extra measures to ensure that RTOs are making all the necessary provisions to protect students should the company become financially unviable or decide to discontinue a particular course. Since the student guarantee is now such an integral part of the audit process, training providers need to be as clear and precise as possible about what actions will be taken in either of the two aforementioned situations. More likely than not, this “action plan” will need to be demonstrated in writing.

There are two key components to the student guarantee that auditors will be looking for:

• Academic guarantee – this focuses on the student being able to continue studies for a particular qualification in the event (for whatever reason) an RTO is unable to continue to meet the study commitment and provision of training for that qualification. This, of course, presumes that there are other RTOs capable and registered to provide the required qualification. This stipulation does not mean the student is guaranteed free alternative training, as the student should have either A) received a refund of payment or B) not yet paid for the course.

• Financial guarantee – this applies where the student has paid in advance, and these funds have been protected by the RTO (e.g. a trust or holding account) and returned to the student in the event of the RTO’s failure to provide training and assessment. This guarantee provides for the security of student funds to allow training by another RTO with the protected funds. The cardinal criteria here is that if fees are taken by the RTO in advance, then those fees must be protected by the RTO until such time as the training and assessment.

IMPORTANT: The student must be apprised of the provider’s conditional obligations and his or her individual rights before any training commences.

• Before clients enrol or enter into any agreement, the RTO will inform them about the training, assessment, and support services to be provided, and about their rights and obligations. (SNR 16.3)

• The RTO’s management of its operations ensures clients receive the services detailed in their agreement with the RTO. (SNR 17.1)

• Once the student has commenced study in their chosen qualification or course, the RTO undertakes to deliver all the agreed service(s) described in our pre-course information and made available to each candidate during course introduction / start-up.(SNR 22.2)

RTOs must ensure that all fees and charges are known to participants before enrolment commences. All requests for cancellations or refunds for any RTO program must be made in writing to the RTO and are subject to the following conditions:

• Requests received 4 weeks or more prior to commencement = 100% refund minus $250 administration fee

• Requests received between 4 weeks and 1 week prior to commencement = 50% refund

• Requests received after 1 week prior to commencement = 0% refund

• No refunds or discounts will be given for failure to attend.

All requests for cancellations or refunds for individual modules of any RTO program must be made in writing to the RTO and are subject to the following conditions:

• Requests received more than 60 days prior to module commencement = 100% refund minus $250 administration fee

• Requests received between 60 days and 30 days prior to module commencement = 50% refund

• Requests received less than 30 days prior to module commencement = 0% refund

• No refunds or discounts will be given for failure to attend.

(Where circumstances prevent a participant from notifying absence prior to commencement of the program, then the fee refund—minus administration costs—may be transferred to another program.  Each individual case will be looked at on its own merits.)

KEY POINTS FOR TRAINING PROVIDERS

• If you are a training provider and you are planning on discontinuing a course or your company is at financial risk, you can either transfer your students to another provider or issue a refund for any training no yet commenced.

• When you collect fees from students, that money should go into a trust fund so that in the event your RTO becomes financially unviable, a refund will be available immediately.

• The student guarantee is particular to the RTO, who has full ownership that cannot be transferred to another RTO. However, the RTO may have an agreement with a group of RTOs delivering similar qualifications, with the understanding that (for a cost) a transferring student will receive qualifications should one of the covenant group RTOs be unable to complete the training and assessment.

• Be upfront and clear about all fees and charges! Ensure that the student understands his or her rights, as well as the obligations of the contract.

• Be able to document your student guarantee policy in writing.

ABOUT PEGS

The Professional Educators Group (PEGs) has a five-fold purpose:

1. To promote professional discussion
2. Validation and moderation network
3. Resource sharing
4. Free professional development
5. Experience sharing

http://www.linkedin.com/groups/Professional-Educators-Group-PEGs-4967757/about

The group meets every six weeks in Gold Coast, QLD. Our lovely aXcelerate Client Coordinator and PEGs member, Teila Dawson, will be providing regular PEGs updates to keep us apprised of the latest issues in the training industry. Stay tuned!