The legislation will also safeguard quality in VET, the national regulator added.

Among the amendments to the National Vocational Education and Training Regulator Act 2011 is the automatic lapse of registration for registered training organisations that have not delivered training and assessment for 12 months, as well as preventing new RTOs from expanding their course offerings within their first 24 months.

The minister for Skills and Training will also have the power to direct ASQA on applications for RTO registration for a period of up to 12 months.

The current skills minister, Brendan O’Connor, said the Albanese Labor government is “strengthening integrity in the vocational education and training sector by cracking down on dodgy training providers”, welcoming the passing of the legislation as good news.

“The regulator now has greater powers to go after non-genuine training providers who exploit students and remove them from the sector,” he said.

“Dodgy providers out to make a quick buck should have no place in it. And we’re making sure they don’t.”

The legislation is the next step in reforms and “there is more to come”, he added.

It comes after Australia formed a $37.8 million integrity unit last year. In the 12 months to October the regulator cancelled or rejected 30 registrations.

“By automatically lapsing the registration of dormant providers, we’re addressing the integrity issues posed by these providers using their registration for non-genuine purposes,” said ASQA CEO Saxon Rice.

“This includes setting up RTOs for the sole purpose of on-selling once they are granted a longer registration period, rather than delivering training and assessment.”

The greater scrutiny on new RTOs will “ensure they are demonstrating a genuine commitment to delivering quality vocational education and training before they expand or change their scope of registration”, Saxon added.

The government had indicated it wanted to have the power to impose a permanent ban on the establishment of new RTOs, something the Independent Tertiary Education Council Australia had lobbied against.

“There are no sound arguments for the government to possess such a sweeping power, so ITECA successfully lobbied the parliament for safeguards within the legislation,” said Troy Williams, ITECA chief executive.

“We know the vast majority of providers do the right thing”

“The final version of the amendments passed by Parliament includes the safeguards ITECA sought,” he added.

However, ITECA still has concerns with some aspects of the amended legislation, particularly around legislative overreach.

“The Australian government’s stated intent was to enhance quality in the skills training system; however, many legal experts and training sector stakeholders argue that the existing regulatory framework could achieve this goal if utilised effectively,” Williams added.

“Some have likened the powers sought in this legislation to using a sledgehammer to crack an egg. However, a more apt analogy is that it is akin to using a tactical nuclear weapon for the same task.”

The amended act also clarifies provisions relating to false and misleading advertising of an RTO’s operations and increases maximum penalties by five times to $939,000.

“We know the vast majority of providers do the right thing – these changes benefit them, students, industry and the wider community, by removing those who undermine integrity and trust in the sector,” Rice concluded.