Sydney TAFE has been under investigation for alleged fraud in its use of millions of dollars from a training program for students on 457 visas, reports The Sydney Morning Herald.

According to the report, “Sydney Institute of TAFE generated $3.3 million last year from migration agents who were paid $380,000 in commissions for recruiting students on 457 visas.”

“A NSW Department of Education officer alleges money received under the visa program – which is meant to be spent on training for Australians and permanent residents through student scholarships – is being spent for other purposes including the payment of commissions to migration agents“ the report states.

Migration Alliance is of the view that a full audit of Training Benchmark A should be undertaken by the DIBP or some other body to ensure that the funds are spent properly and not left sitting in accounts or even worse being improperly misdirected.

In addition to this, the Migration Alliance notes that recently, the Victorian Training Market Half Year Report revealed that some TAFEs were at financial risk. Migration Alliance wrote to Senator Michaelia Cash, Assistant Minister, DIBP and Kim Vance, Director, Program Delivery DIBP with these facts and the concern that employers are being encouraged to send funds to institutions that may be at financial risk.

Given that DIBP encourages Training Benchmark A funds are directed toward TAFEs, it is reasonable to suggest that the DIBP or some other body should follow through and take responsibility in ensuring its proper use. DIBP can't just promote TAFEs and then bury its head in the sand thereafter.

A starting point would be for DIBP to stop insisting that their PAMs are the law.  This conflicts with the Legislative Instrument which broadly prescribes that Training Benchmark A funds are directed to an 'Industry Training Fund'.  The PAMs go into great depth trying to define what that was intended to mean, because there is no definition in the legislation.  The PAMs seek to further define what an industry training fund is, that being a University or a TAFE or a scholarship fund operated by a University or TAFE or a 'statutory training fund'. 

It's time that the DIBP took a more innovative approach as to what an 'industry training fund' is, given that we are in deregulation mode and given that innovation and competition is high on the government's agenda.

There are plenty of organisations in Australia which could be 'industry training funds' if it were not for the restrictive PAMs and FAQs which force private businesses to send their 2% into failing and 'at risk' government institutions.  Propping up failing government institutions or government training funds which need to correct their cash flow is not appropriate.  If the government can't deliver then send it out to private training organisations who can.  Let there be an annual audit and let organisations show what it is they are doing with those funds.