Registration and accreditation 19 October 2018

Registration

Report on the initial registration of Performing Arts Education Pty Ltd

TEQSA has agreed to orders made by the Administrative Appeals Tribunal under which Performing Arts Education Pty Ltd (PAE) is registered pursuant to section 21 of the Tertiary Education Quality and Standards Agency Act 2011 (the TEQSA Act) for a period of four years until 1 November 2022 in the provider category of Higher Education Provider.

The orders also provide for the accreditation of the Bachelor of Screen and Stage (Song and Dance), the Bachelor of Screen and Stage (Acting) and the Bachelor of Screen and Stage (Screen Production) to be offered by PAE pursuant to section 49 of the TEQSA Act, and for five conditions to be imposed on PAE's registration pursuant to section 32 of the TEQSA Act. A copy of the conditions is available at Attachment 1.

Background

PAE applied to TEQSA for registration in the category of Higher Education Provider under Part 3 of the TEQSA Act, and for accreditation of three courses of study under Part 4 of the TEQSA Act.

TEQSA considered PAE's applications and provided draft summaries of findings with details of the assessment of PAE's applications by the responsible case management team. TEQSA's Commission considered PAE's response to the draft summaries of findings and decided to reject PAE's applications on 6 July 2017, on the basis that it was not satisfied that PAE met the Threshold Standards.

PAE applied for review of TEQSA's decision in the Administrative Appeals Tribunal (AAT). In the course of the proceedings, PAE made submissions and provided further information and evidence about the matters raised in TEQSA's decisions.

It is well established that absent a specific legislative provision to the contrary, the AAT is generally required to make a decision on review based on the evidence available at the time of the AAT's decision on review, and that the AAT is not confined to the evidence available at the time of the primary decision. Accordingly, TEQSA accepted that the AAT was required to take account of the further material submitted to TEQSA after TEQSA had rejected PAE's applications.

Main reasons for decision

After reviewing the further material submitted by PAE, TEQSA was satisfied that PAE meets the Threshold Standards. However, TEQSA considered that there remained a number of risks related to PAE's capacity to meet the Threshold Standards in the future. On this basis, TEQSA agreed that it was appropriate to substitute TEQSA's initial rejection of the applications with decisions to register PAE for a period until 1 November 2022, to accredit PAE's courses for the same period, and to impose a number of conditions on PAE's registration.

The conditions are designed to address the following issues:

1. The need for PAE to have access to the necessary financial resources to be able to sustain quality in its higher education operations, and to ensure the achievement of its higher education objectives ?Provider Registration Standards (PRS) 2.1 and 2.2;
2. The need for PAE to provide appropriate financial and tuition safeguards for students - PRS 2.3;
3. The need for PAE's corporate governing body to effectively oversee PAE's financial position, risks to its higher education operations, and policy development and review ?PRS 3.4 and 3.8;
4. The need for PAE's academic staff to be active in scholarship that informs their teaching, and for PAE's corporate and academic governing bodies to oversee PAE's approach to scholarship ?Provider Category Standard 1.4 and Provider Course Accreditation Standard 4.2.

TEQSA is satisfied that the conditions will provide an appropriate framework for TEQSA to oversee PAE's approach to dealing with these issues.

In accordance with subsections 32(2) and 32(3) of the TEQSA Act, TEQSA may vary or revoke a condition imposed on the registration of a higher education provider, either on its own initiative, or upon application by the provider for variation or revocation. Accordingly, TEQSA will have the capacity to vary or revoke the conditions as PAE addresses the risks identified above.

Condition 1: Financial sustainability

1.1 PAE must at all times throughout the period of registration maintain within PAE controlled bank accounts minimum cash reserves of $100,000.

1.2 If the minimum cash reserves referred to in [1.1] are not maintained, PAE must:

1. notify TEQSA in writing within 2 business days, together with its proposed action to bring the cash reserves back into compliance with [1.1];
2. provide TEQSA with a revised financial forecast (including financial projection in the form of income statement, balance sheet, cash flow statement and student projections) within 1 month.

Condition 2: Tuition and financial assurance

2.1 By 31 December 2018, PAE will provide to TEQSA:

1. evidence of membership of an Australian Student Tuition Assurance Scheme that offers protection to support domestic fee for service students in the event of PAE being unable to continue to offer PAE's course; and/or
2. evidence of how PAE has adequately resourced financial and tuition safeguards to mitigate disadvantage to students who are unable to progress in the event PAE is unable to continue to offer PAE's course.

Condition 3: Governance

3.1 By 31 March, 30 June, 30 September and 31 December each year for the period of registration, PAE must provide papers for and minutes of its Governance Board meetings for the preceding 3 months to TEQSA, which show:

1. that PAE maintains oversight of its financial position and financial performance by reviewing a comparison of (i) actual financial position to the budgeted financial position for the previous quarter and (ii) the budget for the following quarter. This material must include income statements, balance sheets, cash flow statements, and the number of staff and students;
2. that PAE monitors potential risks to its operations and has strategies to mitigate risks that may eventuate;
3. that PAE has effective development, approval, implementation and review of all policies; and
4. the nature of PAE's considerations in relation to any of its policies or procedures, including any recommendations and changes to those policies and procedures.

Condition 4: Composition of the Governance Board

4.1 PAE will engage at PAE's expense a suitably qualified expert to review and prepare a report on:

1. whether the composition of the Governance Board is appropriate, including in particular having regard to the need for the Governance Board to maintain effective oversight of PAE's financial position and financial performance and to discharge effective higher education governance and quality assurance; and
2. any recommended changes to the composition of the Governance Board, (the expert report).

4.2 The expert report is to be provided to PAE's shareholders, the Governance Board and TEQSA by 31 January 2019.

4.3 PAE is to provide TEQSA with a response to the recommendations in the expert report, including any changes to the composition of the Governance Board arising from any recommendations in the expert report, by 31 March 2019. The response must be accompanied by evidence that it has been reviewed and approved by the Governance Board.

Condition 5: Scholarly activity and professional development

5.1 PAE must:

1. by 31 December 2018 provide TEQSA with a proposed framework for collating, and reporting on, information about the scholarly activities of its staff. The framework must be reviewed and approved by the Academic Board and the Governance Board, and must include a description of the steps taken by PAE to ensure that this information is consistently and appropriately categorised;
2. by 30 June of each year for the period of registration, provide TEQSA with a complete set of staff scholarship profiles for the preceding twelve months that:
1. have been completed by each individual academic staff member who is required to be active in scholarship;
2. categorise scholarship activities in accordance with meaningful definitions (including any provided by TEQSA);
3. include only activities or memberships which have scholarly or professional relevance to the individual's role with PAE;
4. have been reviewed by the Academic Board and Governance Board, and are accompanied by a response to any issues identified as a consequence of that review.