Australia’s approach to regulation: Lessons for England?

In an exclusive interview, a senior Australian quality assurance expert argues that in order for England’s higher education regulator to win back the trust and respect of universities and the higher education sector, it needs to show its independence from the government.

If England’s higher education regulator – the Office for Students (OfS) – is to win back the trust and respect of universities and other providers, it needs to be clearly seen as independent from government interference and one way to achieve that is through parliamentary accountability and not just ministerial accountability.

So argues Anthony McClaran, a former chief executive of both the Tertiary Education Quality and Standards Agency (TEQSA) in Australia from 2015-20, and the Quality Assurance Agency (QAA) in the United Kingdom from 2009-15.

Speaking exclusively to University World News, McClaran, who is now vice-chancellor of London’s Catholic university, St Mary’s University, Twickenham, and a board member of AVEPRO, the Holy See’s higher education quality assurance agency, said learning from the Australian approach to regulating higher education can help address current concerns about how the OfS is regulating higher education institutions in England.

Among those concerns is the perceived closeness of the OfS to the UK government, with the current chair of the OfS, Lord Wharton of Yarm, being a former Conservative government minister with no previous roles in the higher education sector and worries about the extent of ministerial interference in the role of the OfS and its priorities, as University World News reported last year.

The OfS has recently been under scrutiny from the House of Lords Industry and Regulators committee which has been hearing complaints from university representatives about how it communicates and interacts with institutions.

The Lords’ inquiry is probing how the regulatory framework has developed since the inception of the OfS in 2018, its independence from, and relationship with, the government, and whether it has the necessary expertise and resources to carry out its functions and whether its statutory duties are clear.

The inquiry coincides with the QAA resigning from its contract with the OfS as the designated quality body, or DQB, for independent quality assurance and assessment of English universities after it claimed requirements made by the OfS were “not consistent with standard international practice”.

The QAA is continuing its role with the other nations of the UK and continuing its quality assurance of transnational education, both for UK universities and internationally, and said it took the decision to “demit its DQB status with the regulator for higher education in England” because it wanted to remain aligned with standards reflected in the European Standards and Guidelines, as University World News reported.

The QAA’s decision came into effect from 1 April 2023. As a temporary measure the OfS has taken over as the designated quality body function for higher education in England despite the Higher Education and Research Act (HERA) of 2017 stating that the Secretary of State should designate an independent quality body to provide assessments and advice for the OfS on quality and standards.

Checks and balances needed

In a paper published by the UK’s Higher Education Policy Institute (HEPI) on 8 June 2023, Good Regulation: Lessons for England from the Australian Experience, McClaran argued that England should consider following Australia, as it did with higher education, income-contingent, tuition fee loans and the removal of the student number caps, and evolve its approach to regulating universities.

McClaran told University World News: “The main advantages of Australia’s regulatory framework was securing independence through checks and balances, with real – importantly visible accountability – to reassure students, taxpayers, stakeholders, including the media, and international audiences.

“As chief executive of the Tertiary Education Quality and Standards Agency, TEQSA, I had to appear before a committee of the Australian senate three times a year and they could fire any questions at me about the operation of the regulator,” he said.

“I think the concept of parliamentary accountability, not just ministerial accountability, which is a feature of both the system in England and Australia, is important if you’re going to have a regulator which is independent and free of political influence.

“Legislation for both TEQSA and the OfS says the regulator should be independent and if that’s the case, the regulator needs not only to be independent, but to be seen to be independent, because that’s behind the trust element.

“In the case of TEQSA, independence was assured by a whole series of checks and balances. There was real accountability to parliament. There was a way decisions of the regulator could be challenged through administrative appeals and there was a TEQSA commission, which the chief executive was accountable to and we had to go through the commission when we wanted to take a regulatory decision,” he explained.

“And we had three statutory requirements for all our decisions: they had to be demonstrably proportionate; they had to be risk-based; and they had to be necessary in regulatory terms. I found those three principles very helpful,” he added.

Australia embraced ‘good regulation’

Before he took over as TEQSA chief executive in 2015, Australia had faced many of the criticisms now facing the OfS. England could do well to consider learning from the Australian experience in getting regulation right, suggested McClaran. He said critics of the OfS were too often dismissed as ‘anti-regulation’ when actually most higher education stakeholders simply wanted ‘good regulation’.

In 2012, Australia replaced a mixture of quality assurance and state-based regulation of its higher education providers with a single national federal regulator in the form of TEQSA and the TEQSA Act of 2011 set out clearly what the regulator could do, how the regulator could administer penalties and what the regulator was responsible for.

However, a number of things quickly started to go wrong and a review established by the Australian government in 2013 led by Professor Kwong Lee Dow, former vice-chancellor of the University of Melbourne, and Valerie Braithwaite, emeritus professor of regulatory studies at the Australian National University, tackled sector complaints such as:
• regulation being risk-based in name only;
• a ‘one size fits all approach’;
• the risk framework being excessively complex, with excessive demands for information;
no meaningful interaction with the other regulators, either government or professional;
• unclear messaging, with the sector often uncertain as to what was required from the regulator;
• a poor relationship with the sector, leading to a lack of respect in both directions; and
a lack of consultation and response to the sector’s views.

The review made a number of concrete recommendations, which did not include abolishing TEQSA, which was one option considered.

Instead, it called for a reformed TEQSA which could:
• Apply a genuinely risk-based approach to reduce the burden on providers that could demonstrate consistent quality and develop a concept of ‘trust’ or ‘earned autonomy’;
• Adapt regulatory approaches for different kinds of providers to admit high-quality new providers while identifying and correcting or even excluding those of low quality;
• Simplify data requests, with TEQSA reducing its risk framework, through which it assesses every provider annually, from 44 indicators to 11 after recent consultation with the sector;
• Actively cooperate with other regulators to avoid duplication and provide a more joined-up approach, which became increasingly important as the Australian government viewed the higher and vocational education sectors as one tertiary sector; and
• Clarify messaging and demonstrate a wish for partnership by listening – as there is much more expertise in providers than there will be in the regulator, no matter how well-staffed.

In his paper for HEPI, sponsored by TechnologyOne, a business and planning software company working with both Australian and British universities, McClaran concludes that England should learn from the “early and somewhat traumatic history of the statutory higher education regulator in Australia”.

It can do this by:
• Recognising that the sector is comprised of ‘partners’, not ‘objects’, and there is collective wisdom and value in the structures created by the sector, such as the UK Quality Code and the Subject Benchmarks, and the contribution of reviewers from the sector, with the temporary arrangements for the DQB function offering an opportunity to address the latter point;
• Making sure independence is secured by the right checks and balances, with real accountability;
• Ensuring that regulatory judgement goes through rigorous challenge, both inside the regulator’s structures and beyond; and
• Acknowledging the role that a regulator can play in ensuring a sector-wide response to the great thematic challenges that inevitably arise in organisations as large, complex and embedded in society as higher education institutions.

Commenting on McClaran’s paper, Nick Hillman, director of HEPI, said: “When comparing higher education systems around the world, you quickly see that England and Australia have a huge amount in common.

“However, while the two countries’ university systems tend to track one another, Australia’s higher education system is smaller and often one step ahead and this report shows the two countries are also tracking each other when it comes to regulation,” he added.

“The main Australian regulator, TEQSA, was regularly accused of overstretching itself in its first few years – just as England’s Office for Students is often accused of the same. But the situation down under has abated and the Australian experience might therefore offer some useful lessons.”

Nic Mitchell is a UK-based freelance journalist and PR consultant specialising in European and international higher education. He blogs at www.delacourcommunications.com