A use of risk management tools can improve enforcement, decision-making and regulator’s administrative actions. The Australian Tax Office evidences this through its application of compliance risk and assessment tools to optimise voluntary compliance. The National Measurement Institute (NMI) adopts an educative, risk-based approach to its enforcement activities to minimise the risks associated with non-compliance (case study 1). Moreover, the approach to Department’s regulation enforcement under the (HESA) is to increasingly Higher Education Support Act 2003 adopt a risk-based approach (case study 2). In regards to regulatory enforcement of tertiary education in Australia, the Australian Skills Quality Authority (ASQA) is the primary regulator of the vocational education and training (VET) sector, whilst the Tertiary Education Quality and Standards Agency (TEQSA) is the national regulator of the regulator to regulate higher education higher education. TEQSA’s enabling legislation requires using principles relating to regulatory necessity, risk and proportionality. ASQA regulates the VET sector through the standards for the regulation of vocational education and training which are set by the National Skills Standards Council (NSSC). The NSSC has confirmed the need to reform the standards for the regulation of vocational education and training. A review of VET regulator standards is being progressed to provide for a risk based, accountable approach by regulators (refer to Attachment A). Engagement strategies In directing a business to do something which it is not naturally inclined to do, the concept of behavioural economics can be applied to a approach to its enforcement activities. The regulator’s profile of behavioural economics, within the policy context, is becoming more prominent. Focusing on the characteristics of how people (as businesses) behave in the real world, understanding the decisions they make and the factors which motivate and influence them, can better influence regulatory outcomes.
A regulator’s use of risk management tools can improve enforcement, decision-making and administrative actions. The Australian Tax Office evidences this through its application of compliance risk and assessment tools to optimise voluntary compliance. The National Measurement Institute (NMI) adopts an educative, risk-based approach to its enforcement activities to minimise the risks associated with non-compliance (case study 1). Moreover, the Department’s approach to regulation enforcement under the Higher Education Support Act 2003 (HESA) is to increasingly adopt a risk-based approach (case study 2). In regards to regulatory enforcement of tertiary education in Australia, the Australian Skills Quality Authority (ASQA) is the primary regulator of the vocational education and training (VET) sector, whilst the Tertiary Education Quality and Standards Agency (TEQSA) is the national regulator of higher education. TEQSA’s enabling legislation requires the regulator to regulate higher education using principles relating to regulatory necessity, risk and proportionality. ASQA regulates the VET sector through the standards for the regulation of vocational education and training which are set by the National Skills Standards Council (NSSC). The NSSC has confirmed the need to reform the standards for the regulation of vocational education and training. A review of VET regulator standards is being progressed to provide for a risk based, accountable approach by regulators (refer to Attachment A). Engagement strategies In directing a business to do something which it is not naturally inclined to do, the concept of behavioural economics can be applied to a regulator’s approach to its enforcement activities. The profile of behavioural economics, within the policy context, is becoming more prominent. Focusing on the characteristics of how people (as businesses) behave in the real world, understanding the decisions they make and the factors which motivate and influence them, can better influence regulatory outcomes.
sub018-small-business.docx