A TEQSA material change is any event that will significantly affect a provider's ability to meet the Threshold Standards, or that requires the National Register to be updated, and section 29 of the TEQSA Act requires it to be notified no later than fourteen days after the provider could reasonably be expected to have become aware of it. Changes of ownership or CEO, serious student safety incidents, new third-party delivery arrangements, significant shifts in revenue and major course changes are all on TEQSA's list. What puts a provider under scrutiny, beyond its own notifications, is TEQSA's risk assessment, data returns, complaints, and the record of other regulators.
This article sets out what must be notified and when, what else brings a provider to TEQSA's attention, and how, in fifteen years of TEQSA registration work, I have seen well-run providers stay off the risk list.
What is a TEQSA material change?
Section 29 of the TEQSA Act creates two notification triggers. Under section 29(1)(a), a provider must notify TEQSA of any event that will significantly affect its ability to meet the Threshold Standards. Under section 29(1)(b), it must notify events that require the National Register to be updated, such as changes to the provider's name, ownership, contact details or courses. TEQSA's material change notification policy explains how the agency reads those provisions, and its material changes page lists the categories it expects to hear about.
The categories are broad. Governance changes, including changes of ownership or major shareholdings and changes of CEO. Incidents that significantly affect student safety and wellbeing, with TEQSA giving recurring sexual assault as its example. Matters going to the provider's good standing, such as allegations of research misconduct or an unscheduled compliance audit by another regulator.
Then the operational categories. Financial viability, including significant changes to existing, new or anticipated revenue sources. New arrangements to deliver a course in whole or in part through a third party, and failures of the control and reporting systems over an existing third-party arrangement. And major course changes, including a notable reduction in course duration.
The test is significance, and TEQSA's policy asks providers to err toward notifying. Judged against the TEQSA material change categories, a change of academic board chair, the loss of a course coordinator, a lease expiring on the main campus, or a decision to move a course wholly online are each the kind of event a provider should at least consider notifying, and the fourteen-day clock runs from the point at which the provider reasonably should have known, not from the board meeting at which it was discussed.
What happens when you notify a TEQSA material change?
A notification is not a confession. TEQSA's response to most notifications is to record the change, update the National Register where relevant, and, where the change bears on the Standards, ask for information about how the provider is managing it. A notified change of CEO produces a request for the new CEO's fit and proper person declaration. A notified third-party arrangement produces a request for the agreement and the provider's quality assurance over it. A notified financial change may produce a request for updated projections.
What TEQSA does with the information depends on the provider's history. A provider with a clean record, a habit of prompt notification and a governance response already minuted will usually find the matter closed quickly. A provider that notifies late, or whose notification is contradicted by its annual data or its website, has raised a question about its self-assurance, and that is the question TEQSA's re-registration assessment will return to.
What triggers TEQSA scrutiny beyond notifications?
TEQSA's regulatory approach is risk-based, and it draws on several sources beyond what providers tell it.
The annual risk assessment is the first. TEQSA assesses every provider each year on indicators drawn from its data returns, covering student load and trends, attrition, progression and completion, staff-to-student ratios and staff qualifications, financial position and viability, and regulatory history. A provider whose attrition rises sharply, whose senior academic staffing thins, or whose finances deteriorate will see its risk rating change, and a changed rating brings closer attention at the next application and may prompt a request for information in between.
Complaints and concerns are the second. TEQSA receives complaints from students, staff, other providers and the public, and while it is not a complaints body, it treats a pattern of complaints, or a single serious one, as a reason to look. The same applies to media reporting and to information from other agencies.
Other regulators are the third. ASQA findings against a related RTO, an ASIC action against a director, a Department of Home Affairs concern about visa integrity, or a state consumer regulator's interest in marketing practices all reach TEQSA, and its fit and proper person and good standing assessments take account of them. The fit and proper person requirements are continuing, and a matter arising after registration is as relevant as one disclosed before it.
The provider's own applications are the fourth. Every course accreditation, category change or renewal application is an occasion for TEQSA to read the provider afresh, and an application that reveals a governance change or a staffing gap that was never notified raises the notification question retrospectively.
How do providers end up on the risk list?
The pattern is consistent, and it is rarely a single event. It is a provider that grew faster than its governance, took on third-party or offshore delivery without the control systems to assure it, allowed attrition to rise without an academic board response, lost key academic staff without replacing them, and, at each of those points, either did not recognise the change as material or chose not to notify. By the time TEQSA's risk assessment reflects the accumulated data, the provider is answering questions about several years of unreported drift, and the governance mistakes that stall applications are on display in the record.
Late notification compounds the problem. A change that would have been absorbed if notified within fourteen days becomes, when discovered a year later, evidence that the provider's governing body either did not know what was happening or did not consider TEQSA entitled to know. Neither reading helps.
Staying off the list
The providers that stay off TEQSA's radar do a small number of things reliably. They keep a materiality register, maintained by the company secretary and reviewed at every governing body meeting, that records events considered against section 29 and the decision to notify or not, with reasons, so that the fourteen-day clock is managed rather than discovered. They notify promptly and completely, with the governance response attached, so that TEQSA sees the change and the management of it together. They keep their annual data, their website and their notifications consistent, because inconsistency is what draws a second look.
They also read their own risk indicators before TEQSA does. Attrition, progression, staffing ratios and financial trends are all available internally months before they appear in a data return, and an academic board and governing body that discuss them, and minute a response, have converted a potential trigger into evidence of self-assurance. That is the whole logic of TEQSA's current approach: the regulator wants to see a provider that notices its own problems, and a provider that does so has very little to fear from scrutiny.
Download the Darlo Re-registration Evidence Index Template
— the index structure we use to track notifications, governance responses and risk indicators across the registration period, drawn from our TEQSA registration and governance work with private providers. Get the template
Want the full article?
Enter your email for free access to the rest of this guide and our TEQSA resource library.
Frequently asked questions
How long does a provider have to notify TEQSA of a material change?
No later than fourteen days after the day the provider would reasonably be expected to have become aware of the event, under section 29 of the TEQSA Act.
What counts as a material change under the TEQSA Act?
Any event that will significantly affect the provider's ability to meet the Threshold Standards, or that requires the National Register to be updated. TEQSA's examples include changes of ownership or CEO, serious student safety incidents, allegations of research misconduct, audits by other regulators, significant revenue changes, new third-party delivery arrangements and major course changes.
Is a change of CEO a material change for TEQSA?
Yes. TEQSA lists changes of Chief Executive Officer among the governance changes it expects to be notified, and it will require a fit and proper person declaration for the incoming CEO.
What happens if a provider fails to notify TEQSA of a material change?
Failure to notify is a breach of a condition of registration under the TEQSA Act. In practice TEQSA treats late or absent notification as evidence of weak self-assurance, which raises the provider's risk rating and the scrutiny applied at its next application.
Dr Brendan Moloney is CEO of Darlo Higher Education, Australia's largest specialist TEQSA consultancy. He holds a PhD from the University of Melbourne, is a Cambridge University Press author on governance in higher education, and has advised private providers on registration and course accreditation for more than fifteen years.