Cost recovery for regulatory activity - frequently asked questions

Cost recovery involves the Australian Government charging the non-government sector some or all of the efficient costs of a specific government activity.

The characteristics of a government activity will determine the type of cost recovery charge used.

Further information about the Australian Government’s cost recovery guidelines is located on the Department of Finance website.

Our Cost Recovery Implementation Statement 2022-23 (CRIS) provides key information on how TEQSA calculates and implements fees and charges for specific regulatory activity.

We will be recovering our costs via:

1. A registered higher education provider charge (RHEP charge)
As a condition of registration, each registered higher education provider will be required to pay the registered higher education provider charge (RHEP charge). The RHEP charge (see Part 4.5 of the CRIS) incorporates an annual registration charge for all providers and any additional charges an individual provider must pay as a result of compliance activities undertaken by TEQSA in relation to their institute, university or college. 

2. Application-based fees
Set fees (see Part 3 and Appendix A of the CRIS) will be payable by providers for each application they make to TEQSA, such as applications for registration, re-registration, accreditation and re-accreditation.

The details of the fees and charges that apply after 1 January 2023 have been published on the TEQSA website, see:

• Registered Higher Education Provider (RHEP) charge
• application-based fees.

Providers will continue to be invoiced for application fees when they submit a valid application such as an application for provider registration or re-registration, or course accreditation or re-accreditation.

TEQSA will issue the first invoices for the registered higher education provider (RHEP) charge to providers in early 2023.  The base component of the RHEP charge will be charged at 20 per cent of the full amount in the first year.

For the compliance component of the RHEP charge (investigations, compliance assessments, monitoring of conditions or voluntary undertakings), providers will be charged in arrears for the activity that has taken place in a calendar year:

• Providers will only be charged in relation to an investigation or compliance assessment that commences after 1 January 2023. That charge will form part of their RHEP charge invoice in early 2024.
• Providers will only be charged in relation to the monitoring of conditions or voluntary undertakings that take place from 1 January 2023. Charges relating to conditions and voluntary undertakings will form part of the RHEP charge invoice issued in 2024. Providers will not be charged on the basis that a condition applied or a voluntary undertaking was in place in 2022.

For clarity, the invoices for the RHEP charge issued in 2023 will only include the amount the provider owes for the base component of the charge (which relates to sector-wide activity that cannot be attributed to a single provider). The invoices will not include any charges relating to the compliance component of the RHEP charge.

A valid application is one that:

1. is made using the approved form, accessible on the TEQSA provider portal
2. is accompanied by the relevant fee
3. [for applications made under sections 18 (registration) or 46 (accreditation) of the TEQSA Act] is accompanied by any information, documents and assistance that TEQSA requests. Applicants should submit complete, 'assessment-ready' applications that will not require TEQSA to issue additional requests for information. Complete applications enable more timely processing and assessment by TEQSA and any external experts appointed by TEQSA.

TEQSA will conduct a completeness check to confirm that an application is valid before the application can proceed. TEQSA will inform providers as soon as possible after an application is submitted whether the application is valid or whether a new application needs to be made.

If a new application is required, and that application is submitted in 2023, the application will incur the updated 2023 fees (see Tertiary Education Quality and Standards Agency Determination of Fees (Amendment) 2022).

The annual RHEP charge will be payable by all registered providers as a condition of their registration. The RHEP charge incorporates a base component and a compliance component relating to charges payable as a result of specific TEQSA compliance activities (such as a compliance assessment or investigation, or the monitoring of conditions and voluntary undertakings) directly related to a provider.

TEQSA will send providers an invoice relating to the RHEP charge annually.

The phased introduction of the base component of the RHEP charge for all providers began on 1 January 2023.

Under the phase-in approach, the base component of the charge for 2023 will be 20 per cent of the full amount, increasing to 50 per cent from 1 January 2024 and then 100 per cent from 1 January 2025.

The cost recovery model is based on regulatory effort or activity rather than provider size. The base component of the RHEP charge covers indirect costs for regulatory activities, such as guidance notes, that apply to all providers.

Once the phase-in period is completed, there will be no discounts to the base component of the RHEP charge.

The base component recovers TEQSA’s costs in relation to activities that cannot be attributed to a single provider such as costs relating to risk and compliance activity that applies across the sector.

The costs recovered via the compliance component of the RHEP charge arise from concerns about an individual provider. The relevant provider will be required to pay the charges associated with compliance activities undertaken by TEQSA. A principal consideration here is that individual providers subject to investigations and compliance assessments, rather than all providers, should bear the costs of these specific activities.

TEQSA will only commence an investigation or compliance assessment where our preliminary assessment has confirmed there is a reasonable basis for a substantive concern. Investigations (which are rare) and compliance assessments will not be commenced without a proper basis.

As cost recovery is based on activity undertaken, the cost will be payable even when the outcome of the assessment is not to take regulatory action. TEQSA notes that investigations and compliance assessments often lead to compliance outcomes regardless of any formal regulatory actions taken.

The costs for condition monitoring will be recovered in 2024. At that time, providers will be charged at the fixed rate for conditions that applied in 2023. The rate will not differ based on the duration, nature or level of intensity of those conditions and when those conditions were imposed. Charges for conditions will not be recovered in relation to conditions that applied in 2022.

The RHEP charge includes a base component that all providers have to pay. The base component will recover TEQSA’s costs in relation to activities that cannot be attributed to a single provider (such as costs relating to risk and compliance activity that applies across the sector).

A provider’s RHEP charge will only include additional amounts, as part of the compliance component of the charge, for a compliance assessment or investigation where TEQSA’s preliminary assessment of an allegation or complaint has confirmed there is a reasonable basis for a substantive concern. Investigations (which are rare) and compliance assessments will not be commenced without a proper basis.

TEQSA will only commence an investigation or compliance assessment where our preliminary assessment has confirmed there is a reasonable basis for a substantive concern. Investigations (which are rare) and compliance assessments will not be commenced without a proper basis.

It is not possible to provide an accurate estimate on the amount of time it will take to complete a compliance assessment. However, the Charges Regulations provide for a set fee per compliance assessment that will not vary based on the amount of time the assessment takes.

Whilst an investigation is charged based on time spent, TEQSA conducts investigations rarely so it is not possible to provide an estimate of how long an investigation is likely to take. Further, the answer to this question will always depend upon the particular investigation.

Providers will pay fees based on when a valid application for re-registration or re-accreditation, that complies with all of the relevant requirements in the TEQSA Act, is submitted to TEQSA. Where a provider makes a valid application in 2022, the provider will not be required to pay the updated fees that apply to applications made in 2023 in relation to that application. TEQSA will inform providers as soon as possible after an application is submitted whether the application is valid or whether a new application needs to be made.

Please note, there are requirements that providers must meet for an application to be considered valid and ready for assessment.

Providers will pay fees based on when a valid application for initial registration or initial course accreditation, that complies with all of the relevant requirements in the TEQSA Act, is submitted.

Where a provider makes a valid application for registration or accreditation in 2022, the provider will not be required to pay the updated 2023 fees for either the preliminary assessment or the substantive assessment of that application, i.e. the 2022 fees will apply to a valid application that is submitted in 2022 regardless of when the preliminary or substantive assessments are conducted by TEQSA. TEQSA will inform providers as soon as possible after an application is submitted whether the application is valid or whether a new application needs to be made.

If an application is submitted in December 2022, and when TEQSA conducts a completeness check, that application is found to be invalid, the applicant will be required to submit a new application. The new application will incur the updated 2023 fees if submitted in 2023 (see Tertiary Education Quality and Standards Agency Determination of Fees No 1 2020).

Please note, there are requirements that providers must meet for an application to be considered valid (see 'What is a valid application?').

Providers are able to submit applications at a time of their choosing, for new applications (e.g. course accreditation) and for renewals. Where a provider makes a valid application in 2022, the provider will not be required to pay the updated fees that apply from 1 January 2023 for a preliminary assessment and substantive assessment in relation to the application for registration or accreditation.

We request that providers engage with us at least six months prior to the date of submission, to allow us to work together to clarify the evidence requirements and scope of the application and assist providers to submit a valid application that is ready for assessment.

For renewal of TEQSA registration and course accreditation (excluding undergraduate certificate courses), the requested date of submission is six months prior to the expiration date of the registration or accreditation period (or 90 days in the case of a CRICOS re-registration). Any shortening of the submission period is at TEQSA’s discretion. For renewal applications, it’s important that providers engage with us in preparation for submitting an assessment to help them to submit a valid application that is ready for assessment.

At this time, TEQSA has a high number of scheduled and unscheduled registration and course accreditation assessments. This will impact on our processing times into 2023 and we appreciate your patience during this time.

TEQSA is committed to improving the timeliness of its decision-making for assessing applications. A range of strategies is underway to streamline our approach and reduce the administrative burden associated with regulation for providers.

If a provider is applying for Registration Renewal and is seeking self-accrediting authority, it will need to pay a fee for both the Registration Renewal and Self-Accreditation.

If a provider is already self-accrediting or is not seeking self-accrediting authority, it will only need to pay the Registration Renewal fee.

For the purposes of cost recovery, a nested set of courses means a set of courses consisting of:

• one primary course of study and
• one or more related courses of study.

A ‘related course’ is a course of study:

• entirely made up of units taken from the primary course study, and
• offered by the same registered higher education provider.

TEQSA engaged in extensive consultation with the sector about a proposed model for our regulatory fees and charges in 2021. Valuable feedback from the sector has been used to refine the CRIS for implementation from 1 January 2023.

Starting in 2023, TEQSA will review the CRIS annually, and will seek input from the sector as part of this process.

Please refer to our website for comprehensive resources and answers to frequently asked questions. It’s a good idea to bookmark the above page because it will be an online hub for information about our fees and charges.

If the information you are seeking is not currently addressed on our website, please email your enquiry to costrecovery@teqsa.gov.au and we will respond promptly.

The transition to a new fees and charges model from 1 January 2023 will bring TEQSA into line with other regulatory agencies that operate on a cost recovery model in accordance with Australian Government policy.

Access the Australian Government Charging Framework and Cost Recovery Guidelines (AGCRG) to find out more.

TEQSA’s current cost recovery model covers about 15 per cent of TEQSA’s regulatory and quality assurance costs.

The new fees and charges model will recover about 90 per cent of the agency’s regulatory and quality assurance costs from 2025.

The transition to a new fees and charges model will bring TEQSA into line with other regulatory agencies that operate on a full cost recovery model in accordance with Australian Government policy.

In the first instance, please refer to our website for comprehensive resources and answers to frequently asked questions.

If the information you are seeking is not currently addressed on our website, please email your enquiry to costrecovery@teqsa.gov.au and we will respond promptly.

The obligations on providers under the Higher Education Standards Framework (Threshold Standards) 2021 remain unchanged by cost recovery. 

The structure of cost recovery should encourage all providers to be as transparent and proactive as possible in letting TEQSA know about problems.

Providers will pay fees based on when a valid application for the accreditation of a course, that complies with all of the relevant requirements in the TEQSA Act, is submitted to TEQSA. Where a provider makes a valid application in 2022, the provider will not be required to pay the updated fees that apply from 1 January 2023 onwards in relation to that application. TEQSA will inform providers as soon as possible after an application is submitted whether the application is valid or whether a new application needs to be made.

Please note, there are requirements that providers must meet for an application to be considered valid and ready for assessment.