When Is an Auditor Really a Regulator? the Metamorphosis of the Australian Universities Quality Agency: Implications for Australian Higher Education Public Policy

Article excerpt

The Australian Universities Quality Agency (AUQA) is a company owned by national, state and territory Ministers of Education. It is not a de jure regulatory authority. This article argues, however, that AUQA performs an important de facto public regulatory role in respect of the performance of various institutions, and that the implications of this for public policy ought to be explored. The analysis in this article is confined to the university part of AUQA's activities. AUQA performs a role whereby the performance of Australian universities is measured against objectives and standards, some of which are determined by parties external to the universities. These parties include AUQA. Some of the externally determined standards are implicit, others are explicit.

AUQA's de facto regulatory powers can be exercised in two principal ways. its Board can, firstly, recommend sanctions to government if it is not satisfied with the responses of a university to its requirements. Secondly, it can exert significant pressure on universities through highly public processes of engagement with those universities which AUQA decides do not meet its expectations. This article adduces evidence of AUQA's de facto regulatory behaviour. It outlines some public policy implications and suggests, for example, that this behaviour be governed, in general, by the principles of efficient regulation, and, in particular, by Australian government regulation impact statement processes. The article also argues that efficient implementation of these proposals cannot be achieved under AUQA's current legal form.


The Australian Universities Quality Agency (AUQA) is a company limited by guarantee under Australian corporations law. It was established in 2000. The members of the company are the national, state and territory ministers responsible for higher education in the Australian federal political system. (1) Engagement with AUQA's quality assurance processes is compulsory for Australian universities. Refusal by a university to participate invites the possibility of severe sanctions. (2) AUQA's objects, as far as they are relevant to universities, are

(a) to arrange and manage a system of periodic audits of quality assurance arrangements relating to the activities of Australian universities ...;

(b) to monitor, review, analyse and provide public reports on quality assurance arrangements in self accrediting institutions ...;

(c) to report on the criteria for the accreditation of new universities ... as a result of information obtained during the audit of institutions ...; and

(d) to report on the relative standards of the Australian higher education system and its quality assurance processes, including their international standing, as a result of information obtained during the audit process. (3)

Discharging at least parts of this mandate arguably poses some significant challenges for AUQA. Thus, for example, in respect of object (d) it is difficult to understand how judgments on 'the relative standards of the Australian higher education system and its quality assurance processes, including their international standing' could properly be made on the basis of information obtained during audits of Australian institutions. At the very least, relevant international comparative material would also need to be obtained. A related point can be made with respect to object (c) in that institutional audits may or may not provide information adequate to meaningful reports on the nature of the criteria against which applications for university status might be determined.

In the event, AUQA has chosen to concentrate its efforts on achieving the first two objects. In this respect

   AUQA bases its audits on each organisation's own objectives,
   together with the MCEETYA National Protocols for Higher Education
   Approval Processes ... and other relevant legal requirements or
   codes to which the organisation is committed. …