RTO Set Up Cost | How to Become an RTO

Learn the steps on how to become a Registered Training Organisation. 

Starting an RTO can be a highly rewarding and profitable business. The education industry employees over 1 million employees in Australia and is a $20 billion export business.  Having said it is a complicated and complex landscape to navigate. This guide is designed to help those that want to become and RTO but are not aware of just starting out. 

How to Become an RTO.

The key to successful starting and maintain an RTO is ensure you understand the compliance regulations set up ASQA  National Standards and Vocational & education Training Research.  

To successfully   become a registered training organisation, you must have an understanding of the Australian Vet Sector. In addition to understanding Vet Sector you must also know the National stands and regulations in relation to becoming a new RTO. Click here for a guide on how to become a Registered training organization from scratch. To become an RTO and offer courses, you must ensure you have completed each of the below steps successfully before apply for the new RTO registrations:

 

What is an RTO?

Registered training organisations (RTOs) are education providers approved by ASQA to deliver VET courses. High-quality vocational education and training (VET) are critical to Australia’s education framework. VET provides Australian students with the knowledge and skills they need to make a positive contribution to the national skills shortage and workforce.

 

Steps for Becoming an RTO:

  1. Conduct the Research of the current National Standards, VET industry.
  2. Make sure you meet the financial viability requirements to start an RTO.
  3. Obtain compliant training and assessment resources.
  4. Organize Marketing content for the RTO.
  5. Ensure your policies and procedures are compliant with the NVR 2020.
  6. Prepare other requirements and conduct a self-audit.
  7. Apply to ASQA  for a new RTO registration application.
  8. Ensure RTO meets legislative obligations.
  9. Pay all applicable registration fees and charges.
  10. Successfully pass the RTO registration audit.

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  1. Research of the current National Standards

 

The regulator for the VET sector in Australia is the Australian Skills Quality Authority (ASQA)ASQA handles education providers whether you are offering online courses, CRICOS for international  sutdents or face to face learning.  They govern the majority Trainer providers unless you only plan to provide state specific training in Victoria and or Western Australia. In Victoria you will report to the  Victorian Registration & Qualifications Authority (VRQA) In Western Australia you will report to Training Accreditation Council (TAC)  

 

The Standards for Registered Training Organisations (RTOs) 2015 are in depth legations that new RTO owners need to read and understand to ensure their training follows all the rules inside the document. The document helps those that are looking to start a new Registered Training Organisation by covering the following topics: 

  • Marketing and Recruitment 
  • Student Enrolment 
  • Support and Progression for students  
  • Training and Assessment 
  • Completion 
  • Regulatory Compliance and Governance Practice 
  • Fit and Proper Person Requirements, 
  • Financial Viability Risk Assessment Requirements, 
  • Data Provision Requirements

 

In addation to the above requirements and having a  grasp of your requirements in relation to the Standards for RTOs 2015  you must also be familair with the the VET Quality Framework  in order to be succesfull in your initial steps in registering an RTO. 

 

Financial viability requirements to start an RTO

To become an RTO, you must complete and pass ASQA’s financial viability risk assessment.  This step is required to to prove to ASQA that you have the financial security required to start the RTO and ensure you can maintain the ongoing costs of the new RTO for  many years and students will not be impacted due to your RTO not having sufficent finances.

 

Steps requried to meet financial viability requirements.

In order to prove to AQSA that your RTO will meet the finanical requiests you will need to prepare the following:

  • Prepare RTO Business plan
  • Financial forecast
  • ASQA’s Financial Viability Assessment (FVRA) Tool

These documents will prove to ASQA that you have the financials cablity to acheive the basic functions for starting the RTO including but not limted to:

  • Buy the  equipment and/or stock to start your RTO.
  • Obtain resources  required to offer the  courses your RTO plans to add to scope.
  • Pay wages for teachers to deliver what you plan to add to scope  and other administrative tasks.
  • student support serveirs.
  • Miscellaneous operating costs related to having an  RTO such as  training venue, utilities, travel.

RTO business plan overview 

A business plan is designed to provide an overview of the the new RTO organisations goals and startageies and how you organisation plan to reach those goals. Having a detailed and well researched business plan shows the regulator that you are serious about running your new RTO and you have a long term plan for its success.

The RTO bussiness plan follows the usual standard and should include short term and long terms goals and stragies . You need to ensure the business plans including the following informaiton. The RTO business plan should have the below topics coverred as a minimum.

  • Planned courses to add to scope
  • Basic funding overview
  • Target maret
  • RTO stakeholders
  • location for the RTO
  • equipment costs
  • expansion of courses to scope
  • equipment requirements
  • facilietes requirements
  • delivery method and location
  • copeditor analysis
  • organsational structue
  • short terms and long terms goals for the RTO
  • market analyss for for the coruses you plan to add to scope
  • SWOT(Strength, weaknesses, opportunities and threats ) analysis
  • financial goals both short and long terms

Complete ASQA’s Financial Viability Assessment (FVRA) Tool

One of the critcal steps of the VET Quality Framework is complete the  Financial Viability Risk Assessment Requirements. As part of this process you will need to provide the following documents:

  • bank balance/s,
  • bank reconciliations, and
  • other financial documentation

New RTO applications have different regulators based on where you plan to deliver the course.  the  requirements for the education regulator are below:

  • ASQA –  ASQA’s Financial Viability Risk Assessment (FVRA)
  • TAC  – 2-year forecast, balance sheet, and cashflow projections
  • VRQA  – 3-year forecast

Upon completed of the above steps  you must get the information certifited by an indepened accountatnt that as been current member of  CPA-Australia.

 

Training and Assessment Resources  to start your RTO

ASQA has a student focused model which means that during the the initial RTO registration ,  one of the main factors that the ASQA auditor searches for is the quliaty  of your training and assesment resources.

Ensure your training and resources are compliant and of high quality prior to the registration is a crucial requirement and will have a big part to play wheater you successfully complete initial registration and become and Registratd training organsation.

Your trinaing and resrouces should include the following:

  • compliant  assessment tool – ensuring the map to current requiments
  • compliant learning resrouces
  • equiments required for students to undertake the course
  • qualifed trainer and assessors
  • venue information

 

Are new RTOs profitable?

Like any business, RTOs can make you a good amount of profit. The owner needs to ensure you are adhering to all the rules and regulations set by ASQA or that profit can quickly turn into a loss. As an operator, you can suffer personal financial consequences.

 

RTO Set-up Costs

There are many costs associated with setting up an RTO.  The ASQA fees for the initial registration will cost you  $8500.  This is under the assumptions you are adding under for 4 qualifications to the scope and one delivery site. Anything above that and there will be extra charges.