Michael Ferguson (Bass, Liberal Party) Share this | Hansard source

I rise to speak in favour of the Education Services for Overseas Students Legislation Amendment (2006 Measures No. 1) Bill 2006 and the Education Services for Overseas Students Legislation Amendment (2006 Measures No. 2) Bill 2006 that have been put forward by the minister. These bills are not earth shattering in that they do not contain any major reforms. However, the importance of these bills today is, I think, in their demonstration of the ongoing commitment on the part of the Howard federal government to protecting this very valuable industry: the education of overseas students in Australian universities and other education providers, including schools and TAFEs, at no cost to the Australian taxpayer but, rather, at full market rates charged to the overseas students. Australia does have a reputation, and a well-earned one, of being a safe, progressive and dynamic place to study. We should, and do, maintain this reputation by providing quality education and consumer protection specifically developed for overseas students.

It is important, perhaps partly in response to the comments we have just heard from the member for Capricornia, that we do make a distinction between overseas students and Australian students. Clearly there are differences. First of all the Australian government has a special obligation to Australian students as taxpayers and as Australians. The same obligations do not necessarily always apply to overseas students who we need to protect, and we need to protect as much as anything because they do, as contributors, provide an enormous financial benefit to our education system here.

In addition to that, it is a globally competitive environment and it is very important that Australia be able to hold its head high and give a guarantee to overseas nations that the educational standard that their students receive when they are in Australia is of top quality, and that consumer protections are there. After all, they will be separated from their homes by many thousands of kilometres. That is not the case, of course, with Australian students who do not have language barriers, who do have family support and who do perhaps have a better cultural understanding of the country that they live in. They also have better access to choice, as they understand, through local knowledge, which university will provide them with the educational training opportunities that they need.

It is also worth pointing out that the Australian educational system in the main does not see Australian students as the cash cow that the member for Capricornia referred to. They see them not as an industry at all but rather as an investment in our own future as Australians for Australians. The international education export industry, as the member has said quite correctly, is our fourth largest export industry in this country. I feel that this will come as a surprise to many people. It is worth as much as $7½ billion per year to the Australian economy. If time permits me I will return to those remarks towards the end of my contribution.

The Education Services for Overseas Students Act, more commonly known as the ESOS Act, and its complementary legislation regulate the international education and training services industry in this country. It is important to point out that this act is an innovation of the Howard government. It was, in fact, introduced in 2000 to address problems that were facing the industry at that time, which included the uncertain financial protections for students’ prepaid course fees, the emergence of a small minority of unscrupulous providers and an inconsistent quality assurance regime. Interestingly, after 13 years apparently Labor had not seen fit to introduce such legislation itself.

The purpose of the legislation was then, and is now, to ensure that overseas students who come to Australia to study on student visas receive the education and training for which they have paid. It aims to protect the reputation of Australia’s education and training export industry—and that is what it is: an export industry exporting an educational or training product for a financial return from overseas. It also aims to strengthen public confidence in the student visa program.

As the Parliamentary Library have very well informed me through their Bills Digest, the provision of education and training services to overseas students in Australia is a responsibility which we here in the Commonwealth share with our state and territory government colleagues. The states and territories have primary responsibility for the quality control of education providers and their courses, and exercise this through their own processes of approving, registering and monitoring providers and their courses. This, of course, is a subject all of its own but perhaps one in which we, as leaders in this place, should consider how we can better streamline those processes around Australia—perhaps not necessarily with a view to centralising them but certainly to make them as consistent as we can. The Commonwealth has an interest in protecting the reputation of this $7½ billion per year export industry in order to maintain the integrity of our own migration program and to protect the interests of overseas students as consumers. None of what we have been speaking about today can be seen in isolation from an orderly migration system which includes student visas.

The arrangements under the ESOS Act include the registration of education providers. That is done through CRICOS, the Commonwealth Register of Institutions and Courses for Overseas Students, and the ongoing role that has in ensuring: courses and their providers are of an appropriate standard; the compulsory membership by providers of a tuition assurance scheme; the contribution by those same providers to an assurance fund to ensure that there are funds to pay for student tuition in the case of a provider or its entity collapsing; the reporting obligations on providers; a compulsory national code, along with compulsory compliance with that national code; and sanctions for being in breach of both the act and the national code. Finally, one of the ESOS Act’s roles is to ensure that the Commonwealth does retain powers to be able to investigate providers and to impose sanctions on them, and to remove from the industry operators who are shown to be shonky. These are the main roles of the act.

In six years the act has proven its merit, because we have seen the overseas student education and training industry to be a growing industry. In coming months we will get an update of those figures and the common understanding is that those figures will, in fact, have grown. As the House has already been told, the ESOS Act required within it that it should be evaluated independently and that that should be commenced within three years of it having received royal assent. That evaluation commenced in May 2004 and its results were reported in June 2005, the report being released by the former Minister for Education, Science and Training, Dr Brendan Nelson. It is very important that I report to the House what the evaluation team found. It concluded:

... the architecture of the quality benchmarks represented by the ESOS framework is sound: standards for providers of education and training that are mandatory and operate nationally; a cooperative national regulatory model; the characterisation of the student-institution relationship in consumer terms; and the integration of export education and migration policy. 

The evaluation report found broad industry support for existing arrangements, so no major reforms to this act were considered in any way desirable. But it did make 41 recommendations for improvement, many of which are the subject of our debate today. The amendments we are considering do address the evaluation recommendations and are largely responsive to further consultations which have been had with the education and training industry as recently as this year. The amendments put forward by the government will do three main things: they will maintain Australia’s reputation for providing a quality education experience, they will enhance consumer protection for overseas students and they will improve national consistency in implementation and application of the ESOS legislative framework.

I turn now to the fit and proper test, which is the first major aspect we are debating today. All providers who deliver education and training to overseas students must be registered on CRICOS—the Commonwealth register. It is a requirement of registration that providers demonstrate they are ‘fit and proper’ to be registered. Unfortunately, currently the fit and proper test is applied on registration only and applies to providers and their associates. The amendments will allow for the fit and proper test to be applied not only on registration but at any time during a provider’s registration. Importantly, the government has seen fit to broaden to whom the fit and proper test can be applied. To prevent former providers with a bad history in the industry from taking up positions of influence with other providers, the application of the fit and proper test will now be extended from just providers and their associates to employees, agents and officers of the provider—that is, any person who works in a role with that provider and who is in a position to have an influence on the students or the quality of the course experience. Furthermore, the act will allow for the suspension of their registration from CRICOS, which will put to an end any concerns that overseas students or their families may have with a suspect person. These amendments provide further guarantee of the credentials of CRICOS registered providers.

The second aspect I will address is the tuition assistance schemes and access to student information. The ESOS Act ensures protection for overseas students by placing the main responsibility with the registered provider. Tuition assurance schemes and the ESOS Assurance Fund provide further certainty where the provider is unable to meet their obligations. The amendments will clarify a provider’s obligations to the receipt of course money and the provision of refunds. Allowing tuition assurance schemes access to student information is going to be an important feature of the reforms so far as it concerns students who have attended a provider that has collapsed. It will allow a faster placement of students in alternative courses where a provider is unable to meet their own obligations.

There is a fairly minor amendment of the annual registration charge. Providers contribute to the cost of regulation of the ESOS Act and that is appropriate, being an industry and not a government service. They do this by payment of the annual registration charge, or ARC. This is the legislated charge. I am advised that it is quite a small charge—only in the hundreds of dollars—and that it is payable on the last business day of February of any calendar year. The automatic suspension of a provider’s registration for failure to pay the ARC by the due date will streamline the enforcement action taken against providers who breach this legislative requirement. I also believe it will reduce the time spent by the Department of Education, Science and Training pursuing providers, who are, after all, collecting significant fees and paying fees back to the department which amount only to hundreds of dollars.

There are other amendments which provide for: the fund manager to have discretion to adjust refunds according to a student’s recognition of prior learning status; a sunset clause to be introduced for eligibility to make claims on the fund; and streamlining provisions to provide obligations with respect to migration rules. These amendments will have a minimal effect on the red-tape burden on providers. The consultations have taken place with providers and I am advised that they are broadly supportive of the reforms and accept them as necessary. It will also streamline the processes for the Australian government.

Protection and enhancement of Australia’s reputation for providing reliable and high-quality education is crucial to achieving sustainable growth of this important export industry, which, as I have already said, is Australia’s fourth largest export industry, bringing in over $7.5 billion every year. These amendments will strengthen the regulatory framework and consumer protection provisions of the legislation.

In the last moments that I have I will refer to comments by the member for Jagajaga reported in the press. They begin with the ABC announcing that a federal education department report shows the total number of students at Australian universities in 2005 grew by about 12,000 on the previous year, which is the smallest increase in five years. The report also shows 90 per cent of the additional 12,000 places were for international students. I think that anybody with an ounce of knowledge of this area would see that university placements in this country have not diminished at all. The member for Jagajaga says that degrees are becoming unaffordable. She says:

The real issue is the massive increase in HECS ... when you see the numbers going up as much as they have, they’ve more than doubled.

She says:

... it’s, of course, just going to flow on to very high levels of debt.

The member for Jagajaga went on to say that university graduates and students have debt growing by $2 billion a year. She fails to acknowledge that the HECS system was introduced not by the coalition but by her party, the Labor government, in 1989. It stands to reason that you would see debt increasing. What does that tell us? It tells us that there are more students in Australia studying at university than ever before; that there are more students studying at university than during any of the years of the Hawke or Keating governments; and certainly more students studying at university than was ever the case under the leadership of Mr Kim Beazley when he was the education minister. The government’s record on education in this country is stronger than ever.

Every one of the reforms that has taken place under Brendan Nelson was opposed by the Labor Party—every reform and every major initiative that saw an increase in funding and an increase in the number of places. In my home state of Tasmania that amounted to more than 1,500 new places at the University of Tasmania. Every one of those places was opposed by the Labor Party. Every dollar of the $11 billion in extra investment was opposed by the Labor Party. As recently as yesterday they had the temerity to try to pour shame on the government when they themselves have the poorest record on education in this country.

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