Senate debates

Monday, 30 November 2015

Bills

Education Services for Overseas Students Amendment (Streamlining Regulation) Bill 2015, Education Services for Overseas Students (Registration Charges) Amendment (Streamlining Regulation) Bill 2015; Second Reading

12:43 pm

Photo of Nick XenophonNick Xenophon (SA, Independent) Share this | Hansard source

I have a short contribution to make in respect of the Education Services for Overseas Students Amendment (Streamlining Regulation) Bill 2015. I support the second reading of this bill but I do have a number of concerns in relation to the bill, in particular the removal of the requirement for private providers to keep fees paid by students in a designated account—a matter that was raised by Senator O'Neill. I will address my concerns shortly but, to begin with, it is important to reflect on the importance of international education to Australia and to my home state of South Australia—and, indeed, the home state of our education minister.

International education activity arising from international students studying and living in Australia contributed $18.2 billion to our economy in 2014-15. This is an increase of 14.2 per cent on the previous financial year. In fact, I hope it increases even more with a lower Australian dollar. May the Australian dollar go below 70c as soon as possible because the low Australian dollar is good for our higher education sector in terms of overseas students. It is terrific for our manufacturing sector, and it is very important that, if the dollar keeps going down even a bit further, that just makes us so much more competitive with other countries.

Looking at the economic contribution in more detail, the higher education sector generated $12.5 billion in export income, with the VET sector generating $2.9 billion in earnings. In my home state of South Australia, export income generated from international education last year amounted to $1.127 billion—so $1,127 million. According to statistics sourced from the Department of Education and Training's website, in 2014, there were 249,990 overseas student enrolments in higher education in Australia. In the vocational education and training sector, there were 149,785 overseas students. Unless my maths is wrong, we are talking about 400,000 overseas student enrolments in either the higher education or the vocational education sector.

The Department of Education and Training has also released a research snapshot in relation to international students studying science, technology, engineering and maths, or the STEM subjects, in Australia. The research revealed:

In 2014, 31.5% of all postgraduate research students at Australian higher education institutions were international students. Even higher proportions were in STEM fields, including Engineering and Related Technologies (54.2%), Information Technology (51.6%) and Agriculture, Environmental & Related studies (45.6%) …

Given the importance of international education activity to Australia's economy and Australia's reputation abroad, it is essential we have a framework in place that ensures its administration and regulation is appropriate and robust. The Education Services for Overseas Students Amendment (Streamlining Regulation) Bill 2015, the bill that we are now debating, seeks to amend a number of acts that regulate the international education sector. These amendments will create education services for overseas students agencies, who will have direct responsibility for education providers' registration and for monitoring education providers' compliance with their obligations under the various acts. Education services for overseas students agencies will include the Tertiary Education Quality and Standards Agency and the Australian Skills Quality Authority. By clarifying that these two bodies have direct responsibility for registering providers and monitoring compliance of providers, this bill creates more certainty in the education sector about who is responsible for what.

This bill also makes a number of amendments to the Education Services for Overseas Students Act 2000. The first relates to decisions made by the education services for overseas students agencies. Under the current legislative framework, decisions made by the Tertiary Education Quality and Standards Agency and the Australian Skills Quality Authority can only be appealed in the Administrative Appeals Tribunal. This bill will allow for internal review of decisions made by these agencies. It will help to ease the caseload of the AAT by giving providers and ESOS agencies the ability to reach an agreement between themselves in the first instance. If that means fewer lawyers being involved or less legal work being done then so be it. I can say that as someone who still has my practising certificate—primarily for pro bono work, I should say.

The measures I have just described are some of the more straightforward measures in the bill. It is important to note that concerns have been raised in relation to a number of other measures. For example, in its submission to the Senate Education and Employment Legislation Committee's inquiry into this bill, the National Tertiary Education Union raised concerns about the proposal to remove the requirement for overseas education providers to keep prepaid student fees in a 'designated account', the matter that Senator O'Neill referred to previously. The government argues that forcing education providers to keep prepaid fees separate in a designated account limits the provider's competitiveness and its ability to invest in innovation in order to improve its operations. However, additional flexibility is not necessarily always a good thing, as we have seen from the collapse of some providers in the VET sector and private colleges. By the way, the overwhelming majority do terrific work, but if private providers collapse then that can leave students in the lurch and damage our international reputation as a quality higher education and vocational training provider. In relation to their opposition to this provision, the NTEU, the National Tertiary Education Union, pointed to the ongoing volatility of the private education market—although I would like to think that some of the reforms that Senator Birmingham, as education minister, is proposing to the VET sector will alleviate or deal with some of those concerns. That is why I welcome Senator Birmingham's bill in relation to this, which I understand we will be dealing with tomorrow. The NTEU are concerned that these changes will:

      That is a direct quote from their submission. The Tasmania University Union argues that requiring providers to keep fees in a separate account serves as an accountability measure. In their submission to the Senate Education and Employment Committee, the TUU wrote:

      If students do not start a course they initially enroll in, it is essential that they be refunded their payment. The requirement that Universities have a separate account for the funds paid by overseas students prior to commencing their course streamlines the process of checking that students have been refunded.

      Removing this process not only removes transparency from the use of overseas students fees; but also increases the work involved in overseeing refunds.

      I think there are a number of good points made there by the TUU.

      This bill also seeks to remove the requirement that providers not be allowed to charge more than 50 per cent of tuition fees up front for longer courses. The government believes this improves flexibility for students or their sponsors, especially those who may be studying here on a scholarship and may be able to cover the course cost up front. There are concerns that, by removing the 50 per cent cap on student fee contributions prior to a course starting, we may see pressure being placed on students to pay more than 50 per cent of fees, even though they are not required to do so by law.

      I spoke earlier about the significant contribution international education activity makes to the Australian economy. In order to enhance this contribution, it is imperative that we have systems in place to encourage overseas students to be here, particularly in areas of low population and economic growth. It is an issue on which I hope to engage with the Minister for Education and Training, with Assistant Minister Colbeck and, indeed, with Immigration Minister Peter Dutton. I think that there is a compelling case in regions and states with low population growth and low economic growth—in particular South Australia and Tasmania, because we are below the Australian average for population growth and economic growth. South Australia, sadly, has one of the highest unemployment rates in the nation. It is a position that we do not want to be in. We face much greater challenges in employment with the demise of manufacturing in the automotive sector at the end of 2017 unless there is some urgent work done to claw that back, to keep car manufacturing in South Australia.

      I believe that there is a compelling case for students in low-population-growth areas and regions to have an incentive to study in those regions. That could be that they are allowed to work a bit longer, allowed to stay a bit longer, than in other states. I think that would act as an incentive for those students to study in those low-population-growth, low-economic-growth areas. That is a matter for another time, but I would like to think that it is something that will receive bipartisan support. I know that in South Australia I have had discussions with opposition leader Steven Marshall, who has shared these concerns, and spoken to state government ministers, Labor government ministers, who similarly, I believe, would like to see more international students in my home state.

      So, while I support the measures in this legislation insofar as they relate to education and overseas student agencies, I do have reservations about the other deregulatory measures being pushed for by the government. I would like to have an opportunity to engage further with the government, the opposition and my crossbench colleagues in relation to those measures. But I think it is important that we support the second reading stage of these bills and then see what can be drawn out of the committee stage in terms of any necessary amendments or sensible compromises.

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