Senate debates

Monday, 30 November 2015


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

11:35 am

Photo of Kim CarrKim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | | Hansard source

I would like to say a few words on the Education Services for Overseas Students Amendment (Streamlining Regulation) Bill 2015 and the Education Services for Overseas Students (Registration Charges Amendment (Streamlining Regulation) Bill 2015, quite independently from what I have just said! Hopefully by now senators might actually be reaching for the detail of this report. And if senators are not reaching for it, maybe their staff might be so they can actually look at the detail of it.

Labor does not oppose the goal of streamlining all of the different aspects. We have to acknowledge that circumstances change. As I have indicated, a bit like tax avoidance, one has to recognise that there are different circumstances that need to be met. But we strongly urge the government to revise this package, because its presence in this form is likely to aggravate the problems the bill has sought to resolve. In particular, Labor has great doubts about the effect of removing the requirement that private providers must hold tuition fees paid before the commencement of a course in a designated account. I will be moving amendments to strip that provision from the legislation.

We also have concern about the consequences of lifting the prohibition on the provider receiving more than 50 per cent of the tuition fees before a course begins. While we do not oppose the measure outright, we have doubts about how it will actually operate. It will be a challenge to the regulators to ensure that provisions are not abused. These bills take us down a path that has become, regrettably, all too familiar under this government. Under the guise of cutting red tape and removing supposed burdensome regulation the proposed legislative change opens the door to further abuses. This is what happened in the ill-considered attempt to change the Tertiary Education Quality Standards Authority.

In that case, fortunately, the undermining of TEQSA was prevented because the government accepted criticisms of the bill that Labor had made, and amended it accordingly. The government in this case has no interest whatsoever in looking at the perhaps unintended consequences of their folly.

I hope the government will, however, demonstrate a willingness to consider the bills before the chamber. The question arises: why does the government keep trying to dismantle robust regulatory frameworks for the provision of educational services? The answer can only be that the government's ideological preference for private provision blinds it to the abuses that manifestly occur when there is inadequate regulation to maintain standards and protect students.

Last year's TEQSA bill risked repeating that lamentable history of the Howard government, when a flood of shonky providers threatened to undermine the reputation of the entire international education industry. Some senators will remember the saga of Greenwich University, which was a scam degree factory operating out of Norfolk Island and which the Howard government allowed to run rampant for four years. It is not the only example of dodgy practices—merely the most bizarre.

Between 2008 and 2011, 54 providers of educational services for overseas students collapsed, affecting 13,000 students and triggering a major crisis in the industry. The effect on reputable providers, who do strive to maintain standards and treat students fairly, of course meant that they were often overwhelmed by the avarice and corrupt practices of the shonks and the sharks. When that practice came to light, it tainted the entire industry, the good with the bad. It is a familiar story and one which is being played through in the VET sector around the country today. That is why when Labor came to government we established the higher education and VET regulators, TEQSA and ASQA, and instituted the Tuition Protection Service and other protections for international students. We cleaned up the international education industry in this country and saved Australia's reputation as an education provider.

That is a reputation that must be protected. I remind senators that the provision of international education services brings some $18 billion a year into the Australian economy. I have indicated that it is the third largest export industry after iron and coal. It is probably the largest in Victoria. Any harm to Australia's reputation as an education provider will stem the flow of students into this country and will of course cause enormous damage to our export capacity.

I should also point out that it is important that we actually learn the lessons of history here. Senators will be aware that this is the experience of the Howard government. International students continuing to be exploited by education providers and by employers is an ongoing problem which we need to address. The Australian taxpayer and the students are defrauded. Sometimes even public agencies have been implicated in that exploitation. Only three months ago a joint operation in Melbourne by the AFP, the Australian Borden Force and ASQA resulted in three men being charged with serious migration and workplace exploitation offences. I have indicated that that was the operation on the St Stephen Institute of Technology, owned by Baljit Singh and Rakesh Kumar; and the Symbiosis Institute of Technical Education, owned by Mukesh Sharma.

Foreign students were lured to Australia with promises of receiving working visas or permanent residency after completing their courses at these colleges. Once they arrived, however, no education service was actually provided. Instead they were subcontracted to work for Australia Post, sorting and delivering packages for below-award wages. Mr Singh was a labour-hire contractor for Australia Post, which has since severed its relationship with him. But it is appalling that such an arrangement could ever have begun. Although the colleges are alleged to have provided no training, they charged international students fees of up to $10,000 as part of this scam. The St Stephen Institute was one of the higher education providers granted access to streamlined visa processing under the 2014 budget measures and their subsequent deregulation measures. They were provided special entry provisions to allow people to work as subcontractors for Australia Post and to be ripped off, and students were paying $10,000 for the privilege.

Streamlining visa processing is, of course, another one of those deregulation measures for individual students. It reduces the paperwork—there is no doubt about that—but it also increases the responsibilities for education providers. This is why Labor when we were in government did not approve streamlined visa processing from non-university providers. We were concerned that to do so would risk a revival of the shonky practices of the Howard era. Our concerns have been vindicated by the St Stephen Institute.

Senators will also be familiar with the media reports of the scandalous behaviour of underpayment of foreign students employed by the 7-Eleven chain of convenience stores. Employees at 7-Eleven stores were paid $12 an hour to work in one of the most dangerous retail jobs in the country. Convenience stores experience an average of three robberies a week.

Adele Ferguson, who covered the 7-Eleven stories for Fairfax and the ABC, also exposed underpayment of the delivery drivers for the Pizza Hut fast food chain. Drivers hired by Pizza Hut franchises were paid $6 a delivery, with two deliveries per round trip. Drivers had to provide the car and pay full maintenance, fuel and insurance. They were hired as contractors, although this was clearly a scam. They were, in effect, employees of the franchise. Madam Acting Deputy President Lines, your committee has highlighted this particularly scandalous behaviour. But they were not even paid according to the enterprise agreement. This kind of arrangement is a classic trap for international students.

In the case of the 7-Eleven workers they are typically reluctant to complain because they are afraid of being penalised for infringing their visa obligations. The government has recently passed up an opportunity to provide greater protection for foreign students. It rejected Labor's amendments to the Migration Amendment (Charging for a Migration Outcome) Bill 2015 which were passed by the Senate last week. Those amendments would have extended the bill's provisions to include people on student visas and working holiday visas as well as 457 visas. They would have included protection for whistleblowers who exposed the conditions of businesses like 7-Eleven and Pizza Hut. The amendments would have also prevented vulnerable people such as international students being hired as sham contractors, because they would not have been able to obtain an Australian Business Number. Of course, they could only be hired as staff under regular conditions of employment where their conditions under their student visas could have been checked. But the government rejected these safeguards being included in the migration bill.

So it is more urgent now that we redraft this current bill that is before us. It does not take a great deal of imagination to see how the removal of the need for providers to hold fees in a designated account is an absolute gift to the disreputable private providers. You might as well tell them to take the money and run. The operators of St Stephen Institute of Technology would have loved to have been able to operate under the regime that these bills would introduce. The government, apparently, does not lack the imagination there, does it? It does not take any lack of imagination to see that happening. This sector, however, understands the implications only too well.

In its submission to the Senate inquiry—and I quoted this this morning in consideration of the printing of the report—TAFE Directors Australia stated:

In the current environment where there is so much public concern surrounding the actions of some less reputable private providers, TDA feels it imperative that the requirement for retaining pre-paid fees in a designated account remains.

Government Education and Training International, an agency of the Tasmanian government, commented, in its submission:

The designated account ensures private providers are able to guarantee consumer rights of students in times of provider failure … the designated account should remain to provide this protection in the more vulnerable private sector.

The Tuition Protection Service, while acknowledging the view of those who want to remove the designated account obligation, argued that that remains, 'an area of potential risk for the TPS', which 'would prefer the retention of this integrity measure'.

The TPS submission noted that the worst outcome would be the abolition of the designated account obligation together with removal of the existing limits on prepaid fees which, of course, is exactly what this bill proposes to do. So the body set up to provide the protection is telling us, 'Don't do it.' And the worst outcome would be exactly as this government is proposing: that it be done.

By itself, the amendment to prepaid fee limits has the arguable merit of giving students greater choice and flexibility. That will be the government's case. But abolishing the designated account requirement is dangerous and, in combination with the removal of the prepaid fees, is in fact pernicious. Defenders of the abolition of the requirement have argued that it is not needed now because we have an Overseas Student Tuition Fund and that should fulfil the role of the previous account. That is exactly what the fund was not designed to do. It was envisaged as a last resort—not as a right; as a last resort. If it had operated this way, then—as I have said in the previous discussion—in the events of 2008 to 2011 the fund's resources would not be able to cope. I suppose then that we would have recourse to the government again? So private providers would be bailed out by the government—is that the argument? And the real assurance scheme is going to have to be the Commonwealth budget? These are people who are making money out of students. You should ensure that there are proper consumer protections in place. As I said, this fund, the Overseas Student Tuition Fund, was envisaged as a last resort instrument.

Some may object that the majority of providers are not shonks and sharks—I have heard this argument once or twice before—and they do not exploit students the way I have suggested. Of course that is true, but the problem in this industry is not the majority it is the minority. The problem in this industry is the rotten apple in the barrel which always ruins the whole barrel. The regulation framework has not been set in place because of what the compliant majority do. It exists because of what the rorting minority do—the ones that actually damage this country's reputation and do such harm to students that they rip off. What the shonky minority does is that it destroys this industry. That is why this is so important.

We acknowledge there are some aspects which could always been improved—I do not know a scheme that could not—and eliminating any duplication between the work of TEQSA and ASQA and other agencies through an aligning of reporting of registration requirements is more than reasonable, but the abolition of essential regulatory requirements, such as the designated account, will not result in streamlining; it will be opening the door for the crooks.

The system will not flow more smoothly, because the rorts will come thick and fast. The government's ideological obsessions for deregulation and for privatisation are clouding its vision in all sectors of education. It refuses to see that admitting private providers to contestable funding under the proposed deregulation of higher education will mean the degradation of Australia's world-standard public university system. It has had early warnings in that regard. We have seen what has happened in Victoria with the TAFE system after the introduction of contestable funding in the VET sector. But still the government will not see this. And we see the crisis that has now developed with VET FEE-HELP. But the only interest that the government have is in tinkering at the edges of these problems so they can say, 'We've dealt with that,' and move on.

I will have a lot more to say when the relevant sections of the bill come before the chamber in the committee stage, but, with respect to the bill before us now, the wilful blindness of this government needs to be called to account. Despite the continuing media reports about rorts and exploitation of international students, the government is intent on making life easier for the rorters themselves. For the sake of the international students in Australia and for the sake of Australia's international reputation, we will be urging this government to reconsider these measures.

When these questions are put to the chamber, I trust that senators will have had an opportunity to read the minority report, the additional comments that the Labor Party has presented, in regard to this legislation. This is not an area in which we should act in haste, particularly given the start-up date for private providers is the middle of next year. What is the urgency here? Why is it necessary for the government to try to pull stunts like we have seen this morning, in terms of bringing on the committee report early, and then attempt to ram this legislation through? Why is it necessary to behave in this way unless there is a blind obsession with deregulation for the sake of deregulation, no matter what the evidence to demonstrate that there are colleges out there that pose an unacceptable risk to this nation's reputation and an unacceptable risk to students who enrol in good faith, only to find that they are used and abused in a manner which is unconscionable, even to the point now where the ACCC has had to take action against some of these crooks? Their own regulators should have moved much more rapidly to deal with this question in a timely way, to prevent these people regaining registration, in some cases, or being registered at all, in others. The circumstances are clear, the evidence is abundant and I trust that senators will consider these matters carefully given the long-term consequences— (Time expired)

11:55 am

Photo of Robert SimmsRobert Simms (SA, Australian Greens) Share this | | Hansard source

I rise to speak to the Education Services for Overseas Students Amendment (Streamlining Regulation) Bill 2015. The Australian Greens have long supported the protection of Australia's reputation as a provider of world-class higher education and training. From 2008 to 2011, a number of international students were left without either alternative placements or refunds when multiple education providers went out of business, so the then Labor government recruited Bruce Baird to lead a review into the ESOS legislation. Senator Carr has touched on some of the aspects of that review.

The Baird review found that there were untenable amounts of risk in the system for international students. Given this, it recommended a change in regulation and the creation of a risk management framework to protect international students from exploitation and to protect students from the risk of being left without either a refund or a qualification in cases of provider bankruptcy or market exit. To achieve this, it recommended the introduction of the Tuition Protection Service, which would assist international students to complete their qualification by finding alternative placements or, at worst, reimburse them in cases where providers went out of business.

The bill before the parliament today would unwind many of the regulations around the Tuition Protection Scheme that were put in place by the Labor government in response to the Baird review. These include the ending of the requirement of providers to hold student fees in a 'designated account' until course commencement; the removal of the 50 per cent cap on the up-front costs that are chargeable for longer courses; the removal of the concept of a 'study period'; and the lowering of reporting obligations for student defaults.

The minister, along with some other voices within the sector, now says that he has renewed confidence in the sector and that these regulations are just unwarranted red tape. The Australian Greens do not agree with that. Just last week another major provider in the VET sector, Vocation Limited, went into administration, leaving potentially 12,000 students in limbo. I ask the minister: how on earth can he have confidence in such a system, in such a sector? The Liberals are great at talking about removing red tape. When it is about protecting students, they want to remove red tape, but we know what happens when they take away the red tape: they roll out the red carpet for the shonks and those who are going to exploit vulnerable students. It is all part of the Liberal Party's obsession with a deregulation agenda. We have seen it being rolled out in our higher education sector across the board. We know that, if they win the next election, they are going to revive their plans to deregulate the university sector as well, potentially opening students up to huge amounts of exploitation and saddling them with lifetimes of debt, through skyrocketing HECS fees. That is the agenda of the Liberal Party when it comes to education in this country: 'Let's remove the red tape that actually protects students and let's leave them at the mercy of the market.' That is their agenda.

The Greens are not the only sceptics here. Here is an excerpt from the NTEU submission to the committee inquiry into the bill:

Supporters of the proposal to remove the designated account and 50% rules as a way of reducing provider compliance costs and red tape argue that it is justified as the international sector is more stable than when the current provisions to TPS were introduced in 2012. While we acknowledge that there have certainly been improvements, supporters of the changes argue that the RIS is premised on the assumption that the risk of circumstances (that is, the turmoil the sector experienced over the period 2008-2011) which was the catalyst for these and other changes is now very low or non-existent. However, given the recent evidence of widespread problems within the private vocational sector … we are concerned that both the Government and the sector are seriously underestimating the current levels of provider risk.

I repeat:

seriously underestimating the current levels of provider risk. As such the assumption that it is fine to pull back on regulatory protections is being made under a false premise.

Indeed, the Australian Greens agree that this decision is based on a false premise. Due to the problems within the VET FEE-HELP scheme, as identified in the recent Senate inquiry into the for-profit VET sector, there are more questionable providers than ever before. This is a scandal. Indeed, the Prime Minister has described it as such. Yet apparently the minister still has faith and confidence in this sector. It is our belief that the minister and the government have got their priorities completely wrong here. They need to sort out and tidy up this sector. They need to stop trying to pass the buck. We know that it was the Labor Party that brought in this system, but ultimately it is the Liberals that are in government and they need to try and find a solution.

Of course, the Greens have been advocating for many years that we should be cutting off funding to for-profit providers and redirecting funding back to TAFE. The government should be focusing on fixing this sector before they start going down the path of deregulating further, cutting away red tape, as they call it, and exposing students to huge amounts of risk. That is precisely what the government will do if this is legislated for today. That is precisely what will happen today if this legislation passes. We will be exposing students to more risk when we have not even solved the problems within the sector.

If the problems within the VET FEE-HELP scheme were to be fixed, it is quite possible that providers who rely on rorting the VET FEE-HELP system would struggle to stay afloat. After all, that is their business model. Many of the for-profit providers have an international student component to their business model so there is a structural risk to these international students' qualification and tuition if there is not appropriate regulation. What happens to those students and who carries this risk?

Given the problems identified here, it is the position of the Australian Greens that now is not the right time to pursue the deregulatory agenda contained within the bill. Now is not the time to be deregulating this industry further when we have rorts and scams endemic within this sector. Now is not the time to be saying: 'Let's remove the protections and let's expose students to even more risk.' It would be reckless and irresponsible to do so. It would pose too great a risk to students and Australia's international reputation as a world-class tertiary education provider. So the Greens will not be supporting this bill. We encourage other senators in this place to join us in our opposition to this bill.

12:03 pm

Photo of Bridget McKenzieBridget McKenzie (Victoria, National Party) Share this | | Hansard source

I rise to speak in support of the government's Education Services for Overseas Students Amendment (Streamlining Regulation) Bill 2015. We have over 2½ million international students studying in our great country. It is, as Senator Carr said, one of our great export success stories. In my own home state of Victoria we are keenly aware of the benefits of a vibrant and efficient international education system, but we are also aware that it is where issues arose and risks were exposed. As a result, we are keenly aware of the importance of having an appropriate regulatory environment for international education so we can continue to provide a world-class education to students from around the world, and particularly those in our immediate region, who seek to have all the great things that Australian higher education can give them.

International students studying at our institutions are provided with a new way of learning. Rather than focusing on rote learning, there is a lot more team work and collaboration. There are team assignments et cetera, which they do not necessarily have exposure to in their own education systems. That is in addition to the personal friendships that they make. Many of them build fabulous friendships. We have heard time and again that the relationships that are formed through studying and working together can often lead to some fantastic outcomes once people get out into their professions and become leaders. I look at the Old Colombo Plan, and indeed the New Colombo Plan, in terms of delivering on all that international exchange can provide both for the exchangee and the exchanger.

International education also provides over 130,000 jobs in Australia. It is a very significant industry. The Deloitte report, looking at where is our competitive advantage as a nation post the mining boom, identified international education as one of the top five industries that are going to provide an economic underpinning for our nation going forward. So it is very important to get the settings around this right. We are not the only place where students can choose to study. We are No. 3 behind the UK and the US. It is a highly competitive environment. Canada wants more—everybody wants more—of the international student pie, so we have to get the settings right.

There is a complex interrelationship between the various arms of government that impact on a student's decision as to where they are going to study. It is not just about the reputation of the higher education institution. It is about the visa settings, post-education and pre-education, the value of the dollar and the distance from their home. So there are a whole range of issues interplaying here. That is why I am incredibly pleased that our government has chosen to approach international education from a strategic perspective. We set up a council—a group, if you like—and we got the ministers responsible in all those different areas, as I said, to come together for the first time and start to have a national conversation around where we are going to focus with international education.

When I went to uni and sat on a university governing council, international students were seen as the cash cow. International students were seen as the way for higher education institutions to underpin their balance sheets. That is not an educative process. International students were wrongly viewed as a way to make up for successive governments' shortfalls in funding for higher education institutions. Our government has gone back to the drawing board and has put trade, education, foreign affairs and immigration in the same room and has said, 'How can we focus on building this industry from a strategic perspective and really deliver outcomes, not just for our institutions and our local economies but also for our regions and for the very students who choose to study at our fabulous institutions?' So well done; because it is an incredibly international competitive environment.

The amendments to the Education Services for Overseas Students Act—or, as we are all calling it here today, the ESOS Act—will have the practical effect of reducing certain unnecessary regulatory burdens currently placed on education institutions. This legislation will also improve the quality and reputation of Australia's international education industry whilst maintaining protection for students. The contributions of Senator Carr and Senator Simms went to that very important issue. We do not back away from that at all. As you will see later in the week with our VET FEE-HELP bill, we are very, very focused on ensuring that international students and domestic students are protected in our educational systems. At the end of the day, if we do not protect students, they do not have to purchase international education from us; they can go somewhere else—and they will. This is a highly mobile population. We on this side of the parliament are very well aware of that. So any amendments that we are making to the Education Services for Overseas Students Act will absolutely have that at the forefront.

We want to get the settings right to protect students so that they and their families can have confidence that, when they study here in Australia at one of our fabulous institutions, it will be a high-quality experience. We want the best possible experience for those who choose to study here in Australia—out of all of the places in the world that they could choose to study in. We want it to be enriching and valuable to their personal lives and, indeed, to their professional lives over the course of whatever they do. Ultimately, we want to protect those students who are far away from home studying in a place where English is their second language or, in some cases, their third and who are far away from their usual support structures. We want to have integrity of process and an education system that reflects the fair society we endeavour to always have in this country. The Prime Minister has made it very clear that we are a government that is focused on fairness, and fair principles underpin the changes that we have put forward as part of this legislation.

In his contribution, Senator Carr made consistent reference to dodgy providers. I know through the work of the committee that you chair, Madam Acting Deputy President Lines, and which I am the deputy chair of, that this is an experience and an issue that we are very, very aware of and I know that we are both committed to ensuring that students, whether they are domestic or international, are not subject to unethical practices that seek to take advantage of a person's disadvantage. As I said, the VET FEE-HELP bill is coming through later on this week, and I am looking forward to both the Greens' and the ALP's support for the measures to crack down on those dodgy providers so that we can continually get more and more integrity into our system. We know how serious the VET scandal is. We know that the former government did not mean for these unintended consequences to occur as a result of their legislation. But the reality is that that is how these unethical operators have chosen to treat students—and we are not going to have truck with it. So we really do look forward to your support.

Senator Carr also spoke about reputational damage to our nation and damage to our third-largest export. Senator Carr, we do need to learn the lessons from history. That is exactly what these bills seek to do. They seek not to burden providers with unnecessary regulation but to allow them to be as flexible as they need to be and as flexible as our students need them to be; to be connected to industry; and, at the end of the day, to be focused on outcomes so that the student experience is fulsome and valid for them. We are not a do-nothing coalition. We have identified the cheats of the industry and the blind-eye mentality of the previous Labor government. We know that they were allowed to get away with it under the previous government, and we say to the Australian public that it will not happen again. Vulnerable students will never again be able to be taken advantage of in a heinous way. Never again will taxpayers' money be used to prop up crooked operators who tarnish our valuable and vital international education industry.

We need a comprehensive scheme—and this is the world's most comprehensive student protection scheme; absolutely—but we need it to be targeted on where the risk is. We need it to be focused on where it can give the most benefit to the international students and to those providers who employ over 130,000 Australians in our communities and provide such a significant contribution to our economy. They need to be able to be freed up from the unnecessary regulation whilst keeping the regulation that will benefit in terms of protecting students.

Senator Carr went to the process of consultation. These bills have come as a result of extensive consultation with international education stakeholders. As I have said, our government has been talking to stakeholders in international education for a very long time. Very early in coming to government we recognised this as one of the key pillars of our economy going forward and pulled together the right ministers who have been focused on getting a strategic vision for our nation in this space. We are across the detail. That is why we know what changes to make and where to make them. That is what is important.

Our Department of Education and Training was even congratulated by the Council of International Students. I noticed that, while Senator Carr was very keen to talk about the TAFE directors—who, might I say, have a bit of a conflict of interest in the comments they made around designated accounts—the Council of International Students, the very people this legislation seeks to protect and who we congratulate on coming, congratulates the department for its 'commitment to ensuring that student voices' are heard. In turn, the reforms are very well tailored to solve the real loopholes and problems. They conscientiously seek to add and continually improve the legislation that underpins the successful operation of our international export industry.

The coalition has acted on the plethora of negative evidence about the scheme and delivered this suite of bills to rectify the highly embarrassing problem. We will be tabling our report to this legislation later in the day. It was a really interesting set of submissions that we got. I wanted to briefly read some of the submissions to our committee that support the amendments the government is putting forward.

The Australian Council for Private Education and Training said that the amendments:

Are common sense regulatory reforms that align the domestic and international regulatory frameworks and clarify and confirm the roles of the regulators.

They will reduce the overlap and duplication that has been apparent. And there is overlap and duplication. While those on the other side do not see that as an issue, here on this side we recognise that when you duplicate and overlap what you actually do is waste time. And what you do for organisations that are focused on providing education is you cost productivity; because, while you are filling out all those forms for two different regulators, you are taking your eye off the prize. What you should be doing is providing a quality educational experience for international students in this country.

The Overseas Students Ombudsman said:

The OSO transfers certain complaints to the TPS, where it is better suited to deal with those complaints. This includes complaints about provider closures and complaints about an unpaid refund following a student visa refusal, where the TPS can pay the refund directly to the student.

The Department of Immigration and Border Protection noted that the amendments reflect Australia's visa program. They said:

Increasing the flexibility of education providers to claim more than 50 per cent of tuition fees upfront complements Australia's student visa framework, in which some students are required to show that they have sufficient financial resources to cover course fees, living expenses and travel costs in order to obtain a student visa. The financial requirements for student visas are designed to reduce the risk of international students experiencing financial hardship while in Australia and ensure that international students have adequate financial support for the duration of their studies.

Another inquiry that the committee is looking at goes to working visas. We heard about the shonky practices of 7-Eleven. In certain countries it was promoted that you would have no problems at all in Australia as an international student getting a job. You really did not need to worry too much about having enough money in the bank account to cover your full costs because you could always get job. What we have seen is those students absolutely exploited over a long period of time with respect to that. They are having to take on work that is not appropriately or legally renumerated, which is a great shame. We need to ensure that the legislation surrounding and regulating international students' education does complement our visa program.

Australian Government Schools International noted that often it is not the students themselves who are responsible for paying for their courses but parents, governments or other organisations, all of whom might prefer the option to pay all fees up-front upfront. Their evidence is that 'removing the restriction on payments of 50 per cent of tuition fees provides parents and students with greater choice and flexibility'. Here on this side we understand that flexibility, particularly in education, is fundamental.

When I went to uni to study science in Melbourne, I had to be there from nine to five. It was not a 20-hour a week course. I had to be there on campus. I had to move away from home if I needed to et cetera. Going back to study as a mature age student the flexible options were fantastic because by then I was a parent of many young children—fabulous young adults now—and I needed the flexibility. I was living in regional Australia, so I needed the flexibility afforded by online options and indeed studying on weekends or studying at night—being able to fit into my own life. That increasingly over time is exactly where higher education has had to position itself in order to meet the expectations, not just of international students, but also of our domestic student cohort. Funnily enough, it fits in with our government's focus on having an agile economy that meets the demands of our citizenry and our economy.

Universities Australia also noted that parents would prefer to make payments of more than 50 per cent and, because of the difficulty of getting funds out of some countries due to internal unrest or restriction, some parents would prefer to make tuition payments up front rather than leaving large sums of money in students' everyday accounts in Australia. That is a very sensible common sense approach to the reality of what we are dealing with, that these people are not growing up in the very comfortable leafy suburbs which the Greens represent or even in the suburbs the Labor Party represents. These students come from places where the stability of financial institutions and the stability of the wider society cannot be guaranteed.

The Independent Schools Council of Australia and the Australian Council for Private Education and Training also made positive comments. The report will be handed down later today. Obviously, as a government senator, I am incredibly proud of the legislation which seeks to get the balance right between protecting students and growing our industry.

12:23 pm

Photo of Deborah O'NeillDeborah O'Neill (NSW, Australian Labor Party) Share this | | Hansard source

I rise to put remarks on the record as a Labor senator in regard to Education Services for Overseas Students Amendment (Streamlining Regulation) Bill 2015 and the Education Services for Overseas Students (Registration Charges) Amendment (Streamlining Regulation) Bill 2015. 'Streamlining regulation' is the part which first caught my attention and I worry about what that might mean for who gets the benefit and who ends up paying the cost. One of the things we have seen on occasion after occasion since the election of the Abbott-Turnbull government is days where they have heralded great advances for the nation in terms of cutting red tape. In the midst of their haste to cut red tape—which is also sometimes very necessary regulation to ensure that people have the safety and protection against very powerful interests that would exploit them—we have already seen this government throw the baby out with the bathwater on more than one occasion. That is why we need to pay close attention to this legislation and to watch carefully what it is the government say they are seeking to do and what the unintended consequences of them, in their haste, pressing forward may end up costing those who need the protection of regulation that this government seem too hastily ready to remove from too much legislation.

Let us have a look at what ESOS is—the term we use for 'education services for overseas students'—and why it is such of an important debate for our country today. The fact that international education is our highest earning service in terms of export means that this bill requires incredible scrutiny. We know that the Education Services for Overseas Students Act 2002 and the National Code of Practice for Registration Authorities and Providers of Education and Training to Overseas Students 2007 were instrumental in establishing obligations on Australian institutions to make sure that international students received services of a high quality.

This is an area where students have not always been guaranteed access to high-quality education nor access to processes that were transparent and enabling and gave them a right to ask questions about the quality of the services they were receiving and to ensure that funds they provided for courses were being properly spent and well allocated to their education. The ESOS Act was established to make sure that tuition assurance and refunds for overseas students were available.

I want to make some remarks on Labor's amendment, foreshadowed by the minister in the chamber this morning, which will go to the fifth schedule in the act, talking about the need for providers to keep fees in a separate account. It goes to the first principle of why the act was established in the first place. Sometimes, like the great romances people might have, they might start off wonderfully but when things start to fall apart, there needs to be a way for there to be redress, where a parting of the ways can be done in a way which does not unduly benefit one over the other. Sadly international students often arrive with a language disadvantage and a language set of practices that do not enable them to fight big institutions and perhaps because of a lack of understanding about the processes in Australia, they were required by legislation to have greater protections wrapped around them.

The other role of ESOS when it was established was to protect and enhance Australia's reputation for excellence in education and training services. I know there has been sufficient commentary already about the critical demand for providing assurances of the quality of the experience people are going to have when they come to university in Australia. The foreshadowing of changes to the VET legislation, which in my view are way too late, by a very tardy government in regard to the VET sector, contrast markedly with their haste to change things with this legislation and their haste particularly in their early period of government to get rid of protections from all sorts of legislation. We want to make sure that this significant industry, this significant enabler of learning right across the globe, which we are a part of, maintains its standards and improves constantly on those standards in a highly competitive environment.

The role of ESOS originally was also to ensure that educational institutions report information that is necessary to support the administration of immigration laws in regard to student visas. That was a critical part of it. Labor will always look at this legislation making sure that there is due regard given to that dimension of it. I put on the record my incredible concern about the exploitation of students who are on student visas who are now a part of the conversation in the public place about the 7-Eleven franchise chain. I know that the Acting Deputy President, in her role as the chair of the Education and Employment References Committee, is leading a very significant inquiry into the practices of a company that has decided that the exploitation of student workers for their own purposes is a ripe ground for growing their business in the most unethical way.

Here we have students coming to university—clearly intellectually capable students, though they might lack a degree of cultural knowledge about what a fair wage is in Australia—who have been engaged by franchisees. With their wages being paid by head office—let's not let head office off the hook, as well—those students have had their visa status used against them. This plays into other action from the government, and is why our looking very carefully at this piece of legislation is so important. Those very students who are going to be disadvantaged by the 7-Eleven chain continuing this practice are the students who are desperately in need of this government giving them a visa amnesty. Yet we have a government that refuses to do that.

So students can be vulnerable in a number of ways, not just in their interactions with the institutions at which they seek to study but also in terms of exploitation of the fact that they are on a visa, and a visa with very specific restrictions. This visa says they are allowed to work for no more than 40 hours over a two-week period, and when they have broken that arrangement—often unknowingly, by coercion by their employer—they find themselves in a situation where they have no power. They are just looking for a little income to feed and clothe themselves and to pay for the necessities for their study so as not to be a burden on their families back home, and they are being exploited.

So it is not all good news in this sector. I have had students say to me: 'I thought that I would come to this country and that I would find a fair and free democracy; that my wages would be safe.' Yet what we are seeing is wage fraud being perpetrated on these students. So before we start throwing out regulation—because this government said that they are going to come in and cut regulation, as if that is going to absolutely transform the lives of every person in the country in a positive way—we need to give it the due scrutiny it deserves.

Why do we need this universal protection scheme? I guess the Tuition Protection Service provides both a universal and a streamlined approach to placing or refunding students when their educational institution cannot meet its obligations. This reality, the Tuition Protection Service, came into being because we had revelations of an incredible inadequacy of supervision in the sector that, in the period of 2008 to 2011, led to 54 educational institutions closing and over 13,000 international students being affected by those closures. One of the big problems is that only 11 of those 54 educational institutions were actually able to meet, or partially meet, their refund obligations. We should not forget that. The legislative change undertaken by the Gillard government in the last parliament was significant and effective in redressing that big problem. At the time there were three tiers of tuition protection: there were providers who were meeting their obligation to students; there were the tuition assurance schemes; and there was the ESOS Assurance Fund. The ESOS Assurance Fund is a critical part of schedule 5 in the piece of legislation that is being put here today.

When that ESOS Act of 2012 came in to deal with risk—and this is where Labor's concerns with this particular piece of legislation lie—it was to support the viability and the sustainability of that tuition protection scheme. To ensure that, there was a limit on the amount of course fees that could be collected by the educational institution. Basically they could not take the money and run, which is what we saw happening. The limitation was to make sure they could not collect more than 50 per cent of the total fees for courses of more than 24 weeks duration prior to a student commencing the course. It was very clearly aimed at reducing potential refund liabilities for both the educational institution and the tuition protection scheme. It also required stronger record keeping of student contact details and of academic progress to make sure that students did not just land in the country and disappear off the radar, with the money being held by the institution and no servicing of that student's education occurring. They were the reasons for the changes in 2012.

Let's come to where we are now. What we have in this piece of legislation is a call from the federal government to change this legislation one more time on the strength of 27 submissions from organisations. In principle, Labor does support the streamlining of regulatory and reporting requirements as much as they can be improved, once the sector has settled in response to Labor's original intervention with the 2012 legislation. But I have some concerns about the changes that are being proposed by the government here.

There are two parts. The first part, if we look at this explanatory memorandum, is all about streamlining registration and monitoring providers with the purpose of lining up reporting requirements and registration periods. The first response to that is that it sounds okay at first blush; if we can use new technologies in new ways that make transparency still achievable but with a lower impact on the people who have to enter, monitor and report the data, then essentially Labor would support that. This is consistent with the review of reporting requirements for the universities that was put forward by PhillipsKPA, which was one of the critical documents that was commissioned as part of Labor's consideration of the 2012 amendments to the bill. It was commissioned in August 2012 and released in 2013.

But there is a second part of the government's deregulation agenda embedded in this bill, that wants to remove a range of requirements that really affect the providers. While we have some support for those, we have concerns about the way in which that may be open to interpretation and that it may lead to a loss of security of funds for students who find themselves departing from an institution.

Some of the proposed provisions we see from this government really leave Labor senators with some concern around the removal of the requirement to report all instances of a student default, the definition of what a study period might be and the requirements for providers to enter into agreements with each overseas student, setting out the study period and the tuition fees payable for each student period. The government says that it is better to deal with this through a national code. But Labor have concerns not only because of the scale of the exercise that is undertaken and the value of the industry that is at risk if we get this legislation wrong; also the project of revising the national code is something that is being undertaken right now by the government. Without the clarity of what that national code looks like, there are probably some questions we should ask about what the current legislation might allow because it is going to draw on the code for some of its strength.

In regard to the measure amending the restriction on education providers receiving more than 50 per cent of tuition for a course before the student commences the course if it is longer than 24 weeks, Labor understand the arguments that have been put that the change is going to give students the ability to pay more. But what does that mean in practice and what does it mean to ensure that students are genuinely freely choosing to do that, and where is the point at which we can get some oversight of whether there is coercion?

If I could go to the explanatory memorandum and look at the facts about one of the arguments being put by the government that there is regulatory failure and that they need to change it because students have limited choice on payment options. The data they source tell us that only seven per cent of students, on average, made a significant prepayment of more than one semester at their time of enrolment. Granted it does go on to say that there is significant variation by sector, with ELICOS students paying 44 per cent in advance compared to only four per cent in the higher education sector and five per cent in the VET sector, the problem here is that students really should be able to pay everything up-front. This is an imposition by not allowing them do something administratively simpler and to get the discounts that are available when you pay up-front. But if seven per cent is the number of students who are going to get the benefit of that then I wonder how broad that general claim really is and how valid that argument really is.

That is my constant concern with this government. I have just seen them do so many dodgy things and try to sneak through advantages for those who already have the most while kicking those who have the least when they are down. I do raise some concern about that.

As I said earlier in my remarks, when students commence their studies in Australia—and tens of thousands if not hundreds of thousands of students now have come through and have had wonderful learning experiences in this country under different regimes and taken back an advantageous view of Australia's tertiary sector—we all know that, from time to time, things do come to tears, things do fall apart. That is why, with reservations, Labor will support this legislation. But we will seek to amend it specifically with regard to the student's capacity to have clear sight of the money that should be rightly theirs if their course, for any reason, does not proceed, or if they become unwell and they cannot proceed, that the money that they have paid up-front, even if it is only seven per cent, should be available for them to have access to.

We cannot allow the situation to occur, once again, where the failures of tertiary institutions were so significant that hundreds of thousands of students were negatively affected. The impact on those individual students is something that I am sure they still keenly feel and that their families still keenly feel. Their families often go without a great deal to enable one particularly gifted child the opportunity of studying in Australia. Families who have been disadvantaged by that investment falling over need great protection.

While supporting this legislation in principle and the capacity of technology and new systems to improve and streamline the way in which students might be enrolled and their fees taken, Labor will make sure—and we will seek the support of the crossbenchers—in our amendments that the money that needs to be there when things fall away, when it all ends in tears and the milk is spilt—

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

When things fall apart.

Photo of Deborah O'NeillDeborah O'Neill (NSW, Australian Labor Party) Share this | | Hansard source

A great title for a novel—that students and their families who are investing in them and their futures can access a fair and timely response and secure the funding return that is their just due.

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.

      12:53 pm

      Photo of Sue LinesSue Lines (WA, Australian Labor Party) Share this | | Hansard source

      I would just like to start by putting the Education Services for Overseas Students Amendment (Streamlining Regulation) Bill 2015 and the Education Services for Overseas Students (Registration Charges) Amendment (Streamlining Regulation) Bill 2015 in the context of the sorts of changes that the Turnbull government is seeking to put across all aspects of education in our country, whether it is early childhood education and care, primary school, secondary, TAFE or other education. In that concept, there is one word that links all of those services together, and that is 'deregulation'.

      We have heard the concerns of the sector in relation to deregulation. Last week in this place, Labor asked the minister a number of questions about the casualisation of the early childhood sector. We saw in the media a couple of weeks ago comments that Minister Birmingham made previously about moving to a voucher system in primary schools. Imagine that: a voucher system, completely deregulating our primary school sector! We have seen the sorts of concerns and indeed the explosion of private colleges in the TAFE area, and we have seen in Victoria the Victorian government move to take back 8,000 TAFE qualifications.

      And now we have seen—and we have fought in this place and in the wider community—the Turnbull government's deregulation of the university sector. We spent most of last year fighting their moves to introduce $100,000 degrees. Despite them trying to say that we got it wrong, that has now been shelved, but it has not gone away. It is still their intention to introduce $100,000 degrees, just not yet, because they have not got the support for it. Labor from day one, along with the National Union of Students and a whole range of other community organisations, has opposed that move, and thankfully crossbench senators and the Greens also do not support the deregulation of universities, which would make it incredibly expensive and prohibitive for a range of Australian students to attend university.

      Those opposite can shake their heads, but deregulation is the key word from the Turnbull government when it comes to education, whether it is early childhood education and care—and I must say I was appalled last week to stand in this place and hear about early childhood education and care. We all know the critical impact that early education has on children from the ages of nought to three, and what did we hear from the Turnbull government? We heard 'business models' and 'profit'. How disgraceful. There was no mention of quality.

      Again, we see in this place the impact of the government's proposal to deregulate international students. It is important to acknowledge that international students are big business for Australian universities. This is one thing I have learnt in all of the inquiries that we have done across the university sector, whether they were into the government's disgraceful attempt to introduce $100,000 degrees or this latest move by the government to deregulate. International students are big business, but they should not just be big business. We should be proud of the country being able to offer quality educational services to all who seek them, whether it is our own local students or it is international students.

      What should be at the forefront of that experience of people coming to study at university in Australia is quality: proper, quality courses that change people's lives. I can say from my own experience as a very young mature-age student—I went to uni as a 26-year-old, and I went to Murdoch University in Western Australia—that that was a life-changing experience. That is what we want higher education to be. We want it to change people's lives, to give them greater opportunity. That is really what we want to do.

      Unfortunately, we know that that requires our universities to be transparent, and it requires regulation. It does not happen on its own. It is not a trickle-down effect. It does not happen because nobody is watching, and it will not happen if we continue to deregulate our higher education sector. Of course, it should be regulated to the highest standards. The privilege to go and study at a higher education institution should be made available to many people in our community, whether they are international students or not. That should be an opportunity that is open to all. But it should be a proper opportunity, a life-changing opportunity, a life-enhancing opportunity.

      That needs good, strong regulation—of course, not overregulation. That is not what Labor is calling for. It needs regulation to make sure that, when international students pay funds, those funds are protected and that universities act with great transparency and act in a proper way in relation to international students, because they are big business. Certainly, when we held the inquiry into the government's shelved $100,000 degrees, university after university told us that international students were a significant part of their student body. It did not matter if they were a rural or regional university or, indeed, a university based in our capital cities: international students were very much a core of their student bodies. We want to make sure that that core is protected—and, of course, our reputation.

      We want to keep and indeed enhance our reputation as a country which is open and transparent, a country where students can come without fear of being ripped off and without fear of paying a lot of money and not getting a quality course or indeed not getting a degree at the end that is worth very much. Those are very important and they are also important to Australia, to continue as a leading country in terms of international students. We have world-standard universities and we have quite a small university body, which reflects our population, and we do want to keep that at world standard. We can name the universities which are competing at world standards and which are very highly ranked, but I think that all of our universities are at a world-standard level. So we want our reputation to be upheld. We want that quality and our reputation to grow and we want to continue to be held at a particular level.

      International students make a significant investment, as do their families when sending a child overseas. Not only do they have to pay fees but that child also has to be supported either through working or through continuing to be supported at home. Families make a significant decision when they choose an overseas university, and we want them to keep choosing Australia so we have to have the highest standards. We have to have a quality educational service, and in order to get there we need regulation. It will not happen without regulation.

      When Labor was in government we commissioned a review of reporting requirements for universities and, of course, Labor does support, in part, some of the streamlining of regulation. We do not want to see students and universities overburdened by regulation, but we do want to see very clear protective regulation in part. And some of that streamlining of the regulations is outlined in the bills, as recommended in that report—a report which Labor commissioned.

      The second part, though, relates to the government's deregulation agenda. As I said at the outset, in early childhood education and care right through to higher education the government's keywords in those areas are not quality, protection for students or even cost, surprisingly. It is 'deregulation'.

      As Labor has said, and as you will hear other Labor senators say in this place, that is a danger, as it seeks to remove a range of requirements that affect providers and were indeed partly introduced in response to the last major crisis in the international colleges in 2008 and 2009. None of us in this place, no matter where we come from, want a return to that—where our international reputation, particularly in relation to Indian students, was well and truly on the line. We had some awful protests. We had Indian students allegedly being bullied. We had collapse after collapse, with shonky operators taking the significant funds they received from international students and fleeing. We do not want to see that, because that is not the sort of country we are. We are not a country that promotes shonks and we are not a country that allows people to rip students off in that way. That is not who we are as a country. And of course, that was significant damage to our reputation. Partly, that collapse occurred because we did not have the regulation in place.

      We do need to keep updating regulation. It is probably not appropriate to say that regulation that applied in 2008-09 is going to lead us forward from 2016 onward. It does need to be something we continue to review, because regulation can become a burden if it no longer matches what is being provided. But regulation in and of itself is required because none of us in this place want to go back to what we saw in 2008 and 2009. And we know already that in the era of international education we must have proper regulation that protects students who come here in good faith.

      When you choose a university it is a very exciting time. You make the choice and you make your decision about what sort of degree you want to pursue, and it sets your career opportunities up for the future. It is a very exciting time, so we want to make sure that the highest standard of regulations are in place so that that decision made by the international student and their family is made in an environment they can feel comfortable in. We want to make sure they know they will get the highest-quality education and will be secure in the knowledge that they are not going to get scammed or ripped off by a shonky operator or someone taking advantage of them.

      It is very confusing when you come to Australia from another country. You arrive and everything is different, and you may have English as a second or third language. It is an environment where we need to welcome students, and we need to be able to say to them confidently, 'We have good, strong regulation in place that's going to protect your interests. It's designed to protect you as the international student.' It is us saying in another way how much we value that international student and their family making that often-difficult decision to send their child overseas to study.

      When Labor were in government we initiated in response to those college collapses in 2008-09 a range of reforms, including the creation of the Tuition Protection Service. Alarmingly, some of the requirements in this bill seek to remove those protections that Labor put in place.

      We have seen another form of exploitation of international students in this country with the appalling and shocking exploitation of students by 7-Eleven. We heard in evidence that students were getting paid $12 an hour. The Shop, Distributive and Allied Employees Association, the union in the retail sector, told us that they had calculated for one of those international students that he was working for about $5 or $6 an hour. That is shameful, and I am not suggesting for one minute that anyone in this place thinks that is okay, but it does demonstrate that where international students are concerned there is a market for some who are unscrupulous to exploit them. In the 7-Eleven case, we have already heard in evidence just from the Fels panel that they have done underpayments for 101 students, and that amount of underpayment is more than $2 million. I think people perhaps do not appreciate that these are low-paid jobs. These are jobs where students are earning about $20 an hour, so, to get to an underpayment of around $23,000 per student, which is what the Fels panel is telling us, is a staggering underpayment.

      We have also heard, in relation to 7-Eleven's international students, how they were forced to work more than 20 hours a week, breaching their visa conditions, putting at risk their university career and degree, putting at risk all the money their family had got together to enable that student to come to Australia to study—all of that put at risk because a dodgy company chose to exploit them. We know that in the area of visa workers for international students the current regulations we have are not enough. We certainly want to see a beefing up of regulation there.

      Of course I am not suggesting for a moment that our universities are behaving with some of the unscrupulous practices we have seen from 7-Eleven and others—Pizza Hut just last week. These are all going on now. But it does clearly demonstrate that international students are seen by some as big business. Obviously, where there is a lot of money out there, we do see elements of exploitation. In the cases of 7-Eleven and Pizza Hut, there has been shocking exploitation of international students.

      That damages our reputation. It may not be about the quality of the educational experience the student is receiving, but nevertheless people reading the story—particularly a student looking at Australia as a market to come to to study next year—will take it into account. 'Gosh, I've got to work to look after myself, and I'm entitled to work 20 hours a week, but it seems that I'm going to be exploited.' That is bad for everyone. It is certainly bad for our reputation overseas and it is bad for our universities to be caught up in that kind of story. If there is no story—if people have a good story about the quality of their educational experience in Australia and a good story about not being exploited at work—that in and of itself promotes Australia as a destination that is safe and welcoming to come to. So we do not want to see that kind of thing. We know that, if we want to retain our reputation and our world-class systems, international students need more protection, not less.

      Labor certainly wants to put on the public record in the Australian parliament that these bills before the Senate today remove or weaken student protections. We want that loud and clear. We do not want there to be any mistake that Labor thinks that this is additional protection for students. We do not. We absolutely believe and want on the public record that these bills remove or weaken student protections. These bills will not, as the government states, give international students more protections; they will give them less. We are very clear about that. It is wrong to argue, as the government will, that all deregulation is good. We can look back at the events of 2008 and 2009 to see the perils of not having enough regulation in place, of getting the settings wrong. None of us in this place want to go back to that situation. It is there for us to learn from, but it would seem that the government has not learnt or is not listening, because the current bills will weaken protections for international students. That history of 2008 and 2009 shows us that regulation is needed.

      We do not want to see scams and rip-offs of international students. We see in the visa area that without adequate protections students are vulnerable. International students are big business, and some unscrupulous operators will take advantage. We do not want that. It is bad for all students. If there is a scam around an Australian university, that affects not only international students but also the local students who have a choice about what university they go to. 'No, I won't go to University X, because they've had all that horrible scam of international students.' It affects us all. We want a quality, well-regulated system that protects international students.

      1:13 pm

      Photo of Lisa SinghLisa Singh (Tasmania, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Attorney General) Share this | | Hansard source

      The Education Services for Overseas Students Amendment (Streamlining Regulation) Bill 2015 really has two main parts. The first part is streamlining of the regulatory and reporting requirement. The opposition does give its support to that part in itself. However, the second part relates to the government's deregulation agenda in higher education and seeks to remove a range of requirements that affect providers and that were largely introduced, in fact, by Labor when in government in response to the last time we had a major crisis in the international education sector, which followed the collapses of colleges in 2008-2009 in particular. That is the part the opposition has grave concerns about, will move amendments to and will ask the government to reconsider.

      When we talk about the international education sector, the international education market, we need to recognise the importance of quality—the importance of safeguarding that quality and having strict standards in relation to that quality. We know that this is an incredibly important part of the Australian economy. I understand it is second to coal and iron ore in terms of how important it is to our economy and worth some $18 billion a year. So, over and above the economic benefits that we know the international education market has, we need to ensure that, we as a country, stand proud in what we deliver and what we provide. Regulation is so important, because we know that there are those out there who, unscrupulously, will take advantage of any loophole they can find and offer dodgy courses which will lead, unfortunately, to the outcomes that we saw during the Howard era.

      I want to draw on a little bit of history, though, in talking about the safeguarding of overseas students who come to study in Australia. This idea of a single framework to safeguard overseas students was first introduced by the Hawke government through the Education Services for Overseas Students (Registration of Providers and Financial Regulation) Act 1991. It has had quite a reform journey since that time, and quite rightly so, because we are not talking about an education sector that is static or a time period that is static. Regulations must change as circumstances must change, so perhaps the protections that were provided back in 2009 or in 2012 may not be appropriate for international students in 2016. That is why the opposition takes a very constructive approach to looking at what is needed for the international student sector.

      This issue, though, of standards and of safeguarding quality, I have to say, is dear to my heart. I am the daughter of someone who migrated to Australia as an international student. It was the attractiveness of the standards and the quality education that Australia provided then, in the 1960s, which made Australia a drawcard for my father, as it did for so many other people, so many other overseas students at that time.

      And it has continued to be. Australia has been, certainly, right up there with a number of other countries in the world as a place to come and study and receive a quality education and a quality outcome in that process. But, unfortunately, we have had some hiccups over the last number of years. It is for those reasons that Labor, when we talk about offering international students a pathway for the future, stand very firm on the need to have 'safeguarding quality' as a key to maintaining our high reputation. Why do we do that? Because if we value every human being as equal to ourselves then we would want the same standards provided in higher education to those students coming from overseas to study here as we would want for ourselves. We would not want those students being exploited. We would not want those students to receive a watered-down degree, or have watered-down protections in relation to the fees that they have paid and the educational outcomes that they have then received in return.

      That is why this kind of ideological zeal that this government has in relation to deregulation is just so wrong-ended. It is completely wrong-ended. It is fine to want to reduce some red tape. We all understand that. We all understand the importance of streamlining something to make things easier and run more efficiently for students, as well as for those education providers, but, to me, talking about deregulation speaks of weakening those necessary and effective protections for overseas students that are needed now more than ever.

      We do not want in this place—and I am sure I speak for all senators—a repeat of what occurred during the Howard era with all of those terrible scams that were put out through those colleges operating at the time, which, as we know, culminated in not only a major economic crisis but also an educational crisis with the international education enrolments collapsing at that time. I think it was, if we look back, an issue of naivety on behalf of the Howard government at that time, which Labor, when it came into government, had to fix up in a fairly major way. Between 2008 and 2011 we saw 54 colleges collapse and 13,000 students affected, of whom only 312 students got refunds from their educational institutions.

      Since then, there has also been the saga of Greenwich University, where a scam degree factory operated out of Norfolk Island, which the Howard government allowed to run rampant, I understand, for some four years. It was not only an example of dodgy practice—it was really quite a bizarre situation.

      I think that the efforts of all of the reputable providers who strive day in, day out, to maintain high standards, treat students fairly and with dignity are tainted, unfortunately, when there is some dodgy education provider in the mix. That is a shameful thing—when we know that there are so many good education providers out there whose reputations get damaged in the process.

      Unfortunately, there have been too many familiar stories in this space, though. It is that concern that I certainly have. I know that Senator Lines also touched on issues to do with the recent sham with contracting arrangements at 7-Eleven. We saw something similar with Australia Post as well recently, with international students being exploited. Even though we are aware of some of these cases—7-Eleven, educational colleges, Australia Post—it raises the question of how many scams or exploitations of international students we are not aware of. This is only what is being reported and what has been found out. We know that there could indeed be a number of reports that go hidden, and in that sense we are left in a cloud of secrecy.

      So I do raise the importance of the additional comments that were provided in the Senate committee report on this bill. They went into some detail as to what Labor's position is—the fact that we support the positive elements of this bill but that we want the government to reconsider those provisions that we do not see as reasonable. Anything that is reasonable, of course, we would support, but we have that anxiety, as I mentioned, about the potential consequences of the deregulation agenda of this government.

      If I can reiterate the position that Senator Carr spoke of here and that our shadow assistant minister for higher education spoke of in the other place: we are absolutely willing to do what is necessary in relation to reducing red tape, but we do not want to see the watering-down of protections for international students, which would threaten international education, which, as I said earlier, is one of our biggest export industries. So we reserve the right to make those amendments here in the Senate in that regard.

      Any harm to Australia's reputation as an education provider will really stem the increasing flow of students into this country and the flow of export income along with them. I am sure the government understands the importance of that, if nothing else—the importance of this market to our bottom line in relation to our economy. We know the freedom that is available to students globally now and that they shop around and look at what is the best and most affordable education on offer to them. Australia may not always be their first port of call, but we want them to make the choice about coming to Australia and being educated here on the basis of quality, on the basis of safety and on the basis that they are not exploited—that they are able to come here and live safely, comfortably, in a supported, multicultural community and come out of it at the end with a really decent quality education and an enjoyable experience as a student whilst here. That is what we would want for our own sons and daughters if they were to travel overseas and study in an institution in another country, and I cannot see why we would want anything less than that for international students coming here to Australia.

      On the basis of that, Labor will support in essence the main first part of this bill, but we certainly will be moving amendments in the committee stage and making very clear the reasons why this bill is flawed in its second part. We have shown over the years that we were able to clean up the mess of the Howard government and ensure that we did not get a repeat of the collapse of this educational sector with the closure—the necessary closure, of course—of those colleges and the withdrawal of enrolments. We want to ensure that in this country we have a proud, well-functioning, properly regulated international education market that continues to provide billions of dollars to our economy. The only way we will do that is by ensuring we have good legislation, with good regulations that help make that happen, and a positive attitude to our approach to international students in this country.

      1:27 pm

      Photo of David FawcettDavid Fawcett (SA, Liberal Party) Share this | | Hansard source

      I also rise to make a contribution on the Education Services for Overseas Students Amendment (Streamlining Regulation) Bill 2015. This is an important industry for Australia. The senators opposite are calling on us to be positive about this. We are very positive about this sector. It is in fact, as a number of reports show, probably one of our largest inbound industries in terms of capital. It is about third after iron ore or coal. Nationally there are over 420,000 students who choose to come and study in Australia, from over 193 different countries. Not only does that provide work for our educational institutions but, as someone who is involved in our foreign affairs, defence and trade committees and efforts, I believe it is an incredibly good expression of soft power and soft diplomacy, getting people to come here to experience Australia. Overwhelmingly, those people go home to their own countries with a positive experience of Australia.

      In fact, a survey of students was done just recently by the University of Adelaide, in my own home state, and overwhelmingly the students said that South Australia was a great place to come because it felt safe, things were close, the people were friendly and the standard of education was good. So they went home with a very positive view of Australia. As we have seen from things like the original Colombo Plan and now the New Colombo Plan, which has been a particular initiative of the Minister for Foreign Affairs, Julie Bishop, those ties matter. Those long-term interactions with people of other countries, both the students and their families, and their employers in the future, matter because we actually build understanding between people who are going to be conducting business transactions and building relationships that will affect our economy as well as theirs.

      To answer Senator Singh's comment, we are very positive about international students and education because it contributes a lot both now and into the future. In South Australia in particular it is an area that has been growing significantly. In the last year alone there has been about 8½ per cent growth in the sector. We have gone from just over 28,000 students studying in South Australia to now nearly 31,000 students in South Australia. In terms of the value to our economy, over $1 billion a year is brought into the South Australian economy. Depending on which reports you read, the estimates are that over 7,000 jobs are directly or indirectly created as a result of international students choosing to study in South Australia. That is a very positive thing for us. It is not guaranteed though. We cannot always assume that that is going to occur.

      If we look at cost, for example, in a recent survey that was done of over 5,000 students from 15 different nations, two key things were identified. The first was that Australia was not necessarily the cheapest place. In fact, for these 5,000 students who were surveyed across a range of courses we were one of the most expensive places. It was estimated that, on average, around $42,000 was required by the time they paid fees and paid for their support—things like accommodation, transport or just living in South Australia. Given that people have consistently said that South Australia is a cheaper place to live compared to many other spots in the world then clearly a lot of that comes down to fees. In Singapore, for example, it was nearly $3,000 a year cheaper than in Australia to live and study. In the USA it was some $6,000 a year cheaper. This is an international market where students can choose, or parents can choose, with their children, where they entrust their children to go and study. If price is an issue—and it is certainly something that is reflected in the studies—the more expensive it is for our providers to provide education then the attractiveness of Australia as a place to be doing business is reduced.

      The second key finding was that, for these 5,000 people who were surveyed, the perception was that Australia was no longer the highest in terms of quality. I think we are about No. 5 in terms of quality. Clearly, we should be seeking to help our providers in these sectors reduce their costs and focus on putting their effort into the quality of education as well as the experience for the student, so that the story that goes home to prospective students and families who may be looking to send their children here is that Australia is a safe and friendly place and that it offers quality education and affordable education.

      Government policy does matter in terms of affecting those things and affecting demand. Deloitte Access Economics highlighted in one of their reports that between 2010 and 2012 there was about a 19 per cent decrease in the value of the international student sector due to changes in Australia. They said in their report that those changes were due to a number of things. Three in particular came down to government policy, which was a tightening of skills requirements. In 2010, occupations like hairdressing and cooking were removed from the skills occupation list. The number of people who were applying for visas fell from over 31,000 in 2008-09 to 693 in 2010-11. Regarding the temporary stay requirement, in 2011, students were required to prove that they were temporary residents and had no intention to stay permanently. The impact of the genuine temporary entrant requirement resulted in the acceptance rate falling—in this case from India—from 90.8 per cent in 2007-08 to only 49.6 per cent in 2010-11. There was also a crackdown with new visa requirements that allowed students who studied at bachelor level to stay for up to four years after they graduated. But because this only applied to people at university, the demand for VET subsequently decreased.

      Some of those measures are valid, although at the moment there is significant debate around visas and whether we should have further reform of visas, given that some of the people who are here studying as international students and who are keen to remain are studying in areas where there are recognised shortages and skills. If Australians are not choosing to do that study and get the qualifications and we have businesses suffering as a result because they cannot attract a skilled workforce then it appears logical that if someone has chosen to come and study in Australia and pay for their education and then wants to remain and work in that sector and contribute back to Australia's economy that is something we should be encouraging.

      The point I make here is that government legislation does make a difference. That is why it is important that the changes we make in this sector value what this brings. Speaking as a South Australian, I am clearly keen to make sure that South Australia retains the value that it currently has and, in fact, grows. I think the state government has set a target of around 34,000 people by 2017 as something it would like to see. We need to make sure that legislation we bring forward does, in fact, help these providers to deliver a better quality of education at a lower cost.

      The reforms that have been proposed in the Education Services for Overseas Students Amendment (Streamlining Regulation) Bill 2015 and the Education Services for Overseas Students (Registration Charges) Amendment (Streamlining Regulation) Bill 2015 are enablers to do just that. These reforms, as you would expect, have been developed with considerable consultation with the sectors and with overseas students, particularly their peak body, over the last couple of years. Their peak body has indeed made submissions to the Senate inquiry that was conducted into these bills.

      The reforms in schedule 5 of the bill are going to deliver some $76 million worth of savings to providers just through reducing red tape and duplication. As I highlighted, we are in a competitive environment, and parents have a choice as to where they encourage their children to go and study. As we have seen, Singapore and the US are both significantly cheaper on a per annum basis than Australia. So the net effect of being able to reduce the cost to providers, by some $76 million each year, will go some way to helping them to make sure that Australia remains an attractive place for people to send their children. That also means that, rather than duplicating efforts and dealing with red tape, these providers can spend more time improving the quality of the education that they are delivering. The Council of International Students, who were one of the groups consulted, indicated in their submission to the Senate inquiry that they do not see that this bill in any way weakens student protections. In fact, they welcomed aspects of the bill, such as the flexibility in terms of being able to provide more than 50 per cent of their course fees up-front if they wish to.

      I will go through some of the particulars of the bill, but I thought it was important to set that broad context first. It is important for Australia, and it is particularly important for South Australia. We value it and we recognise that it needs to be affordable and quality, and one of the ways to achieve that is to get rid of unnecessary duplication and red tape. That is the target of this bill, with some $76 million of savings. It has not been done in isolation; it has been done in consultation both with the providers and, importantly, with the international student body, who are the people who are directly impacted by this. So, for those who wish to criticise the bill, it is important to recognise this does have broad support from the people who are impacted by it.

      Schedule 1 of the bill goes to streamlining registration, monitoring and quality assurance processes for education providers to provide a more seamless system. This means that the providers under the ESOS Act will be aligned with their domestic registration. So, rather than having to register twice, there will be the one process that deals with both their domestic and international markets—which seems to a logical person just to make sense. The requests for information for providers will also be reduced, with external regulatory bodies being able to use information collected for domestic registration in registering providers under ESOS. When I speak to small business in Australia, many sectors, including the education sector, tell me that one of the most frustrating things is having to provide the same information multiple times to different government departments or, in some cases, to the same government department but for a different purpose. Any legislation that we can provide that means that they only have to provide the information once is just good governance let alone a benefit to providers.

      Schedule 2 looks at internal review of decisions. This saves time for providers by giving them access to an internal review process for decisions taken by the regulators. It provides the option to avoid lengthy appeals processes through the Administrative Appeals Tribunal when an internal review may in fact be a better way to resolve issues and to save time and resources. Importantly, in terms of consistency, the ESOS Act becomes consistent with domestic legislation for providers.

      Schedule 3 looks at ministerial directions. It allows the minister to direct an agency to focus on a particular issue in the sector. Whether it is, for example, academic misconduct or cheating, they can direct the agency to look at that issue without having to actually identify a particular provider. That provides a good balance in being able to focus their effort without being seen to unfairly disadvantage any particular provider.

      Schedule 4 looks to increase the powers of the Tuition Protection Service director to support quality assurance in international education. As I said in opening and setting the context, that survey of 5,000 students and their families found that quality was one the determining factors that they take into account when choosing where to come for their study. The TPS director, who is someone who is often privy to information about the activity of providers, plays a vital role in making sure that the providers meet their obligations to students. If the TPS director sees issues that are not being rectified by providers, they can go to the regulators with recommendations that allow them to take quick action against the poor practices of particular providers. That is another way of making sure that we have a system in place that works with providers and, if need be, directly with the regulators in a targeted way to lift the quality of what is being provided. Schedule 5 goes to other amendments, which is where we see the $75.9 million in savings for providers annually. As I said, this is going to be a significant boon in terms of making the sector cost competitive.

      Some of the practical issues that have been raised and are now reflected in the bill go to things like removing student default reporting. Currently, providers have to report within five days if they think a student has defaulted. But some of the reports indicate that there is sometimes uncertainty as to whether it is a genuine default—that is, a student has in fact chosen not to turn up at all for a course—or whether there has been a problem with transport or getting into the country or establishing themselves and turning up on the day. Whilst information still has to be provided, the reporting time frame has been extended to 31 days to enable them to ascertain whether or not it is a genuine default as opposed to reaching a conclusion within the first five days. Both providers and students indicated that they felt that time frame of five days was too short. Examples provided included an illness that might have prevented a student from turning up. For students under 18, clearly the welfare of that student and the duty of care of the provider to have an interest in the welfare of the student is important. So a reporting requirement of 14 days remains where the student is under 18. That measure around the student default reporting and refining their system saves some $16 million annually for the students.

      One of the areas that the student peak body for international students particularly supported was allowing students to have more choice in how much of their fees they paid up-front. Currently, the bill restricts providers from collecting more than 50 per cent of student fees up-front. This bill allows students to pay more if they wish. What that means is that, if there are favourable exchange rate conditions or other reasons it suits the student or their family to pay up-front, then they have the option to do that. Short courses continue to be exempt from this requirement and the definition has increased up to 25 weeks which better reflects short-course enrolment patterns. Again even this small change to better reflect what actually occurs on the ground is a saving of $1.2 million annually.

      The last area in here that has a significant saving for the sector is the removal of the designated account. At the moment—unlike domestic providers who can use the fees that are paid to invest directly in the innovation and developing of their product, their facilities and the quality of the course—international students have to hold prepaid tuition fees in a designated account, which means that they cannot use it. Public providers, such as universities, TAFEs and government schools, do not have to do that. Having private providers able to invest this money into the quality of the course means that they can act in the same way as public providers do. There will still be the ongoing financial viability checks to make sure that they are a fit and proper person to run the course and have the flexibility, but the estimates are that this will save some $27.7 million annually making them more cost effective and increasing competition.

      As I said at the start, this is an important sector for Australia—over 420,000 students for South Australia and more than 30,000 moving towards a target of 34,000 by 2017. It is worth more than a billion dollars to our economy. We need to get the settings right so that they remain cost competitive and they can focus on providing a quality education. I welcome this bill and we will be supporting it.

      1:47 pm

      Photo of Matthew CanavanMatthew Canavan (Queensland, Liberal National Party) Share this | | Hansard source

      It is also a great pleasure to rise to support this particular piece of legislation and associate myself with the comments of my colleague Senator Fawcett, who was right to say it is extremely important that we maintain the competitiveness and cost-effectiveness of our university sector if we want it to maintain its position as a very attractive place for international students to come to study. I certainly want to maintain that position.

      It is one of the largest export earners in our country. It has huge upside potential to grow, particularly with the growth to our north in the Asia-Pacific region. Like many of our export industries, it stands in a uniquely geographically determined area that can benefit from the rise of Asian countries and the increasing numbers in the Asian middle class. Of course, those people, as they go to the middle class, want a better education for their children—they are no different to Australians—they want a better future for their grandchildren and they will look to other areas of the world to make sure that they can receive the best education possible so that they can live up to that potential.

      I do think education is somewhat different in that it faces different challenges and risks than other sectors that are similarly exposed to that Asian growth—for example, in agriculture where the rise of an Asian middle class will certainly drive uptake of premium Australian products. As people seek to define themselves by the clothes they wear, the cars they drive and the food they eat, they will look to countries like Australia, which are known to produce premium food, to seek those needs. While that phenomenon will be there—people will look to higher quality education—another thing will happen in parallel to the increasing economic growth and sophistication of Asian economies, and that will be the improvement of their universities in Asia. Their universities will increasingly become some of the better in the world as they invest in their own institutions, as their economies become stronger and more able to invest in higher education to a similar extent than we can in this country.

      That will create both opportunities and challenges for our university sector. The opportunity will be there because there will be increased demand from both numbers of students in Asia and also the willingness to pay for a good-quality education from Asia. There will also be increases in supply of high-quality education in our region, particularly in Asian countries and that will make it more difficult for our domestic university sector to compete.

      Just to labour on this point a little bit, in a particular ranking released earlier this year—there are different measures of world university rankings—the 2014-15 rankings reported that two Asian universities are now in the top 25. The University of Tokyo and the National University of Singapore are now within the top two of the 25, compared with only one last year and none in 2011-12. Five years ago there were no Asian universities in the top 25 in the world and now there are two. I have not got this particular ranking in front of me for all universities, but the last time I looked there were no Australian universities in the top 25 at all. We usually have one in the top 50.

      In the top 50 there are six East Asian universities—from Japan, Singapore, Hong Kong, China and South Korea. Now in total 24 of the top 200 universities in the world are in Asia. That is just a small demonstration of what is occurring in our region and why it is so important that we continue to support a strong, competitive and cost-effective sector here in Australia so that we can maintain its position as a strong magnet for students to come here and study. A key part of that is making sure that the regulatory burden on our university sector is not over burdensome, and is not put in place to an extent which would limit or inhibit its ability to compete with those Asia-Pacific universities.

      This bill is not going to be a panacea for all those risks and challenges but it has make some important changes that will improve the competitiveness of our universities the changes that will reduce the amount of the overlap, duplication and red tape imposed on that sector. Senator Fawcett has usefully outlined what some of those changes will be. To put them in context, they stem from changes to the broader regulation of our higher education in about 2012, by which time the Commonwealth government had two type to agencies—with the Australian Skills Quality Authority and the Tertiary Education Quality Standards Agency—to provide overall regulatory oversight of the quality and standards of our tertiary sector. It was an important development to make sure those standards were maintained across the country.

      Those standards were in place for domestic students but of course they had an impact on the quality and standards of university courses for all students around our country. However, because we lifted the bar on the standards and oversight for domestic students, they had not been aligned with the regulatory standards we had in place for overseas accreditation. This is what this bill seeks to align. The education services for overseas students have different regulatory standards and different agencies covering that sector. This bill seeks to align those with the high domestic standards we now have in place. For example, we will allow only one designated agency to be in charge of both overseas and domestic students' accreditation—the TEQSA and the ASQA. We will allow the internal appeals processes of those bodies to deal with any complaints that may arise from the teaching of overseas students, instead of having to go to the and more costly and convoluted Administrative Appeals Tribunal. That will save red tape and costs. We will allow the minister to direct TEQSA and AQSA in regard to the accreditation arrangements for overseas students, just as the minister can for domestic students, and we will also expand the functions of the Tuition Protection Service, which functions as the director of that service, which is in place to help protect overseas students and the quality of their studies.

      All of those changes would appear to be supported by the opposition, at least in the recently tabled Senate committee report into this bill. They did not see opposition from Labor senators on that committee. I welcome that support. The Greens unfortunately, in their dissenting report, have rejected all of those changes and have not proposed any alternative scheme. The Greens have harped back to the fact that a lot of these things were put in place in the 2009 review conducted into the sector, conducted to make sure that there were high standards for overseas students. What they have ignored is that since 2009 we have put in these other agencies—AQSA and TEQSA—to improve the standards of domestic arrangements. We have somewhat brought the domestic standards and obligations up to what was deficient for overseas students. So there is no need now for specific overseas student regulations. That is something the opposition has accepted and I welcome that.

      The review which led to the changes in this bill was commissioned in May 2013 by the then Labor government. It obviously did not report until after the election and this bill seeks to put in place some of the recommendations, although further consultation was conducted on those recommendations and we now have this bill. So largely supported by the two major parties in this place is a constructive attempt to streamline regulations in this sector. There are some other amendments that are smaller in nature but do nonetheless provide substantial savings of up to $76 million for the sector. Reporting time frames for complaints will no longer be just five days but will be 31 days. Students will be allowed to pay up front in full for their fees if they so choose. At the moment the up-front fees are capped at 50 per cent. While that cap will remain—that an institution cannot ask for more than 50 per cent up-front payment—if a student so desires to pay more than 50 per cent of his or her fees up-front, they he will be allowed to do so—a sensible change which allows students to have that choice. If, say, they feel the exchange rates are attractive or they would like to make the payment while their parents are willing to do so and not after their marks come back, that is a fair and reasonable change which again I believe will be supported in the Senate committee report from the opposition. There will also be removal of the strict restrictions on regulations of the study period which students must cover—at the moment, 24 weeks. We will make that more flexible.

      My understanding of the Senate committee report is that the only matter of disagreement is what is called the designated accounts at the moment. So private overseas student operators must maintain a designated account for the fees and funds provided by overseas students, to put into what seems to be a trust account at the moment—I do not think that is a term in the legislation—whereas other public institutions do not have to do that when they are offering the services. Obviously some are not really competitively neutral between the public and the private sectors and this bill therefore seeks to remove that anomaly to make sure that public and private providers are at the same level.

      Photo of Kim CarrKim Carr (Victoria, Australian Labor Party, Shadow Minister Assisting the Leader for Science) Share this | | Hansard source

      Where are the crooks?

      Photo of Matthew CanavanMatthew Canavan (Queensland, Liberal National Party) Share this | | Hansard source

      The problem with the Labor Party is that they seek crooks everywhere and they just want to put regulation on everyone, including on the people doing the right thing. Why should we seek to impose more regulation on those providers doing the right thing rather than to clamp down on those doing the wrong thing? We should be rooting out the people who do the wrong thing, not putting up the cost for our entire university sector. That is what Labor are proposing to do. They are ignoring the fact that we have increased standards in universities since 2009. They are ignoring the fact that the vast bulk of our education providers have a good name and provide good services. By opposing this motion, they are dragging our tertiary education sector through the mud by somehow saying that there are sharks everywhere. Will what kind of message does that send to overseas students?

      An opposition senator interjecting

      Yes, Senator, you know a lot about sharks, I know. What sort of message is that sending when most of our education providers do the right thing? They provide excellent services and we should get behind them and support a more streamlined regulatory structure for our tertiary education. (Time expired)

      Photo of Stephen ParryStephen Parry (President) Share this | | Hansard source

      Order! It being 2.00 pm, the time for debate is interrupted.