Thursday, 5 August 2021
Tertiary Education Quality and Standards Agency (Charges) Bill 2021, Tertiary Education Quality and Standards Agency Amendment (Cost Recovery) Bill 2021; In Committee
I'd like to ask, in the context of this legislation, if the government has considered even delaying its implementation to allow a better understanding of the impact of COVID on the sector on which these fees will be imposed. If not, have you properly assessed the impact on training organisations and whether private smaller organisations might be put out of business?
We continue to assess the situation. We are in constant communication with the higher education sector. We have assured them and guaranteed them their fees until the end of calendar year 2021. After that, the situation will be reassessed, as appropriate, according to the situation we find ourselves in at that time.
This bill is for cost recovery. Are you saying that, even though we're purportedly voting on cost recovery today, the government is not going to implement the provisions of the bill? I'm somewhat confused.
Yes, it will be. However, we have staged the fee recovery by 20 per cent in the first year and 50 per cent in the second year, and then full fees will be paid by 2024.
How is that consistent with monitoring if that is already set out in the schedule of the legislation as the government's approach? We can see that that will have a substantial impact on smaller providers in particular. What is the approximate calculation of that fee for, for example, a small training institute with 100 students—a culinary school or something like that? Can you give me some cost estimates of what the current fees are and what the fees are projected to be for each of those years, by the type of course and the size of the student cohort?
That's not information I have in front of me. I will take that on notice. But what I can say is that the structure of the fees is set in regulations, so it can be changed as needed in response to the situation at the time.
I'd like to ask the minister to clarify directly as to whether the government has done a deal with Senator Griff over this bill, because we understand he was paired to support the government on this. I think as a South Australian and South Australian parents and students and universities and university workers deserve to know what deal Senator Griff has done to get this legislation passed. Be up-front about it. What has he given you? Because, if he's given you his vote for nothing, then what a dud deal that is.
Thank you, Senator Hanson-Young, for that contribution that was worthy of the broadcasting sign! As you know, as happens in every bill we pass through this place, we will always speak to the crossbench in good faith. We take suggestions from them in good faith if we need to. In this case, Senator Griff is supporting the government's legislation.
I'm a little bit confused. There's clearly been a last minute change, and I apologise I didn't pick up exactly on what you were saying. You're saying that the fees will now be introduced over a longer period of time? I request your indulgence: can you just repeat what it is you say that you're changing?
That's set out in regulations. The proposed new annual charge covers the cost of delivering six regulatory activities: concern management and resolution; stakeholder communications and engagement; risk assessment of providers; inquiries from providers; business support to TEQSA's regulatory activities; and guidance notes for providers.
For item 1, it's proposed the cost will be divided amongst providers proportional to each provider's size by student enrolments. This is because the more students a provider has the more likely it is that a student will raise an issue or make a complaint for TEQSA to consider. This element costs $269,000 out of the $5.7 million total for all six activities.
For items 2 to 6, TEQSA estimates the cost of delivery is the same regardless of the provider size. For example, risk assessment is a data based process that takes the same effort for a provider that has 20 students as a large university with 40,000 students. This cost, $4.5 million, is therefore proposed to be evenly split across all 186 registered providers as at 2 June 2021. The annual charge will be phased in over three years, commencing on 1 July 2022. From 1 January 2022, 20 per cent of these costs will be recovered, rising to 50 per cent of the costs in 2023 and 100 per cent of cost recovery from 1 January 2024.
I was asking the minister, please, for an example of those fees and what they would actually look like. I'm really keen to properly understand the likely costs that each institution will face and, indeed, the prospective costs that might be passed on to students. I understand this phasing is not new, but I still think it is far too significant in these uncertain times, noting that it would be full cost recovery from 2024 and 50 per cent in 2023, when we know that there is a very uncertain future for institutions in this period of time.
It depends on the number of courses that a provider provides. The accreditation fees are paid once every four to seven years. The fees average around $15,000 to $80,000 per provider.
Over the entire period, so it's a one-off payment for that whole period of time. If that's the average payment—and this is what led Labor to oppose this legislation in significant part—what does it mean in the context of a small provider where you may only have 100 students or so at a cooking school or for other trade qualifications?
I think, Minister, you're making this difficult for yourself. If you've got 100 students, there's not likely to be a huge diversity of courses. I can see the logic that you are trying to pursue here; nevertheless, if $15,000 is an average, what is the size of fees over the spectrum for smaller institutions?
It won't be lower than that. Would the government recognise that, at that level of fee structure, that would, for a smaller institution where you've only got a small number of students—ten, 20, 50—threaten the viability of some providers, as Labor's been told? What assessment have you done of this issue? Do you reject that assertion, or do you agree that this is an existential threat to some providers?
The question that essentially you're asking, Senator Pratt, is: is it for small higher education providers that a disproportionate share of TEQSA's new cost-recovery arrangement is? Can I clarify that that's what you're asking? The Australian government charging framework requires that all fees and charges be directly linked to the regulatory effort attributable to the activity. The majority of TEQSA's regulatory assessments are done to assist smaller non-university providers that do not yet have authority to self-accredit their courses. The government is extremely mindful of this impact and has adopted several measures to address this, so course accreditation fees will be reduced for all providers with fewer than 5,000 student enrolments—that is, equivalent full-time students—and this will reduce the financial barrier to innovation and new course development.