Michael Hatton (Blaxland, Australian Labor Party) Share this | Link to this | Hansard source

Prior to going to the Education Services for Overseas Students Legislation Amendment (2006 Measures No. 1) Bill 2006 and cognate bill, as a former member of the Public Works Committee many moons ago and as the current Deputy Chair of the Defence Subcommittee of the Joint Standing Committee on Foreign Affairs, Defence and Trade, I would like to endorse the work that has been done at the Shoalwater Bay facility in preparation for Talisman Sabre in 2007. Together with the member for Gorton and others, I was present at the 2005 Talisman Sabre exercises. This is an area of immense importance in terms of Australia’s defence preparedness. We conduct operations there jointly with a number of other countries. It is of great importance and significance to the local towns. It is good to see that our normal public works processes have been undertaken and this has now been given approval to go ahead.

Going to the matter in hand, which is this cognate bill, I will deal with it in this manner. The Education Services for Overseas Students Legislation Amendment (2006 Measures No. 1) Bill 2006 is relatively simple. It concerns one particular area that has been introduced. That is the beefing up or extension of the definition of a ‘fit and proper person’ to cover what are called high managerial agents of an education provider so that it includes the principal, teaching staff and some other members of staff. The principal point behind this is to remedy situations that have occurred previously where the question of whether an educational provider should continue to provide has been hindered by the fact that the minister could not take action if agents of that provider had been found wanting.

The critical issue here goes to the extension of that ‘fit and proper’ test, which is covered by sections 9, 11, 17 and 83 of the relevant act. With the extension of that definition, provision is made in item 24 for automatic suspension of the provider’s registration where that provider no longer meets the fit and proper person test—and they need that in order to maintain their registration. However, in doing so, item 25 specifies who falls under that definition: people with management responsibility, teachers, consultants and principals of the provider.

The fundamental reason for that is explained, and it is an important one: this will prevent former providers with an adverse history in the industry from taking up positions of influence with other providers. We know that was not the case previously throughout the commercial area and that it still happens. That is where companies engaged in other businesses are set up and run for a period of time, accumulating debts and entitlement questions for people on their staff. They then close down or fold and, within a relatively short period, they open up under the guise of another entity. So the problems they cause in the first place come back to haunt that particular part of industry.

In this particular case, we have had several examples in the past of educational providers doing a similar thing—opening up, running courses and bringing in people from overseas but not running properly and not giving full value to those overseas students. In fact, there have been cases of providers robbing the students blind and treating them very poorly—and, in that process, damaging the reputation of the industry here. We are now dealing with not a small industry but our fourth biggest industry in Australia—a $7 billion a year industry. If you look generally at English-speaking educational providers providing international access, we are dealing with the third biggest provider. We are in single digits, but we follow the United States with 32 per cent and Britain with 15 per cent. I think we are up to around the area of nine per cent.

The very reputation of those service providers and the guarantee that fit and proper people are providing those services guarantees two things. One is the continuing high reputation of the industry within Australia and, therefore, the ability for universities, technical and further education colleges, other higher education colleges and, indeed, schools to be able to market themselves, particularly within the Asian region, to bring students into Australia—and that here the agents of this organisation bear that responsibility as well. There is also a related provision where steps have been taken to ensure that things are put back on an even keel so that the minister can then move very quickly to reintroduce that legislation.

The Bills Digest points out that, apart from this fundamental area, which is this fit and proper person test to apply to agents, the rest of the provisions of the bill are highly technical. They are part of the 41 amendments that were recommended by the group tasked with looking at the operation of the act, which came into being in the year 2000. The Education Services for Overseas Students Act, apart from guaranteeing our international reputation of quality education services, also concerns what guarantees can be given to the people who are the consumers of those services. Therefore, we have in part 2 of the bill a series of provisions to ensure that students who are using these services get some protection as well.

So in this section of the Education Services for Overseas Students Legislation Amendment (2006 Measures No. 2) Bill 2006 it is a two-way street: how do you ensure that students have a guaranteed position and how do you better regulate the industry and do so in such a way that the industry itself has to measure up? You can put in particular provisions that will cover students as well, but it is part of an attempt to balance things out. Related to this, the opposition will be moving—and the member for Capricornia is the relevant person—a significant technical amendment in relation to the annual registration charge. This goes to the fundamental position of who should be penalised if there is a fundamental failure, how readily and quickly that penalty should be imposed if that failure occurs, and what the implications of that would be.

There are significant changes in this legislation to the automaticity of the treatment of a failure. The Australian Vice-Chancellors Committee have approached us and urged that this particular amendment be made. I encourage the Minister for Education, Science and Training to take full note of the fact that this is coming not just from the Australian Labor Party; it is on the advice of the Australian Vice-Chancellors Committee. The reason they have put this is that they are one end of the spectrum of service providers and, at the moment, with the changes that are currently there, they could, together with all of the other institutions, be knocked out of the ring peremptorily, because that is what is said here.

The key point of our amendment is that there should be adequate notice of where a failing is and how it should be remedied. The specifics of our amendment are:

(1)

The Secretary must give to each provider who is liable to pay an annual registration charge for a year a written notice stating the amount of the charge.

Why is that important? Because that can come into question and into dispute. If it is in dispute and if it is indeterminate as to what amount should be paid, the current provisions of this legislation say that the provider can be simply knocked out, even though there is a dispute. So this is a question of certainty with regard to what they have to perform to. Secondly, our amendment would require a notice to be given by the last business day of January of the year. The amendment goes on:

(3)

Subject to subsection (4), a registered provider must pay the annual registration charge for which the provider is liable by the last business day of February of the year.

(4)

If the notice has not been given to a provider by the last business day of January, the annual registration charge for which the provider is liable must be paid within 28 days of the day on which the notice was given to the provider.

So this is very specific and it goes to the question of certainty and guaranteed notification. The provisions as they stand do not demand that notification and they do not demand a guarantee of certainty. It would be wise for the government to take this up. I think it is a very good and a very sound recommendation. It also goes to the question of the intent of a great deal of this legislation, and that intent is to underscore the importance of this particular set of educational arrangements. Education is our fourth biggest industry. I was incorrect when I said nine per cent; it is seven per cent of international provision, versus 32 per cent for the Americans and 15 per cent for the United Kingdom.

In a lot of ways it could be argued—and I think it is pretty right—that with this particular set of provisions about how you should deal with this new regime, the government are using a hammer to crack a walnut. The reason you could argue that that is happening is that they are catching up with a number of people who might otherwise not be brought in. There is an argument that you could actually identify them. The concluding comments in the Bills Digest are:

Stakeholder response has expressed concern at ‘an ever increasing compliance and reporting load on providers, with impacts on customer service and administration costs. These costs will have to be passed onto students, which in turn will impact on Australia’s international competitiveness.’

That is something none of us should want to see. The comments go on:

Furthermore, providers are concerned that the legislation imposes more regulation on all providers in an attempt to deal with the small minority of unscrupulous providers that could be dealt with under the existing legislation.

That is a fundamental problem. We have experienced this previously. We have had two significant outbreaks. You have to put this into context and remember that this $7 billion a year industry of educating overseas students started in 1984. It started as a Labor government initiative. It started with John Dawkins as education minister. What Labor found from our experience in setting that up in the early years, when there was no experience whatsoever with this, was that you had to provide the correct framework but you had to have an enforceable framework for an industry that grew rapidly but demanded standards which would encompass not only Australia’s universities, technical and further education facilities and established schools but a plethora of independent providers—some good, some excellent, some poor and some downright dastardly. We had a series of episodes where people who should not have been in the industry were and they significantly damaged our reputation overseas.

Another fundamental aspect of this is the key interaction between the education system and the Department of Immigration and Multicultural Affairs and their concern—which was covered in the background in relation to this legislation—about the enforcement of student visas. This is a balancing act. People gaining access to Australia for English language tuition in particular are allowed to work 20 hours a week. It is possible—and this has happened before; indeed, it is still happening—that people can break the provisions of that visa and simply use that as an entry to Australia and seek to work a 40-, 60-, or 80-hour week. They might work those hours in order to gain the income to cover their cost of entry, but working might be their prime purpose. That is why we toughened up our approach and the rules that govern this.

I can see fundamental reasons for further clarification of that in this legislation and why it attempts to get at those service providers who pop up and continue to be problems. In section 1 of the bill there is the broad classification of ‘high managerial agents’. That is so that we can ping them and stop that inappropriate activity. There is, though, the fundamental problem that in going after those guys you create a much more significant problem for the institutions that do not cause you problems.

There is a key thing about this legislation that needs to be looked at. When you talk to the peak bodies—and I will quote the end of the Bills Digest, because it is important—they claim that the $6 million collected in the annual registration charge provides the government with:

...the resources to be more proactive in identifying and dealing with those providers operating on the fringes of the industry who continue to take advantage of international students, and facilitate visa fraud and illegal immigration without imposing additional administrative, regulatory and compliance burdens on all providers.

The problem is that that is what they have done in this legislation.

There is a significant competitive difficulty when we are up against others. Trying to ensure the proper balance between allowing educational access and preventing that being used as a way to exploit our economic situation and to make a lot of money is the fundamental problem at the centre of this. That is underlined by an ESOS evaluation report by DEST. The report said:

A gulf exists between the education system which views student participation and progress as primarily matters of educational judgement, and DIMIA which views them as facets of visa control. Given their different goals and cultures, a tension is inevitable, but it has been unnecessarily exacerbated by the lack of specificity in the Code.

…            …            …

... the relevant National Code standards should be rewritten in terms that fit the realities of teaching, learning and assessment in each sector.

Part of the solution to this conundrum lies in the fact that the provisions in the legislation that we have before us put in place a number of technical recommendations out of the 41 recommendations that were put up. There is an attempt to make the industry secure and to provide a balance between providers and those who are using those services.

A fundamental and necessary part of this is a rewriting of the national code. Where is it? We do not know; we have not got it yet. It is not here; it is not extant; it has not been done. This is a case of the government saying, ‘We’ll put these measures into place and then down the track we’ll continue to process this and eventually get to it.’ This is indicative of the government’s approach to a range of bills and matters before this parliament. In the past two weeks or so, I have spoken on a number of bills where the problem has been exactly that. They should get their act together in this regard. The strength of this industry and the manner in which it is regulated mean that if you do not do the proper thing here we will lose our particular advantage.

Singapore has recently entered the field of international education. The Singaporean government does not do things by half measures. We have seen that in the airline industry and in terms of the development that they are working towards in the pharmaceutical area, to have a large pharmaceutical techno-park in Singapore, and they are becoming a leading supplier throughout the area. They are in partnership with the Chinese government in, I think, Suzhou province, building one of the biggest active industrial parks in the world—one that is absolutely cutting edge and one that is at the core of the growth within China. Once they make a determination to enter a market, those who are in that market need to take note—us particularly. The source of the students being addressed in this bill is the very region that Singapore is at the epicentre of. We are at the periphery. It is much quicker to get from Singapore to virtually every part of the Asian region than it is from Australia.

It is necessary that we make these changes and allow good educational service providers who will work within the bounds to operate more effectively than they have in the past and to build on and reinforce their strengths. While doing that, we need to kick out the people who have caused the fundamental problems—those providers who have gone beyond the mark or who are not fit and proper people to run those institutions. They damage brand Australia and they should be knocked down. (Time expired)

Martin Ferguson (Batman, Australian Labor Party, Shadow Minister for Primary Industries, Resources, Forestry and Tourism) Share this | Link to this | Hansard source

I appreciate the opportunity to address the House on what I consider to be very important legislation. The Education Services for Overseas Students Legislation Amendment (2006 Measures No. 1) Bill 2006 and the Education Services for Overseas Students Legislation Amendment (2006 Measures No. 2) Bill 2006 go to our desire as a nation to further cement opportunities in education and to maintain our strong international reputation as a world-class provider of education to international students. It is important that we maintain this. Over the last 20 years, it is fair to say that, as we have sought to develop these export opportunities, we have had some failings on a number of occasions. I note that some of those occurred under the previous Labor government, with some English learning centres having difficulties in Australia.

It is therefore very important that we adopt a commonsense approach to this legislation. For that reason it is largely supported by the opposition with an amendment, to be moved by the member for Capricornia, which is aimed at strengthening the intent of the bill. This amendment on behalf of the opposition is to guarantee that, in consideration of this bill, the House properly focuses on the need to strengthen consumer protection. The consumer protection measures for individual overseas students are exceptionally important because they go to the very nature of their study in Australia. It is about providing consistency within the education services sector for the overseas students framework.

I think we all appreciate that Australia’s education services industry is our fourth largest export industry. Not only do we earn a lot of export dollars from it but it is also a key employer of Australians—more than ever in key regional and provincial centres of Australia. Think about the importance of the education industry in the context of export earnings. It is just behind coal, tourism and iron ore. Take that on board in the context of Australia’s export performance at the moment—the key economic achievements that are being made, for example, because of access to such important markets as China.

In 2000 there were more than 153,400 overseas students studying in Australia. Almost half of these were completing courses in higher education. We should also appreciate that in Australia in the 21st century, overseas students are important for the purposes of strengthening our university sector and they are also a key component of our migration program. The system has changed for those undertaking approved courses in Australia. They now earn points which enable them to gain easier access to Australia. That is a proper program, which is also about strengthening our skills base in Australia. The reputation of our overseas program is therefore important for the education sector and export earnings and, more than ever, it is central to the migration program which Australia is so proud of.

Over the past two decades we have seen a strong increase in the number of overseas students coming to Australia, to the point where the sector generated $3.7 billion for the Australian economy in 2000. The sector’s global reputation and integrity must be protected from issues arising from within the industry. These bills are about protecting the industry from itself because, on some occasions, the industry likes to take shortcuts for the purposes of getting the upper hand on some of the other competitors in the industry. Potential difficulties include the uncertain financial security of students who have prepaid course fees and the emergence of a small minority of unscrupulous providers—and I emphasise that it is a small number—who, if not tamed, can damage Australia’s reputation generally with respect to the education sector. It is also appropriately about inconsistent quality assurance.

We always have to be careful to maintain the highest possible education standards to ensure that we are not only attractive in terms of cost but also in terms of the international standing of the degrees that we offer overseas students. The last thing we want is to lower our educational standards for the purposes of attracting export dollars and then give those who should not be able to migrate here a backdoor entry to Australia. We have to be about the highest possible education standards whilst also ensuring that, in terms of protecting the consumers, the overseas students are guaranteed a proper consumer protection system in Australia. That is what this debate is about. The issues I have raised are appropriately addressed in the bills. We are hopeful, especially if the government takes on board our amendment, that the bill will ensure that the overseas students who come to Australia to study on student visas receive a quality education and training opportunities appropriate to the financial payments they make to the Australian tertiary education sector.

Since the early 1980s Australia’s reputation as a quality education provider has grown substantially alongside the economic growth experienced in many countries across Asia. Just think about the importance of maintaining this sector when you consider the huge increase in the number of students from places such as China and India. With further economic growth and development opportunities in those countries, there are going to be further opportunities for Australia on the overseas education front. To make sure that we have the best consumer protection system in place, we need to make sure that we protect a terrific employment opportunity for the purposes of providing overseas education services in Australia. That is about making an investment now, in a proper legislative framework, to guarantee our access to this market in the years to come. One needs to appreciate that is important, and I say that because Australia’s relatively isolated location globally sometimes presents additional challenges for the prosperity of this nation.

As the shadow minister for tourism, I know that Australia is regarded as a long-haul destination for international visitors from Europe and the USA, in particular. But our close proximity to Asia, especially South-East Asia, has enhanced our capacity as a nation to absorb many students from Malaysia, Hong Kong, Indonesia, Singapore and China, who might have otherwise studied in England or America if not for our international reputation, which is just so important. We should never allow that reputation to be tarnished. We must always err on the side of being especially cautious with respect to not only the quality of education offered by our tertiary institutions but also the guarantee that the consumers, the students, have protection in law with respect to their own entitlements and consumer opportunities.

Obviously, if one examines the facts, the majority of overseas students still originate from Asia, yet our reputation has appropriately spread far. We are now seeing an increasing number of international students from, interestingly, South America, including Colombia and Brazil, and Eastern Europe, including the Czech and Slovak republics.

It is this reputation for delivering quality education to international students that owes its genesis to the Hawke Labor government. It was this government’s initiative in the mid-1980s that ensured Australia was an early player in the educational export industry which directly linked trade and policy. This policy included a decision in 1986 to allow full-time fee paying international students into Australia’s education system. Overseas students then—and we should not forget this—made up only a small component of the student body; today they are part of almost every tertiary institution and make up 40 per cent of all long-term visitor arrivals and over four per cent of all short-term visitor arrivals.

I can think of the importance of this education opportunity by way of my own involvement in recent times with the Melbourne campus of the Central Queensland University where there were some difficulties with Indian students. Because of some complaints as to the operation of that Melbourne campus there was the need to make sure that not only were their education opportunities protected but also the quality of their education was protected. I am pleased to say that it seems that those difficulties are now resolved; the reputation of the institution has been maintained and the students themselves understand not only their responsibilities but also their rights as students paying a significant amount of money in Australia for a quality educational opportunity. That is the key to the debate.

We are a large provider per head of population. Interestingly, we are the third-largest English-speaking provider of international education services—behind only the US and the United Kingdom—with seven per cent of the market. And that is why we have to have debates about proposals such as this because you maintain your market share by making sure it is a quality product at a reasonable price and giving the students proper consumer protections. This represents the outcome of a decision by the Hawke-Keating Labor governments to not only get in early to actually pursue these international market opportunities but also focus on quality in delivering education export services as part of our early entry into the market.

Australia, as we all appreciate, has become more broadly recognised in the arena of international education and is appropriately regarded as a safe study destination that offers high-quality courses in a friendly environment. This influx of international students has been highly beneficial to Australia and has resulted in flow-on effects to Australian communities and industries. We are a highly successful multicultural nation and the education services sector of our Australian economy has added to the strength to the benefit of Australia at large. I say that because not only do overseas students continue to be a major source of revenue for Australian education institutions but also they contribute to the overall Australian economy and the social and cultural make-up of Australia. In 1994, overseas student fees amassed $883 million; in 2000, this figure more than doubled to reach $1.8 billion. In that same year, overseas students outlaid a total of $1.9 billion on goods and services whilst in Australia. This is of assistance to the tourism industry, for example, because it encourages family members and friends to also make a visit to Australia.

Obviously there are many post-study benefits to a healthy education export industry, such as the contribution the international student program now makes to our migration program. I take the House to a report released in 2000 by the Australian Bureau of Statistics which indicates that international students continue to have an important influence on Australia’s skilled migration and tourism industries well after they have finished their studies in Australia. We all understand that having a positive experience studying here is likely to encourage overseas students to not only think about migrating to Australia but also maintain those social networks to visit Australia. Experience shows that these connections have also been important in facilitating trade opportunity access for Australia in a range of countries around the world. There is also an increased likelihood that family, relatives and friends, as I have touched on, will visit these students in Australia, bringing further opportunities for Australia on the export earnings front.

These are all wins for Australia and they further stress the need to safeguard the integrity of our education export industry. I say that because tourism is one of the world’s fastest growing industries with world tourism forecast to grow from 714 million international passenger arrivals in 2002 up to 1.6 billion in 2020. Australia’s tourism industry must step up to the mark if it wants to maintain itself as a key player in this highly competitive global market because it is also about making sure that we can compete in a tough global market not only on the education services front but also with respect to tourism. Every opportunity therefore to enhance our reputation as the destination of choice must be seized and the education export industry is part of that desire by Australia to seize those opportunities.

As well as adding to our cultural diversity, overseas students add to our skill supply by often becoming permanent residents after completing their study. In a survey conducted in 1992 on overseas students in higher education, 47 per cent said that they planned to migrate to Australia at a later time. One of the main reasons they gave was their high-quality experience of studying in Australia. There is also the added bonus for former overseas students wishing to migrate to Australia that they have Australian qualifications. In 1999-2000, 14 per cent of permanent residence grants made in Australia were to holders of student visas, and in 2000-01, around 50 per cent of applicants for skilled migration were former overseas students. These students are generally in their early 20s and from all corners of the world and while studying here have increased their desire to remain in Australia.

When you think about it, for a nation facing a major skills shortage because of a lack of government commitment to the education of Australians, this represents a huge potential skilled workforce that should not be overlooked. Importing skilled labour is always a difficult issue; it must never be at the cost of Australian workers. We should be doing everything possible to not only train Australians but also create a welcoming education opportunity for overseas students. I also remind the House today that in addition to encouraging and strengthening the education services sector for international students we also have to pay more regard to investing in the skilling of Australia, and especially our apprentices and mature age workers who can add to our skill requirements at this difficult point in the economic cycle.

Therefore, this is obviously an important debate. It is for those reasons that so many Labor representatives have sought to contribute to this debate. The failure of the government to participate in the debate is a damning indictment of its arrogance and its lack of commitment to parliamentary processes. All too often, if you go through the Notice Paper and consider the bills which are debated on a regular basis not only in the House but in the Main Committee, you find a raft of opposition speakers trying to contribute to improving the legislative process, yet very few representatives of the government, despite it having a significant majority, are willing to come in here and participate in debates in the House and Main Committee and also, more than ever, in the proceedings of those important institutions of the House—our policy committees, the various standing committees of the House and joint standing committees of the House and the Senate.

I raise these issues because I think it is about time that the government moved away from the hubris which now exists on the other side of the House and got serious about debating legislation and contributing to a better legislative framework in Australia in order to secure not only our education opportunities in the future but also our export opportunities as a nation in the 21st century. We must have such debates, and this debate is one of them. I say that because there is an urgent need to consider some of these pressing issues not only in the education sector but also in the resources, tourism and health sectors. These are all complex debates that require people to come in here and properly represent their constituents.

There are a range of opportunities for young people to come to Australia. I remind overseas students, as well as those who visit Australia but who are not necessarily studying here, of the importance of our backpacker working visa program, which has been extended from three to six months in a range of industries, such as the hospitality industry, and up to 12 months in the agricultural sector. These represent further opportunities for young people to come to Australia and experience Australia’s great tourism opportunities as well as being gainfully employed under agreed terms—namely, appropriate Australian wages and conditions, which the Australian government now wants to break down. This program will contribute to the needs of a range of Australian industries while also making it easier for some people to have extended stays in Australia. This is important, because we have a major skills shortage in Australia at the moment, in sectors such as agriculture, horticulture, resources and tourism, to name just a few.

I say in conclusion that the member for Capricornia has, quite properly, come into this House and foreshadowed an amendment to what is a very important bill. It is a bill that cements our international reputation as a major provider of education services to overseas students. It is about guaranteeing that those students have proper consumer protection. I urge the government to give the amendment appropriate consideration. Labor supports the passage of the bill. We think the amendment will add to the government’s desire to maintain the integrity and reputation of our overseas student education sector. I commend the bill to the House, along with the amendment foreshadowed by the member for Capricornia.

Craig Emerson (Rankin, Australian Labor Party) Share this | Link to this | Hansard source

The Education Services for Overseas Students Legislation Amendment (2006 Measures No. 1) Bill 2006 and cognate bill help to assure the quality of Australian education and training institutions for overseas students. The legislation is designed to protect the reputation of Australia’s $7 billion education export industry. Certainly, as has been acknowledged by the member for Batman, we should reflect on the fact that this education industry was created initially by the Hawke and Keating governments. They saw wonderful opportunities for education exports from Australia, involving overseas students coming to Australia in large numbers and benefiting from our education system; and Australia benefiting not only from the revenue that was generated by their participation in education but also from the improvement in the diversity and quality of our culture and our links back to the countries from where those students came.

That was all part of the integration of Australia into our region—a reorientation of the Australian economy and, to some extent, of Australian society, such that it was more interested and more engaged in our local region and neighbourhood. That program has been a wonderful success. However, from time to time it will need some repair work, some tending, to ensure that quality is maintained. Unfortunately, there have been occasions when the quality of our offering has not been up to scratch. That is due in part to unscrupulous operators—a small minority of the total sector. That is why this legislation is before us—to ensure that unscrupulous operators are not abusing the system and so that quality is maintained.

The legislation is in part a consequence of an evaluation of the regulatory framework—an evaluation which made 41 recommendations. This legislation implements some of those recommendations while others do not need legislative change in order to be implemented. Labor is supporting the legislation but will move an amendment that provides for 28 days notice of the amount of annual registration charges to the education providers. This amendment will be moved by the member for Capricornia.

The education system in Australia for overseas students has become an integral part of our immigration program, as the member for Batman explained. Overseas students coming to Australia can earn points for immigration purposes through their study. I think that is a good thing because we will continue to need a strong immigration program in the coming decades as our own population ages and as the proportion of working age Australians in the total population consequently falls. An immigration program will play a significant role, along with other measures that can be taken, in ensuring that we are successful in combating the adverse economic consequences of the ageing of the population.

In a book of mine that was published earlier in the year I suggested the idea not only of the students themselves being given some extra consideration in remaining in Australia but that, while they were studying, their parents and other family members might be encouraged to come to Australia. It stands to reason if parents are so motivated to send their children to Australia to study that those parents might themselves make a good contribution to our society. This is all part of the challenge of the 21st century, a challenge that has been well explained by Richard Florida in two books, the first called The Rise of the Creative Class and the second The Flight of the Creative Class. By a ‘creative class’ Florida means those people who have had the opportunity to go to university, whether that be in the humanities, architecture, medicine or scientific research. He identifies, in a broad order of magnitude, about 150 million such people around the world. And he suggests that, more than any other factor, the availability of people who constitute the creative class will determine the wealth and prosperity of parts of the world in the 21st century. I think there is a lot of merit in that argument.

Richard Florida does not specifically deal with countries but with parts of countries. As is the case now, and it may be increasingly so in coming decades, there are parts of countries that are wealthy and other parts that are struggling. Florida observes that the prosperous and most tolerant parts of countries tend to be those that have high concentrations of the creative class. So the great contest of the 21st century will be to generate, attract and retain members of the creative class. Florida’s argument is that, rather than building businesses and trying to attract people to those businesses, communities should seek to attract the creative class, and businesses will follow.

Again in the book that I released, I argue not only that we should do much more to create, attract and retain our own creative class but that perhaps regional areas in Australia could be encouraged to do the same and that a visionary government could contribute to that great task, thereby creating a band of gold of our dynamic regional centres which obviously would include regional universities. That is the sort of challenge Australia confronts in the 21st century—the intense competition for people who have been educated in universities and vocational training institutions. To give absolute currency to this debate, I am able to refer to the OECD report Education at a glance that was released overnight. My colleague the shadow minister for education and Deputy Leader of the Opposition, who is in the chamber now, pointed to the revelations in this report and asked a question of the Prime Minister earlier today which he fobbed off.

A report from the OECD comparing Australia’s performance with that of other members of the OECD should ideally be a goldmine, but this one is a minefield—and I will explain that conclusion as I continue my remarks. On the question of overseas students, it is clear from the report that Australia is more heavily reliant on overseas students than any other OECD country. Indeed, the report says:

Australia, Austria, Switzerland and the United Kingdom display the highest ... proportion of international students in their total tertiary enrolment.

It goes on to say:

In Australia, 16.6% of tertiary students enrolled in the country have come to the country expressly to pursue their studies.

That is not a bad thing; it is a good thing. But it also begins to tell another story, and that is of the neglect of our higher education institutions by the Howard government for domestic students, Australian students.

We welcome overseas students coming to our country, for all of the reasons that I have mentioned, but it should not be a substitute for investment in the education of Australian students; it should be a complement to it. As this OECD report points out, that really has not been the case because the number of Australian undergraduate students has in fact declined, in the last two years for which statistics are available, for the first time in half a century. The report goes on to say, in relation to the contribution of international students to graduate output:

In Australia, Canada, Switzerland and the United Kingdom, more than a quarter of tertiary-type A second degrees or advanced research degrees are awarded to international students. This pattern implies that the true domestic graduate output is significantly over-estimated in overall graduation rates. This over-estimation is most important for tertiary-type A second degree programmes in Australia and advanced research programmes in Switzerland and the United Kingdom, where international graduates represent over 35% of the graduate output.

When the Deputy Leader of the Opposition asked the Prime Minister a question today on our performance in producing Australian undergraduate students at our universities, he bundled together, I believe, all students—overseas and domestic students—to inflate the number. And this is what this OECD report is saying; it is making a very legitimate point that we deserve to know how many of those students are from overseas and how many are Australian. He sought to disguise the fact that this government has tragically and massively underfunded university education for Australian students, such that many universities have had to rely very heavily on overseas full fee paying students in order to sustain their viability.

Indeed, since the change of government in 1996 virtually all the enrolment growth in Australian public universities has been in the area of overseas full fee paying students. There has also been a small lift in the proportion of Australian full fee paying students, but it is from those who are subsidised through the HECS arrangements that we get the result that enrolment growth has been virtually non-existent.

In relation to immigration and overseas students, the OECD report says:

... the education systems where international students contribute most to the graduate output are those of countries with a long tradition of immigration favouring skilled individuals ...

It mentions specifically Australia, Canada and New Zealand. It goes on to say:

In this perspective, the contribution of international graduates to the total graduate output can also be seen as a measure of the size of the potential pool of highly skilled immigrants upon which host countries can capitalise to enhance human availability in the economy.

Hear, hear! And that is why Labor does welcome overseas students into this country. But as I said, the way it has been managed by this government has resulted in our universities relying very, very heavily on overseas students for their revenue. That is because the government has not properly indexed, and therefore increased in line with costs, the payments to our public universities.

From this OECD report the Deputy Leader of the Opposition has revealed, in a statement today, an absolutely stunning indictment of this government. That is that public investment in our TAFEs and universities has declined by seven per cent while in other OECD countries it has increased by an average of 48 per cent—a 48 per cent increase on average for other OECD countries, but in our tertiary education institutions a decline of seven per cent.

The OECD reveals what has been going on in this country since the change of government, because it says:

... many OECD countries with the highest growth in private spending have also shown the highest increase in public funding of education.

This is referring specifically to tertiary education. It says:

This indicates that increasing private spending on tertiary education tends to complement, rather than replace, public investment. The main exception to this is Australia, where the shift towards private expenditure at tertiary level has been accompanied both by a fall in the level of public expenditure in real terms ...

What an indictment that Australia stands out amongst OECD countries as a country where increases in private spending on tertiary education have substituted for, rather than complemented, increases in public expenditure on tertiary education. What this government has done is to shift the burden of investment in higher education and in TAFEs onto private individuals and onto the private sector, and it has shirked its responsibility to invest in the talent of our young people.

As a consequence of the failure to invest properly, the OECD report finds that in Australia the main reason for the increase in the private share of spending on tertiary institutions between 1995 and 2003 was changes to the Higher Education Contribution Scheme that took place in 1997. Who was in government in 1997? The Howard government was, and as soon as it got its hands on the reins of government it moved to very sharply increase HECS fees in this country. Depending on the course, those increases were anywhere from around 30 per cent to more than 100 per cent. This government has no philosophic commitment to public investment in our public education institutions, in our higher education institutions. It believes that a university education is 100 per cent a private good and that there is no public benefit from investing in education. And yet even the driest, most economically rational economist will tell you that there are very, very substantial spillover benefits for the rest of society from investing in higher education and in education more generally.

But this government, driven by blind ideology, does not agree with that, and believes that individuals who are going into our education institutions generate only benefits for themselves and not for the rest of the society. We know that because for most of the last few years this government, instead of investing in our higher education institutions, has been absolutely obsessed with voluntary student unionism and enforcing, coercing and bullying higher education institutions to adopt its own blind ideological position on Australian workplace agreements. When the now Minister for Defence was education minister we spent hours and hours in this parliament debating changes to enforce voluntary student unionism, instead of having a proper debate about investing in the nation’s future and about what we need to do to ensure that we are creative and productive, and have a decent, prosperous and harmonious society in the 21st century.

We desperately need university reform in this country. It will not come from the coalition because it just does not believe in it. But it will come from Labor. The Deputy Leader of the Opposition has produced a very well considered and creative package of higher education reforms that encourages diversity, that turns away from the one-size-fits-all approach of the last 20 years and that questions the government’s approach of ‘Moscow on the Molonglo’, of determining from Canberra the minute details of the operations, courses and practices of universities all around Australia.

Labor’s proposals reward and encourage excellence. They are subject to quality assurance. Just as this legislation provides some quality assurance, Labor believes in quality—not in a highly interventionist approach but one that ensures our public universities are absolutely up to scratch. That is where we are. The OECD report is not a goldmine as it should be; it is a minefield for the coalition government because of its neglect of higher education in this country. It will only be a Labor government that invests truly because it is only a Labor government that believes in higher education in Australia.

Jenny Macklin (Jagajaga, Australian Labor Party, Deputy Leader of the Opposition) Share this | Link to this | Hansard source

I am pleased to speak on the Education Services for Overseas Students Legislation Amendment (2006 Measures No. 1) Bill 2006 and the Education Services for Overseas Students Legislation Amendment (2006 Measures No. 2) Bill 2006 that amend the Education Services for Overseas Students Act, because Labor certainly does believe that Australia’s international education services industry must be properly regulated to maintain high-quality standards, and that international students studying in Australia must have the strongest consumer protection measures to make sure their rights are protected and that they receive the education they pay for.

Firstly, I thank the member for Capricornia, Labor’s shadow parliamentary secretary for education, for taking the lead for the opposition in the consideration of and response to these bills. The member for Capricornia has dealt with the details of the bills and has indicated Labor’s support. In my contribution I want to speak briefly about why a strong consumer protection and quality assurance regime for international education fits as part of Labor’s overall commitment to lifting quality and standards in higher education.

As many members know, education services are Australia’s fourth largest export industry, worth about $8 billion annually. As a nation with record and sustained trade deficits, when we have something the world wants to buy our national government must be ever vigilant to make sure our viable exports remain valued. While commodity prices can rise and fall and rise again with changing international demand and prices in the global marketplace, our education services sector is sustained by Australia’s reputation as a high-quality provider. Protecting the reputation of a service involves a different equation from reducing the supply of a physical commodity. Reputations, of course, are built over time, potential users taking a longer term assessment. However, they can be quickly compromised by education service providers who mistreat students and by students dissatisfied with their education experience spreading the word about poor quality back home.

Labor has been a very strong supporter of the education services sector for some time. In fact, it was the Hawke Labor government that allowed Australia’s universities to accept international students in the 1980s, opening up this very important new market for Australia. The latest figures show that from that decision of 20 years ago there are now 239,000 overseas students studying in Australia. About 136,000 of these are at an undergraduate level, and over 70,000 are undertaking masters by coursework programs.

The international student body has grown rapidly over a decade from less than 10 per cent to around 23 per cent of enrolments on average. In 13 universities the international student body is over 25 per cent of total enrolments. Enrolment growth has, however, slowed over the past two years, and last year the total number of overseas students commencing in Australian universities actually fell. The countries of origin have also changed in recent years away from tradition markets, such as Malaysia and Singapore, towards India and China. These students are very important to our education system.

International student fee income provided $2 billion to our universities in 2004. This rapid enrolment growth, a feature of the system until last year, with its accompanying income generation has followed a period of cuts, neglect and underfunding during the period of the Howard government. Growth in international student income contrasts sharply with public investment by the Howard government in tertiary education. According to the OECD—and new figures out last night confirm this once again—Australia is the only developed country to have reduced public investment in tertiary education since 1995. While Australia went backwards, the rest of the world increased their investment. The developed world knows that it is important for their future economic prosperity to put public investment into the tertiary education system. It is only in Australia where this economic message is constantly ignored and, as a result, Australia is falling behind.

Our universities have turned to international student income to supplement, and supplant, proper funding from the Howard government. The cuts of this government that has now been in power for 10 very long years have hurt our university sector badly. The cuts are worth about $5 billion since 1996 and they are having a serious impact on quality. Funding cuts have pressured universities to chase revenue, increase student numbers, raise student to staff ratios and class sizes, cut back tutorials and cut corners on student assessment. The consequence is that the quality of Australian higher education is under pressure with, most seriously, risks to the reputation of Australian degrees.

The government recognised the problem in 2002 when its Crossroads review noted allegations of:

... falling standards, courses lacking academic rigour, deterioration of the calibre of students entering university, and claims of soft marking.

But I am sorry to say nothing was done by the former minister for education and nothing has been done by the current Minister for Education, Science and Training to address these concerns.

Concerns have also been raised by international students, foreign governments and employers about the quality of offerings from some higher education providers. In June 2006, the Asia working group advising the Prime Minister’s science and innovation council reported:

There is the belief held by the working group that the quality of our university degrees is declining.

You would think that the federal minister for education would take some notice of these very significant concerns. Unfortunately, they seem to be falling on deaf ears. These are the messages that the Howard government has been getting.

At the same time, we have had the rest of the developed world supporting their universities, we have had growing competition coming from other countries and we have had the expansion of domestic supply within Australia’s traditional source countries of South-East Asia—notably Malaysia, Singapore, Hong Kong and Indonesia. Those countries, which used to send significant numbers of overseas students to Australia, are now recognising the importance of developing their own higher education sectors to a very high quality. Of course, if we do not pay attention to the quality of our degrees, we are going to lose this very significant market. The concern is that we will no longer be the favoured destination for high-quality students. Our universities are certainly very concerned about this prospect.

Much depends on the reputation of higher education, the quality of student experiences and the standards of degrees in Australia. Our competitors can be quick to exploit deficiencies in the quality of Australian providers. There are no systems in place in Australia for assuring the standards of degree quality. Compared with 30 years ago, in higher education there are now four times the number of students, twice the number of universities and 10 times the number of private providers. The rapid growth in the number of students and new higher education providers has led to concerns being raised about the quality of Australian degrees.

While the measures in these bills here today tinker with some of the systems under the ESOS Act, they do not go to the heart of the quality issue. Unfortunately, the government has no plan to deal with these very serious concerns. We have a new minister for education who is very big on rhetoric but does not seem to have either the ideas or the capacity to implement the changes that are needed. We must lift quality and standards in our universities. Australia needs a national commitment to tackle the problem of standards and quality head-on where it exists. Otherwise, the effectiveness of our universities to attract international students will be lost.

Just two months ago I issued Labor’s higher education white paper, Australia’s universities: building our future in the world, which focuses on strengthening the quality of educational offerings in higher education in Australia. We need to raise higher education standards generally to give our students the best opportunity to develop their abilities and to build a competitive economy. Students deserve the confidence that they will receive a high-quality education and that their degree will be recognised both in Australia and overseas as a credible qualification for work and further study. Employers are entitled to expect the highest standards when they hire Australian graduates. They should understand the meaning of different grades of higher education attainment.

We should expect the best from our universities because of the significant public investment that they receive. It is not to the advantage of any higher education institution to be part of a system that does not assure at least minimum standards of quality in its educational qualifications. Yet at the moment, and this has been the case for the 10 years we have had this government, there is no way of knowing whether minimum acceptable standards in a degree are achieved. We have no reliable information about the grades of achievement of different graduates from different institutions in different fields of education.

Labor’s commitment is, first of all, to increase public investment in higher education, and that is predicated on a reciprocal commitment by universities and other providers to demonstrate higher standards of higher education quality. Labor will act to protect our universities’ reputation for international excellence, which they have taken generations to build but will only, unfortunately, take a moment to compromise.

Very sadly, we have a government in Canberra that has no plan, no policies, to protect and raise educational quality in this country. Even the tinkering is incomplete, and it is certainly not thought through. While these bills do take some action to deal with some of the issues raised in the independent evaluation of the ESOS Act tabled over a year ago, they do not address all the recommendations.

I know that Labor’s Northern Territory senator, Senator Crossin, has been in correspondence with the minister regarding recommendation 3. That is about the extension of the ESOS legislation to enable providers in the external territories, especially Christmas Island, to register on the Commonwealth Register of Institutions and Courses for Overseas Students, or CRICOS, as it is known. It is disappointing that this and many of the other recommendations from the review have not been acted upon.

The member for Capricornia has indicated that Labor intends to move a substantive amendment to the first of these bills. The No. 1 bill proposes a new provision to automatically suspend providers from CRICOS if they do not pay their annual registration charge by the due date. Clearly the government have identified late payment of the annual registration charge as a problem, which they are seeking to remedy by imposing a very severe sanction.

During the estimates process, Labor senators raised this issue with the government. In answer to our questions the department revealed that, of the 1,193 providers liable to pay the registration charge this year, 493 had not paid by the due date. Yet all bar one provider has since paid, and the CRICOS registration of the outstanding provider is currently suspended.

Suspension from CRICOS is a very serious and severe sanction, as registration is mandatory for all Australian providers wishing to operate in the international student market. Automatic suspension for nonpayment of the annual registration charge could be unfair in circumstances where the department of education is under no obligation to inform the provider of their precise liability in a reasonable time before payment is due.

The amount each provider is liable to pay as their annual registration charge is determined by the Education Services for Overseas Students (Registration Charges) Act 1997. Section 5 of that act calculates the charge at a $300 base amount plus a $25 per student contribution based on enrolments with the provider in the previous year. The annual registration charge relies on an agreement between the provider and the department on the total enrolments in the previous year. Resolution of discrepancies can affect the amount to be paid. Automatic suspension for nonpayment by the end of February, when the department is under no obligation to detail the extent of liability, could certainly be seen as unfair.

Labor’s amendment would require the department to give registered providers 28 days notice of the specific amount they are required to pay as the annual registration charge under section 23 of the act. Suspension from CRICOS would only be automatic when a provider fails to pay the charge 28 days after a final determination of their liability is received. This amendment was suggested to the opposition by the Australian Vice-Chancellors Committee, which is concerned about automatic suspension when providers may still be in discussion with the department about final student enrolment numbers; especially given that payment is due by the end of February. I urge the government to support Labor’s practical amendment.

Gavan O'Connor (Corio, Australian Labor Party, Shadow Minister for Agriculture and Fisheries) Share this | Link to this | Hansard source

The bills we are debating here today, the Education Services for Overseas Students Legislation Amendment (2006 Measures No. 1) Bill 2006 and the Education Services for Overseas Students Legislation Amendment (2006 Measures No. 2) Bill 2006, seek to amend the Education Services for Overseas Students Act 2000 and follow a review in late 2003 and subsequent recommendations proposed to improve the operations of the act. This legislation that we are debating here today, which is complementary to the original act, is, according to the second reading speech by the Minister for Education, Science and Training, designed to:

... ensure the quality of education and training provision to overseas students, provide overseas students with consumer protection and maintain the integrity of the student visa system.

These are very important objectives which the opposition has no hesitation in supporting in this place.

Since the decision by the Hawke Labor government in 1986 to open up Australian education to full fee paying students, Australia has seen a dramatic growth in the export income from the provision of educational services. At this time the industry ranks fourth as an earner of export income. There were very sound economic reasons as well as other reasons for this decision, which has yielded enormous economic benefits and other benefits to this country. The Hawke government was a trade orientated government which had the foresight to see that Australia’s global future would need much more than a dependence on digging resources out of the ground or exporting agricultural commodities to secure future living standards of Australians. So it took an inward-looking economy that had been stagnating under years of Liberal-National coalition government and gave it an outward and global orientation. That had as a consequence an enormous growth in manufactured exports and service exports.

Educational services became a central factor in the enormous growth in the services sector. Educational institutions around Australia responded to the Hawke government’s economic leadership and its foresight, and the rest is really a matter of history. Where previous coalition governments had failed to capitalise on Australia’s economic strengths, Labor in government provided not only the leadership but the financial support to those institutions that had the will to get into the export ring. The Hawke Labor government recognised that the quality and the diversity of our education sector was an economic strength with obvious potential for earning export income, and also that it was a sector that had the potential to do much more for Australia’s position in the region and the world. Labor saw the educational experience for overseas students as a vehicle for elevating the understanding of Australians and their culture by others in the region.

And here we are 20 years later, where in our region many government ministers, high-ranking businessmen, public servants, educators and others fondly recall their educational experience in Australia. You simply cannot buy that goodwill, and any Australian government investment in this area of activity has borne economic and other advantage well beyond the value of the initial investment.

We on this side of the House cannot understand a government which in 10 long years in office has cut to pieces educational expenditure in this country. It makes no economic sense for Australia not to be at the top of the educational tree in this global trading environment. I would have given ministers in this government the benefit of the doubt, having come through the political ranks in their respective parties, that they would not engage in the politics of stupidity over the past 10 years and that they would see, as the Hawke government saw before them, the enormous advantages that could accrue to Australians and to this nation by enlarging and expanding our educational sector. But, as the member for Jagajaga outlined in her excellent contribution to this debate, the decline in quality that is now occurring in our tertiary sector and the enormous pressure that it is under are because of the actions of this government.

I cannot believe the crass stupidity of the Howard government in this area. This is a government that has failed Australians and now we are seeing reports like the OECD’s, which are shining the spotlight on the comparative disadvantage that Australia now experiences compared with other countries around the world of similar economic structure and economic development. This government has for 10 long years, with its ideological obsessions, been squandering the great advantage and legacy that were given to it by the Hawke and Keating Labor governments. That is a cause of great disappointment, because I would have thought the art of politics was not engaging in an orgy of stupidity in a particular sector but picking the eyes out of the strengths of a previous government and building on them in the interests of the Australian community. That would seem to me to be a logical policy proposition, but it is one which is lost on the tired and visionless government that we have in place.

I have always said that the Prime Minister’s great vision for this nation was a limited one—and, of course, it is. It was basically based around implementing a goods and services tax, selling Telstra and wrecking the lives of Australian working families, including those in the education sector, through a draconian industrial relations system. If that is all the Prime Minister has to show for his time in Australian political life, you would have to rate him as an abject failure. The government that he is leading—and which I am sure will shortly have its mandate terminated by the Australian community—similarly reflects the lack of vision that the Prime Minister has shown throughout his political career.

I would have thought the objective of putting Australia front and centre in the education of the world was something that we could all aspire to in a bipartisan way. To do that and to maintain it you would need to ensure that our educational institutions were properly funded, that we were world leaders in all the benchmarked areas in the tertiary sector, and that people were looking to Australia. I know the government will argue that per head of population, or whatever criteria it might employ, Australia leads the world and that we are the third-largest provider of export services in the English-speaking world behind the United States and the United Kingdom. So what’s new? The government was left a sector that was in an enormous pattern of growth and, thanks to the vision of the Hawke and Keating governments and the basis and the foundation that they laid in this particular sector, we have seen Australia’s educational exports grow.

Like any industry sector that has undergone a rapid expansion, it is not always, and not on every occasion, plain sailing for those institutions or for overseas students. That is the reason for the legislative framework we are debating here today and the reason why Labor will be supporting the thrust of this legislation. As I have mentioned, Australia is now the third-largest English-speaking provider of educational services, and we hold seven per cent of the market behind the United States of America, with 32 per cent, and the UK, with 15 per cent. Per head of population, we are the largest provider. It is therefore very important that everything is done by government and educational providers in this market to secure and expand our market share—and so the necessity for this legislation to ensure that students get the education for which they have paid and that students comply with their student visa conditions.

There are many technical aspects to this legislation which are outlined in the explanatory memorandum that has been provided to members of this House by the minister. I note her presence in the chamber at this point in time and I thank her for that explanatory memorandum. It goes to a whole host of technical provisions that I will not be discussing in detail today. Suffice to say that the measures that have been included in this bill are a positive refinement that the opposition will support because we support educational institutions that are cutting the mustard in this increasingly competitive market, and we want to see and ensure that the legislative framework that governs their operations and sets out the immigration and responsibilities of overseas students is of the highest quality and standard.

The Geelong region is blessed in that it is served by two educational institutions that have very high international reputations—the Gordon Institute of TAFE and Deakin University. Both were early players in the provision of educational services to overseas students and both are active participants today in offering courses to overseas students. The Gordon currently, in 2006, offers education across a variety of courses to 113 inbound students. Traditional inbound student markets for the Gordon have been Hong Kong, Korea, Japan, Taiwan and Thailand, and we are seeing now some expansion in developing markets in China, India, Indonesia and South America. I note that around 65 per cent of those 113 students come from Korea, Japan, China, Hong Kong, Malaysia and Taiwan. That is a very significant number of inbound students from our region.

Some 70 courses are offered by the Gordon to international students. Not only does it offer these courses; it also hosts delegations and offers training in specific areas. I note in the 2005 annual report the involvement of the Gordon in providing training to Vietnam Airlines Corporation and Vietnam Steel Corporation. It has also provided training and support to the Toba Pulp Timber Mill in Sumatra, Indonesia. The Gordon continues to promote its educational services and project itself into our immediate region.

Current enrolees at the Geelong campus of the Deakin University number 616. The main sources of these students are India, 16 per cent; Zimbabwe, 14 per cent; and China, 13 per cent. The students participate in a range of courses, including commerce, engineering, arts, construction, management, public relations, education and information technology. Deakin has projected that these student enrolments will grow at around 10 per cent in coming years.

Both institutions take their responsibilities to overseas students who choose to study in Geelong very seriously indeed and offer them a range of support services on their arrival and while they are studying. They assist them in their search for housing and to get a better command of the English language to help them in their studies. In addition, they assist them in a host of other areas related to their personal needs.

I note that the range of support services offered by Deakin University is quite extensive. It offers exchange/study abroad orientation programs to introduce new students to the university and to Australian life and culture, and it offers an international enrolment and orientation program, which certainly goes deeply into the demands of university life and various other matters related to studying in Australia. It provides reception service and post-arrival support, which involves airport reception and first-needs support to assist the student in settling in. That includes peer support programs for friendship, links and networking. Also provided are shared experiences and support in banking, first-meal shopping, campus familiarity, city orientation, off-campus housing appointments and other support materials. It provides a community links program to connect the student with local service organisations, sporting clubs, community radio stations, churches et cetera, and an international student orientation camp which is run out of the faculty of education. The university provides academic monitoring, networking and life skills seminars, and an international students program is run by the faculty of the arts.

I mention these because I think there has been a tendency in the past for some educational institutions that have entered the export services arena not to meticulously plan and prepare to support students who choose to undertake courses with them, and I am very pleased that Deakin University is providing these sorts of support services. I was recently part of an Australian parliamentary delegation that visited Malaysia and Japan, and the provision of educational services to those countries by Australia was the focus of our discussions with senior ministers and others in the business communities. Some quarter of a million Malaysians have been trained in Australia and that can only be a good thing for Australia.

In conclusion, Australians now live and work in a global village and, across the globe, students are seeking to be educated in environments other than their own. It is estimated that the world demand for higher education could increase from around two million to eight million students by 2025. We now have a global education market which is rapidly expanding, with enormous growth being generated by demand from Asian countries—particularly emerging economic giants such as China and India and established developing economies such as Japan, Taiwan, South Korea and other Asian countries. It is a simple fact that economic growth generates a strong demand for education and alters a country’s demand profile for educational services. It is very important that Australia maintain its pole position in the provision of educational services.—(Time expired)

Ms Julie Bishop (Curtin, Liberal Party, Minister Assisting the Prime Minister for Women's Issues) Share this | Link to this | Hansard source

in reply—We have before the House this evening for consideration two bills to amend the Education Services for Overseas Students Act 2000, the ESOS Act. The ESOS Act and its complementary legislation represent international best practice in the regulation of education and training delivery to overseas students. The growth of the industry to date is in no small part due to the effectiveness of this regulatory framework. However, Australia’s position as market leader is under challenge from our traditional competitors, a number of whom are duplicating aspects of the ESOS framework. In this environment it becomes critical that Australia continues to set the pace in the effective regulation of our international education and training services to remain competitive.

The amendments to the ESOS Act in the Education Services for Overseas Students Legislation Amendment (2006 Measures No. 1) Bill 2006 and the Education Services for Overseas Students Legislation Amendment (2006 Measures No. 2) Bill 2006 demonstrate Australia’s ongoing commitment to ensure the delivery of high-quality education to international students studying in Australia. The ESOS Act protects the high-quality reputation of Australia’s education and training export industry by regulating education and training providers, providing consumer protection for overseas students and ensuring the integrity of the student visa program.

The evaluation of the ESOS Act made recommendations for the improvement and clarification of provisions to support its effectiveness. The amendments proposed in these bills will have a beneficial impact on each of the three main objectives of the ESOS Act. The ESOS Act safeguards the interests of overseas students by setting standards for education and training providers. All providers who deliver education and training to overseas students must be registered on the Commonwealth Register of Institutions and Courses for Overseas Students, CRICOS.

Before registration, in addition to meeting state based quality requirements, providers must demonstrate that they are fit and proper to be registered. The ESOS Act currently applies the ‘fit and proper’ test to providers and their prescribed associates. Amendments will extend the test to others with positions of authority with providers and will allow for the ‘fit and proper’ test to be applied not only upon registration but at any time during a provider’s registration. Sanctions can be applied for noncompliance. These amendments will prevent persons with a history of noncompliance with the ESOS Act from taking up positions of responsibility with other providers and will allow for enforcement action to be taken against providers who no longer meet the ‘fit and proper’ requirements. They will provide a further guarantee of the credentials of CRICOS registered providers.

The ESOS Act provides three levels of consumer protection for overseas students. It places refund obligations on registered providers, allows for placement in any alternative course by the provider or their tuition assurance scheme—another acronym, TAS—and establishes the ESOS Assurance Fund to place a student in an alternative course or provide the student with a refund if the two previous consumer mechanisms fail. Amendments will oblige a provider who offers a student placement in a course as an alternative to a refund to obtain the student’s acceptance of the placement in writing. If there is a claim on the fund, this will clarify whether a suitable offer has been made and whether or not it has been accepted.

The ESOS Assurance Fund was established with Australian government support and is now maintained by annual provider contributions. This bill addresses industry concerns that the current provisions of the act which govern fund refunds may result in some students effectively receiving part of their education at no cost, which was not the original intent. This instance could occur if a student receives academic credit or recognition of prior learning for completed study in addition to a full refund from the fund.

An amendment will now allow the fund manager to reduce the amount of a refund where it can be demonstrated that a student has received academic credit or recognition of prior learning for study undertaken with their former provider. The legislation should work to ensure that students receive the education and training for which they have paid and that they do not effectively receive part of this education at no cost if a provider fails.

Similarly, the introduction of a 12-month sunset clause for claims on the fund will provide the fund manager with more certainty regarding liabilities and assist with managing the fund’s assets. To date, lack of access to student information has hindered the TASs—tuition assurance schemes—in fulfilling their placement function, but an amendment which will give TASs access to student information will facilitate a faster placement of students in alternative courses.

The ESOS Act supports the integrity of the migration system by placing obligations on registered providers to recruit only genuine students and to monitor and report on breaches of visa conditions relating to attendance and satisfactory academic performance. A breach of these visa conditions may result in the cancellation of a student’s visa. The extensive consultation with industry undertaken as part of the ESOS evaluation revealed that the attendance and satisfactory academic performance visa conditions no longer reflect educational practice. The Department of Education, Science and Training has been working with the Department of Immigration and Multicultural Affairs and peak bodies to develop changes to providers’ monitoring and reporting obligations that better reflect teaching, learning and assessment in each sector while maintaining the visa integrity intent of the act.

The revised national code will reflect the outcome of these discussions. The migration regulations will be amended to impose student visa conditions that support the revisions to the national code, and these visa conditions will be prescribed in the Education Services for Overseas Students Regulations 2001.

In conclusion: protection and enhancement of Australia’s reputation for providing reliable and high-quality education is absolutely crucial to achieving sustainable growth of this important export industry, which is currently worth over $7½ billion annually to the Australian economy. These measures will further strengthen the ESOS regulatory framework and ensure that Australia continues to be a destination of choice for overseas students. I commend these bills to the House.

Question agreed to.

Bills read a second time.