Alex Hawke (Mitchell, Liberal Party) Share this | Link to this | Hansard source

I welcome the chance to resume my remarks in relation to the Education Services for Overseas Students (Registration Charges) Amendment Bill 2011. At the time of the interruption of my last remarks I was speaking about the impact upon smaller colleges and enterprises in Australia today and the sometimes unintended consequences of government regulation where there is an inconsistent policy approach.

Since I have had the opportunity to do so I have been reading further papers from the Council of Private Higher Education Incorporated, which has put together a worthwhile paper in relation to this area. I would like to quote from their paper in relation to what the role of government is in the private education sector. The council says, 'The international education sector does not expect a direct subsidy of the type variously afforded industries such as manufacturing; but nor does it expect excessive charges, even under the mantra of full cost recovery. Above all, it does not expect unhelpful and unnecessary policy settings, inconsistency between different arms of government and sudden, politically-driven policy changes without full industry consultation.'

Amen to that. At the moment, of course, we do have inconsistent approaches between state and federal governments for this sector. We do have excessive regulation and, indeed, this government is moving us towards full cost recovery for the industry. Some people might ask, 'What's wrong with that?' Indeed in many cases I am a supporter of full cost recovery, and the fee restructuring that is going on here is not all bad. However, the inconsistency in policy approach from this government, including the handling of visas and the regulatory framework that has surrounded the treatment of international students, has meant a diminishing of this vital industry for Australia. Once again, I would endorse the role that this industry plays; it was our third biggest export industry a few years ago and totalled $17 billion in income for our country. It allows Australia to provide a great source of regional foreign policy in educating students from all across Asia. Most of those students, of course, return to the countries they come from, well educated by our country and looking forward to seeking high roles in their countries, with a high view of this country and the education services that we provide: a great outcome for all concerned. So I do think that government does have a role to provide a much more balanced regulatory framework—as the council calls for—one that is not inconsistent, one that does provide certainty for the industry and with proper industry consultation. I think that, if the government had consulted further on this legislation, it could be improved. I think that it is reasonable to say that colleges with fewer than 30 international students could benefit from a cap on the fees that are being charged. That is not something that would cost government a lot. With proper consultation I think that small and very small colleges, those struggling to survive and those that are working their way up to become large colleges, could have their fees capped. I do not think that that is unreasonable. With minimum consultation, the government could have ascertained that that would be a good idea and approach and that we could improve the quality of this legislation. I want to say again that the government often fails to consult adequately with industry sectors and I do think that that has led to the inherent weaknesses in the legislation that we see put before us in this parliament.

We know that if a college has less than five per cent of international enrolments this will unfairly penalise them financially. With fewer than 30 international students, or less than five per cent of enrolments, there is a very low risk here of any kind of trouble for the government and what with full cost recovery and the nature of the return for the government it certainly seems to be a strange policy setting. It probably has more to do with the nature of the government debt burden we have at the moment than anything else.

Of course this legislation comes out of the Stronger, simpler, smarter ESOS: supporting international students review conducted by the Hon. Bruce Baird. It had many recommendations, some of which the government has adopted, some which it has not. That review had a certain point of view. I think that some of its recommendations were worth while; I think that others unfairly burden this industry. It is heavily regulated. There are providers in this sector that have continued to hold the accreditation required by state and federal governments over many, many years without incident. They have been proven to be effective providers of education at tertiary level and for other courses and therefore they do not need the same level of regulatory burden or increased regulatory burden that we might be looking to target institutions that do not have such a good record or that do have problems. That is where government does have a role to play, but we have to find ways to target our legislation at the problem we are seeking to address and not to burden unnecessarily the entire sector with increasing regulatory burdens and costs without any due return.

I just want to make that point before finishing my remarks. Here in this place we have some great providers of overseas education. Indeed, we ought to be encouraging this industry to continue to do the job that it has done so well over the last decade. Certainly, this sector is suffering, not exclusively but in part, due to government action. This kind of regulation, while it may look inherently good on the surface, will not help in general with the policy settings that the government has put in place in this sector. We should seek legislation and regulatory reform that recognises those worthwhile institutions that have been accredited for a long time and that are providing a service in this space and not causing any trouble, and remove burdens as well as increase the amount of legislation or amendments that we are passing in this place. We should also seek to make the job of independent providers easier in Australia.

Kate Ellis (Adelaide, Australian Labor Party, Minister for Employment Participation and Childcare) Share this | Link to this | Hansard source

I would like to take this opportunity to thank those members who have spoken on the Education Services for Overseas Students (Registration Charges) Amendment Bill 2011 and the Education Services for Overseas Students Amendment (Registration Charges Consequentials) Bill 2011. As we have made clear, the Australian government is deeply committed to ensuring that those international students who choose to study in Australia receive high-quality education and training. At the same time, the government maintains the same level of commitment to also ensuring that the international education services industry remains a robust and sustainable one. (Quorum formed)

The Education Services for Overseas Students (Registration Charges) Amendment Bill 2011 and Education Services for Overseas Students Amendment (Registration Charges Consequentials) Bill 2011 build on recent changes to the ESOS Act through the reregistration of all providers and ensures a rigorous gateway to the industry in terms of ongoing registration and compliance activity. All international education providers are required to register on the Commonwealth Register of Institutions and Courses for Overseas Students. Through the restructure and rebasing of the annual registration charge, the Commonwealth will be able to deliver a more direct and effective registration and supervisory regime for the international education industry.

The tiers of the restructure charge, which are outlined in this bill, reflect the different levels of regulatory risk presented by various categories of providers across the industry—something the government sees as appropriate. For example, new providers considered to be higher risk in the first three years of their operation will pay additional amounts in those initial years of operation. Providers who have had regulatory action taken against them will also pay additional amounts. Further, there is scope through regulation to allow certain providers such as public universities, technical and further education providers, and public schools to be exempted from certain elements in the new ARC such as the annual per course component. This rebasing and restructuring of the ARC is a significant milestone for the international education services industry.

The government is moving away from a charging arrangement that treats all categories of providers—all businesses in this industry—as having the same characteristics. Instead, the new ARC will reflect the different characteristics of the main subsectors across the industry, as these are reflected in the costs of registration and compliance activity. These amendments represent the first component of the government's second-phase response to the recommendations of the Baird review, which was released on 9 March 2010. In releasing the final report, the Prime Minister in her then role as Minister for Education noted that the government supports the recommendations made by the review relating to lifting the bar on entry to the international education industry. These bills take up the challenge of this recommendation by introducing an entry-to-market charge on providers seeking their first registration in the industry. This will also ensure that this group of providers is able to receive the requisite attention in their initial period of registration.

While the restructured ARC introduces more components than the existing arrangements, this bill will realise a fairer and more equitable distribution of the imposition of these charges across the industry. This will mean many providers across the industry will experience an overall reduction in the total amount of the ARC they pay, while the introduction of a risk based element in accordance with the recommendations of the Baird review will mean that some providers pay slightly more based on that risk assessment. In turn, those providers that present more regulatory risk will receive more regulatory attention.

The restructured and rebased ARC will help ensure a strong and vibrant industry where high-quality providers are able to flourish and those that present a higher regulatory effort are given the appropriate regulatory attention. This first component of the government's second-phase response to the recommendations of the Baird review will make a significant difference in ensuring the integrity and sustainability of the international education services industry in Australia. I commend the bill to the House.

Question agreed to.

Bill read a second time.