Clare O'Neil (Hotham, Australian Labor Party) Share this | Link to this | Hansard source

I appreciate the opportunity to make some comments on this very important piece of legislation, the Education Services for Overseas Students Amendment Bill 2013. It is a piece of legislation that is going to contribute to the protections that are in place for international students who are studying in Australia. Two specific amendments are on the table before us this afternoon. The first is to ensure that the Tuition Protection Service has the power to force the refund of prepaid fees where a provider fails or a course is cancelled. The second is to ensure that the Tuition Protection Service has the power to force a refund of prepaid fees where a visa is refused for a prospective student. I will speak a little bit about those amendments in detail, but I want to state first off that these are really important steps to ensuring that Australia's higher education sector remains attractive to students overseas and remains competitive, because we are competing with other nations in this extremely important export industry. This is also a bit of an opportunity for me to reflect on Labor's legacy in growing this very important industry, and I will speak about that in due course.

Let us get started by thinking a little bit about the importance of international students in my electorate of Hotham. I am incredibly lucky to represent a very diverse and very interesting population in Hotham. We are within a stone's throw of Monash University. Many of you would know Monash as one of the best universities in the whole of Australia. It is also one of the most international universities in the whole of Australia. I was lucky to be a student there for quite a few years and I can say that, whether it was being in a sporting team or joining students in a sports class or engaging in a few student political activities—which many of us got into in our younger years—or in the course of tutorials or university lectures that we shared, having international students learn with us was one of the most enriching parts of that educational experience. It is enriching for the life of that university and it also enriches life for the people of Hotham. Hotham is a vibrant and diverse place, and our international student community is very much a part of that.

But we have to be up-front and say that, for all the benefits and all the excitement that we have for the international students that are studying in Australia, there is a seedy underbelly to this too, and that is that there are many providers and we have been through a number of regulatory changes that at various times have made it, I think, too easy to provide courses. We have seen some very disturbing stories. Some of these have occurred right in my electorate of Hotham, unfortunately. I am not going to mention names or go into the gory details, but I can say that there have been incidents where teachers in colleges have purported to have qualifications and that later proved not to be true. There have been issues around course structure. One example in my electorate was where a course was being taught to the students back to front. There have been examples where students have been charged exorbitant and, frankly, exploitative fees to study at these institutions. So the legislation that we have before us is about protecting the best of this industry and making sure that that seedy underbelly does not pervade what we put out there as one of our critical exports to the world.

This is an industry that is absolutely worth protecting. I think everyone in Australia knows that this industry is important but many would not realise its critical economic importance. Educational exports is our fourth largest export industry. We export $15 billion worth of education every year to people visiting Australia. It is actually more than our whole tourism industry combined. It supports 100,000 jobs. It has also, for better or worse, come to be a pivotal part of funding our higher education sector, and that is for students who are visiting from overseas but also for Australian students who are accessing tertiary education. About a quarter of our students at the moment are international students. They more than pay their way, and our universities are now very frank and up-front about how important that is for their survival.

These are some of the hard financials, but those of us who have been lucky to participate in this know that we reap a lot of other benefits from having international students studying with us in Australia, that it is not just about the dollars. In October 2012, the Labor government released the Australia in the Asian century white paper, a fantastic document which I think just started to unravel some of the difficult issues that we need to face to really embrace our proximity to Asia and get the most out of the Asian century. A report that considered the white paper pointed out that 80 per cent of the international students studying in Australia were from the Asian region and it said:

International education is a pillar of the people-to-people relationships that drive economic, cultural and social outcomes for Australia in the Asian Century …

I am very committed to this sentiment because I have been lucky to study in America as well and just about all of my classmates were from different countries around the world. I can absolutely say from personal experience that those person-to-person relationships are pivotal to the way that we liaise with other countries. When you look in the economics textbooks they are all about numbers on a page, but people really matter when it comes to building economic links. I think it is also relevant when we think about foreign affairs. A key plank of Australia's soft power and aid strategy is really being pursued through this exposure that we are giving to students all over Asia to Australian culture, to improved fluency in English and to the building of friendships that I have talked about. Perhaps even more relevantly for Australia as a nation, surrounded as we are by mostly Asian countries, it is a fantastic opportunity for us to learn about their culture, their language and the way that they do business.

A final point I would make on this is: just think of the fantastically skilled workforce that we are creating by helping turn out so many skilled graduates from our higher education institutions around Australia. This is hundreds of thousands of mostly young people, mostly from Asian countries, who are learning more about the English language, more about our Australian culture and forming ties to people, companies and institutions.

So there are a lot of benefits that I have talked about, but there have been challenges. When we see the thriving state of the sector today it is important for us to remember that this did not just happen organically. Significant intervention was required at certain times to make sure that things did not fall off the rails. Initially, the Howard government took a very hands-off approach to international education, with near disastrous consequences for the sector. I think we can remember that back in those days just about any old duffer could start up an international college of some sort and start providing some type of higher qualification. There were issues with lax immigration rules, which led to the entry of completely unsustainable levels of international students. Frankly, the institutions were unable to absorb those sorts of numbers. We saw the entry of some dodgy operators, who affected the whole export industry.

I think that, as well, we are all across a lot of the practical issues that were faced by those international students and that the government eventually had to come in and give a hand with. On issues around housing, we have all heard the stories of 17 young people crowding into and sleeping in shifts in bedrooms and all those sorts of things that have been going on. We have heard the endless stories about work exploitation that has taken place where international students were being paid well below the minimum wage and were not being given appropriate awards and conditions in the work that they were doing. We have heard about massive international attention being given to incidents of violence against international students—very disturbing stuff.

One of the things that we are seeing and that we have seen in recent years is that this is a very discerning group of consumers. These students who are coming to study in Australia have options presented to them all over the world. This is an open competition where countries like Australia are competing for these young students to come and study. When you look at the numbers you can see some of the sensitivities here. From 2008 to 2009, we had 70,000 visa applications granted to international students from India. I believe that was the peak of applications from India. It was also the time when some of those controversies started to bubble up a little bit. The following year, that dropped by more than 50 per cent. There were just 30,000 applications that following year. It is a staggering decline and just illustrates the importance of making sure that we have our eye on that industry. It does not need to be overregulated, but at the same time there are consequences for our whole economy and for this huge export industry if we let things run without some proper oversight.

The summary of this particular point is really that policy matters when it comes to this area of our economy. Leadership really matters, and national leadership at a time of global challenge is imperative. We saw the Rudd government come in and show leadership to try to grow the sector and to try to restore integrity so that those many thousands of Indian students who came in 2008-09 and then turned away the following year would feel more confidence in their decision to study in Australia. Just as important to restoring integrity to the sector is ensuring that we are restoring the appearance of integrity to the sector, because, as I said, this is a very discerning group of consumers.

A package of reforms was put forward to try to provide an appropriate level of protection and oversight to the industry. The Tuition Protection Service is an integral part of that. The Tuition Protection Service is a very important reform of the previous Labor government. It is simple. It provides a single contact point for students who are affected by provider default. It illustrates, I think, a deep level of commitment to protect these students who have made Australia their home for a period while they are trying to get higher education. The way that it works is that providers pay a levy, and the levy is used to support students who are trapped by provider default. It helps those students to either be placed in an alternative course or be paid a refund. It is very simple and very much an issue of justice when you think about it. The legislation said that, where students had paid up-front for a course and that course could not be provided to them, they were able to get help. They were able to be diverted into a new course or, at the very least, get their money repaid. It is shocking to think that we would even need legislation of this nature. You would think that this would not be required, but unfortunately there have been so many instances where we have seen students taken for a ride in this sector that the Rudd government had to come in and put this reform in place.

It is important to note also that the Tuition Protection Service has been essential because there have been so many instances, and I think there are predicted to be even more instances, where some of these institutions go into default. I think the Tuition Protection Service reported last year that up to 22 providers, serving 4,400 students, would close in the coming year through either business failure or regulatory action. Let us just absorb that. That is 4,400 students who went through the process and got themselves a visa, many of whom got on a plane and came to Australia to participate in these courses, and were then told, 'I'm sorry; the college has gone into default.' All we are really saying here is something pretty straightforward: these people deserve to get their money back or to be assisted into another type of institution.

In conclusion, we have talked about how important this sector is for our whole economy. Not all sectors are like this, but this one in particular is one where regulation has been very important. National leadership from our federal government has been essential to growing this sector and essential to maintaining the integrity of the sector so that a group of students who are showing themselves to be increasingly discerning about where they study will continue to choose Australia. And students like me, who had the great fortune to study with so many international students when I was a student at Monash, will continue to have that fantastic experience, and we will continue to see built those person-to-person links that will continue to help Australia move into this, the Asian, century.

Labor supports these amendments. We support any measures to help protect these international students, who are so much a part of our community and so much a part of my community in Hotham. I am pleased to speak in support of the amendments.

Craig Kelly (Hughes, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Education Services for Overseas Students Amendment Bill 2013. Firstly, I would like to note that this bill makes a few technical amendments to the Education Services for Overseas Students Act 2000. However, before I go on to the specifics of the bill, I think it is very important to emphasise how important our educational exports are to our nation and how they grew under the previous coalition government.

If we go back to 1996, when the previous coalition government was first elected, our educational exports were a little over $2 billion per annum. By the year 1999-2000, we had been able to double it to $4 billion. In fact, by 2007-08, when the coalition left office, this sector was worth $14 billion of exports. Of course, the trajectory that it was on under those years of the coalition government saw it, by 2009, reach close to $19 billion worth of exports. To put that in context, that makes educational exports our third-largest export industry, only behind coal and iron ore. In fact, we have more people coming to this country and our nation derives more export income from education than it does from tourism. Although we have our natural wonders of Bondi Beach, Ayers Rock and the Great Barrier Reef and we have places like Sydney Harbour Bridge and the Opera House which attract overseas tourism and build wealth and create jobs in this country, our educational sector surpasses that. Our universities, our TAFEs and our schools actually return more to this nation in exports than do our natural resources, our beaches and the other wonderful things we have for overseas tourists to come and see.

The wealth to this country is even beyond that measured dollar value. We see that where we have students from overseas it strengthens our global network of connections. Who knows how many future leaders of Asian countries will be among those many students that come to Australia to study and receive their formative education and experiences here in Australia? This helps them be leaders of Asian countries in the future and means a lot to our nation through the friendships that will develop. However, even though we were able to get close to that $19 billion figure in 2009, unfortunately, and contrary to what the previous speaker was saying, we have seen a decline in those export revenues under the previous Labor government. It depends how you measure it, whether you take the financial year or the calendar year, but we have seen our educational export sector shrink to be something like 20 to 25 per cent smaller. It is a common theme that we see. The coalition continually improves things and then when Labor came to office back in 2007 they headed on a downward trend. This government is determined to reverse that downward trend and get our educational exports headed back in the right direction.

One of the main reasons our educational exports declined is because of some of the changes the previous Labor government made. To give them some sympathy, they were not totally to blame, but the changes they made to the visa system, the increases in fees, had a detrimental effect and harmed our exports. In fact, when we say a 20 to 25 per cent decline, this was something like $3 billion to $3.5 billion wiped off our educational export sector. That is more than if our entire wool industry was wiped out for one year. That is what we have lost in our educational exports.

On the specifics of the bill, it ensures that overseas students can receive appropriate refunds for unexpended fees in the case of an education provider or student default. It addresses the unintended consequences of amendments made in the ESOS Act 2012 which meant that some students were not able to receive refunds as originally intended. The problem only became evident after amendments were applied in practice. The bill proposes an amendment to ensure that the refund is for the full amount of tuition paid for or by the student, minus the amount calculated as having been delivered by the provider. The bill also gives the minister power to make a legislative instrument that will set out the method of calculation for refunds and in the case of different circumstances of visa refusal. This will streamline the requirements of the ESOS Act for users.

We have a great potential in this nation to increase our exports in our educational sector. We look across the board and we see where our jobs are going to come from in the future. Our educational sector is one of the keys to our economy. It is one of the areas where we have a competitive advantage. It is one of our nation's strengths. This is where government should be giving its support. UNESCO estimates that over this decade the number of internationally mobile students will almost double from four million to seven million. There is potential for us to increase our exports by multibillion dollars in future if we get the policy settings right, if we get our educational sector right. It is also important for several of our states. In New South Wales our educational exports are our second largest export sector. In Victoria it is actually the largest export sector for the whole state.

However, there are some risks and some concerns. Some of those concerns that threaten this potential export bonanza we can have are what is in our cross-curriculum priorities, our new national curriculum. We do have those three cross-curriculum embedded priorities of Aboriginal and Torres Strait Islander history and cultures, Asia and Australia's engagement with Asia, and sustainability. The concept of sustainability under the new national curriculum will be embedded in all areas of the curriculum, including mathematics. I quote from the national curriculum:

In the Australian Curriculum: Mathematics, the priority of sustainability provides rich, engaging and authentic contexts for developing students’ abilities in number and algebra, measurement and geometry, and statistics and probability.

It goes on:

The Australian Curriculum: Mathematics provides opportunities for students to develop the proficiencies of problem solving and reasoning essential for the exploration of sustainability issues and their solutions.

If the definition of sustainability was about economic sustainability, how governments must run a sustainable budget, this would be a welcome change, something that is welcome in our curriculum. We could actually take those concepts and we could use them in mathematics. We could look at basic addition and use the theory of economic sustainability to teach it to our children. For example, we could actually add up the last five budget deficits of this Labor government—$27.1 billion, $54.8 billion, $47.7 billion, $43.7 billion and $19.4 billion—to work out $192 billion of accumulated deficits. This would obviously help our children learn about mathematics and addition.

We can also project forward. Again, we could teach children about addition in mathematics as a concept and look at the MYEFO over the last four years—for 2013-14, 2014-15, 2015-16 and 2016-17. If we add up those projected deficits that the previous government has locked in with our policies, we get over $120 billion of combined deficits. We could also teach our children the principles of simple interest in mathematics, as the current unsustainable debt that was racked up by the previous Labor government now costs the economy $10 billion annually. This is a way we can teach children percentages.

We could also teach them probability. We could quote to children the budget speech of the former Treasurer back in 2012, when he said:

The four years of surpluses I announce tonight are a powerful endorsement of the strength of our economy, resilience of our people, and success of our policies. This Budget delivers a surplus this coming year, on time, as promised, and surpluses each year after that, strengthening over time.

He continued:

The surplus years are here.

We could teach the concept of probability to students, because they could learn that the probability of that occurring would be absolutely zero.

If that is what our children were being taught about sustainability, we would not have too much objection, but what is the definition of sustainability? I quote directly from our new national education curriculum which defines it as follows:

The Sustainability priority is futures-oriented, focusing on protecting environments and creating a more ecologically and socially just world through informed action.

This is not a Greenpeace brochure; this is the concept that is embedded in everything Australian students learn under our national curriculum. Gone is the notion that our progress is defined as the exercise of mankind's ability to overcome our natural barriers. Gone is the inspiration and positive vision for the future that was instilled in my public school education back in the seventies. Gone is the need to strive to make our society wealthier and to grow the pie. Instead, we are replacing it with the idea of cutting the pie into smaller pieces in a so-called 'more socially just world'.

This is not what we want to have in our education system. If we want our education system to be a world best, something we hold up to attract exports and that students from overseas want to come and learn in, we need to be teaching in our education system. We need to place importance on independence and self-confidence. We need to be teaching our kids about fierce determination and willingness so that they are not afraid to make mistakes. We need to teach them critical thinking and to question common dogma. But most of all, we need to teach our kids optimism.

But instead, the definition of sustainability we have embedded in our national curriculum is simply a corrosive, green doctrine. It is at odds with progress. It teaches restraint and low growth, social conformity, a mistrust of society and a pessimistic fear of the future. This is not what we want. Rather than indoctrinate children about sustainability, the limits to growth and the limits to our resources, we should be teaching our kids that the greatest resource they have is human ingenuity and that it is something that has no limits. Instead, our curriculum has been hijacked by green ideology.

For such an important industry for our country, something that we are going to rely upon to drive growth and to create those future jobs, we must address these issues so that we have overseas students who want to come to Australia, who see our education system as a world best and to enable kids to have a positive outlook for the future. The current national curriculum does not do that and it needs to be addressed. I congratulate the Minister for Education on his work and on this bill and also on addressing the issues in the national curriculum. I commend this bill to the House.

Lisa Chesters (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak on the Education Services for Overseas Students Amendment Bill 2013. I will reflect quickly on some of the comments that the previous speaker made. I want to say how sad it is that higher education has become the biggest exporting industry in Victoria. To become the biggest exporting industry in Victoria, it means that we have lost others. For higher education to be the biggest exporting industry, it means that as we have seen today, last week and yesterday with Toyota, we are starting to lose other industries that are important to our economy, such as our manufacturing industry. I do not believe that it is something that we can celebrate without acknowledging that other industries we rely on, ones that employ other people and create wealth and jobs, are disappearing.

The future of this country cannot rely solely upon a strong higher education sector. Higher education is important, as all the previous speakers have suggested, and international students are particularly important. The figures that we are talking about are over $15 billion and there are over 100,000 jobs in the higher education sector. Like every industry, it needs to be regulated to ensure that those purchasing the product get a good quality product and that those receiving the education get the best education they can for the dollars they provide.

I turn to why our universities are so reliant on full-fee-paying international students. It is not right to talk only about the higher education sector as an export industry, like coal, iron ore or manufacturing. We need to grow this sector because funding for our university sector was radically cut during the Howard years, which put us on a path to universities needing to rely on international students to supplement their budgets.

I support the amendments in the bill before us in relation to the Tuition Protection Service. The amendments aim to ensure that the TPS has the power to force a refund of prepaid fees where the provider fails to deliver the service, a course is cancelled or a visa is not issued. These safeguards ensure the quality of services provided by the education system. It is no secret that we have had some shonky and dodgy colleges taking advantage of international students by suggesting that if they complete their studies they will get permanent residence in Australia. Whilst this bill does not go to those issues, it ensures that if an international student has a visa cancelled or has enrolled in a course that is cancelled, they will receive a full refund. The aim is to build in safeguards that do not already exist so overseas students get the education they seek.

In providing additional financial security, these amendments will ensure there is a policy connection between the federal and state agencies to support the international education sector. In my state of Victoria a lot of work was done by the former Labor government to try and get rid of dodgy providers and rogue operators who popped up in any corner store. In fact, a place across the road from where I live was given as the address of college claiming to teach motor mechanics, but it was just an empty house. When international students turned up on the day their classes were supposed to start there were no classes. This occurs and, without government stepping in to clean up these practices, such practices will continue. These sorts of practices are not good for our reputation as they send a message that Australia is not serious about higher education, but rather is a country where students need to pick and choose so as not to end up across the road from my place wondering why it is not a mechanics institute, as was thought.

I acknowledge the contribution international students make to our society. Many of these students choose to stay in Australia. I have talked to a number of students in my electorate who have chosen to stay and make Australia their home once they have navigated their way through the system and successfully completed their education and asked them about the changes they feel are needed. I asked them what we could have done to support international students and about the challenges they faced. I draw on some comments made by Abi Awasthi, who is today working at La Trobe University's Bendigo campus. His comments include ensuring that, apart from having access to courses of high quality, international students in Australia have access to affordable, safe and adequate accommodation services and that international students also have access to student services. For many international students this is a foreign country and they may not be used to our practices. This may be the first time they have left their home country, so there is a need to support them when they arrive particularly if they believe the college they attend is not delivering the services they paid for.

Another issue raised is the need for good jobs with good pay and working conditions so international students can properly support themselves. Dodgy contractors employing international students are very similar to dodgy colleges in that they take advantage of the students not knowing a lot about Australian legislation, so being easy to rip off. We need to support international students by ensuring they get good quality education, the course they believe they have signed up to and good jobs. I draw to the House's attention a recent report by United Voice, the cleaners union representing international students working in the cleaning industry. This report found that a number of international students are working for fly-by-night subcontractors who often cheat the students out of at least $15,000 a year in pay. These students lack the knowledge of their rights, which makes them extremely vulnerable to exploiters.

This is happening in the cleaning industry in capital cities as well as regions. Why do international students take up these jobs? Often their courses are quite expensive and they need the work to support themselves while they study. Across the whole area, when it comes to international students, whether it be the courses that they take up, the jobs that they have or the accommodation services that are provided, we need to do better to ensure that they are treated fairly and we need to do better as the host country.

As mentioned earlier, Abi is an example of the kind of international student who is coming here. He arrived in Australia in 2008 as a full-fee-paying international student to pursue his masters at La Trobe University. He says that his experience is a good experience, but the experience of some of the other international students he knows is not so good. He talks about people being picked up at the airport and being dropped off with their bags at an office, and that is it. He talks about people who have had accommodation found for them that is an hour and a half, two buses and a train away, from where their courses are. He talks about the courses that they have been offered, the one-on-one tutorial time that they are told they will get and the payment that they will get to do their placements, but when the students take up the placements they are not paid. That is another major problem for international students today.

In some courses these students are becoming free labour, almost slave labour. As part of their course, they are required to do work experience, but the work experience might be three months working nine till five. You see these schemes being rolled out and rolled out. To complete their course, the international student has to work for free for long periods of time. That is something that Australian students would balk at and say, 'That is simply not fair.' This is why the changes being proposed to the Tuition Protection Service are important.

Across the sector, we need to make sure that we are doing better by our international students. Why are international students so important to university funding? I flagged this earlier in my speech. I know that some would argue, particularly in my community, that we should train our own first, that the growing number of international students is at the cost of Australian places. The truth is that the higher education sector would have collapsed without the funding of international students.

This situation was created under the former Howard government's bad Liberal policy of the late 90s and early 2000s. The funding that was cut from the higher education sector and the rate at which it was cut forced our universities to look for alternate funding streams. It was shortly afterwards that we saw the explosion in international student numbers. They have enhanced our universities and are building a strong culture. However, we cannot step away from the fact that cutting university funding has created a market for international students where sometimes our institutions are more interested in the money they are getting than the courses they are delivering. We need to ensure that our students and our guests in this country are receiving the quality education that they are seeking to pursue.

I want to go to comments made about the reduction in international student numbers in the last year. That is not the result of changes to the visas but purely and simply because of the cost of study in this country. Australia is now ranked as the highest in regard to the cost of study. Our courses are going up and there is the effect of the Australian dollar and the cost of living. That is why I have attempted to highlight the need to do more for international students when it comes to their jobs, their education and their accommodation. Whilst I support these measures to ensure that we have quality within the system, I would like to reiterate my warning that we cannot rely on higher education continuing to be our largest export sector. If we continue down this path of just educating people and not having jobs for them, we will soon run out of people to educate. We need to make sure that we have strong industries—industries such as higher education, health and manufacturing. It is not always the best news to be the largest export sector; it means that other sectors are doing badly. To say that it is wonderful and is the future of jobs in this country, I think, is a bit sad particularly following the announcement by Toyota that they are withdrawing. We need an economy where we are growing jobs across the board, not just in our higher education sector.

Alannah Mactiernan (Perth, Australian Labor Party) Share this | Link to this | Hansard source

I want to pick up from the very wise comments of my colleague. It is always very important for us to think that education is part of what we need to do to create a place for ourselves in the 21st century economy, but so is investment in research and development and the practical application of that research. Just blindly following the mantra that it is all education, education, education can very much misguide us as to what we need to do to ensure that we have the jobs into the future and the capacity for people to exploit that education. Countries like Ireland and Italy produce very many skilled graduates who simply are unable to find work in their home country

So we know that is a necessary but certainly not a sufficient condition. If we are going to be a successful country, we have to be prepared to invest and to understand that government investment in research has been critical for the development of industries that we like to think of as 21st century industries. It was not Google, Yahoo or Facebook that developed the internet, nor did they develop Wi-Fi or touchscreens. All these things were developed within government agencies with massive government investment to explore these very new technologies. The private sector then, quite rightfully and properly, leveraged off it. But let us not be confused about this mantra of small government being the thing that is going to drive our economy forward.

In relation to higher education, there are a couple of observations. I do not want to repeat what everyone else has said. It is very important that we keep our standards high. There is some evidence that Australia is perhaps in some higher education areas becoming a less preferred destination. We have to take steps to ensure that the quality of our institutions is considered comparable to the quality in the United States, the United Kingdom, Europe and even in some of the Asian countries. It is really important for us always to focus not just on the quantity but also on the quality for us to maintain our ability to compete against those institutions in other First World countries. We have to be capable and prepared to invest. I repeat: part of keeping our higher education sector competitive is being prepared to invest in the research component of institutions so that they attract the brightest and best and in turn prove attractive to students overseas who see themselves having the opportunity of working in prestigious organisations, but also working on projects and with individuals who are seen to be at the leading edge of a particular discipline.

Everyone likes to come in here to talk about this fantastic export industry. It is an important industry and it is very beneficial for us. We do occasionally have to take off the rose-coloured glasses and look at where we stand particularly on higher education in relation to other universities around the world and look at ways in which we can support quality, because there is an inherent conundrum for universities and others selling their services. Do we consider the people who are buying these services to be our customers? The customer is always right, so do we ease the customer's passage through our institution, perhaps of the cost of lowering standards, or do we take a longer term gain and keep those standards high, which may create the difficulties of whether or not we pass or fail students? It is a contradiction, one I know academic institutions around the world are grappling with. How do we attract foreign fee-paying students, giving them in the short term perhaps an easier passage through the courses while maybe damaging the longer term reputation of our institutions? It is a hard game to play. We know that people tend to focus more on the short term than on the long term in looking at the performance of their institution.

I was surprised by some of the statements. I thought we had bipartisan support around this thing but as usual we had an attack on the Labor government embedded in the second reading speech—it is almost ritualistic. It is interesting that they were talking about us driving down the student figures. The figures I have, even the driven down figures supposedly of the last financial year, are well and truly in excess of anything achieved under the Howard government. So it does seem to be a rather strange criticism that during the last year of the Howard government when there were 250,000 student visa holders in Australia and in the last year of the Labor government there were 304,000, you could seek some claim that we had driven this industry backwards. There was a very substantial increase over the time of the Labor government. It peaked in 2009. I also make the point that there is absolutely no doubt that we want international students here, that we want this industry, that it creates good jobs for Australians. It has the ability to drive up standards, to make more complex and intellectually rich and robust our higher education institutions.

But there is also a price to be paid with these high levels because there is certainly no doubt that our housing affordability problems are related to the rapid rise in our population. We saw this happening very dramatically in Perth where house prices doubled within a three- to four-year period from 2003 to 2007. Growth in population does drive housing affordability problems. If we expand our population too rapidly, our ability to supply housing at a sufficient rate is simply not there. That has certainly been the experience in Australia over the last 10 years. So I do think that, whilst we must encourage this as a vibrant industry, it cannot be that numbers go up without any real thought about what that does to the burden of infrastructure and to our ability to accommodate everyone at a price that is not going to undermine affordability of housing for very many Australian people.

I certainly think we have seen that more dramatically in Perth than anywhere else. This is not blaming migrants, but this is saying that rapid population growth does bring with it some real challenges. So we should not be there with rose-coloured glasses saying that all of these issues and industries are not without their challenges. This is a good industry. I totally support us providing these measures that are going to enhance the student experience and address some of the concerns that were experienced by the industry, while at the same time maintaining quality. But I do want to say, let us not be uncritical about what some of the challenges are that come with bringing large numbers of additional people into the country in a very small space of time. Thank you.

Jim Chalmers (Rankin, Australian Labor Party, Shadow Parliamentary Secretary to the Leader of the Opposition) Share this | Link to this | Hansard source

I am pleased to rise today to speak in favour of Education Services for Overseas Students Amendment Bill 2013 and also to follow some great contributions from colleagues from Cunningham, Hotham, Bendigo and Perth.

Attracting overseas students to study in our institutions is one of the most important ways we can build and maintain a broad, smart, Asia-focused economy into the future. For a lot of Asia's young people, studying in Australia can be a leap of faith. Imagine a young person in Mumbai or Guangzhou or any city or town in our region or beyond, thinking about taking that step. They want to know that their investment is secure, that their chosen institution is credible and that their surroundings will be safe and conducive to learning. If you go beyond all the acronyms and the public policy speak, that is what the Tuition Protection Service is all about. It is about safeguarding the investment and the potential that flows from many thousands of the world's young people choosing our education system over all the others.

I am proud to have the opportunity to speak in this place on a bill that seeks to empower the TPS, which is a great reform of the higher education sector achieved by Labor in government under Prime Minister Gillard. This legislation deals with an issue very close to my own heart and is crucial to our country, our economy and my own community in Rankin.

Like a lot of my colleagues in here. I believe Australia has a lot to gain from a strong higher education sector, for our own people and also for our international students. Tertiary education like all forms of learning is about providing people with the tools to create their own success in life. I think the most important thing governments can do is provide these tools and nourish those aspirations. In this way, wide access to higher education is a path to greater economic mobility, which should be one of our most pressing objectives as parliamentarians. It is only through higher education that Australia can become a knowledge economy, which will drive greater productivity and transform the lives of individuals, families and communities from one generation to the next.

I am proud to say that the previous Labor government did a lot to strengthen the higher education sector. This is one of its proudest legacies—something even its harshest critics would have to concede. Labor oversaw a growth in university funding of more than 50 per cent, a staggering amount given the fiscal constraints of the time. We established the Tertiary Education Quality and Standards Agency which has helped maintain our world-class standards in the area of higher education. We were also responsible for introducing the Tuition Protection Service, which is the subject of this bill, and which offers protections for international students studying in Australia and ensures that our reputation as a country with high-quality higher education is maintained—something that is absolutely crucial for our ability to sell education to the world.

The unfortunate fact is that the need to introduce the TPS came about as a result of some poor handling of the higher education sector in the last years of the Howard government. That government oversaw student immigration laws that resulted in unsustainable increases in the volume of international students studying in Australia without the necessary systems and safeguards, which as a result failed to maintain the integrity of the system. The natural consequence of this was the entrance of a large number of new higher education providers specially designed to capture the international student market and not all of them were, shall we say, well-intentioned. Unfortunately, some of these could be better described as immigration scams rather than genuine educational providers. That is the reality of it.

Students from overseas were lured here on the promise of world-class education in Australia's high-quality higher education sector, but arrived on our shores to find something entirely different. In 2009 and 2010 alone, 49 higher education providers closed, leaving over 11,000 students displaced. The result of this was substantial reputational damage to the entire Australian education system, jeopardising our place in the very competitive global market for higher education. International student numbers took a hit as a result.

The introduction of the TPS was one of several measures introduced by Labor to restore confidence and quality to our education system in Australia. The benefit of the TPS over previous measures is that it was set up to function like insurance cover for international students. In this way, education providers paid levies based on their risk of closure or failure to provide a course

As a result, public universities do not pay a risk component at all, as they present an extremely low likelihood of closure. All education providers pay for the basic costs of administering the program and they all benefit from the enhanced reputational stability that results.

In the 2013-14 financial year, the annual TPS levy placed on registered providers of international education collected $6 million for the Overseas Students Tuition Fund, which gives you an indication of the scope of this program. The benefits of the TPS for students and universities are substantial and so are the benefits for Australia. Overseas students have greater confidence about coming to study in Australia. The TPS means that if a provider fails or a course becomes unavailable, the student has access to resources to help find an alternative placement for them. They can also rest more soundly in the knowledge that if there is no alternative course available they are able to request a refund of their fees out of the $6 million pool that is raised annually.

In the 2012-13 financial year, nine providers around the nation were closed, affecting 907 students. Well over half of those students sought assistance from the TPS and 282 of them were placed in alternative courses or received refunds. For the university sector, the TPS offers assurance that Australia's reputation as a provider of quality education is not diminished by the closure of smaller institutions. I am pleased to see that this bill will give the TPS further powers to achieve these goals.

Firstly, the TPS will be able to force the refund of pre-paid fees from a provider where that provider fails or a course is cancelled. It is a very basic thing but an important piece of assurance. Secondly, the TPS will be able to force the refund of pre-paid fees where a visa is refused for a prospective student. Again, this is a good, common-sense measure. Both of these extra powers will provide greater certainty for prospective international students considering coming to Australia for study.

The reputation of our educators, including universities across Australia—like Griffith University at Logan in my electorate—will benefit from these proposed changes. Across Griffith University international students make up over a quarter of the student population, or nearly 11,000 students. Students attending the TAFEs and private colleges in my electorate will also benefit. The Metropolitan South Institute of TAFE, with campuses in Browns Plains and just over the border of my electorate at Loganlea, offer courses to international students in a range of disciplines including hairdressing, business and youth work.

There are nearly 350,000 international students in Australia, a quarter of whom are from China and nearly 10 per cent from India. International students provide a huge boost to our universities, allowing them to invest in infrastructure to support all students and increasing the cultural diversity of education in Australia. Since the changes to higher education by the Labor government in 2012, there has been a strong resurgence in international student numbers across Australia. And it is the right kind of high-quality resurgence—not a free-for-all, like last time.

Data from the Department of Immigration and Border Security shows that over 74,000 foreigners applied to become students in Australia in the quarter to September 2013. That is an increase of seven per cent on the previous year, and that is a very good thing. Really encouraging is the fact that Chinese student applications jumped by over 20 per cent and applications from India more than doubled. That is a great outcome and a fantastic development for our economy.

With the surge in international student numbers in Australia, it is critically important that we support those students once they are here. Assurance of the provision of courses via the TPS is just one aspect of this. It is equally important that we ensure the quality of education for all students in Australia. I had the opportunity and the pleasure last November to deliver a speech at the conference of the Australia and New Zealand Student Services Association. It was a great opportunity to meet with people who devote their careers to achieving great outcomes for university and TAFE students, including our international student population. They are a big part of what we need to succeed in this area and I pay tribute to their work. Some of them expressed concerns to me about the future of student services in the face of cuts confirmed by the government last year, and cuts that are likely to be around the corner under the guise of the Commission of Audit.

Universities and vocational education providers around Australia just cannot afford extreme cuts to their budgets. Of course there are difficult decisions to be made in budgets, and that is where priorities kick in. The fact that the coalition imposed a $2.3 billion cut, after not supporting the needs-based schools funding scheme that the saving was designed to cover, is indicative of their overall approach to education. The coalition sees spending on education as a cost rather than as an investment. They do not understand that investment in education results in increased productivity, increased labour force participation and a boost in funds raised from the export of education—among many other benefits.

Data from the Australian Bureau of Statistics in 2012-13 shows that education-related travel was Australia's fourth-largest export, beaten only by iron, coal and gold. Think about that for a moment: the fourth largest export. As such, Australia's economy depends on us having a strongly competitive and stable higher education market for international students, and that is something that this bill will support.

As we witness a resurgence in the international student population in Australia, a strong TPS is more important than ever. The annual report for the TPS indicates that there are up to 4,400 students with 22 providers that could close in the coming financial year, either as a result of business failure or because of regulatory action. Those 4,400 students depend on a strong Tuition Protection Service to ensure that their education is not affected as a result of poor operational decisions by higher education providers. What is more, the reputation of the entire Australian university and vocational training sector depends on a strong TPS. It is for this reason that the Labor opposition are proud to support this measure to strengthen our original Tuition Protection Service, and it is why I encourage all members to vote in support of this bill.

Josh Frydenberg (Kooyong, Liberal Party, Parliamentary Secretary to the Prime Minister) Share this | Link to this | Hansard source

The Australian government supports a vibrant education system. It is committed to rebuilding Australia's international education industry and ensuring the appropriate quality assurance underpins our education system while taking steps to reduce red tape and the overall regulatory burden. The government will work tirelessly to ensure international students who choose Australia as their study destination receive education and training of the highest quality we can offer. Ensuring certainty for them and respecting their rights as consumers adds to both the credibility of our reputation in international education and the fulfilment of their ambitions in studying here.

By ensuring that the Education Services for Overseas Students Act 2000, or ESOS, and its associated legislative framework work effectively and efficiently, we will enhance the reputation and appeal of Australia's education system. The amendments made to the ESOS Act by this bill will help deliver on our government's commitment to international students to provide a robust and fair system. They will increase certainty and fairness for students and providers of international education by rectifying unintended consequences from amendments to the legislation made in 2012 which may inadvertently restrict the amount of a refund an international student receives in some circumstances. The bill gives the minister the power to make a legislative instrument to specify refund requirements where an international student has had their visa refused. I will be using this opportunity to more clearly articulate those requirements after consultation with stakeholders.

The bill also amends the name of the National Code of Practice for Registration Authorities and Providers of Education and Training to Overseas Students 2007 to remove reference to 'Registration Authorities'. The name of the national code will then reflect its purpose following the 2012 amendments to the ESOS Act. The change to the title of the national code does not affect its contents or operation. This minor amendment will be followed by further work on the national code to ensure it is contemporary and as far as possible addresses the needs of international students and education providers.

These amendments ensure the ESOS Act operates as it should. Timely passage of this bill is important to ensure certainty and clarity for providers and students across the sector as we rebuild the status and potential of international education in Australia.

Question agreed to.

Bill read a second time.

Message from the Governor-General recommending appropriation announced.