Education Services for Overseas Students Amendment


Monday, 19 October 2009

I rise today to speak on the Education Services for Overseas Students Amendment (Re-registration of Providers adn Other Measures) Bill 2009. I want to continue on from what the member for Forde was saying in relation to the importance of this sector to the Australian economy. We know that it is the third-largest export industry for Australia. This is a fantastic Australian success story. In 2008 it brought in about $15.4 billion. It employs many hundreds of thousands of people. It is vital that we continue to allow such an important sector to achieve and do so much for our economy.

The government’s legislation, as it is proposed, seeks to do a number of things in addressing many of the problems that all of us here have been aware of in recent times. Particularly, it enables a re-registration process for all institutions that are currently registered on the Commonwealth Register of Institutions and Courses for Overseas Students. It looks at requiring providers to publish the names of education agents who represent them and promote their education services. I want to address those two things separately.

Firstly, I record my support for the provisions which require providers to publish the names of education agents. I think this is a widely supported provision and it will go some way towards enabling a better outcome where unscrupulous operators, or people who have engaged in unethical behaviour in relation to overseas students, have been caught in that activity. That is one way of ensuring more transparency and of limiting the possibility for problems. Of course, there are other ways that the industry itself suggests and that we may consider at a future time.

Secondly, I want to raise an issue in relation to the other main provision of this bill, which is that it will enable a reregistration of all institutions that are currently registered on the Commonwealth register. That is one way of addressing the problems that have arisen in the public domain. The argument is that there have been some alarming allegations made against some private education providers. For instance, students who have complied with all their requirements have been forced to pay additional fees over and above their agreed payments or risk having their visas revoked. Of course, that is unacceptable. However, I want to note in this place that that is not the practice of most of the providers of private education. In fact, most of those fine institutions have been responsible for the growth in this sector of the economy and have exported a fine quality product to overseas students. It has been a wonderful success story in Australia.

It is also important to note that there are already significant regulatory mechanisms in place. It is very difficult to establish a private education facility, as perhaps it ought to be. There are substantial state and federal requirements to ensure that it is a rigorous and difficult thing to do. When passing this legislation, we should consider not burdening those very successful enterprises that have met substantial regulatory requirements with going through a process where they revisit issues that they have already addressed in a substantial way. That is the feedback that I get from many of the private education providers who have been in business a long time. There is no question about their bona fides. But there is a question regularly asked of them by state and federal authorities, and they answer that question in a proven, acceptable and demonstrable way. Their reputations are not in question in relation to the allegations that are now in the public domain.

I want to caution that perhaps the process by which this reregistration will be conducted, particularly by the regulation, should be carefully considered and that an extra compliance burden not be placed on those completely ethical and properly regulated businesses that have conducted themselves in a proper fashion for a long time—and that is most of the sector. We have some wonderful stories about this sector. The businesses that have behaved ethically and built very successful education businesses are the custodians of our reputation internationally.

We know that education is an enabler; it is something that lifts people out of their situation. In our region, education is making a great difference to the vast number of people who still do not enjoy the standard of living that we do here in Australia. Exporting education is a great and powerful enabler for our region. It is something that enhances Australia’s reputation and role within our region and it has the capacity to do a great deal of good for our future relations with such important neighbours and trading partners. So it is important that we do not damage the reputation of this important sector by acting injudiciously. I would not suggest here today that that is the intention of the government. Rather, I simply say that, perhaps in our rush to respond to alarming situations, there are unintended consequences of that rush.

Legislating is not always necessarily the best answer to a problem like this, particularly when you look at peak bodies like the Australian Council for Private Education and Training. They represent about 1,119 organisations around Australia. Membership of their body requires a certain standard and a certain set of ethics and that, in effect, allows for self-regulation and that limits the capacity for problems and fraud. Some of the members opposite have spoken about self-regulation. Self-regulation can be a much more effective response in many instances than government legislation. In relation to these problems, the reality is that whatever legislation you pass, you still require a great deal of industry input of self-regulation to occur. We ought to be encouraging a system of self-regulation.

Some of the private providers that came to see me spoke of the mechanisms they use when one of their private institutions fails or may not be able to meet the commitments it has made to overseas students who have arrived here to study. Of course, this is the critical area. With the best will or the best intentions in the world, an institution may not be able to meet its commitments. An insurance scheme put together by a peak body could provide the capacity for other institutions to share the load of the member or institution that is unable to meet its commitments and could therefore take on the overseas students and so alleviate the problem. It is that kind of practical and considered industry specific solution that we ought to consider as an alternative in helping to deal with this situation. The legislation before us will deal with a very different situation—that is, people who behave unethically and do not met their commitments to overseas students. The legislation is designed to protect students who can often be vulnerable or who are unable to protect themselves—and that intention is a good thing.

In summing up that section of the provisions, I caution that we ought to very carefully ensure that the reregistration process does not inadvertently add continual and extra pressure on institutions that go through very rigorous processes to meet their accreditation at both the state and federal levels.

The other provisions of this bill are quite important. They go a long way towards alleviating many of the serious problems which have arisen in recent times. Fraudulent practices can cause irreparable damage to this vital industry for Australia. It is important that we act to send a signal to those people who would engage in fraudulent practices that they will not be accepted and that they will not be able to continue that activity.

As an opposition, we have great concerns that this legislation goes the entire way in relation to these matters. The coalition has proposed amendments, and I record my support for those amendments because there needs to be a tightening up to prevent students being duped by incompetent or dishonest providers.  Some of these are high-quality amendments and I recommend them to the government. We have introduced, for example, an amendment aimed at ensuring that regulatory bodies follow a risk management approach when determining the reregistration of providers. This is what I have been speaking about. This risk management system would mean that you look at the experience with the already registered entities—that is, those which have been in operation for a substantial period and have a record of success, being long-term viable businesses that employ thousands of people and potentially educate thousands of students. There ought not be a particular burden or question asked of those successful enterprises, which are not in question.

We really believe risk management in the approach to the implementation of this legislation is absolutely vital. As I have spoken about, there are already significant hurdles in place for many colleges and education facilities. Therefore, that amendment is a high-quality amendment. I do not think any government, of any persuasion, should stand and say, ‘We are the arbiters of all things that are good in legislative terms or legislative instruments.’ Indeed, when oppositions or other parties propose sensible and common-sense amendments, governments ought to consider those amendments with a view to improving legislation. I think that a risk management approach in reregistration is simply common sense and good policy that ought to be adopted by any government.

Looking at some of the other amendments that we are proposing, it is also critical that education agents are providing reliable and up-to-date information to prospective students. We have proposed that improved services be provided by education agents and a requirement that education agents will undertake qualified training. Once again, this is a sensible amendment. As a result, more accurate information will be given to prospective students, ensuring that their education experience in Australia is in line with their expectations. Again, this is a sensible amendment which is proactive and positive and will improve this proposed legislation. Indeed, the provision in the bill requiring the publication of the names of education agents is a good provision and should be supported. Equally, I accept that our proposed amendment that they undergo qualified training is also a good proposal which ought to be seriously considered and will improve the integrity of this legislation.

The third area of concern which we have as an opposition is the default fund for reimbursing overseas students if their provider ceases operation. This fund reimburses the student when the fund manager is unable to secure a suitable alternative training place for the student. Looking at how many recent provider closures there have been, this fund is obviously at a level where it must be fairly close to some sort of collapse. Recently, there has been a spate of very significant collapses, of private closures. They have been well publicised and there is an issue in relation to this fund. We have sought some more amendments that seek to improve the accountability and transparency of this fund—something I widely support. Under our amendment, the fund manager would be required to provide the minister with a written report in each instance of provider default where a claim is made on the fund. The minister would then have 30 days to table this in parliament. In terms of accountability and transparency, that is a good amendment. Thinking about how we could practically deal with the problems that come from provider collapses, then of course an assurance fund is one practical way of ensuring that we deal with the on-the-ground problems created when a provider collapses.

Without labouring the point too many times today, I really want to record my full support for this important sector of the Australian economy. This is our third biggest export area. It provides $15.8 billion to the Australian economy. The experience is overwhelmingly positive with the major number of private education providers in Australia for overseas students being ethical and conducting themselves to a high standard, promoting a good quality product that is in demand by our neighbours. Many of our neighbours choose to educate their children here because of the quality of the products that Australian institutions are offering.

The private education sector for overseas students is a great Australian success story. I feel that this legislation will allow for those institutions which are behaving fraudulently or unethically to be further limited. That is a good objective. However, in doing so, I would caution the government in reiterating that it ought to think carefully about how that is achieved. The legislation ought not place extra burdens upon those very ethical and properly conducted operators who have been in business for many years and provide good products. It ought to take a risk management approach and consider the opposition’s amendments in the spirit in which they are intended.