CHAPTER 2
Key issues
Introduction
2.1
The committee received 27 submissions to this inquiry, from a range of
organisations including education providers (public and private, school and
tertiary), unions and student associations and government departments and agencies
(state and commonwealth).
2.2
The majority of submissions supported the bills. Broadly, submitters
agreed that the changes would reduce the administrative burden on providers and
improve options for students and their families, without significantly increasing
potential risk.
2.3
In addition, many submitters highlighted the consultation process
undertaken by the department in developing and refining the amendments, with
several noting that potentially problematic changes had been averted through
this process.
2.4
The department also noted that the bills address four of the
recommendations of the 2013 Review of Higher Education Regulation, as noted in
Chapter 1.[1]
Streamlining regulation
2.5
In response to recommendations from the 2013 Review of Higher Education
Regulation, a primary consideration for the bills was to more closely align the
ESOS Act with the two domestic frameworks supporting quality and integrity in
Australia's education system: the Tertiary Education Quality and Standards
Agency Act 2011 (TEQSA Act) and the National Vocational Education and
Training Regulator Act 2011 (NEVTR Act).[2]
2.6
In doing so, the bills will reduce unnecessary duplication and red tape,
while continuing to ensure that Australia's international education system
maintains its high quality reputation. The bills seek to clarify the roles of
the Tertiary Education Quality and Standards Agency (TEQSA) and the Australian
Skills Quality Authority (ASQA), including through the creation of the role of
the ESOS Agency.
2.7
The department highlighted this change:
This provision gives clear decision making responsibility to
TEQSA, ASQA and the Department of Education and Training under the ESOS Act.
This responsibility incorporates, as appropriate, the national regulators'
roles in assessing, monitoring and approving the registration of education
providers on the Commonwealth Register of Institutions and Courses for Overseas
Students (CRICOS) under the ESOS Act.[3]
2.8
There was general agreement amongst submitters to this inquiry that
reducing the regulatory burden on education providers is a positive development
both for providers and regulators, as well as improving educational outcomes
for students by rewarding quality providers.
2.9
The Australian Council for Private Education and Training (ACPET), for
instance, noted that the measures contained in the bills would 'reduce provider
compliance costs', allowing providers to 'focus on the delivery of quality
education and training'.[4]Similarly,
the Council of Private Higher Education, the peak body representing higher
education institutions independent of Australian public universities, supported
the bills which, they argued, will:
reduce red tape and the unproductive compliance burden on
providers, while strengthening the powers of ESOS Agencies, including regulators,
to execute their functions for the better protection of students and the reputation
of the international education industry.[5]
2.10
The Tuition Protection Service (TPS) provides international students
with protection against loss of study options or money in the event that a
provider closes unexpectedly. They were 'highly supportive' of measures in the
bills which 'reduce regulatory burden on education providers'.[6]
2.11
Regarding schools, the Independent Schools Council of Australia (ISCA)
argued that existing regulations and requirements pose a serious burden on the
sector:
It is ISCA's view that the current level of administration
and reporting required is acting as a disincentive for non-government school
providers to continue to enrol overseas students. This is perhaps more
pronounced in the schools sector than in other sectors because the profile of
overseas students in the non-government schools sector is quite different to
other sectors with most schools enrolling only small numbers of overseas
students. We are aware of schools that have decided to let CRICOS registration
lapse for this reason.[7]
2.12
The committee notes that the majority of submissions made to this
inquiry supported the streamlining of regulations, which should decrease the
regulatory burden on providers without compromising the protections afforded to
students.
Tuition Protection Service account
2.13
The proposed amendments to the bill remove the requirement for all
non-exempt providers to maintain an account (referred to as the 'designated
account') into which all tuition fees paid prior to commencement of a course
are held.[8]
2.14
The department explained that the removal of this requirement will allow
providers to invest that money in innovation and improving their courses, thus
also improving quality.[9]
2.15
The department noted that students' protection is not lessened by the
removal of this requirement:
Importantly, the removal of the designated account does not
change a provider’s obligations to protect students and pay the required TPS
levies, nor does it change the protections students receive from the TPS.[10]
2.16
Submitters - particularly education providers - argued that the existing
arrangement is burdensome and inefficient, and reported that its removal would
give them the flexibility to invest tuition fees on their receipt into the
course itself, thereby improving course standards.
2.17
For example, English Australia described the requirement for private
providers to keep tuition fees in a separate bank account as 'administratively
cumbersome and costly' and that it was 'anti-competitive both for private
versus public institutions as well as Australia as a whole'.[11]
2.18
International Education Association of Australia (IEAA) noted that the
TPS is in:
such a sound financial position that the Australian
Government Actuary has advised that the removal of the current ESOS designated
tuition fee account provision will not involve a risk to our nation's tuition
protection arrangements.[12]
2.19
On that basis, the IEAA argued:
requiring private education providers to retain pre-paid fees
in a designated account is not a quality assurance measure and it's removal
will have no bearing on the quality of Australia's education providers. The
current designated account requirements are also inequitable as they act as a
blanket provision not imposed according to the risk of individual providers.
For the above reasons, all eight industry associations strongly support the
removal of the current designated account requirements as per the wording in
the Bills before the Parliament.[13]
2.20
Education provider Navitas also argued strongly against the existing
provision in the Act and supported the amendment:
Navitas strongly supports the removal of this requirement as
it has placed an extremely burdensome financial and administrative requirement
on private institutions to maintain student tuition fees in a designated bank
without providing a material level of additional protection for students. In
Navitas' case this single piece of regulation has required the company at times
to retain up to $100m of additional funding facilities than would otherwise be
required. This has added a considerable annual cost in commitment fees to
retain these accounts, in direct funding cost, increased debt servicing costs
and the lost opportunity cost of employing that capital for improved delivery
services.
And most tellingly the evidence demonstrates that it has
failed to protect student tuition fees in the instances of closures since its
introduction and the introduction of the TPS.[14]
2.21
Some submitters, however, argued the amendment served to undermine the
guarantee for students that refunds on courses not commenced would be
straightforward and readily accessed.
2.22
The Tasmania University Union, for instance, argued that the measure
requiring providers to keep fees in a separate account serves as an
accountability measure:
If students do not start a course they initially enroll in,
it is essential that they be refunded their payment. The requirement that
Universities have a separate account for the funds paid by overseas students prior
to commencing their course streamlines the process of checking that students
have been refunded. Removing this process not only removes transparency from
the use of overseas students fees; but also increases the work involved in
overseeing refunds.[15]
2.23
The National Tertiary Education Union (NTEU), noting that the original
provision was designed in response to perceived level of risk in the sector,
contended that the problem has not been fully resolved:
However, given the recent evidence of widespread problems
within the private vocational sector (summarised in a recent Senate report into
the sector), we are concerned that both the Government and the sector are
seriously underestimating the current levels of provider risk. As such, the
assumption that it is fine to pull back on regulatory protections is being made
under a false premise.[16]
2.24
The NTEU maintained that the designated account, along with the
restrictions on students paying more than 50 per cent of the course fee before
commencing study:
act like the ‘seat belts’ in international education, which
act to lessen the financial damage inflicted on students should their provider
fail them.[17]
2.25
The TPS, the body responsible for administering the system, noted their
concerns with this amendment:
With limits on the collection of pre-paid fees retained, the
removal of the requirement to hold fees in a designated account reduces the
risk to the OSTF measurably, nevertheless, it remains an area of potential risk
for the TPS. Whilst the TPS would prefer the retention of this integrity
measure, it is also pursuaded [sic] by the many views of the stakeholders who
advocated for its removal.
The TPS notes that in the absence of the requirements to
maintain designated accounts, the Bill provides for regulators to impose conditions
at any time during a provider’s registration which may include conditions that
would place stronger requirements on the use of pre-paid tuition fees by a
provider considered by the regulators to be an integrity risk. The TPS is of
the view that these provisions could perhaps be further clarified by a specific
reference to conditions on collection and use of prepaid fees in explanatory
material or other appropriate elements of the ESOS legislative framework.[18]
2.26
Some submitters suggested a compromise on this point is possible. The
Council of Australian Postgraduate Associations (CAPA) advocated for a response
which falls between the current system and the bill's amendment:
It is CAPAs suggestion that while a course is in the first 2
years the fees from students are kept in an account that cannot be touched by
providers as with the current system but from the third year of successful and
continuous registration fees can be accessed as soon as paid to ensure that
they may be used to improved course delivery. This compromise will provide both
a security measure from scam providers as well as incentivise those course
providers that are seen as doing the right thing in their first 2 years of
operating. This system adds little red tape to the current system as the timing
is based around the registration fees for that course.[19]
2.27
Similarly, TAFE Directors Australia (TDA) suggested that a compromise
between the current system and the proposed amendments might provide the best
solution:
In the current environment where there is so much public
concern surrounding the actions of some less reputable private education
providers, TDA feels it imperative that the requirement for retaining pre-paid
student fees in a ‘designated account’ remains.
TDA instead advocates that the current requirements (for
private education providers to hold student fees in a designated account) be
revised to reflect the ‘risk-level’ of individual providers. At present the
requirements are inequitable, as they impose the same blanket provision to both
high and low-risk private providers.[20]
Committee view
2.28
While noting the submissions which opposed or suggested alternatives to
this point, the committee is persuaded by the majority of submissions which
supported this amendment and recognises that flexibility and red-tape reduction
for providers will enable them to improve their course offerings for students,
while also pointing to the ongoing protections for students.
Upfront fees
2.29
The removal of the restriction on students paying more than 50 per cent
of their tuition fees before the course begins was a measure discussed in the
majority of the submissions received. The department's submission noted that
this issue was also frequently identified during the consultation process
undertaken before the introduction of the bill.[21]
2.30
Most submissions favoured this change as providing greater flexibility
for students and providers alike, while maintaining protections for students by
making the option a choice for students, rather than a requirement a provider
could enforce.
2.31
ACPET, in supporting the amendment, noted some of the reasons why this
option for students and their parents might be an attractive one:
The amendments will enable students to make prepayments of
more than 50 per cent where it suits their circumstances. For example, the
payment of tuition fees up front may assist students on scholarships or other
sponsored arrangements. This will not only assist these students but reduce
some provider administrative burden.[22]
2.32
Australian Government Schools International (AGSI) made similar points
in their submission, noting that often it is not the students themselves who
are responsible for paying for their course, but either parents, governments or
other organisations, all of whom might prefer the option to pay all fees
upfront:
Removing the restriction on payments of 50% of tuition fees
provides parents and students with greater choice and flexibility. Parents
often request payment of a whole year to take advantage of favourable exchange
rates. A number of AGSI members have agreements with provincial Ministries of
Education overseas who provide scholarships for their students to study in an
Australian government school for a year and they wish to pay the full year
tuition fees upfront. The restriction on the payment is regulation required for
a very small number of unethical providers who should be dealt with through the
CRICOS registration process. The National code provides students and parents
with protection. These changes assist them further by providing greater
flexibility.[23]
2.33
Submitters noted that the amendments introduced flexibility, still
allowing students (and others responsible for paying fees) choice in the
matter. For example, the IEAA argued:
The Bills, before Parliament, would allow them [students] to
choose to pay more than 50% upfront, but would still prohibit providers from
requiring a greater payment, thereby protecting the students. This proposed
change would allow students, their families, and sponsors the flexibility to
pay fees when there are favourable exchange rates or when it suits their
personal situations. The current restriction has disadvantaged some students
rather than providing protection.[24]
2.34
Government Education and Training International noted that the added
flexibility does not come at the expense of security for students:
The National Code provides students and parents with
protection. These changes assist them further by providing greater flexibility.[25]
2.35
English Australia also supported the amendment:
The introduction of restrictions on institutions receiving
more than 50% of tuition fees in the 2012 changes had several unintended and
very negative consequences. On one hand, it created significant administrative
and financial burden for institutions. On another, it caused difficulty by limiting
choice for international students, parents and other funding bodies, such as
government scholarship funds, that wished to prepay more than 50% of their
tuition upfront. Meanwhile, this restriction has potentially enabled negative
behaviours, such as onshore course hopping, that have negative impacts on
quality providers, student outcomes, ‘brand Australia’, and, to a degree, the
integrity of the Australian visa program.[26]
2.36
Universities Australia noted that, while the issue does not affect many
students in universities, the current provision does impact some students
negatively. In addition to arguments made by other submitters, Universities
Australia noted that some parents would prefer to make payments of more than 50
per cent:
because of the difficulty of getting funds out of some
countries due to internal unrest or restriction. Some parents would prefer to
make tuition payments upfront in these circumstances rather than leaving large
sums of money in students’ everyday accounts in Australia.[27]
2.37
Universities Australia made a further point in support of the removal of
this restriction, noting that the administrative burden would decrease for
universities:
For universities this change will bring about an additional
benefit as it will remove the considerable administrative burden associated
with returning funds to students who have inadvertently paid in excess of the
limit. The process for returning funds can be quite complicated as students
must respond to a request for bank details to which to return the excess funds
and entails additional university reporting on refunds to the TPS.[28]
2.38
The University of Adelaide supported this proposal, noting that the
existing requirement:
has been particularly problematic with shorter courses such
as those offered by our English Language Centre which are shorter than one year
in duration.[29]
2.39
TPS noted their concerns with removing all restrictions on the amount of
fees students would be required to pay before the course began, but supported
the amendments as presented in the bill:
The TPS is pleased that the proposed provisions in the
Streamlining Bill retain the limit on the collection of pre-paid fees (albeit
modified appropriately to allow students and third parties to pay more than 50
percent only if they request to do so).[30]
2.40
The Department of Immigration and Border Protection noted that the
amendments reflect Australia's visa program:
Increasing the flexibility of education providers to claim
more than 50 per cent of tuition fees upfront complements Australia's student
visa framework, in which some students are required to show that they have
sufficient financial resources to cover course fees, living expenses and travel
costs in order to obtain a student visa. The financial requirements for student
visas are designed to reduce the risk of international students experiencing
financial hardship while in Australia and ensure that international students
have adequate financial support for the duration of their studies.[31]
2.41
While most submitters supported this amendment, for the reasons outlined
above, several submissions included concerns with the provision.
2.42
The University of South Australia supported the change in a broad sense,
but noted potential problems with the amendment's wording and feared that it
could actually lead to increased administrative burdens on providers:
We however have a concern with the exact
wording/interpretation of the amendment. If a student or third party pay more
than 50 per cent of their tuition fees to a provider without "formally
requesting" to pay more than the required amount, this should also be
allowed (as an implied request), rather than having to separately ask the
student for their express approval. This would create an unnecessary
administrative burden.[32]
2.43
The Overseas Students Ombudsman (OSO) noted the amendment's benefit for
students on scholarships but, based on their experience, raised concerns about
the potential for students to be pressured into paying more than 50 per cent of
their fees upfront:
However, in relation to non-scholarship students, we would
like to note the concerns raised about this change at the National Overseas
Student Complaint-Handlers Forum, which we hosted in Melbourne on 9 July 2015
with over 30 complaint-handlers from a range of organisations around Australia.
Concerns were raised about how it can be demonstrated that it was the student
or payee’s choice to pay more than 50% of the fees upfront. For example, could
some providers or education agents seek to pressure students to request to pay
100% of the fees prior to course commencement for the provider’s benefit,
without a genuine desire on the part of the student to pay the total fees?
Alternatively, could providers request more than 100% of the fees upfront
without telling students they have a right to choose to only pay 50% upfront?
We expect we may receive complaints where the student claims they did not
request to pay more than 50% of the fees upfront but the education provider
states that it received such a request from the student or the student’s
education agent.[33]
2.44
As a response to this, the OSO recommended increased safeguards:
To ensure there are sufficient safeguards in place in
introducing this change, we recommended in our submission to DET that it
provide clear guidance to education providers and students about what
constitutes a request to pay more than 50% of tuition fees prior to
commencement for courses over 25 weeks long. We recommended that DET include a
requirement that such a request be recorded in writing and retained by the
provider to be produced in case of any future disputes.[34]
2.45
While noting that the amendment ensures that choice remains in the hands
of students, the Tasmania University Union suggested that this amendment may
lead, over time, to an expectation from providers that students pay higher
proportions of their fees before the course begins:
Although the provision does not require students to pay more
than 50 percent of course fees before they commence; the Tasmania University
Union believes that allowing students to do so will lead to an expectation for
them to pay up to the full cost of their course before commencing.[35]
Committee view
2.46
The committee notes that the vast majority of submissions favoured
amending the existing legislation to allow for increased flexibility in the
upfront payment of tuition fees. The committee also notes that when students do
pay their fees upfront, the administrative burden on providers will be reduced.
2.47
Importantly, the bill retains the element of choice and continues to
offer students – along with their parents or governments and other
organisations who often pay for their studies – a choice in whether or not to
take up the option offered by this amendment. When students do pay their fees
upfront, providers will have a reduced administrative burden and increased
flexibility.
2.48
The committee acknowledges that some submissions did raise concerns or
objections to this amendment. However, the committee is confident that the
increased options for students – and flexibility for providers – do not
undercut the students' ability to choose how they pay their fees.
TPS director
2.49
The bill strengthens and increases the powers of the Tuition Protection
Service (TPS) Director. The TPS was established in 2012 to protect the rights
of international students in Australia. Should a provider close unexpectedly,
the TPS will help students to either find a place in a new course to continue
their studies or pay them a refund of their tuition fees. This refund is paid
out of the Overseas Students Tuition Fund (OSTF), collected by the TPS from an
annual levy on all providers of education to international students.[36]
2.50
While the TPS Director can share information about providers with
regulatory agencies under current legislation, the amendments will expand that
role to enable the TPS Director to make a recommendation to an ESOS agency that
they take enforcement action against a particular provider.[37]
2.51
These amendments should serve to ensure that the TPS Director 'has a
more direct role in supporting quality and integrity in the international education
sector'[38],
and therefore were broadly supported by submitters to this inquiry.
2.52
ACPET, in supporting the changes, noted that:
The proposed amendments will include an enhanced ability to
gather information from providers in support of the TPS Director’s role and to
share information with the ESOS regulators. ACPET strongly supports these
measures which will contribute to a strengthening of the TPS and the broader
regulatory arrangements. It will reinforce the clear message of Australia's
commitment to a robust, high quality international education sector.[39]
2.53
The OSO also supported this amendment:
The OSO transfers certain complaints to the TPS, where it is
better suited to deal with those complaints. This includes complaints about
provider closures and complaints about an unpaid refund following a student
visa refusal, where the TPS can pay the refund directly to the student. Where
the TPS identifies a serious breach by the provider, we understand the TPS can
report this to the relevant regulator. Therefore, we support this change to
ensure the TPS can provide relevant information about potential breaches of the
ESOS Act or National Code to the ESOS Agency for consideration.[40]
2.54
The TPS itself supported the amendment, arguing that the expanded powers
of the TPS Director would:
make it easier for the TPS to monitor providers at risk of
not meeting their obligations to students and to work more closely with the
regulators in taking action against providers of concern which have come to the
notice of the TPS.[41]
Committee view
2.55
The committee notes the various arguments raised by submitters and is
persuaded that strengthening the TPS Director's powers will serve to improve
the quality of education in Australia by improving the capacity for regulators
to monitor providers.
Reporting deadlines
2.56
Currently, all providers are required to report, to the Secretary of the
Department of Education and Training and the TPS Director, any instances of
student default within five days. The bill's amendment removes that
requirement, with the exception of instances where the provider has paid a
refund to the student. Other information about students, as defined in section
19 of the ESOS Act, must still be reported, albeit with a timeframe of 31 days,
rather than the current 14.[42]
2.57
The department explained that the current system has proved problematic,
in part because five days 'was too short a period in which to determine a
genuine student 'default' had occurred'.[43]
2.58
Broadly, other submitters – particularly providers and especially
universities – were in favour of the proposed amendment, on the grounds that
the existing requirement is overly burdensome and unnecessary.
2.59
For instance, The University of South Australia described the current
arrangement as a 'burdensome requirement' and supported its removal.[44]
2.60
Similarly, Griffith University described the existing provisions as
'administratively and financially burdensome to a provider (especially a
low-risk provider with a significant number of international students such as a
university)' and the amendment as likely to result in 'a positive change in
compliance costs'.[45]
2.61
The University of Adelaide described the existing requirement as
'onerous and time-intensive' and strongly endorsed the bill's proposed
amendments regarding reporting.[46]
2.62
TPS added their support to this amendment, noting that the current
system is unnecessarily burdensome on providers:
We are pleased to see the proposed removal of section 47C of
the ESOS Act which required providers to report the occurrence of all student
defaults within five days. The modification of section 47H to further reduce
reporting requirements is also welcomed. The TPS is of the view that the
compliance costs of the current requirements far outweigh the potential
benefits.[47]
2.63
English Australia also supported the amendment:
The changes to requirements introduced by the bill, simply
remove an administratively burdensome requirement for reporting that delivers
little or no value while actually removing from institutions the ability to
sensibly support students and resolve issues.[48]
2.64
The Department of Immigration and Border Protection (DIBP) noted that
removal of these deadlines may have an impact on their monitoring of students
on visas:
Extending the period for education providers to report
student default or course variations may have a minor impact on visa processes
where an international student's family members apply for student visas to join
the student in Australia after a course variation occurred. This may affect
visa processing officers' access to the most current information on the
student's enrolment status when assessing the family member's visa application.
The Department intends to monitor the impact of these measures on the integrity
of the student visa programme.[49]
2.65
The Queensland Government Department of Education and Training broadly
supported this amendment, but with a caveat regarding student welfare:
Repealing the current 5 day reporting requirement where the
student default does not create a welfare concern (such as those relating to
refund reporting) is supported.
However, where a provider holds welfare responsibility for
the student and the default has welfare implications, it is recommended that
the 14 day reporting period be reviewed with a view to retaining the current 5
day default reporting period.[50]
2.66
While most submitters argued that the amendment removes an overly
burdensome requirement which results in little benefit for students, CAPA
argued against the change, noting that the current system exists to protect
students:
The current amendment wishes to change the reporting of
student default to cases where the provider only reports a default they have
paid a refund to the student (ESOS Amendment streamlining bill 2015,
explanatory memorandum). It is a subtle difference but places the decision of a
refund not in the hands of an external body but in the hands of the course
provider. In most cases this may not be an issue however the protection of
students from shonky providers is now placed directly in the hands of those
same providers. Whilst the aim of this amendment is to reduce red tape, and the
reporting of student defaults may seem and easy place to remove red tape, CAPA
is of the opinion that the reporting of defaulting students of only selected
cases may create as much red tape as just reporting all cases of student
default. It is therefore CAPAs recommendation that this aspect of the bill be
reviewed and perhaps expand reporting to any student that defaults but has paid
any amount in course fees to a provider thus allowing the outside body to make
the final recommendation in regards to a refund.[51]
Committee view
2.67
The committee notes that the majority of submissions agreed that the
current system produces minimal benefit to students while placing an
unnecessarily strict requirement and administrative burden on education
providers.
2.68
The committee is therefore of the view that the amendment is a
reasonable change that will reduce the compliance burden on providers, allowing
them to be more competitive.
Internal review
2.69
Under the ESOS Act, providers who are unhappy with a decision made by an
ESOS agency have the right to appeal that decision to the Administrative
Appeals Tribunal (AAT). The amendments proposed by the bill retain that right,
but add the option of providers requesting an internal review by the agency
itself as a first step.
2.70
The Department of Education and Training explained the benefits of this
amendment:
An internal review of certain decisions made by the ESOS
agency will support a more cost effective and fairer approach to providers seeking
redress where they disagree with the ESOS agency’s regulatory decision. It will
give providers the opportunity to have appeals dealt with quickly and in a less
costly way than under the current arrangements. The provisions will align the
ESOS Act with the TEQSA Act and NVETR Act, which allow an internal review or
appeal of decisions made by the regulator.[52]
2.71
The OSO also supported this amendment, noting that internal review
provisions are:
consistent with best practice complaint handling principles,
which support the provision of an internal review right within the
decision-making body prior to a review application being made to an
independent, external complaints/review/appeal body.[53]
Committee view
2.72
The committee agrees that adding the option of an internal agency review
is of benefit to providers, and maintaining the existing right of appeal to the
AAT ensures that providers unhappy with a decision by an ESOS agency are not in
any way disadvantaged by this amendment.
Study period definition
2.73
The ESOS Act currently discusses a 'study period', which each provider
must define in writing for each student, with such a period being a maximum of
24 weeks. The amendment does away with this concept, on the basis that the
transparency around course length and the fees which relate to courses will
still be defined for students under the national code.
2.74
The bill's removal of the maximum of 24 weeks for a defined study period
was described in submissions as a necessary change to reflect the variable
reality of the education sector.
2.75
In discussing this point, for instance, IEAA argued that:
The current requirement under the ESOS Act for a study period
to be less than 24 weeks is an arbitrary period of time that, in the modern
world, does not necessarily align with the study periods offered by education
providers. This ESOS requirement is also at odds with Australia's National
Code, wherein education providers can offer study periods that are "a
discrete period of study within a course, namely a term, semester, trimester,
short course of similar or lesser duration ...." as long as the study
period does not exceed 6 months. The 24 week limitation also has a particular
impact on the ELICOS sector as many of their providers have longstanding five
week teaching block academic progression arrangements.[54]
2.76
ACPET described the change as aligning the regulation to reality:
This simply responds to the market realities that see a range
of programs being developed to respond to the needs of students. Providers will
still need to provide students with full details (including costs) of their
program of study in accordance with the requirements of the National Code.[55]
2.77
English Australia also noted that the amendment corrects an
insufficiently flexible provision:
The introduction of the prescription of 24 weeks as a ‘study
period’ failed to properly take into account short courses, particularly
ELICOS, which offer 5-week programs. The minor change in the new Bill of the
length of a ‘study period’ from 24 to 25 weeks will effectively lessen the
administrative burden, particularly for, but not limited to, our universities.
English Australia would certainly argue that even this is an unnecessary
limitation, however, and that a ‘study period’ should be extended to a longer
period of 36 or even 52 weeks to allow for more program flexibility and
innovation.[56]
2.78
ISCA also supported this change:
ISCA supports the removal of “study period” from the Act and
the need to document the tuition fees for every study period in every written
agreement. This measure will reduce the amount of administrative work involved
in student enrolments and this information is in any case adequately captured
in other enrolment and reporting processes. Under the requirements of the
National Code, providers are still required to enter in written agreements with
every student setting out the details of the course being undertaken and an
itemised list of course monies payable.[57]
2.79
The University of Adelaide described the existing requirement as
'anachronistic' and argued that removing this requirement would 'greatly
enhance offer and admissions processes for international students and reduce
confusion'.[58]
2.80
While the majority of submitters supported this change, the OSO raised
some concerns about how it might affect refunds and fee cancellation policies:
We note the intention to remove the requirement to specify a
study period in a written agreement between the provider and student. This
should not have any effect where the refund policy and fee cancellation policy
refer to the course start date when setting out whether a student is eligible
for a refund or liable to pay further fees in case of a student default.
However, if the refund policy or fee cancellation policy refers to withdrawing
from a course before or after the start of a study period, then a definition of
study period should be included in the refund policy and any fee cancellation
policy, to give meaning to this term in the written agreement.
For example, we see some written agreements which state that
if the student withdraws from the course without giving a certain amount of
notice, the fees for the next term or semester will still be payable. In order
to apply this policy a definition of term or semester, and the proportion of
the fees that apply to that period, would be necessary. Otherwise, providers
may not be able to implement their refund policy or fee cancellation policy if
a reference to study period is made without a definition and without an
explanation of what percentage of the total tuition fees this amounts to, in the
absence of a list of tuition fees for each study period.[59]
Committee view
2.81
Most submitters were in favour of the removal of the concept of the
'study period' from the ESOS Act, on the basis that it was overly restrictive
and based on an arbitrary length. These arguments persuaded the committee that
this amendment should increase flexibility for providers and students alike.
Committee view
2.82
The overwhelming majority of submissions to this inquiry supported the
amendments contained within the bills, which were drafted following extensive
consultation undertaken by the department. The committee therefore suggests
that the amendments as proposed have received considerable scrutiny and input
from those in the sector and have been improved and approved as a consequence.
2.83
In particular, the committee notes that these amendments to the ESOS Act
will serve to improve education standards and course offerings for
international students in Australia, increasing flexibility for both providers
and students while maintaining protections and safeguards for each.
2.84
Key regulators in the sector – the TPS, TEQSA and ASQA – will all have
increased and streamlined powers to address problems which arise, and providers
will be better able to focus students and course offerings by reducing their
administrative burden.
2.85
Students retain the majority of the safeguards which they currently
have, while also being offered greater flexibility and more choice in their
study and payment options.
2.86
The committee is of the view that the bills address key points of
concern with the existing legislation and set in place a framework for
Australia's international education system which will enable it to maintain its
world-class reputation.
Recommendation 1
2.87
The committee recommends that the Senate pass these Bills.
Senator McKenzie
Chair
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