Introductory Info
Date introduced: 11 November 2020
House: House of Representatives
Portfolio: Education, Skills and Employment
Commencement: The day after the Act receives Royal Assent, except Schedule 1, Part 1, which commences on 1 July 2021.
Purpose of the Bill
The purpose of the Education
Services for Overseas Students Amendment (Refunds of Charges and Other
Measures) Bill 2020 (the Bill) is to amend the Education Services
for Overseas Students Act 2000 (ESOS Act) to:
Background
The ESOS
legislative framework
The ESOS Act and related
legislation is intended to provide protection for overseas students
studying in Australia. For the purposes of the ESOS legislative framework, an
overseas student is a person (whether within or outside Australia) who holds a
student visa.[1]
It is an offence for a person to provide a course to an
overseas student, or offer to provide a course to an intending overseas
student, without registration under the ESOS Act.[2]
All Australian education providers approved to offer courses to overseas
students are listed on CRICOS, which is maintained by the Department of Education,
Skills and Employment (DESE).[3]
In order to be registered, a provider must meet a range of requirements,
including paying an Annual Registration Charge (ARC) and Entry to Market
Charges (EMC) imposed under the Education Services
for Overseas Students (Registration Charges) Act 1997 (ESOS
Registration Charges Act).[4]
Each year, all providers registered or suspended on CRICOS
on 1 January are required to pay the ARC.[5]
In 2020, the ARC consists of a $1,505 base fee, plus $10 per overseas student,
$115 per course by location, and $1,156 if, in the past 12 months, the Minister
has imposed sanctions on the provider for non-compliance under section 83 of
the ESOS Act.[6]
The EMC is imposed in the first three years of
registration, with the first charge due at the time the provider becomes
registered, and then the latter two charges due on the first and second
anniversaries of the day of registration.[7]
In 2020, the first charge is $8,676, and if the provider remains registered,
the second charge is $5,784 and the third charge is $2,882.[8]
The effect
of COVID-19
In 2020, Australian providers of education to overseas
students have been affected by COVID-19 travel restrictions first announced for
travellers from mainland China on 1 February 2020, then for all foreign
nationals (excluding Australian permanent residents and some other persons)
from 20 March.[9]
The Australian Government has provided regulatory
flexibility for overseas students to study online, and at September 2020, there
were at least 87,626 enrolled students studying from outside Australia.[10]
However, data covering January to September 2020 shows the number of overseas
students commencing new courses, and the total number of overseas students
enrolled, has fallen compared with the same period in 2019 (Figure 1).[11]
The declines in 2020 follow a period of sustained growth since 2013, and have
been seen in all sectors except vocational education and training (VET). A
sector breakdown of overseas student commencements and enrolments is provided
in the appendix to this Bills
Digest. The Government is working on the assumption that overseas students will
gradually return to Australia ‘through the latter part of 2021’.[12]
Figure 1:
Overseas students, total enrolments and commencements, January to September,
all sectors, 2011–2020
Source: DESE, ‘International Student Data 2020’, DESE website, extracted 16 November 2020.
Declining overseas student numbers, coupled with other
challenges related to COVID-19, such as restrictions on face-to-face teaching,
have resulted in significant financial losses for many providers. For
universities, where overseas student fees accounted for 27.3 per cent ($10.0
billion out of a total $36.5) of revenue in 2019, COVID-19 has resulted in
additional expenditure on on‑line learning and student support, as well
as investment losses, and losses of fee income.[13]
Universities Australia (UA) has estimated university revenue losses due to
COVID-19 from 2020 to 2023 at $16 billion.[14]
The English Language Intensive Courses for Overseas Students (ELICOS) sector,
which had already seen declines in student numbers in 2019, has reported that
complete reliance on students from overseas has left ELICOS providers
particularly vulnerable to closure due to COVID-19.[15]
So far, three CRICOS registered English language colleges have reported
temporary closure due to COVID-19, although this is out of a total of 77
temporary VET provider closures.[16]
Committee consideration
Senate
Standing Committee for the Selection of Bills
The Senate Standing
Committee for Selection of Bills has deferred consideration of the Bill to its
next meeting.[17]
Senate
Standing Committee for the Scrutiny of Bills
The Senate Standing Committee for the Scrutiny of Bills
recommended that the Bill not be referred to a committee.[18]
Policy position of non-government parties/independents
At the time of writing, no non-government
parties/independents have expressed a position on the Bill.
Position of major interest groups
At the time of writing, no major interest groups have
expressed a position on the Bill.
Financial implications
The Explanatory Memorandum states that changes to the
Provider Registration and International Student Management System (PRISMS)
required to implement the changes proposed in the Bill have an estimated cost
of $0.2 million.[19]
Statement of Compatibility with Human Rights
As required under Part 3 of the Human Rights
(Parliamentary Scrutiny) Act 2011 (Cth), the Government has assessed the
Bill’s compatibility with the human rights and freedoms recognised or declared
in the international instruments listed in section 3 of that Act. The
Government considers that the Bill is compatible.[20]
Parliamentary
Joint Committee on Human Rights
At the time of writing, the Parliamentary Joint Committee
on Human Rights had not yet considered the Bill.[21]
Key issues and provisions
Fee changes
On 12 April 2020, in response to COVID-19, Minister for
Education Dan Tehan and Minister for Employment, Skills, Small and Family
Business Michaelia Cash announced the Higher Education Relief Package.[22]
This package included regulatory fee relief, including, for CRICOS-registered
education providers, waiver of the ARC in 2020 and 2021, and EMC from 1 January
2020 to 30 June 2021.[23]
According to the Explanatory Memorandum, refunds for fees
for 2020 that had already been paid were provided using the act of grace
provisions of the Public
Governance, Performance and Accountability Act 2013, which allow the
Finance Minister to authorise waiver or offset of payments owing to the
Commonwealth, or, in special circumstances, to authorise payments to a person.[24]
ARC and EMC refunds totalled more than $10.9 million.[25]
Those charges that had not already been paid—the ARC for
2021, and EMC from 12 April 2020 to 30 June 2021—were waived by providing an
exemption for all providers through the Education Services for
Overseas Students (Registration Charges) Regulations 2011, made under
section 9 of the ESOS Registration Charges Act.[26]
Item 1 of Schedule 1 of the Bill inserts proposed
section 176D into the ESOS Act, to allow the Secretary (currently
the Secretary of DESE) to refund charges under the ESOS Registration Charges
Act (that is, the ARC and EMC) if they are satisfied that special
circumstances justify doing so. The provision would commence on 1 July 2021,
and the application provision at item 2 specifies that the new
arrangements would only apply to charges paid on or after that date. Since the
waiver and refund of fees in response to COVID-19 has already been given effect
by other means, the purpose of the amendment is to provide power for the
Secretary to act in similarly unexpected circumstances in future, rather than
to provide a response to the current circumstances surrounding COVID-19.
No definition of special circumstances is provided in the
Bill, nor is the term currently used in the ESOS Act or the ESOS
Registration Charges Act. The Explanatory Memorandum indicates that special
circumstances would generally be characterised by ‘unexpected events or
situations, across the sector, creating undesirable or anomalous outcomes that
could be improved or remedied by refunds of charges.’[27]
The Bill does not propose to make any changes to exemption
arrangements.
Course
changes
In the 2020–21 Budget, the Government announced it would
remove the requirement for eligible supplementary and VET courses to be registered
on CRICOS, in order to ‘allow education providers to offer additional courses
to encourage international students to take up new training opportunities
linked to their education, employability and welfare’.[28]
The Bill implements this decision by amending the
definition of course in the ESOS Act. Currently, the ESOS
Act captures all teaching of overseas students as requiring CRICOS
registration, by defining a course as ‘a course of education or
training’.[29]
Narrower definitions are used in other Commonwealth legislation—for example,
the Higher
Education Support Act 2003 (HESA) limits its definition of
course to study that leads to:
- a
higher education award under the Australian
Qualifications Framework (AQF) or
- an
enabling course, which is provided with the purpose of enabling a person to
undertake a higher education award, but does not normally lead to a
qualification.[30]
The AQF is the national policy for regulated
qualifications in schools, VET, and higher education, as agreed by Commonwealth
and state and territory ministers with responsibility for higher education.[31]
It includes:
- the
Senior Secondary Certificate of Education
- VET
sector qualifications including Certificates I to IV, Diplomas, and Advanced
Diplomas and
- higher
education qualifications including associate, bachelor, honours, masters, and
doctoral degrees, and Undergraduate Certificates, Graduate Certificates and
Graduate Diplomas.[32]
Items 4 and 5 repeal and replace the current
definition of course in the ESOS Act, with a new
definition in proposed section 5AA. The new definition includes:
- a
course leading to a qualification recognised in the AQF
- a
course of primary or secondary education under section 15 of the Australian
Education Act 2013
- a
Foundation Program—that is, nationally recognised courses designed to equip
these students with the skills and capabilities to seek entry into first year
undergraduate study or its equivalent in Australia[33]
- an
ELICOS—that is, a course solely or predominantly of English language
instruction provided, or intended to be provided, to an overseas student[34]
- a
course offered by a registered higher education provider
- a
VET course within the meaning of the National Vocational
Education and Training Regulator Act 2011—this includes the units of
competency within a training
package, the units of competency or modules of a VET accredited
course, or the units of competency or modules of a course accredited by a
VET Regulator of a non-referring State[35]
and
- a
course determined by legislative instrument by the Minister.
This captures all formal qualifications under the AQF, all
other accredited schooling and VET, all other courses taught by higher
education providers, and all Foundation Programs and ELICOS.
Proposed subsection 5AA(3) will allow the Minister
to determine, by legislative instrument, that a course of education is not a
course for the purposes of the ESOS Act. It appears that any such
instrument will be disallowable.[36]
The Explanatory Memorandum states that it is the Minister’s intention to
specifically exclude courses not intended to be in scope, following
consultation:
It is intended that the Minister will exempt certain types of
courses (sometimes referred to as short courses, supplementary courses or
microcredentials) from the definition of course for the purposes of the ESOS
Act. The proposed exempt courses are typically short in duration and low cost,
such as first aid, infection control, construction white cards, or responsible
service of alcohol courses. It is intended that the Minister will exempt hobby
and recreational courses (that are considered non-award courses) offered by
higher education providers that overseas students wish to take in addition to
the main course for which their student visa was granted.[37]
Any exclusion of a course from the ESOS Act will
have consequences for that course’s treatment in other related contexts. For
example, an excluded course would no longer be subject to the protections of
the ESOS Act, such as the Tuition
Protection Service, which ensures a refund or replacement course is
provided if an overseas student’s provider does not deliver their course as
promised.[38]
Courses that are not CRICOS registered are also not able to be used as a basis
to apply for a student visa.[39]
Item 3 also makes a consequential amendment,
inserting a definition of the AQF into section 5 of the ESOS Act,
stating that it has the same meaning as in HESA.
Concluding comments
This Bill is part of the Government’s response to COVID-19,
but will not of itself address the challenges faced by Australian providers of
education to overseas students due to COVID-19.It does however propose two
relatively non-controversial measures: powers for the Secretary to determine,
in special circumstances, that refunds of CRICOS charges are to be provided;
and a new definition of course, which will include powers for the
Minister to include or exclude certain courses from requiring CRICOS
registration.
Appendix: Overseas student enrolments
and commencements by sector
Table 1:
Overseas students, enrolments by sector, January to September, 2011–2020
| Sector |
2011 |
2012 |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
2020 |
| Higher Education |
235,960 |
224,299 |
223,227 |
240,301 |
262,111 |
294,726 |
337,921 |
384,140 |
428,563 |
410,827 |
| VET |
153,232 |
130,404 |
119,593 |
131,357 |
148,296 |
164,511 |
189,281 |
213,074 |
247,133 |
276,551 |
| Schools |
19,797 |
17,617 |
16,799 |
17,259 |
19,471 |
22,095 |
24,470 |
25,769 |
24,701 |
20,257 |
| ELICOS |
78,139 |
75,604 |
91,929 |
108,961 |
115,957 |
120,746 |
125,912 |
126,241 |
129,711 |
94,462 |
| Non-award |
26,781 |
24,102 |
26,811 |
32,833 |
36,373 |
41,721 |
47,548 |
46,870 |
45,039 |
30,132 |
| Grand Total |
513,909 |
472,026 |
478,359 |
530,711 |
582,208 |
643,799 |
725,132 |
796,094 |
875,147 |
832,229 |
Source: DESE, ‘International Student Data 2020’, DESE website, extracted 16 November 2020.
Table 2:
Overseas students, commencements by sector, January to September, 2011–2020
| Sector |
2011 |
2012 |
2013 |
2014 |
2015 |
2016 |
2017 |
2018 |
2019 |
2020 |
| Higher Education |
90,503 |
83,083 |
88,213 |
100,360 |
107,236 |
120,393 |
137,524 |
151,562 |
165,064 |
128,852 |
| VET |
80,959 |
70,200 |
68,507 |
81,104 |
88,660 |
96,198 |
108,826 |
116,548 |
134,193 |
137,220 |
| Schools |
8,180 |
7,499 |
7,812 |
8,485 |
9,970 |
11,201 |
12,211 |
12,105 |
11,102 |
8,000 |
| ELICOS |
55,414 |
55,668 |
68,620 |
79,170 |
82,357 |
85,028 |
88,389 |
87,851 |
90,519 |
56,345 |
| Non-award |
20,701 |
19,448 |
21,692 |
26,665 |
27,817 |
32,451 |
34,600 |
34,064 |
32,556 |
18,238 |
| Grand Total |
255,757 |
235,898 |
254,844 |
295,784 |
316,040 |
345,271 |
381,550 |
402,130 |
433,434 |
348,655 |
Source: DESE, ‘International Student Data 2020’, DESE website, extracted 16 November 2020.