Chapter 1 Higher Education Support Amendment (Asian Century) Bill 2013

Referral and conduct of inquiry

1.1                   On 14 February 2013, the House of Representatives Selection Committee referred the Higher Education Support Amendment (Asian Century) Bill 2013 for inquiry and report. The text of the Bill is provided in Appendix A.

1.2                   The reason for the referral was:

The Bill contains a number of provisions relating to OS-HELP and the implementation of the Asian Century policy in relation to study overseas that need to be explored in greater depth.[1]

1.3                   The inquiry was announced by media release on 18 February 2013 and received 17 submissions. A list of submissions is provided in Appendix B.

1.4                   Officials of the Department of Industry, Innovation, Science, Research and Tertiary Education (referred to as both the Department and DIISRTE) appeared at a public hearing in Canberra on 21 March 2013 to respond to concerns raised by stakeholders. Details of witnesses are listed in Appendix C.

Background

1.5                   The Higher Education Support Amendment (Asian Century) Bill 2013 (the Bill) expands the eligibility for Overseas Higher Education Loan Program (OS-HELP) assistance and provides additional incentives for university students to undertake part of their course of study in Asia.

1.6                   The Bill implements some of the goals set out in the October 2012 Australia in the Asian Century White Paper which outlines pathways for further engagement with Asia[2] through universities. The Government intends to:

Work with universities to substantially boost the number of Australian students studying in Asia through closer links with regional institutions, and improve financial support and information for students who study in Asia.[3]

1.7                   In his second reading speech, the Minister for Tertiary Education, Skills, Science and Research elaborated on the Bill’s role in the pursuit of these goals and the importance of developing Asia-literacy skills:

The white paper identified a need for a larger number of Australian university students to be studying overseas and for a greater proportion to be undertaking part of their degree in Asia. The Bill addresses this need by amending the Higher Education Support Act 2003 to provide additional assistance through the OS-HELP scheme to assist more students to undertake a wider variety of study related activities.[4]

OS-HELP

1.8                   OS-HELP complements the support packages available to students in Commonwealth Supported Places (CSPs) who wish to undertake part of their study overseas. OS-HELP can be used for a range of expenses such as airfares, accommodation, and other travel or study expenses.[5]

1.9                   A CSP is a place at a listed provider that is subsidised by the Commonwealth Government and for which students pay a ‘student contribution’ amount. Most domestic students who study their undergraduate degree at university do so as Commonwealth supported students.[6]

1.10               Listed providers consist of: universities; accredited higher education institutions; and Vocational Education and Training (VET) providers who have been approved by the Commonwealth Government to offer Commonwealth assistance (HELP loans or CSPs).[7] These providers are categorised as Table A, Table B, or Table C. The list of providers under each of these categories can be found in Subdivision 16B of the Australian Higher Education Act 2003.[8]

1.11               DIISRTE advised that CSPs are primarily available in public universities and, as such, OS-HELP is primarily available to students studying at Table A providers.[9]

1.12               However, CSPs are allocated to some non-Table A providers in areas of study that are deemed to be a national priority.[10] Examples of this are the CSPs for nursing and early childhood education allocated to Holmesglen Institute of TAFE and the CSPs for early childhood education allocated to North Melbourne Institute of TAFE.[11]

1.13               The Department stated that, whilst the Bill will extend OS-HELP eligibility to Commonwealth-supported postgraduate students, it does not expand eligibility to full-fee students. This is consistent with the primary purpose of the OS-HELP which is to provide assistance to CSP-students.[12]

Consultation

1.14               The Department indicated that the Bill was circulated to the Universities Australia AsiaBound Working Group prior to being introduced to the House of Representatives. The Working Group included representatives from Universities Australia, University of Adelaide, Australian National University, Victoria University, La Trobe University, University of Technology Sydney, University of Melbourne, University of Western Sydney, RMIT University, Charles Sturt University, Griffith University and the University of Western Australia. The Department described the responses from the Working Group as ‘positive with limited feedback.’[13]

Outline of the Bill

1.15               The Bill will amend the Higher Education Support Act 2003 to:

n  increase the maximum OS-HELP loan amount for students studying in Asia;

n  introduce a supplementary loan of up to $1000 for students who undertake intensive study in an Asian language in preparation for undertaking overseas studying in Asia;

n  remove the requirement that a student must be enrolled with an overseas higher education institution or at an overseas campus of an Australian higher education provider to be eligible for OS-HELP;

n  extend eligibility to postgraduate Commonwealth supported students; and

n  reduce the Equivalent Full Time Student Load (EFTSL) that a student must have remaining on completion of the overseas study, from 0.5 EFTSL to 0.125 EFTSL.[14]

1.16               The Bill consists of one schedule in two parts and will come into effect the day after it receives the Royal Assent.

Schedule 1 – Part 1

1.17               Schedule 1 – Part 1 of the Bill proposes amendments to increase the maximum amount of OS-HELP assistance available for Commonwealth-supported students undertaking overseas study in Asia. Under the amendments, eligible students will be able to access a maximum OS-HELP loan of $7,500 for a period of 6 months for study undertaken in Asia. This is compared to the current amount of $6,250,[15] which will continue to be available for overseas study undertaken in all other locations.[16]

1.18               The proposed amendments will allow students to apply for a supplementary payment for preparatory study of an Asian language prior to studying in Asia.[17] This payment is in addition to the OS-HELP assistance that a student may receive for overseas study. Under the amendments, the maximum OS-HELP (Asian language study) amount for a period of 6 months is $1,000. The amendments also allow for the OS-HELP (overseas study) and OS-HELP (Asian language study) amounts to be paid at different times, determined in accordance with the OS-HELP guidelines.[18]

1.19               The Bill also proposes amendments to allow students to undertake overseas work placements and internships. It achieves this by removing the requirement that a student be enrolled with an overseas higher education institution or at an overseas campus of a higher education provider in full time study. However, the work placement or internship must count towards the course requirements of the course of study that a student is enrolled in with their home provider.[19]

1.20               The proposed amendments will now extend OS-HELP assistance to Commonwealth-supported postgraduate students.

1.21               The Bill also proposes amendments to reduce the required amount of remaining study, in a student’s course of study, upon returning from studying overseas. This will lessen the required remaining study from 0.5 EFTSL to 0.125 EFTSL.[20]

Schedule 1 – Part 2

1.22               Schedule 1 - Part 2 of the Bill contains provisions relating to the application of the amendments contained within the Bill, as well as provisions relating to the indexation of the maximum OS-HELP (Asian language study) amount and the maximum OS-HELP (overseas amount).[21]

Strong support for the bill

1.23               The Bill received strong support from stakeholders. None of the stakeholders objected to the measures. However, peak bodies of private higher education providers, among others, called for further expansion of access.[22]

1.24               The Asian Studies Association of Australia (ASAA) expressed support for the goals outlined in the Australia in the Asian Century White Paper and the Bill’s intention to encourage more students to undertake study in Asia:

The Bill under consideration by the Committee on Education and Employment is therefore very welcome as an excellent development that will benefit many students and help deliver the promise of the Asian Century White Paper for more Australian students to be able to study in Asia.[23]

1.25               The National Tertiary Education Union (NTEU) endorsed the OS-HELP program, noting its benefit to individual students and its achievements to- date building Australia’s national capacity for international engagement. The NTEU welcomed the Government’s efforts to increase Australia’s Asian literacy:

NTEU believes that lifting engagement with the Asia-Pacific region is highly desirable, and that the proposed amendments represent a potentially important means of improving Australia’s Asian ‘literacy’, a goal highlighted in the 2012 Ken Henry Australia in the Asian Century white paper.[24]

1.26               The Australian Medical Students’ Association (AMSA) commended the proposed removal of the requirement that a medical student has to be officially enrolled in an overseas higher education institution or at an overseas campus of a higher education provider in full-time study in order to access OS-HELP. AMSA explained that this has jeopardised many students from benefiting from overseas placements when medical elective placements are a key component of most medical school curricula across Australia and:

Many medical students elect to undertake such placements overseas. These overseas placements provide great experiences for students, as many get to support the delivery of healthcare in a developing nation, gain extra clinical experience that may not be possible in the Australian health care system and increase their understanding of the global health.[25]

We are pleased to see that more overseas placements, thanks to this Bill, will now fall within the scope of OS-HELP.[26]

Stakeholder concerns

1.27               A range of concerns were raised by stakeholders, regarding:

n  further extending access to non-CSP and non-university students;

n  human rights;

n  the requirement for remaining study; and

n  the definition of Asia for the purposes of the Bill.

Non-Commonwealth Supported Place students

1.28               Under the Higher Education Support Act 2003, students must be enrolled in an undergraduate course with an Australian provider as a CSP student to access OS-HELP.[27] This requirement is not amended by the Bill; however, eight of the 15 submissions proposed that non-CSP students should be able to access OS-HELP. [28]

1.29               Bond University put forward an argument for the inclusion of non-CSP students:

As a not-for-profit, private university Bond delivers high-quality graduates into the Australian workforce who have not received any benefit from the Commonwealth Grants Scheme tuition subsidy. Under the current and proposed HESA arrangements, they will also be excluded from the same incentive and support for Asian studies that is available to their public university counterparts through the important OS-HELP scheme.[29] 

1.30               Similarly, the Council of Private Higher Education (COPHE) advocated for the inclusion of non-CSP students:

All Australian graduates make a contribution to Australian society and we see no reason to discriminate against students choosing to undertake their higher education outside public university institutions.[30]

1.31               ASAA pointed out that more than half of postgraduate students are non-CSP students and therefore will not be able to access OS-HELP even with the Bill’s amendments:

Some 58% of graduate students are not on CSP places, which includes the vast majority of those enrolled in Masters by coursework courses. As a large proportion of these Masters course enrolments are in the management and business areas it is particularly important that students in these courses are encouraged to undertake a period of study in Asia would be of great benefit.[31]

1.32               Universities Australia concurred:

Under the terms provided by the proposed legislation, the OS-HELP scheme will be extended to postgraduate students provided they have a Commonwealth supported place. As the majority of postgraduate students are fee-paying (58 percent of the 2011 postgraduate cohort) rather than Commonwealth supported, this excludes more than half of the cohort.[32] 

1.33               AMSA asserted that all domestic medical students, who wish to undertake overseas placements, should be able to access OS-HELP:

1.34               AMSA further believes that all domestic medical students, regardless of whether they hold Commonwealth supported or Full-Fee places should be eligible for OS-HELP when undertaking overseas medical elective placements.

As such, we believe that the Bill should further increase the accessibility of OS-HELP to domestic students who hold Full-Fee places.[33]

1.35               DIISRTE stated that the current and original purpose of OS-HELP is to assist CSP students. It is not intended to support all students:

This has always been an add-on for Commonwealth supported students complementing the other benefits that we have given them. This scheme has been like that since it was created in 2005.[34]

1.36               The NTEU also emphasised the original purpose of OS-HELP:

It is notable to recall that OS-HELP was introduced as part of a suite of income-contingent student loans that became the Higher Education Loan Program (HELP) in 2005...Since this time, the introduction of the OS-HELP loan scheme has been credited with increasing the number of students undertaking an Australian degree program studying overseas, with a growth rate of around 10 per cent.[35]

1.37               The Department responded to claims[36] that the Bill is contradictory in broadening eligibility to post-graduate students, when most of these students are full-fee paying, by reiterating the original focus of OS-HELP. The Bill’s intent is to grant access to Commonwealth-supported post-graduate students. The inability for non-CSP students to access OS-HELP does not diminish the support that the amendments grant Commonwealth-supported post-graduate students.[37] 

1.38               The Department advised that whilst the Bill does not extend eligibility to all post-graduate students, it will provide greater access to those post-graduate students who are Commonwealth-supported students.[38]

Committee comment

1.39               The Committee recognises that the Bill’s intent is to assist Commonwealth-supported students, in keeping with the original purpose of OS-HELP. However, the Committee notes the submissions  put forward by Bond University and the COPHE, that non-CSP students also have access to OS-HELP.

1.40               The Committee is of the view that consideration be given to extending eligibility of OS-HELP assistance to non-CSP students.

 

Recommendation 1
	The Committee recommends that the Commonwealth Government consider extending the eligibility of OS-HELP assistance to non-CSP students.

 

Non-university higher education

1.41               The Australian Council for Private Education and Training (ACPET), called for eligibility to be extended beyond CSP students to all higher education students, including those studying at private business colleges, private design schools, private music schools and a wide range of other discipline-specific private colleges:

Full fee paying students at non university higher education providers, whether by upfront payments or FEE-HELP, are already severely financially disadvantaged when compared to Commonwealth Supported Place students as they do not have their tuition fees subsidised. Therefore we believe these students should at least be subject to equitable treatment and have the same eligibility to access OS-HELP as a Commonwealth Supported Place student.[39]

1.42               ACPET recommended that eligibility for OS-HELP loans be extended to include all students enrolled at non-university providers registered at the Tertiary Education Quality and Standards Agency.[40]

1.43               The Department reiterated that the primary purpose of OS-HELP is to assist Commonwealth-supported students and noted that CSPs are not limited to public universities.[41] A number of CSPs are allocated to non-university higher education providers in areas of study which have been determined to be a national priority, such as nursing and early childhood education.[42]

Human rights concerns

1.44               The Joint Parliamentary Committee on Human Rights (JPCHR), together with Bond University and COPHE, raised concerns regarding the Bill’s potential incompatibility with the International Covenant on Economic, Social and Cultural Rights (ICESCR), due to its preferential treatment of study undertaken in Asian countries and its focus on assisting CSP students, rather than all students.

1.45               The JPCHR raised concerns regarding the Bill’s compatibility with the ICESCR due to the Bill’s focus on Asian countries.[43] The report criticised sections of the Bill’s Explanatory Memorandum:

The Bill is accompanied by a self-contained statement of compatibility. The statement focuses on the Bill’s engagement with the right to education, but does not address equality and non-discrimination issues to which the Bill gives rise.[44]

1.46               The JPCHR sought clarification regarding the distinction that the Bill draws between those students who wish to undertake study in Asia and those who wish to undertake study elsewhere:

The committee seeks an explanation as to why the bill treats students studying in different overseas countries differently and seeks clarification as to how such differential treatment can be seen to be reasonable and objective.[45] 

1.47               Furthermore, the JPCHR expressed concerns that these restrictions may be incompatible with Article 13 of the ICESCR:

The different groups of students, depending on where they undertake study, arguable fall within the category of ‘other status’ under article 2(2) of the ICESCR. The differential treatment of two groups whose members are apparently in the same situation may therefore amount to discrimination in the enjoyment of the right to education guaranteed by article 13. Even though the government may not be obliged to provide access to loans or other financial support for students to prepare for or undertake overseas study, once it does so, it cannot discriminate between categories of students in providing access to these benefits unless the justification for differentiation is reasonable and objective.[46]

1.48               The JPCHR stated its intention to write to the Minister seeking clarification and asking for justification as to how differential treatment can be seen to be reasonable and objective.[47]

1.49               Bond University and COPHE expressed concern[48] that the ineligibility of non-CSP students to access OS-HELP loans is not compatible with the ICESCR, Article 13(2)(c), which states that:

Higher education shall be made equally accessible to all, on the basis of capacity, by every appropriate means…[49]

1.50               DIISRTE confirmed that the Bill is compatible with the ICESCR:

There is nothing in the Bill that inhibits access to higher education. The Bill does not actually discriminate against particular provider types.[50]

1.51               In response to assertions of the unfair exclusion of non-CSP students, the Department indicated that the primary purpose of OS-HELP is to support CSP students:

The OS-HELP program has always been a complement to the other support that the government provides to Commonwealth –supported students.[51]  

1.52               On the matter of the eligibility of students at public versus private universities and TAFEs, the Department noted that whilst CSPs primarily exist in public universities, there are some exceptions. CSPs are available outside of public universities in areas of study which are identified by the Minister as national priority areas.[52]

Requirement for continued study

1.53               The Higher Education Support Act 2003 requires the minimum Equivalent Full Time Student Load (EFTSL) remaining in a student’s course of study upon returning from overseas to be 0.5 EFTSL. The Bill proposes to amend this to 0.125 EFTSL. Universities Australia and ASAA questioned the reasons behind the requirement for any continued study.[53]

1.54               Universities Australia stated that:

The rationale for requiring some portion of study to remain following the overseas experience is to ensure the student returns to Australia to complete their degree and therefore pay their OS-HELP debt. There is no publicly available information on the rate of non-repayment of OS-HELP debts due to students leaving the country, given the absence of an evidence base, the risk of the policy is trying to minimise may be minimal, but would have the effect of excluding many final semester from funding their overseas study.[54]

1.55               ASAA asserted that the proposed amendment is an unnecessary restriction that will exclude students following non-traditional programs of study, especially those students who are studying part of their course online.[55]

1.56               DIISRTE confirmed that the rationale behind the requirement was to ensure that students accessing the scheme are committed to living and working in Australia after completing their studies:

With this sort of scheme our main worry is that we want it to be used to assist with a person’s education. We do not want to turn it into a cheap form of holiday loan. So some of our criteria go to that. Then there is the issue of whether the person is continuing to be committed to living and working in Australia. That is the fundamental reason that we have always had this criteria that when you finish your overseas placement there should be a little bit of study to be completed in Australia.[56]

1.57               The Department referred to the importance of balancing the increased flexibility offered by the Bill’s amendments whilst ensuring a good return on the Commonwealth’s investment in a student’s education:

We have extended the scheme so that they can do work placements as well as study overseas, and it is possible that they could completely segue into living and working overseas. Unless they have a taxable income in Australia, we are not able to recover HELP debts if they do that. We had basically a half full-time year before and we have taken than down to 0.125. That is normally the equivalent to one unit of study. If you have got eight units in the year, that is one of them. So it is still there, but we have reduced it to what is probably the minimum while still retaining it.[57]

1.58               The Department also indicated that there are no restrictions that prohibit a student’s final unit of study being undertaken online.[58]

Definition of Asia

1.59               In its report, the JPCHR raised concerns regarding the lack of definition of Asia, as it applied to the Bill:

The bill does not contain any definition of ‘Asia’ or ‘Asian language’, and none is contained in the Higher Education Support Act 2003. The bill contemplates that guidelines may be made specifying ‘whether overseas study undertaken at a particular place is undertaken in Asia.’ There are a number of possible understandings of the term.[59]

1.60               The Committee shared the concerns of the JPCHR regarding the lack of a clear definition of Asia in either the Bill or the Higher Education Support Act 2003.

1.61               DIISRTE advised that a clear definition of Asia will be outlined in the OS-HELP guidelines.[60] The Department explained that, for the purposes of the Bill, Asia will include South East Asia, North East Asia and southern Asia:

The intention is that across these different schemes [OS-HELP and AsiaBound] we will have the one definition of Asia. All the countries are currently listed on the PM&C website. They are countries which the ABS would classify as South-East Asia, North East Asia and southern Asia.[61]

Concluding comments

1.62               Stakeholders raised concerns regarding the inability of non-CSP students to access OS-HELP assistance. DIISRTE’s response to these concerns addressed the Bill’s focus on CSP students and consistency with the primary purpose of OS-HELP, which is to support Commonwealth-supported students. That noted, the Committee acknowledges the arguments and advocacy put forward by eight submitters, including Bond University and the COPHE, that non-CSP students should be able to access OS-HELP and recommends that consideration be given to extending eligibility of OS-HELP assistance to non-CSP students.

1.63               Whilst the JPCHR also raised concerns regarding the preferential treatment that the Bill grants to students wishing to study in Asia, DIISRTE assured the Committee that the Bill is compatible with all human rights obligations. Preferential treatment is a key component of the Bill’s intent which is to encourage students to undertake part of their course of study in Asia. This is in order to increase their Asian literacy skills and enhance our engagement with the region, as set out in the Australia in the Asian Century White Paper.

1.64               The Bill broadens eligibility for OS-HELP assistance and provides additional incentives for Commonwealth-supported students to undertake part of their course of study in Asia. The Committee recommends that the House of Representatives pass the Bill.

 

Recommendation 2
	The Committee recommends that the House of Representatives pass the Higher Education Support Amendment (Asian Century) Bill 2013.

 

Mike Symon MP
Chair
27 May 2013