Education Services for Overseas Students Amendment Bill 2013; Second Reading

SHARON BIRD:  I rise to indicate my support for the Education Services for Overseas Students Amendment Bill 2013. The bill seeks to make amendments to empower the Tuition Protection Service to better protect students, and therefore Australia's reputation as a country offering the highest quality vocational and tertiary education. Firstly, this amendment bill seeks to ensure the Tuition Protection Service has the power to force the refund of prepaid fees where a provider fails or a course is cancelled. Secondly, this bill is designed to ensure that the Tuition Protection Service has the power to force a refund of prepaid fees where a visa for a prospective student is refused.

The Tuition Protection Service is a great reform of the previous Labor government. It emerged, as many would be aware, from the crisis in our international education sector due to the lax immigration rules of the Howard government in relation to student visas. These lax rules had led to unsustainable volumes of international students, and the failure saw the entrance into the market of some providers running what could only be described as immigration scams.

This led to serious questions being posed about the quality of an Australian education and the soundness of education providers. This was clearly very damaging to the entire Australian education sector. I quote one comment of the time to give a taste of what was being said. In the Monthly in November 2010, journalist Margaret Simons described the situation as such, saying:

Most of our big export industries do their business out of sight of city dwellers. Mines are dug and ore extracted without stirring the dust on suburban streets. There is one such industry, though, whose major commodity is visible in our capitals. That commodity is human beings. They are the confused young people trying to serve us in low-rent fast food outlets. They are the lonely kids on city streets or sharing rooms—and even beds—in crowded houses in the suburbs. They are an underclass in the labour market, with working conditions that undermine those for all lower paid workers.

Dodgy colleges had sprung up like mushrooms for the single purpose of providing students a piece of paper that was the pathway to residence. Instead of delivering the skilled workers our country and other countries needed to compete, those Howard government policies had resulted in Australia gaining migrants whose qualifications would not stand the test. It was a crisis for our immigration program and our education system.

It was imperative that the Labor government act to clean this up, and we did. We cracked down on dodgy colleges, we cleaned out the migration agents and we tightened the rules. Not acting on this situation challenging the sector's potential for sustainable growth was simply not a viable option. Education courses had become linked to migration outcomes. Following the Baird review, we acted to improve regulation of the sector. This involved higher entry standards for colleges, and more information for and more care of the students. Also, this is where the Tuition Protection Service came into existence.

The service's establishment was one of a suite of measures to restore integrity and quality to our international education market. Its purpose was to act as a single point of placement for students who were affected by provider default, with adversely affected students either being placed in an alternative course or paid a refund from the Overseas Student Tuition Fund. This money comes from an annual Tuition Protection Service levy. This levy is placed on all registered providers of international education including vocational training providers and private and public higher education institutions. In 2013-14, this levy collected $6 million for the Overseas Student Tuition Fund.

In 2012-13, nine providers closed, according to the annual report of the TPS. These closures affected 907 students. In these circumstances, 498 students sought assistance from the Tuition Protection Service. Of these, 64 were placed in alternative courses and 218 students received refunds. From this history, we can see there is clearly a great need for the Tuition Protection Service. Its annual report reveals that the TPS fears that up to 22 providers with around 4,400 student could close in the coming financial year as a result of things such as business failures or regulatory action. There is clearly a great need for the continued operation of the Tuition Protection Service. It works quietly and effectively to help to protect Australia's billion-dollar international education sector. The effect of the amendments in the bill before us is to clarify its powers in relation to prepaid fees. Clearly these are not minor matters for those who are affected.

International education is our fourth largest export industry, after iron ore, coal and gold. It sustains more than 100,000 jobs and generates some $15 billion in annul revenue. Prospects for sustained growth are good. The OECD estimates that by 2020 there could be three million more students worldwide seeking an offshore education. Asia will continue to be a source of growth in student numbers for years to come. However, we face profound challenges to retain Australia's market share in international education. Competitors are vigorous, especially those in North America and Europe, where they are making up for a shortfall in revenue following the global financial crisis through a renewed emphasis on international education and especially students from Asia.

This competition will only increase for Australia in the foreseeable future. We must be aware of these challenges and the pressures on policymakers. It is important to remember the significance of this sector when Australia seeks to attract overseas students. All sides of politics across the generations have recognised and valued the opportunities provided to those students in Australia. It is of great benefit to the individual obviously to get a qualification and to have a start in a career in their chosen field. The exchange and interaction that happens between nations through this sort of program and activity is also important. It is an area where Australia has had a great reputation. At the time of the crisis, we acted to make sure we were seen to be taking those interests into account and we acted in a significant and real way to protect students and to maintain our reputation so we could continue to be a successful provider of international education.

There is a great opportunity, particularly as we see emerging middle-class populations of our near neighbours and in Asian more broadly looking for an overseas education. We want them to naturally look to Australia and to come here if they are participating in education in one of our neighbouring countries. We want a great exchange with our population and between our students and the students coming here. I often have the great pleasure of being invited by my local Rotary clubs to dinners to meet the students. Rotary provide some great hospitality activities for overseas students studying at the university in my local area of Wollongong. It is like a mini United Nations at these dinners with students from all around the world who are participating in education at a local university. It is a great pleasure to see that. It is a really strong aspect of our offering. Not only are there educational opportunities but also communities across all university sectors are very keen and welcoming of students who come to Australia and study. As those opportunities arise, it is important that we take the actions necessary to provide a vibrant international education sector. Sadly, there are too many of these areas where young people are taken advantage of. We must make sure that we provide the best protection possible for them.

For a lot of these students, the tuition involves a lot of money when they invest in the opportunity to come here. Obviously, the Tuition Protection Service is a critical part of that. The bill makes two amendments which are directly targeted at strengthening how the service can intervene. It is one thing obviously to provide the support it provides, but when people have prepaid fees and something happens such as a business failure and a particular provider collapses, or some sort of regulatory intervention affects their attendance in a course, we want to make sure that the Tuition Protection Service is able to find the best outcome. That could mean being placed into a course with another provider or being able to access a refund, recognising that that refund is provided through a levy that all participants contribute to in the international education sector. What is important is that the vast majority of quality providers who are interested in providing a service that is of great value and benefit to young people have a vested interest in working with the government to make sure the reputation and wellbeing of the sector is maintained and that young people have a good experience.

International education obviously must remain at the forefront of our focus on the education system in Australia. Our reputation for quality must be preserved. It is a precious resource that we get benefit from and it gives us a great competitive advantage. As the government consider widening post-study work rights, our hope on this side of the House is that the minister and his colleagues do not repeat some of those mistakes of the past conservative government and that they continue to take action such as in this bill to support the Tuition Protection Service. We support that sort of action and support this bill. We support the amendments because they should help the Tuition Protection Service to operate more effectively in protecting international students and Australia's reputation. In that spirit, I commend the bill to the House.