Education Services for Overseas Students Amendment Bill 2013

11 February 2014

Dr CHALMERS (Rankin) (17:46):  I am pleased to rise today to speak in favour of Education Services for Overseas Students Amendment Bill 2013 and also to follow some great contributions from colleagues from Cunningham, Hotham, Bendigo and Perth.

Attracting overseas students to study in our institutions is one of the most important ways we can build and maintain a broad, smart, Asia-focused economy into the future. For a lot of Asia's young people, studying in Australia can be a leap of faith. Imagine a young person in Mumbai or Guangzhou or any city or town in our region or beyond, thinking about taking that step. They want to know that their investment is secure, that their chosen institution is credible and that their surroundings will be safe and conducive to learning. If you go beyond all the acronyms and the public policy speak, that is what the Tuition Protection Service is all about. It is about safeguarding the investment and the potential that flows from many thousands of the world's young people choosing our education system over all the others.

I am proud to have the opportunity to speak in this place on a bill that seeks to empower the TPS, which is a great reform of the higher education sector achieved by Labor in government under Prime Minister Gillard. This legislation deals with an issue very close to my own heart and is crucial to our country, our economy and my own community in Rankin.

Like a lot of my colleagues in here. I believe Australia has a lot to gain from a strong higher education sector, for our own people and also for our international students. Tertiary education like all forms of learning is about providing people with the tools to create their own success in life. I think the most important thing governments can do is provide these tools and nourish those aspirations. In this way, wide access to higher education is a path to greater economic mobility, which should be one of our most pressing objectives as parliamentarians. It is only through higher education that Australia can become a knowledge economy, which will drive greater productivity and transform the lives of individuals, families and communities from one generation to the next.

I am proud to say that the previous Labor government did a lot to strengthen the higher education sector. This is one of its proudest legacies—something even its harshest critics would have to concede. Labor oversaw a growth in university funding of more than 50 per cent, a staggering amount given the fiscal constraints of the time. We established the Tertiary Education Quality and Standards Agency, which has helped maintain our world-class standards in the area of higher education. We were also responsible for introducing the Tuition Protection Service, which is the subject of this bill, and which offers protections for international students studying in Australia and ensures that our reputation as a country with high-quality higher education is maintained; something that is absolutely crucial for our ability to sell education to the world.

The unfortunate fact is that the need to introduce the TPS came about as a result of some poor handling of the higher education sector in the last years of the Howard government. That government oversaw student immigration laws that resulted in unsustainable increases in the volume of international students studying in Australia without the necessary systems and safeguards, which as a result failed to maintain the integrity of the system. The natural consequence of this was the entrance of a large number of new higher education providers specially designed to capture the international student market, and not all of them were, shall we say, well-intentioned. Unfortunately, some of these could be better described as immigration scams than they could genuine educational providers. That is the reality of it.

Students from overseas were lured here on the promise of world-class education in Australia's high-quality higher education sector, but arrived on our shores to find something entirely different. In 2009 and 2010 alone, 49 higher education providers closed, leaving over 11,000 students displaced. The result of this was substantial reputational damage to the entire Australian education system, jeopardising our place in the very competitive global market for higher education. International student numbers took a hit as a result.

The introduction of the TPS was one of several measures introduced by Labor to restore confidence and quality to our education system in Australia. The benefit of the TPS over previous measures is that it was set up to function like insurance cover for international students. In this way, education providers paid levies based on their risk of closure or failure to provide a course. 

As a result, public universities do not pay a risk component at all, as they present an extremely low likelihood of closure. All education providers pay for the basic costs of administering the program and they all benefit from the enhanced reputational stability that results.


In the 2013-14 financial year, the annual TPS levy placed on registered providers of international education collected $6 million for the Overseas Students Tuition Fund, which gives you an indication of the scope of this program. The benefits of the TPS for students and universities are substantial and so are the benefits for Australia. Overseas students have greater confidence about coming to study in Australia. The TPS means that if a provider fails or a course becomes unavailable, the student has access to resources to help find an alternative placement for them. They can also rest more soundly in the knowledge that if there is no alternative course available they are able to request a refund of their fees out of the $6 million pool that is raised annually.

In the 2012-13 financial year, nine providers around the nation were closed, affecting 907 students. Well over half of those students sought assistance from the TPS and 282 of them were placed in alternative courses or received refunds. For the university sector, the TPS offers assurance that Australia's reputation as a provider of quality education is not diminished by the closure of smaller institutions. I am pleased to see that this bill will give the TPS further powers to achieve these goals.

Firstly, the TPS will be able to force the refund of pre-paid fees from a provider where that provider fails or a course is cancelled. It is a very basic thing but an important piece of assurance. Secondly, the TPS will be able to force the refund of pre-paid fees where a visa is refused for a prospective student. Again, this is a good, common-sense measure. Both of these extra powers will provide greater certainty for prospective international students considering coming to Australia for study.

The reputation of our educators, including universities across Australia—like Griffith University at Logan in my electorate—will benefit from these proposed changes. Across Griffith University international students make up over a quarter of the student population, or nearly 11,000 students. Students attending the TAFEs and private colleges in my electorate will also benefit. The Metropolitan South Institute of TAFE, with campuses in Browns Plains and just over the border of my electorate at Loganlea, offer courses to international students in a range of disciplines including hairdressing, business and youth work.

There are nearly 350,000 international students in Australia, a quarter of whom are from China and nearly 10 percent from India. International students provide a huge boost to our universities, allowing them to invest in infrastructure to support all students and increasing the cultural diversity of education in Australia. Since the changes to higher education by the Labor government in 2012, there has been a strong resurgence in international student numbers across Australia. And it is the right kind of high-quality resurgence—not a free-for-all, like last time.

Data from the Department of Immigration and Border Security shows that over 74,000 foreigners applied to become students in Australia in the quarter to September 2013. That is an increase of seven per cent on the previous year, and that is a very good thing. Really encouraging is the fact that Chinese student applications jumped by over 20 percent and applications from India more than doubled. That is a great outcome and a fantastic development for our economy.

With the surge in international student numbers in Australia, it is critically important that we support those students once they are here. Assurance of the provision of courses via the TPS is just one aspect of this. It is equally important that we ensure the quality of education for all students in Australia. I had the opportunity and the pleasure last November to deliver a speech at the conference of the Australia and New Zealand Student Services Association. It was a great opportunity to meet with people who devote their careers to achieving great outcomes for university and TAFE students, including our international student population. They are a big part of what we need to succeed in this area and I pay tribute to their work. Some of them expressed concerns to me about the future of student services in the face of cuts confirmed by the government last year and cuts that are likely to be around the corner, under the guise of the Commission of Audit.

Universities and vocational education providers around Australia just cannot afford extreme cuts to their budgets. Of course there are difficult decisions to be made in budgets, and that is where priorities kick in. The fact that the coalition imposed a $2.3 billion cut, after not supporting the needs-based schools funding scheme that the saving was designed to cover, is indicative of their overall approach to education. The coalition sees spending on education as a cost rather than as an investment. They do not understand that investment in education results in increased productivity, increased labour force participation and a boost in funds raised from the export of education—among many other benefits.

Data from the Australian Bureau of Statistics in 2012-13 shows that education-related travel was Australia's fourth-largest export, beaten only by iron, coal and gold. Think about that for a moment: the fourth largest export. As such, Australia's economy depends on us having a strongly competitive and stable higher education market for international students, and that is something that this bill will support.

As we witness a resurgence in the international student population in Australia, a strong TPS is more important than ever. The annual report for the TPS indicates that there are up to 22 providers with 4,4000 students that could close in the coming financial year, either as a result of business failure or because of regulatory action. Those 4,400 students depend on a strong Tuition Protection Service to ensure that their education is not affected as a result of poor operational decisions by higher education providers. What is more, the reputation of the entire Australian university and vocational training sector depends on a strong TPS. It is for this reason that the Labor opposition are proud to support this measure to strengthen our original Tuition Protection Service, and it is why I encourage all members to vote in support of this bill.