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Wednesday, 20 August 2003
Page: 19119


Mr BAIRD (10:09 AM) —It is my pleasure to support the Education Services for Overseas Students (Registration Charges) Amendment Bill 2003 in the House. It is an important move in terms of the education services for overseas students, which is certainly an area which is growing as an export segment for Australia. Some 10 years ago it was not at the level it is today, but the forecast is for even further growth in this area.

As chairman of the Trade Subcommittee, which is a subcommittee of the Joint Standing Committee on Foreign Affairs, Defence and Trade, I visited Eastern Europe. The subcommittee went to Poland, the Czech Republic, Hungary, Slovakia, Slovenia and Croatia. My colleagues—the group being led by Senator Alan Ferguson—went on to Romania and Bulgaria. One of the things that were interesting was the opportunities for education services from those countries in particular, as there are from various places around the world. Australia is particularly attractive to those countries. We already receive some 1,500 students each year from Central Europe, but the forecast is that within the next couple of years it will grow quickly to 3,000 or 3,500. The Czech Republic is the biggest of those.

During our visits it was clear that the reasons why Australia is an attractive place to go were, firstly, the English language facility; secondly, the multicultural environment—which sometimes we take for granted in Australia—in that it provides a good environment and people coming from various parts of the world can feel at home and find their own ethnic group or language group within the country; thirdly, the fact that Australia's tourist environment is important; and, fourthly, the fact that students can work for up to 20 hours a week. Britain, which is finding that some of its student markets have slipped to Australia, has now changed its requirements. It is enabling students to work a similar number of hours in the UK, but we have got an advantage in that the perception is that we allow people to work. That has been quite helpful to enable them to afford to pay for themselves in Australia.

It is an emerging market for us, not only in Central Europe, which we visited. We are certainly making a recommendation in our report, which is, I think, being tabled in the next sitting period, that we should put more emphasis on and more resources into supporting this effort. It also applies in South-East Asia, South America and Scandinavia. It is widespread. We have been very successful. With regard to the standard of Australia's academic institutions, it is obviously important that they are recognised as being amongst the best in the world. Generally, in terms of Central Europe, the feedback was that the preference is the UK, the United States and Australia. Since September 11 there has been some caution in travelling to the States; nevertheless, they receive a large number of students and, of course, they have very fine institutions, as does the UK. It is particularly interesting that we are seen as competing in that segment.

This bill is important to continue to regulate the activities of students in Australia, in terms of registration charges and in terms of assistance to our universities. It is not only about our foreign relations and is not only about developing our tourist trade. The tourism industry sees it as an excellent way of developing tourism, and not necessarily for the short term, although these people travel extensively around Australia and there are enormous benefits. If you track the record of people who have come as students, they end up coming back to Australia at later stages, often with their wives and families, and become great ambassadors for the country. So it is important in tourism terms. In terms of foreign relations it is important that there are people who have lived in our country, who understand it and who can promote it within their own countries. Also, it is an important source of revenue because the universities have the ability to charge the overseas students what they see as being the appropriate market rate. That is to the benefit of all the other students who attend the universities, in that it leads to the improvement of facilities at those universities. I believe that students bringing their own dimensions from their own countries enrich the campuses in which they participate.

There are many good reasons why we should continue to support and encourage the education services market. I am very pleased to see the opposition is supporting this bill as well. Overseas student enrolments in educational institutions are of great benefit to Australia, both on a cultural and an economic level. As an industry, higher education is experiencing significant growth, as I have mentioned. Its value to the Australian economy has risen from $700 million in 1991 to over $5 billion today, and it continues to rise. The education system needs to be nurtured by government to ensure its continued success, and this is of course what this bill is about.

With the right policies and intellectual infrastructure in place, Australia will continue to be known as the clever country, capable of providing a quality and level of education unrivalled in our region. We are a small nation in world scale, accounting for only 1.2 per cent of world GDP and representing only 0.3 per cent of world population. We clearly punch above our weight. As a country, we rely heavily on our intellectual capabilities when competing with the rest of the world. We rely on our ability to produce a quality product, develop new technologies and attract large numbers of overseas students. International students represent over 14 per cent of students onshore and offshore for Australia. This is the second highest proportion in the world. In some university faculties, overseas student representation is over 50 per cent. With one particular college that I have a relationship with, the International School of Hotel Management and Tourism in Manly, some 65 per cent of its students are from overseas. Many of them are from Scandinavia. It is providing people for the tourism industry right around the world. It is doing a wonderful job.

Education services is now in fact Australia's third largest export services sector. This represents a very significant increase in recent years and represents a significant contribution to Australia's balance of payments. It generates more export dollars than the wool industry and almost as much as the wheat industry. Its value continues to rise on a yearly basis. It is interesting to note how some of the educational institutions were initially established. The college in Manly was established out of a growth of tourism educational facilities in Switzerland. Now the college is considering taking over the Swiss facility. So the Australian image and standards are seen as being very internationally competitive.

In a similar way, there has been the incredible growth in the tourism industry. If we look back to 1975, as the member for Gilmore, who is with me in the chamber, would know, we had half a million visitors. Now we have 4½ million. If it had not been for SARS and the events of September 11 and October 12, perhaps we would have gone past the five million level. We are seeing the same trend with international students. Following another record, there are now in excess of 190,000 international students studying in Australian universities, vocational education and training institutions, schools and English language training colleges. With the almost 400 per cent growth experienced in the past seven years, there is now a greater need for regulation. The whole area of education services really is a good news story on so many levels. The government too realises this piece of legislation is not only about education. As my colleague the Minister for Education, Science and Training, Dr Brendan Nelson, stated following the budget:

International students provide the foundation for strong foreign and trade relations, as well as research and scientific exchanges and collaborations that are vital to our continued economic growth and development.

It is the future leaders of our region coming to Australia and understanding the Australian way of life that is one of the absolute pluses of this bill. They will be able to make a positive affirmation of the nature of our country and all of the wonderful attributes that we in Australia recognise and value. Students will be provided with an opportunity to build a global network of friends, acquaintances and future business partners. This happens through modern emails. I understand, from knowing a whole number of students at the Manly college, that students do this all the time for years after they have been through the college, even though they are located in various parts of the world. Students will develop an understanding of globalisation through the development of international views and cross-cultural communication.

International students have become political and business leaders in our region. They hold Australia and Australians in high regard. One of the interesting things that I found during my time in the tourism industry was how many of the leaders in tourism and hotel chains and businesses in Malaysia had actually studied in Australia. I think it was also quite interesting that during the Olympic period when we were chasing up people, as the deputy leader would know, several of the people who had to vote on whether Sydney secured the games had actually been students in Australia. One of our strongest supporters, Dr Nat Intrapana from Thailand, organised a lot of the numbers—and we know what that means politically. He was a student in Australia for a number of years; he did a PhD here. He was enormously supportive of Australia. So there are various benefits to come from that means.

Students come from as near as Malaysia, Hong Kong and China and from as far afield as South America and Europe. This internationalisation is testimony to the outstanding reputation, level of service and quality of courses that this country offers, and this piece of legislation will maintain and enhance these benefits. To achieve its objectives, the Department of Education, Science and Training will receive $5.1 million to ensure the enforcement of measures assuring the quality and integrity of education providers in Australia that enrol overseas students. This will be proceeding over a four-year period and will be budget neutral so will not increase costs to the Commonwealth.

I think we would all agree that there is currently in place an inequitable fee structure for all providers registered on the Commonwealth Register of Institutions and Courses for Overseas Students. The new fee structure will be put in place to redress this apparent imbalance. Announced in this year's budget, the new structure will be $300 per provider per annum, plus a $25 enrolment fee for each student. For approximately 550 providers, half of those registered, there will therefore be little or no change to the amount currently being paid. How enrolment is defined will not be affected. A course covering more than 26 weeks will constitute a whole course and one under 26 weeks a half course. These amendments will not be changing the way enrolments are calculated. This is also good news as it provides equality for providers and students alike. No-one will pay more than another and no-one will pay less than another. Any suggestion that it would impact more greatly on urban areas as opposed to regional areas, or vice-versa, is incorrect.

Like many industries, education services are no stranger to problems. The current ESOS Act has established key national elements for the regulation of the international education and training services industry. Acting in consultation with industries and state, territory and Commonwealth agencies, this government has taken a responsible step towards addressing the issues identified as problem areas. These include the uncertain financial protection for students' prepaid course fees, the emergence of a small minority of unscrupulous providers and inconsistent quality assurance. I am sure that the House will be very interested in all of those factors to ensure the quality we provide in education services.

Since the original act was introduced in 1991, it has become obvious to Senate inquiries that certain parts of the legislation needed to be reviewed. Some of the provisions, once tested, were found to be deficient. What it will protect against, though, are the rogue providers who offer students courses at reduced costs in order that they can gain entry into Australia. It is widely felt that these providers bring the industry into disrepute, and these changes will prevent such actions. The bill will provide for sanctions against noncompliant providers, with the strongest action being cancellation of registration for noncompliance.

The bill will ensure that education providers clearly understand what is expected of them in providing education for international students. Operators who see this as a way of circumventing Australia's visa requirements will be sadly disappointed. Members of the industry themselves, no doubt, appreciate the need to maintain a reputation in order to foster the industry's long-term growth. It has been suggested—and I quite agree—that a bad provider could have ramifications that extend to Australia not being a desired choice for education. That applies in the tourism industry as well, as the member for Gilmore would well know.

We must remember that education services is a competitive international commodity, so it is important to preserve Australia's interest in this field. The bill will ensure that our international reputation as a high-quality and reputable education provider is protected. We want international students to come to Australia and this bill will encourage them to do so. The bill before us will tighten up the requirements and ensure that those who choose Australia as their education provider over all our competitors can be assured of a level of quality from the underlying guarantees. Thanks to the coalition government, overseas students choosing the Australian experience in education will be doing so with the confidence that we run a quality and genuine industry. I commend the bill to the House.