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Wednesday, 2 December 1998
Page: 1223

Ms WORTH (10:00 AM) —I move:

That the bill be now read a second time.

The Education Services for Overseas Students (Registration of Providers and Financial Regulation) Amendment Bill 1998 proposes to amend section 20 of the principal act, the Education Services for Overseas Students (Registration of Providers and Financial Regulation) Act 1991, the ESOS Act. Section 20 of the ESOS Act is a sunset clause which will deactivate the act on 1 January 1999. The government requests an amendment to the sunset clause by extending the date it takes effect from 1 January 1999 to 1 January 2002. This amendment recognises that the ESOS Act:

. has the strong support of stakeholders in the industry;

provides the criterion of `registered courses' for the issue of student visas to over 100,000 overseas students each year;

. ensures the quality and reliability of education and training provided to students from overseas; and

. provides the regulatory framework which protects and enhances the reputation of Australia's fifth largest export industry.

It is particularly important at this time of the Asian financial crisis to ensure the stability and legislative protection for this industry. There is greater competition from our competitor nations and a need to maintain confidence in Australia's international education industry.

The ESOS Act provides financial and tuition protection and quality assurance for students from overseas who choose to study in Australia. It requires that only registered providers who have met the standards for state or territory accreditation and approval can provide education and training for overseas students. It ensures the quality and integrity of our educational products and protects the students' prepaid fees. The act was introduced in 1991. With its several amendments, it has three main objectives, namely:

. to ensure that international students in Australia are treated with equity and fairness;

. to ensure the quality and reliability of Australian education and training for overseas students, which provide a positive basis for promoting Australia's international reputation as a provider of reliable high quality education and training; and

. to ensure that taxpayers' funds are not required to recompense international students who may have been let down by individual education and training providers.

These objectives remain relevant today. The legislation and the amendment bill are supported by industry representatives. They expressed this support in national consultations in 1996, in further consultations with stakeholders in April and May 1998, and to the Senate Employment, Education and Training Legislation Committee in July this year. That committee considered the amendment bill, and recommended that it be passed without amendment.

In 1996 the ESOS Act was amended to extend the sunset clause from 1 January 1997 to 1 January 1999. This followed a review of the act by an independent consultant which indicated universal support for the continuation of the current cooperative approach to industry regulation. The reviewers found strong support for the Commonwealth maintaining a regulatory role in relation to the education export industry. This was because of the international trade, immigration and foreign affairs issues which could not readily be coordinated by the states or territories or by industry bodies.

Australia's international education and training industry is our fifth largest export industry, worth an estimated $3.4 billion for Australia in export revenue in 1998. Stakeholders argue that the existing regulation of the industry adds value in the marketplace and they have indicated strong support for retaining the ESOS Act as part of a cooperative Commonwealth, state-territory and industry approach to regulation. In particular, they want to maintain the Commonwealth Register of Institutions and Courses for Overseas Students—the register.

There are costs to the Commonwealth in maintaining the regulatory framework, including the register. The costs are shared by the Commonwealth and industry through the collection of annual and initial registration charges, introduced in 1997. The regulatory framework, with the Commonwealth's ESOS Act as the key national element, has contributed to the successful maintenance of a stable domestic environment for the education and training services export industry over the past five years. This is evidenced by Australia's highly successful engagement in education exports and the continued strong support which stakeholders assert for the ESOS Act.

Stakeholders' support for the ESOS Act recognises that the maintenance and growth of Australia's international education industry depends on the confidence that students overseas have in the quality of the courses they undertake and the protection of the moneys they invest in receiving an Australian education.

The international education and training industry is an important and valuable one for Australia. It is a major contributor to Australia's growth in the export of services, bringing many intangible benefits, including the development of contacts for future trade, and ideas and international perspectives. The confidence of students is fundamental to the credibility and viability of the industry which accounts for over $3 billion in export earnings annually. The industry deserves the support of the existing Commonwealth, state-territory and industry cooperative framework, and this bill enables the framework to continue until 1 January 2002. This is particularly important in light of the East Asian currency crisis which is creating a highly volatile and uncertain period for export services industries.

A three-year extension to the ESOS Act's sunset clause will allow a stable domestic environment to be maintained during a time of economic volatility in major source markets. The extension will also allow time for the Commonwealth, state and territory governments and industry to focus on possible future cooperative regulatory models. I present the explanatory memorandum and commend the bill to the House.