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Thursday, 30 November 2000
Page: 20348


Senator STOTT DESPOJA (Deputy Leader of the Australian Democrats) (9:27 PM) —I rise on behalf of the Democrats to address the Education Services for Overseas Students Bill 2000 and related bills. It is long overdue, through you, Mr Acting Deputy President Calvert, to Senator Crossin. After years of calling for greater regulation of the provision of education services to overseas students, years of extensions of sunset clauses applying to the existing scheme, the Democrats are happy to see this legislation finally brought to this place. However, as noted in the minority report to the committee's inquiry into this legislation and also noted in my additional comments to that committee report, these bills will require amendment if the regulatory framework we are seeking to introduce is to provide the protection for students and providers that the growing education export market requires.

Two years ago, in a debate on the Education Services for Overseas Students (Registration of Providers and Financial Regulation) Amendment Bill 1998, the Democrats sought to oppose the extension of the sunset clause, recognising that insufficient protection existed for students in the event of a collapse of a private education provider and that there was insufficient regulation of providers operating in and entering the market. Since that time, awareness of the importance of the provision of education services and the importance of education in supporting Australia's move to a knowledge economy has grown. Sadly, this awareness has not translated into more responsible federal government policy with regard to the funding of public institutions to enable them to meet demand for education at the undergraduate and postgraduate levels and to enable them to continue to meet Australia's research and innovation needs—some of the issues I just addressed in the ARC bills that were hastily brought on in the last hour.

The federal government is in the habit of promoting Australia's potential as a world leader in the provision of education to overseas students. However, these claims have been made in a climate of increasing overseas competition, which may not be offshore for much longer. The advent of electronic education with degrees offered and taken over the Internet is already here and our international competitors are already seeking entry to our domestic market, let alone providing increasingly strong competition for overseas students. Canada and the UK have made significant investments in their education sectors, recognising that infrastructure and quality of education offered are what will attract and retain overseas students.

Sadly, the massive funding cuts imposed by this government have served to undermine Australia's future competitiveness in this market. As a consequence of these cuts, Australian universities have had to over-enrol undergraduate students, cut courses and charge up-front fees, thus reducing access to education, reducing the number of subjects and courses offered and reducing the completion times for postgraduate degrees—I referred to some of those issues earlier in the context of the research debate.

The number of international students studying in Australia has risen from approximately 48,000 in 1991 to 158,000 in 1999. Australia has traditionally been able to offer quality education to these students and has received in return the benefits of these students' contributions to teaching and research, and of course the exchange of international perspectives between domestic and international students. The provision of education to international students brings Australia more than $3 billion in revenue per annum in addition to the jobs created within and outside the education sector. I remember that a popular catchcry from a few years ago was the notion that export education created more revenue than wheat sales. When we put it in that context, we realise that it is an extraordinarily large market.

In April 1998, the Australian Council for Private Education and Training appeared before the Senate committee's inquiry into the ESOS Act and stated that the act was fundamentally flawed. It also warned of the imminent problems within the private education export sector if the proposal to extend the legislation for a further three years was enacted. At that time, the Democrats favoured only a one-year extension of the ESOS Act pending proposed ACPET and government research. As the operator of Australia's largest tuition assurance scheme under the ESOS Act, ACPET was obviously well positioned to identify any flaws that happened to be in that act. ACPET informed the Senate inquiry that it would undertake research to look into more effective legislative control of Australia's private export education industry.

However, only six months later in October 1998, the government re-enacted the ESOS Act for a further three years—with the vote of the Labor Party. So what we considered to be an inadequate and flawed piece of legislation was extended with the concurrence of both the government and the opposition. In many respects, that permitted much of the degradation that has occurred in the export education field. It has also enabled the action of a few dishonest private providers who are operating under that act without prosecution to cast doubts overseas about the quality of Australia's universities.

Following the 1998 Senate inquiry, ACPET proceeded with the promised research by contracting Hall Chadwick Chartered Accountants and Business Advisers and Systems F1 Pty Ltd. This research cost ACPET in excess of $80,000. It received no government assistance—which I note that ACPET members regard, quite rightly, as perplexing considering the fact that it is a growing export industry that contributes in excess of $300 million annually to the wealth of Australia, and that much again in overseas student expenditure while these students are in Australia. It goes without saying that there are flow-on benefits.

The negative consequences of the ESOS Act began to emerge soon after this time. For the majority of private providers who educate many overseas students honestly, and therefore contribute to Australia's wealth and international reputation by doing so, the scams that were tolerated under the ESOS Act have been to the undeserved detriment of their reputation. Many have been unable to compete against the low-cost, no-tuition practices of the scammers and have therefore closed. Some have tried to compete but will close unless there is immediate action to protect fair trade that offers teachers proper rates of pay, that gives tuition of the required standard to students and that looks after the welfare of those students. In some instances, students are too ashamed to return home to their parents or too scared to report their treatment to authorities. They are of concern too. We must consider the fact that people have been unwilling, unable, inhibited or intimidated in relation to reporting these scams. These students have been lured to Australia for low-cost tuition and the promise of high wages to repay unscrupulous overseas agents who offer inflated interest on student loans.

There are extraordinary examples of people who are taking off with thousands—even millions—of dollars as a consequence of some of these loopholes. A Victorian college that offered a non-accredited masters degree in Vanuatu and dubious courses in Melbourne—which the Senate has heard about—collapsed. A Sydney college also collapsed after ACPET expelled it from its tuition assurance scheme on the basis of fraudulent marketing. It collapsed with some hundreds of students missing who apparently never received tuition. Another Sydney college collapsed just before the final examinations of those few students who stayed in its courses.

In 1997 ACPET reported a number of examples of rorts to the then director-general of the relevant New South Wales authority, who neither responded to the ACPET allegations—as far as we know—nor took any action. Subsequent reporting to the various state authorities has been met with responses such as `That's a Commonwealth matter' or `We don't have the resources to do DIMA's job'. So even when reporting is taking place—for example, on a state level as in this case in 1997—it is met with the belief that it is a Commonwealth responsibility.

Herein lies another flaw in the current scheme. The dishonest private providers operate knowing that DETYA is unlikely to prosecute. DIMA, on the other hand, is unlikely to investigate and the state registering authority is unlikely to deregister. Essentially, the dishonest provider operates within those loopholes in the ESOS Act, which are caused by the lack of a whole-of-government approach. ACPET has often stepped in and utilised its own resources for the wellbeing and welfare of students to protect not only their educational opportunities but also the reputation of this country.

In light of this sorry history of rorts and abuses under the old ESOS scheme, the Democrats welcome the legislation that is before the parliament as it seeks to address the loopholes that have existed for so long. As I stated before, it is a pity that we did not deal with this matter two years ago instead of extending the scheme, but at least we are finally dealing with it now. However, the Democrats maintain that, in addition to plugging the loopholes, we need a vision for Australia's export education that entails not just regulatory imposts but some kind of cooperative venture between industry and government to ensure the welfare of our students, to build Australia's export earnings and our respect internationally, and to introduce a professional standard akin to those of other professions. Most professions require the attainment of an educational standard prior to practice and ongoing professional development to sustain membership.

I certainly look forward to this debate. The Senate report is worth reading to get a cursory examination of the debate—certainly a detailed examination of this legislation. But there are many inquiries and reports dating back many years, not to mention a number of submissions that have been provided over the years. I particularly want to put on record and acknowledge the work of Andrew Blake, the Young Democrats National Education Officer, who made a submission to that inquiry. I certainly was proud to see that there was a role for youth wings of political parties in not simply engaging in, I guess, the political rhetoric that we have but also providing a policy submission and thinking about legislation that affects them and their peers.

I am told that, as we discuss the second reading in relation to this legislation, the running sheet for the Gene Technology Bill 2000 is hurriedly being prepared and should be organised and able to be dealt with by 10 o'clock. So that is good news. Otherwise this legislation and the legislation before it could be dealt with as not simply the ESOS and ARC bills but the `not the gene technology 2000 bills'. For anyone who has witnessed the debate in this place over the last hour or so—certainly I have, having dealt with four bills in as many hours—I place on record again the fact that amendments have been circulated to the ESOS legislation and to the ARC bills. I do recognise that, even though we received some of those amendments only today, they were received in good faith. Certainly the Australian Labor Party and the Democrats were not expecting this legislation to come on today, so there is no reason why we should—


Senator Patterson —Neither were we.


Senator STOTT DESPOJA —Through you, Mr Acting Deputy President, to Senator Patterson: nor were you. No, that is true. But one thing we were told to expect, whether we liked it or not, was the Gene Technology Bill 2000. Unfortunately we were not given the Labor amendments, so we could not proceed. But apparently we will be proceeding sometime after 10 o'clock, when that running sheet is hot off the press. I do make reference light-heartedly to that issue, but I want to put on record again my concern about the way that the business of the Senate has been conducted tonight. While I acknowledge that the government has brought on these bills—all the ESOS bills and the ARC bills—in order to give the participants in the gene tech 2000 debate an opportunity to review the ALP amendments, that does not always work if you are in a minor party and you have to debate the bills in the interim.

So I hope that we will have an interesting beginning to the gene tech 2000 debate. I am sorry that we cannot get into the committee stage of the ARC or ESOS bills. But I think that would be an unfair ask on just about anyone in the chamber, probably including the government too. So I acknowledge Senator Patterson's surprise that these have popped up at this stage of the debate. But I hope that we will see a constructive resolution to the ESOS debate. It is one that is long overdue. I look forward to debating the amendments that have been put forward and hope that government business over the next week is not as haphazard as it has been today.