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Higher Education Support Amendment (Job-Ready Graduates and Supporting Regional and Remote Students) Bill 2020

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2019-2020

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

HIGHER EDUCATION SUPPORT AMENDMENT

(JOB-READY GRADUATES AND SUPPORTING REGIONAL AND REMOTE STUDENTS) BILL 2020 

 

 

 

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Education,

the Honourable Dan Tehan MP)



HIGHER EDUCATION SUPPORT AMENDMENT

(JOB-READY GRADUATES AND SUPPORTING REGIONAL AND REMOTE STUDENTS) BILL 2020

 

OUTLINE

 

 

The purpose of the Higher Education Support Amendment (Job-Ready Graduates and Supporting Regional and Remote Students) Bill 2020 ( the Bill ) is to introduce reforms to higher education funding in Australia, and to strengthen and extend provider integrity measures, primarily through amendments to the Higher Education Support Act 2003 ( HESA ). HESA is the main piece of legislation providing funding for higher education in Australia, providing for Government subsidies and tuition support for students.

 

The Bill contains measures that will encourage higher education providers to produce job-ready graduates, create more opportunities for regional and remote students - including Aboriginal and Torres Strait Islander Australians - and direct growth in the higher education sector towards Australia’s regions and national priorities. The Bill also includes measures to extend and strengthen student protection and provider integrity measures in HESA, and ensure higher education providers are more accountable for the outcomes they deliver for students, industry and the wider community.

 

Schedule 1 of the Bill includes amendments to HESA to redesign the Commonwealth Grant Scheme ( CGS ) funding clusters and the Commonwealth contribution amounts ( CCAs ) to better align CGS funding to the cost of delivering higher education and ensure this funding is directed to areas of national priority and employment growth. This Schedule also includes measures to ensure that higher education providers will continue to receive the same amount of CGS funding for ‘grandfathered students’ enrolled in a Commonwealth supported place ( CSP ), where the current maximum student contribution amounts ( SCAs ) will apply for units those students enrol in after 1 January 2021 (see Schedule 2). ‘Grandfathered students’ include students who are currently Commonwealth supported and:

·          are enrolled in a course of study prior to 1 January 2021 who have not completed that course immediately before that day;

·          completed a course of study before 1 January 2021 and go on to study a related honours course after that day;

·          are undertaking an enabling course in 2020 and go on to study another course of study leading to a higher education award on or after

1 January 2021;

·          are undertaking an undergraduate certificate in 2020 and go on to study a related course of study leading to a bachelor degree on or after

1 January 2021.

 

Schedule 1 of the Bill also amends HESA to change the way grants are paid to higher education providers in relation to CSPs. The changes mean a Table A provider’s funding agreement may specify a maximum basic grant amount for any of the following:

·          ‘higher education courses’ - any course of study other than a ‘designated higher education course’ or a ‘demand driven higher education course’;

·          ‘designated higher education courses’ - a course of study in medicine or a course of study determined by the Minister; and

·          ‘demand driven higher education courses’ - a course of study leading to either a bachelor degree or bachelor honours degree (other than a designated higher education course, currently a course of study in medicine) undertaken at a Table A university by an Indigenous person from a regional area or a remote area.

 

These amendments, and others made in Schedule 1 will allow Table A providers to be allocated a funding envelope for all CSPs in ‘higher education courses,’ which will provide Table A providers with more flexibility in how they use the bulk of their CGS funding to meet the demands of students, industry and their local communities.

 

Schedule 1 also amends HESA to remove the broad exclusion of ‘work experience in industry’ ( WEI ) units of study from CGS funding under subsection 33-30(1), and will instead only exclude WEI units from CGS funding where the student does not pay a SCA for that unit of study; that is, where there is essentially no engagement between the provider and the student for that unit of study. This amendment will remove barriers to the availability of this type of learning in higher education and encourage students to gain more work experience in what they learn and as they learn.

 

Schedule 2 of the Bill amends HESA to change the maximum SCAs for a place in a unit of study to reflect the changes to funding clusters and CCAs that are proposed in Schedule 1. This Schedule also ensures that ‘grandfathered students’ do not have to pay the higher maximum SCA for a unit of study they enrol in after

1 January 2021 where the SCA for that unit would otherwise increase as a result of the amendments being made by the Bill.

 

Schedule 3 of the Bill amends HESA to provide legislative authority for the National Priorities and Industry Linkage Fund ( NPILF ), and to allow for the transition arrangements required to implement the Indigenous, Regional and Low

Socio-Economic Status Attainment Fund ( IRLSAF ).

 

Schedule 4 of the Bill amends the Education Legislation Amendment (Provider Integrity and Other Measures) Act 2017 to extend various quality and accountability requirements contained in HESA to all higher education providers (now including Table A, B and C universities), and also introduces new student protection measures in HESA (that would again apply to all providers). These amendments will support work being done in the higher education sector around best practice approaches to student enrolment and progression, and will re-signal the quality of Australia’s higher education sector both domestically and internationally.

 

Specifically, the measures contained in Schedule 4 of the Bill will:

·          prohibit all providers from engaging in unscrupulous marketing practices and from submitting requests for Commonwealth assistance on behalf of students;

·          require a person to be a ‘genuine student’ in order to receive Commonwealth assistance;

·          require providers to assess a person’s academic suitability to undertake a unit of study prior to that person receiving Commonwealth assistance for that unit;

·          prevent providers from pursuing ineligible students for SCAs or tuition amounts where the provider is at fault;

·          require a provider to re-credit a person’s HELP balance in a range of circumstances including where the provider completes any part of the person’s request for Commonwealth assistance for the relevant unit of study, or where the person was not entitled to HECS-HELP assistance in the first place;

·          allow the Minister to audit all higher education providers for matters of compliance with HESA;

·          enhance financial reporting requirements for, and improve assessment of the financial viability of providers;

·          apply civil penalties to existing obligations on providers under Division 19 of HESA;

·          preclude providers from imposing financial or administrative barriers to a student withdrawing from study;

·          require all higher education providers to co-operate with HESA and Tertiary Education Quality and Standards Agency ( TEQSA ) investigators;

·          require all higher education providers to keep records of a kind, in the manner and for the period required by the Higher Education Provider Guidelines, and publish information as required by those guidelines;

·          require a student to maintain an overall pass rate of 50 per cent to remain eligible for Commonwealth assistance; and

·          require providers to assess a student’s capability to enrol in a concurrent study load above 2.0 Equivalent Full Time Study Load ( EFTSL ).

 

Schedule 5 of the Bill includes several miscellaneous amendments to HESA, including:

·          an amendment to subsection 142-1(2) to define a ‘school’ as including a ‘centre-based day care service’ - this change better aligns the legislation with the policy intention relating to very remote HELP debtors;

·          an amendment to remove the University College London ( UCL ) as a Table C provider, as UCL is no longer an approved higher education provider under HESA;

·          amendments to sections 27-5, 36-55, 51-5, 54-5, 57-1, 57-5 and 238-10 to remove references to the Tuition Fee Guidelines and the Reduction and Repayment Guidelines, as these guidelines have never been made; and

·          amendments to the names of certain Table A and Table B providers listed at subsections 16-15(1) and 16-20(1) to better reflect the names of these providers that are included on the TEQSA National Register for Providers and Courses.

 

Schedule 5 also amends paragraph 137-10(2)(b) of HESA to reduce, for units of study with a census date on or after 1 January 2021, the loan fee for students obtaining a FEE-HELP loan for an undergraduate course of study at a non-Table B provider from 25 per cent to 20 per cent.

 

The FEE-HELP loan fee recognises the cost to the taxpayer of the Commonwealth providing HELP loans to cover fee paying undergraduate places. The reduction of the loan fee allows the HELP scheme to remain sustainable, while also reducing the financial burden on students and the total time taken to repay a HELP debt. This change also brings consistency to the tertiary sector by aligning the FEE-HELP loan fee with the 20 per cent VET student loan fee that is applied to VET student loans accessed by full fee paying VET students.

 

Schedule 5 of the Bill also amends the Social Security Act 1991 to reduce (from six to three) the number of months a student living away from home must be receiving eligible student support payments (Youth Allowance, Austudy Payment and the Pensioner Education Supplement) before being eligible to receive Fares Allowance for a return journey home during the study year.



FINANCIAL IMPACT STATEMENT

 

 

 

The measures contained in Schedules 1, 2 and 3, and items 17 and 18 of Schedule 5, of the Bill, as announced as part of the Government’s Job-ready Graduates Package (the Package), were budget neutral. Subsequent amendments to Schedule 1 of the Bill mean measures announced as part of the Package produce a net saving of approximately $125 million over the forward estimates, with this saving to be redirected towards additional places, such as short courses or Commonwealth supported places in 2021-22.

 

The measures in Schedule 4 of the Bill produce savings of $0.5 million in fiscal balance terms and a cost of $0.4 million in underlying cash over the period 2020-21 to 2023-24.

 

The remaining measures in the Bill do not have financial implications.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 



 

STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS

 

 

Prepared in accordance with Part 3 of the Human Rights

(Parliamentary Scrutiny) Act 2011

 

HIGHER EDUCATION SUPPORT AMENDMENT (JOB-READY GRADUATES AND SUPPORTING REGIONAL AND REMOTE STUDENTS) BILL 2020 

 

The Higher Education Support Amendment (Job-Ready Graduates and Supporting Regional and Remote Students) Bill 2020 ( Bill ) is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .

 

Overview of the Bill

 

The purpose of the Bill is to introduce reforms to higher education funding in Australia, and to strengthen and extend provider integrity measures, primarily through amendments to the Higher Education Support Act 2003 ( HESA ). HESA is the main piece of legislation providing funding for higher education in Australia, providing for Government subsidies and tuition support for students.

 

The Bill contains measures that will encourage higher education providers to produce job-ready graduates, create more opportunities for regional and remote students - including Aboriginal and Torres Strait Islander Australians - and direct growth in the higher education sector towards Australia’s regions and national priorities. The Bill also includes measures to extend and strengthen student protection and provider integrity measures in HESA, and ensure higher education providers are more accountable for the outcomes they deliver for students, industry and the wider community.

 

Schedule 1 of the Bill includes amendments to HESA to redesign the Commonwealth Grant Scheme ( CGS ) funding clusters and the Commonwealth contribution amounts ( CCAs ) to better align CGS funding to the cost of delivering higher education and ensure this funding is directed to areas of national priority and employment growth. This Schedule also includes measures to ensure that higher education providers will continue to receive the same amount of CGS funding for ‘grandfathered students’ enrolled in a Commonwealth supported place ( CSP ), where the current maximum student contribution amounts ( SCAs ) will apply for units those students enrol in after 1 January 2021 (see Schedule 2). ‘Grandfathered students’ include students who are currently Commonwealth supported and:

  • are enrolled in a course of study prior to 1 January 2021 who have not completed that course immediately before that day;
  • completed a course of study before 1 January 2021 and go on to study a related honours course after that day;
  • are undertaking an enabling course in 2020 and go on to study another course of study leading to a higher education award on or after

    1 January 2021;
  • are undertaking an undergraduate certificate in 2020 and go on to study a related course of study leading to a bachelor degree on or after

    1 January 2021.

 

Schedule 1 of the Bill also amends HESA to change the way grants are paid to higher education providers in relation to CSPs. The changes mean a Table A provider’s funding agreement may specify a maximum basic grant amount for any of the following:

  • ‘higher education courses’ - any course of study other than a ‘designated higher education course’ or a ‘demand driven higher education course’;
  • ‘designated higher education courses’ - a course of study in medicine or a course of study determined by the Minister; and
  • ‘demand driven higher education courses’ - a course of study leading to either a bachelor degree or bachelor honours degree (other than a designated higher education course, currently a course of study in medicine) undertaken at a Table A university by an Indigenous person from a regional area or a remote area.

 

These amendments, and others made in Schedule 1 will allow Table A providers to be allocated a funding envelope for all CSPs in ‘higher education courses,’ which will provide Table A providers with more flexibility in how they use the bulk of their CGS funding to meet the demands of students, industry and their local communities.

 

Schedule 1 also amends HESA to remove the broad exclusion of ‘work experience in industry’ ( WEI ) units of study from CGS funding under subsection 33-30(1), and will instead only exclude WEI units from CGS funding where the student does not pay a SCA for that unit of study; that is, where there is essentially no engagement between the provider and the student for that unit of study. This amendment will remove barriers to the availability of this type of learning in higher education and encourage students to gain more work experience in what they learn and as they learn.

 

Schedule 2 of the Bill amends HESA to change the maximum SCAs for a place in a unit of study to reflect the changes to funding clusters and CCAs that are proposed in Schedule 1. This Schedule also ensures that ‘grandfathered students’ do not have to pay the higher maximum SCA for a unit of study they enrol in after

1 January 2021 where the SCA for that unit would otherwise increase as a result of the amendments being made by the Bill.

 

Schedule 3 of the Bill amends HESA to provide legislative authority for the National Priorities and Industry Linkage Fund ( NPILF ), and to allow for the transition arrangements required to implement the Indigenous, Regional and Low

Socio-Economic Status Attainment Fund ( IRLSAF ).

 

Schedule 4 of the Bill amends the Education Legislation Amendment (Provider Integrity and Other Measures) Act 2017 to extend various quality and accountability requirements contained in HESA to all higher education providers (now including Table A, B and C universities), and also introduces new student protection measures in HESA (that would again apply to all providers). These amendments will support work being done in the higher education sector around best practice approaches to student enrolment and progression, and will re-signal the quality of Australia’s higher education sector both domestically and internationally.

 

Specifically, the measures contained in Schedule 4 of the Bill will:

·          prohibit all providers from engaging in unscrupulous marketing practices and from submitting requests for Commonwealth assistance on behalf of students;

·          require a person to be a ‘genuine student’ in order to receive Commonwealth assistance;

·          require providers to assess a person’s academic suitability to undertake a unit of study prior to that person receiving Commonwealth assistance for that unit;

·          prevent providers from pursuing ineligible students for SCAs or tuition amounts where the provider is at fault;

·          require a provider to re-credit a person’s HELP balance in a range of circumstances including where the provider completes any part of the person’s request for Commonwealth assistance for the relevant unit of study, or where the person was not entitled to HECS-HELP assistance in the first place;

·          allow the Minister to audit all higher education providers for matters of compliance with HESA;

·          enhance financial reporting requirements for, and improve assessment of the financial viability of providers;

·          apply civil penalties to existing obligations on providers under Division 19 of HESA;

·          preclude providers from imposing financial or administrative barriers to a student withdrawing from study;

·          require all higher education providers to co-operate with HESA and Tertiary Education Quality and Standards Agency ( TEQSA ) investigators;

·          require all higher education providers to keep records of a kind, in the manner and for the period required by the Higher Education Provider Guidelines, and publish information as required by those guidelines;

·          require a student to maintain an overall pass rate of 50 per cent to remain eligible for Commonwealth assistance; and

·          require providers to assess a student’s capability to enrol in a concurrent study load above 2.0 Equivalent Full Time Study Load ( EFTSL ).

 

Schedule 5 of the Bill includes several miscellaneous amendments to HESA, including:

  • an amendment to subsection 142-1(2) to define a ‘school’ as including a ‘centre-based day care service’ - this change better aligns the legislation with the policy intention relating to very remote HELP debtors;
  • an amendment to remove the University College London ( UCL ) as a Table C provider, as UCL is no longer an approved higher education provider under HESA;
  • amendments to sections 27-5, 36-55, 51-5, 54-5, 57-1, 57-5 and 238-10 to remove references to the Tuition Fee Guidelines and the Reduction and Repayment Guidelines, as these guidelines have never been made; and
  • amendments to the names of certain Table A and Table B providers listed at subsections 16-15(1) and 16-20(1) to better reflect the names of these providers that are included on the TEQSA National Register for Providers and Courses.

 

Schedule 5 also amends paragraph 137-10(2)(b) of HESA to reduce, for units of study with a census date on or after 1 January 2021, the loan fee for students obtaining a FEE-HELP loan for an undergraduate course of study at a non-Table B provider from 25 per cent to 20 per cent.

 

The FEE-HELP loan fee recognises the cost to the taxpayer of the Commonwealth providing HELP loans to cover fee paying undergraduate places. The reduction of the loan fee allows the HELP scheme to remain sustainable, while also reducing the financial burden on students and the total time taken to repay a HELP debt. This change also brings consistency to the tertiary sector by aligning the FEE-HELP loan fee with the 20 per cent VET student loan fee that is applied to VET student loans accessed by full fee paying VET students.

 

Schedule 5 of the Bill also amends the Social Security Act 1991 to reduce (from six to three) the number of months a student living away from home must be receiving eligible student support payments (Youth Allowance, Austudy Payment and the Pensioner Education Supplement) before being eligible to receive Fares Allowance for a return journey home during the study year.

 

Analysis of human rights implications

 

The Bill engages the following human rights:

·          the right to work - Article 6 of the International Covenant on Economic, Social and Cultural Rights ( ICESCR );

·          the right to an adequate standard of living - Article 11 of the ICESCR; and

·          the right to education - Article 13 of the ICESCR

·          the right to a fair and public hearing and the right to be presumed innocent until proven guilty, and minimum fair trial guarantees (relating to the imposition of penalty provisions) - Articles 14 and 15 of the International Covenant on Civil and Political Rights ( ICCPR ).

 

ICESCR Article 6: right to work

 

The Bill positively engages Article 6(1) of the ICESCR, which recognises the “the right of everyone to the opportunity to gain [their] living by work” and that the State will “take appropriate steps to safeguard this right”. Article 6(2) cites “technical and vocational guidance and training programmes, policies and techniques to achieve steady economic, social and cultural development and full and productive employment under conditions safeguarding fundamental political and economic freedoms to the individual ” as steps to be taken by a State Party to achieve the full realisation of the right contained in Article 6(1).

 

The Bill contains various measures aimed at supporting stronger links between universities and industry, and ensuring graduates gain the knowledge and skills they need to be job-ready and successful in a competitive labour market. These measures include:

·          directing the bulk of CGS funding towards students enrolled in disciplines with high employment outcomes (see Schedule 1);

·          extending CGS funding to certain WEI units, and therefore encouraging providers to include this mode of education in more courses of study (see Schedule 1); and

·          creating a new purpose for which the Minister can make grants to higher education providers, being to encourage those providers to engage with industry—thereby providing legislative authority for the NPILF (see Schedule 3).

 

The Bill is compatible with the right to work.

 

ICESCR Article 11: right to an adequate standard of living

 

The Bill engages with Article 11(1) of the ICESCR, which recognises “the right of everyone to an adequate standard of living for [themselves] and [their] family, including adequate food, clothing and housing, and to the continuous improvement of living conditions”.

 

Schedule 1 of the Bill includes a measure to increase the maximum SCA for some Commonwealth supported students. While this measure, on its face, may appear to result in a rise in living costs for impacted students, this is ultimately not the case as impacted students are able to defer their SCAs through the HELP scheme. Students are not required to make payments towards their HELP loan until they earn above the minimum repayment threshold, which is above the minimum livable wage. As such, to the extent this measure limits the right of students to an adequate standard of living (if at all), this limitation is reasonable and proportionate to meet the policy goal of ensuring Commonwealth funding for CSPs is efficient, maximises the number of places available, and is directed towards areas of national priority and employment growth.

 

Schedule 5 of the Bill also includes a measure to decrease the time period—from six to three months—a student studying away from home must be receiving eligible student support payments prior to accessing Fares Allowance for a return journey home during the study year . This measure enables students to access Fares Allowance earlier in their studies for a return journey home, thereby improving their overall access to this allowance and the positive impact it has on travel costs for impacted students.

 

The Bill is compatible with the right to an adequate standard of living.

 

ICESCR Article 12: right to education

 

The Bill engages the right to education under Article 13(2)(c) of the ICESCR, which provides that ‘higher education shall be made equally accessible to all, on the basis of capacity, by every appropriate means, and in particular by the progressive introduction of free education’.

 

The Bill contains several measures aimed at improving access to higher education for more Australians. Schedule 1 of the Bill contains a measure to better align Commonwealth funding for CSPs to the cost of course delivery. This measure is aimed at improving efficiency in Commonwealth spending in higher education in order to maximise the number of available CSPs. As a result of these changes, the Commonwealth will be able to support more university places. Schedule 1 of the Bill also contains a measure to introduce demand driven funding for regional and remote Indigenous students to enrol in bachelor and bachelor honours level courses at Table A universities. This measure will improve access to higher education for Indigenous Australians in regional and remote areas, who historically have had lower participation rates than the rest of the population.  

 

Schedule 4 of the Bill contains various measures which promote the right to education by strengthening and ensuring the ongoing quality and operational integrity of Australia’s higher educational sector. These measures extend existing requirements to all higher education providers, as well as introduce new student protection and provider integrity requirements in HESA. Collectively, these measures enhance the probity and efficacy of higher education in Australia, ensuring all providers are focused on delivering high quality education and strong outcomes for students.

 

The Bill also contains measures aimed at diversifying course level and learning style options for Commonwealth supported students. For instance, Schedule 1 of the Bill introduces the concept of a ‘funding envelope’ for Table A providers. The funding envelope would combine all funding for a provider’s CSPs in a single maximum base grant allocation, unless funding for a particular course of study is excluded from that allocation, i.e. courses in medicine and demand driven higher education courses. This gives more flexibility in how providers allocate their CSPs, and improves provider responsiveness to student preferences in terms of learning style, level and discipline. As a result of this measure, students will have significantly more choice in the Commonwealth supported study options available in higher education. The measure contained in Schedule 1, which extends CGS funding to WEI units of study, would also provide more choice in Commonwealth supported study options in higher education and further encourage students to engage in the type of education best suited to their learning style or ability.

 

The amendment to the waiting period for receipt of Fares Allowance for a return journey home contained in Schedule 5, also supports the right to education. This measure enables students, mostly from regional and remote areas, to access Fares Allowance earlier in their studies for a return journey home, thereby improving their access to support systems and increasing the likelihood that these students will go on to complete their studies.  

 

The Bill also introduces measures which may—or may appear to—limit the right to education. In particular:

 

Redesigning the CGS funding clusters, Commonwealth contribution amounts, and maximum student contribution amounts for Commonwealth supported places

 

Amendments to section 93-10 of HESA (see Schedule 2) will increase the maximum SCA for a place in a unit of study for students studying in certain disciplines. While this measure may be perceived as restricting access to higher education, this is not the case as the students affected by these changes are able to defer their SCAs through the HELP scheme. Further, this measure is intended to maximise efficiency in Commonwealth spending for higher education and support a significant expansion in the number of CSPs that will not only improve access to university education but also enable more people to enjoy the opportunities it creates. 

 

As this measure does not directly limit a student’s ability to access higher education, the measure is compatible with the right to education.

 

Extending academic suitability requirements for students at all higher education providers and limits on concurrent study loads

 

Schedule 4 includes measures that would require all higher education providers to develop and apply appropriate student admissions procedures that ensure a student is properly assessed as academically suitable for a unit of study before enrolling, and that the student is a ‘genuine student’ for the purposes of HESA. While these measures may technically limit a student's ability to access higher education, the limitation is a reasonable and proportionate action to protect students who do not have the academic ability to undertake a higher education course from being burdened with significant and unnecessary debt. The genuine student requirement is also reasonable and proportionate to the objective of ensuring that higher education resources are directed to students who have a genuine desire and interest in pursuing higher education. 

 

Schedule 4 also includes a measure restricting the amount of units a student can enrol in over a 12 month period to an EFTSL value of no more than two. To the extent the right to education may be limited by this measure, these limitations are reasonable and proportionate to:

·          protecting vulnerable people who do not have the academic capability from being burdened with a significant debt;

·          ensuring higher education resources are directed to students who have a genuine desire and interest in pursuing higher education;

·          protecting students from enrolling in study loads that are beyond their capacity and capability to complete; and

·          encouraging responsible use of Commonwealth assistance.

 

Moreover, limiting a student’s study load to units with an EFTSL value of no more than two will not affect the majority of students accessing Commonwealth assistance because one EFTSL is a typical study load for a year, and students will continue to have the option to enrol in a study load with an EFTSL value of more than two, provided they receive support from their higher education provider.

 

To the extent these measures may limit a student’s ability to access higher education, these limitations are reasonable, proportionate and supports the legitimate policy objective to improve integrity, performance and regulatory compliance in the sector.

 

ICCPR Articles 14 and 15: Criminal process rights

 

The Parliamentary Joint Committee on Human Rights’ Guidance Note 2 specifies that civil penalty provisions may engage criminal process rights under Articles 14 and 15 of the ICCPR, regardless of the distinction between criminal and civil penalties in domestic law. When a provision imposes a civil penalty, an assessment is required as to whether it amounts to a criminal penalty for the purposes of the ICCPR.

 

The Bill extends the applicability of civil penalty provisions in Divisions 19 (Chapter 2), 169 (Chapter 5), and 174 (Chapter 5) of HESA to all higher education providers (currently those provisions do not apply to Table A, B or C providers). The relevant factors for assessing whether a penalty is a criminal penalty for the purposes of human rights law include the classification of the penalty in domestic law, the nature of the penalty and the severity of the penalty.

 

The purpose of these penalties is to encourage compliance and deter

non-compliance with HESA. The penalties will only apply to the regulatory regime of HESA rather than to the public in general. Based on the nature and severity of the civil penalties imposed under HESA, these penalties are appropriately characterised as civil rather than criminal in nature.

 

Conclusion

 

The Bill is compatible with human rights because it advances the protection

of human rights in the delivery of higher education in Australia. To the extent that it may limit human rights, these limitations are reasonable, necessary, and proportionate.

 



HIGHER EDUCATION SUPPORT AMENDMENT (JOB-READY GRADUATES AND SUPPORTING REGIONAL AND

REMOTE STUDENTS) BILL 2020 

 

 

NOTES ON CLAUSES

 

Clause 1 - Short title

 

This clause provides for the Act to be Higher Education Support Amendment

(Job-Ready Graduates and Supporting Regional and Remote Students) Act 2020
(the Act).  

 

Clause 2 - Commencement

 

The table in subclause 2(1) sets out when the Act’s provisions will commence. The table provides that:

·          sections 1 to 3 and anyth ing in the Act not elsewhere covered by the table at subclause 2(1) commences the day after the Act receives the Royal Assent;

·          Schedule 1 (Commonwealth Grant Scheme) commences the day after the Act receives the Royal Assent;

·          Part 1 of Schedule 2 (Maximum student contribution amounts for places) commences the day after the Act receives the Royal Assent;

·          Part 2 of Schedule 2 (Maximum student contribution amounts for places) commences on 1 January 2021;

·          Part 1 of Schedule 3 (Other grants) commences the day after the Act receives the Royal Assent;

·          Part 2 of Schedule 3 (Other grants) commences on 1 January 2021;

·          Part 1 of Schedule 4 (Student protection) commences on 1 January 2021;

·          Part 2 of Schedule 4 (Student protection) commences on 1 January 2022;

·          Part 1 of Schedule 5 commences on 1 January 2020;

·          Part 2 of Schedule 5 commences the day after the Act receives the Royal Assent; and

·          Part 3 of Schedule 5 commences on 1 January 2021.

 

Subclause 2(2) provides that information in column 3 of the table at subclause 2(1) is not part of the Act and information may be inserted into column 3 or information in it may be edited in any published version of the Act.

 

Clause 3 - Schedules

 

This clause provides that any legislation that is specified in a schedule is amended or repealed as set out in the applicable items in the schedule and that any other item in a schedule has effect according to its terms.

 

 

 

 

 

List of abbreviations

 

Administration Guidelines

the Administration Guidelines 2012 made under section 238-10 of HESA

 

CCA  

Commonwealth contribution amount

 

CGS

Commonwealth Grant Scheme

 

CGS Guidelines

the Commonwealth Grant Scheme Guidelines 2012 made under section 238-10 of HESA

 

CSP

Commonwealth supported place

 

Department

Department of Education, Skills and Employment

 

EFTSL

equivalent full time study load

 

HESA

Higher Education Support Act 2003

 

HELP

Higher Education Loan Program

 

Higher Education Provider Guidelines

the Higher Education Provider Guidelines 2012 made under section 238-10 of HESA

 

MBGA

maximum basic grant amount

 

Minister

the Minister responsible for administering HESA, currently the Minister for Education

 

Other Grants Guidelines

the Other Grants Guidelines (Education) 2012 made under section 238-10 of HESA

 

Provider Integrity Act           

Education Legislation Amendment (Provider Integrity and Other Measures) Act 2017

 

SCA

student contribution amount

 

 

SS Act

Social Security Act 1991

 

TEQSA

Tertiary Education Quality and Standards Agency

 

VET   

vocational education and training

 

VSL Act

VET Student Loans Act 2016

 

WEI    

work experience in industry

 

 

             

                                   

                                                                       

Schedule 1   Commonwealth Grant Scheme      

 

Summary

 

Schedule 1 of the Bill includes amendments to HESA to redesign the CGS funding clusters and the CCAs to better align CGS funding to the cost of delivering higher education and ensure this funding is directed to areas of national priority and employment growth. This Schedule also includes measures to ensure that higher education providers will continue to receive the same amount of CGS funding for ‘grandfathered students’ enrolled in a CSP, where the current maximum SCA will apply for units those students enrol in after 1 January 2021 (see Schedule 2). ‘Grandfathered students’ include students who are currently Commonwealth supported and:

  • are enrolled in a course of study prior to 1 January 2021 who have not completed that course immediately before that day;
  • completed a course of study before 1 January 2021 and go on to study a related honours course after that day;
  • are undertaking an enabling course in 2020 and go on to study another course of study leading to a higher education award on or after

    1 January 2021;
  • are undertaking an undergraduate certificate in 2020 and go on to study a related course of study leading to a bachelor degree on or after

    1 January 2021.

 

This Schedule also amends HESA to change the way grants are paid to higher education providers in relation to CSPs. The changes mean a Table A provider’s funding agreement may specify a maximum basic grant amount for any of the following:

  • ‘higher education courses’ - any course of study other than a ‘designated higher education course’ or a ‘demand driven higher education course’;
  • ‘designated higher education courses’ - a course of study in medicine or a course of study determined by the Minister; and
  • ‘demand driven higher education courses’ - a course of study leading to either a bachelor degree or bachelor honours degree (other than a designated higher education course, currently a course of study in medicine) undertaken at a Table A university by an Indigenous person from a regional area or a remote area.

 

These amendments, and others made in this Schedule, will allow Table A providers to be allocated a funding envelope for all CSPs in ‘higher education courses,’ which will provide Table A providers with more flexibility in how they use the bulk of their CGS funding to meet the demands of students, industry and their local communities.

 

This Schedule also amends HESA to remove the broad exclusion of WEI units of study from CGS funding under subsection 33-30(1), and will instead only exclude WEI units from CGS funding where the student does not pay a SCA for that unit of study; that is, where there is essentially no engagement between the provider and the student for that unit of study. This amendment will remove barriers to the availability of this type of learning in higher education and encourage students to gain more work experience in what they learn and as they learn.  

 

Detailed explanation

 

Part 1 - Amendments

 

Higher Education Support Act 2003

 

Items 1, 3, 6 - Subparagraph 30-1(1)(b)(ii), At the end of subsection 30-10(4), and Paragraph 30-25(3)(aa)

 

Items 1, 3 and 6 make consequential amendments to subparagraph 30-1(1)(b)(ii), subsection 30-10(4), and paragraph 30-25(3)(aa) to reflect the changes being made to how the ‘number of Commonwealth supported places’ the provider has provided is calculated under section 33-30 (see items 15, 17 and 18).

 

Item 1 amends subparagraph 30-1(1)(b)(ii) to make it clear that a non-Table A provider will be eligible for a grant under Part 2-2 of HESA if the Minister has made an allocation under section 30-10 to the provider for that year. This is a technical amendment to clarify the operation of this provision in light of the changes being made to section 33-30.

 

Item 3 amends subsection 30-10(4) to make it clear that an allocation of CSPs made to a non-Table A provider by the Minister under section 30-10 must also specify:

(a)   the number of places (if any) for each funding cluster that are in respect of non-grandfather ed students; and

(b)   the number of places (if any) for each funding cluster (other than the first funding cluster and the second funding cluster) that are in respect of grandfathered students; and

(c)   the number of places (if any) for each grandfathered funding cluster part that are in respect of grandfathered students.

This is a technical change to ensure that a non-Table A provider’s total basic grant amount can be calculated under new subsection 33-5(7) using the correct ‘number of Commonwealth supported places’ (taking into account the numbers of ‘grandfathered’ and ‘non-grandfathered students’ in each funding cluster or ‘grandfathered funding cluster part’).

 

Item 6 amends paragraph 30-25(3)(aa) to clarify that a provider’s funding agreement may specify the number of CSPs allocated to the provider under

section 30-10 for a funding cluster, or a ‘grandfathered funding cluster part’, for the relevant grant year. This is a technical amendment to clarify the operation of this provision in light of the changes being made to section 33-30.

 

Item 2- Section 30-10

 

Item 2 replaces subsection 30-10(1) with a new subsection which states that the Minister may allocate a specified number of CSPs for a year to:

(a)   a Table A provider in relation to designated higher education courses; and

(b)   a higher education provider referred to in subparagraph 30-1(1)(b)(i) (i.e. a non-Table A provider).

The new note at this subsection also explains that the Minister does not allocate places to Table A providers in relation to higher education courses or demand driven higher education courses.

 

The amendments made by this item are mostly consequential to the changes being made to section 30-27 (see item 9). These changes also provide the Minister with flexibility to allocate CSPs at any time during the year (currently, places can only be allocated under subsection 30-10(1) before the commencement of a year). 

 

Item 4 - Section 30-12

 

Under HESA, Table A providers can only receive CGS funding in relation to ‘designated courses of study’ based on the number of CSPs that are allocated to the provider by the Minister under section 30-10, up to the amount of the provider’s MGBA for ‘designated courses of study’. Currently, courses of study in medicine and non-research postgraduate courses of study are specified as ‘designated courses of study’ under subsection 30-12(1) of HESA. The Minister has also specified, by legislative instrument, that the following courses are also designated courses of study for the purposes of subsection 30-12(2):

·          courses leading to an award of diploma;

·          courses leading to an award of advanced diploma;        

·          courses leading to an award of associate degree;

·          courses leading to an award of undergraduate certificate; and

·          enabling courses.

 

The Commonwealth also provides a separate MBGA for ‘non-designated courses of study’. This means that providers are not currently allowed to use funding for

non-designated courses to offer a CSP to a student in a designated course of study and vice versa.

 

To allow for the creation of the ‘funding envelope’ for Table A providers that was announced as part of the Job-ready Graduates Package, funding for CSPs will be combined across more levels of higher education, providing more flexibility for Table A providers to transfer CSPs between disciplines and course levels and respond to student demand. This will be achieved by replacing the concepts of ‘designated courses of study’ with ‘designated higher education courses’ and

‘non-designated courses of study’ with ‘higher education courses,’ and by specifying fewer courses as designated higher education courses (compared with those currently specified as designated courses of study).

 

To give effect to this policy intent, item 4 replaces section 30-12 with a new section which provides that ‘designated higher education courses’ are courses of study in medicine or a course of study determined by the Minister in a legislative instrument (see new subsection 30-12(2)).

 

This will mean that, from 1 January 2021, only courses of study in medicine will be excluded from the funding envelope, and postgraduate courses of study will no longer be designated higher education courses, which will allow providers to transfer CSPs between bachelor and postgraduate courses. The Minister will retain their power to specify that other courses of study are ‘designated higher education courses’; however it is the Commonwealth’s intention to repeal the existing ‘designated courses of study’ instrument made by the Minister to ensure that sub-bachelor courses and undergraduate certificates are not included in the funding envelope.

 

Item 5 - Section 30-15

 

Item 5 replaces the funding cluster table at section 30-15 of HESA with the following new table:

 

F unding clusters

Item

Funding clusters

1

Law, Accounting, Administration, Economics, Commerce, Communications, Society and Culture

2

Education, Clinical Psychology, English, Mathematics, Statistics, Allied Health, Other Health, Built Environment, Computing, Visual and Performing Arts, Professional Pathway Psychology, Professional Pathway Social Work

3

Nursing, Foreign Languages, Engineering, Surveying, Environmental Studies, Science

4

Agriculture, Medicine, Dentistry, Veterinary Science, Pathology

 

The changes to section 30-15 made by this item are required as a result of the changes being made at item 14 to the CCAs for each funding cluster.

 

Items 7, 8 and 11 - Subsection 30-25(3) and Subparagraph 33-1(1)(b)(iv)

 

Items 8 and 11 amend paragraph 30-25(3)(e) and subparagraph 33-1(1)(b)(iv) of HESA to replace references to ‘transitional loading’ with references to the ‘Transition Fund loading.’ These amendments effectively include the ‘Transition Fund,’ announced as part of the Job-ready Graduates Package, on the face of the legislation.

 

The purpose of the ‘Transition Fund loading’ is to ensure that Table A providers can maintain their revenue over the grant years 2021 to 2023, whilst the Job-ready Graduates Package is being implemented.

 

The detail of the ‘Transition Fund loading’ will be included in the CGS Guidelines. The CGS Guidelines are a legislative instrument for the purposes of the Legislation Act 2003 and are subject to the Parliamentary disallowance process. This means that this Guidelines instrument will be subject to Parliamentary oversight and scrutiny, ensuring transparency for providers.

 

Item 7 makes a consequential amendment to repeal paragraph 30-25(3)(cb), which currently states that a provider’s funding agreement may specify the maximum number of CSPs provided by the provider which can have transitional loading in the grant years. This paragraph is no longer needed as the Transition Fund loading will not be calculated based on the CSPs provided by a provider. 

 

 

 

 

Item 9 - Section 30-27

 

Item 9 replaces section 30-27 with a new section to give effect to the creation of the new ‘funding envelope’ for Table A providers and to reflect the changes being made to section 33-5 by item 13.

 

Maximum basic grant amounts for Table A providers

 

New subsection 30-27(1) provides that, subject to new subsections 30-27(2), (3) and (5), a funding agreement for a Table A provider:

(a)   must specify an amount as the MBGA payable to the provider for a grant year for ‘higher education courses’; and

(b)   may specify an amount as the MBGA payable to the provider for a grant year for ‘designated higher education courses’ and ‘demand driven higher education courses’.

 

These changes give effect to the Government’s announcement, as part of the Job-ready Graduates Package, that a ‘funding envelope’ will be created for Table A providers. Under the funding envelope, funding for CSPs will be combined across more levels of higher education, providing more flexibility for Table A providers to transfer CSPs between disciplines and course levels and respond to student demand. This will be achieved by replacing the concepts of ‘designated courses of study’ with ‘designated higher education courses’ and ‘non-designated courses of study’ with ‘higher education courses,’ and by specifying fewer courses as designated higher education courses (compared with those currently specified as designated courses of study). Funding agreements with Table A providers will also be updated to implement the new funding envelope.

 

This new subsection also implements the Government’s announcement that it will provide CGS funding on a demand driven basis for Indigenous persons from regional and remote areas who enrol at a Table A provider in a bachelor (or bachelor honours) level course of study (other than a designated higher education course, currently a course of study in medicine). It does this by introducing the concept of ‘demand driven higher education courses’ into HESA. Funding for these courses will form part of a provider’s total CGS funding, but will be separate from the proposed funding envelope arrangement.

 

Table A providers—maximum basic grant amount for higher education courses

 

New subsection 30-27(2) provides that, for funding agreements for Table A providers made in respect of 2021, 2022 and 2023, the MBGA for the provider for each of those years for higher education courses must not be less than the amount specified in the CGS Guidelines for the purposes of this subsection for the provider for each of those years for those courses.

 

New subsection 30-27(3) goes on to provide that for funding agreements for Table A providers made in respect of other later years, the MBGA for the provider for each of those years for higher education courses must not be less than:

(a)   for 2024—the amount specified in the CGS Guidelines for the purposes of this paragraph for the provider for that year for those courses; and

(b)   for any other later year—the MBGA specified in the provider’s funding agreement for the preceding year for those courses.

 

New subsection 30-27(4) then provides that, without limiting subsection 30-27(2) and paragraph 30-27(3)(a), the Commonwealth Grant Scheme Guidelines may:

(a)   specify different amounts for different years for the purposes of that subsection; and

(b)   specify different amounts for different Table A providers for the purposes of that subsection or paragraph.

 

New subsections 30-27(2), (3) and (4) have been inserted to reflect requests from the higher education sector to include an MBGA ‘floor’ for higher education courses (i.e. a guaranteed baseline for MBGAs for those courses) on the face of the legislation. To give Government the flexibility to implement the Job-ready Graduates Package across the grant years 2021 to 2024, the ‘floor’ for MBGAs for these years will be specified in the CGS Guidelines. That is, the MBGA for a provider for higher education courses for those grant years, which will be specified in the provider’s funding agreement, must not be less than the amount specified in the CGS Guidelines for those years. 

 

To ensure that Table A providers can maintain their revenue over the grant years 2021 to 2023, a ‘Transition Fund loading’ will be added to the provider’s grant amount for the year (see item 11).

 

The CGS Guidelines are a legislative instrument for the purposes of the Legislation Act 2003 and are subject to the Parliamentary disallowance process. This means that the instrument setting the MBGA ‘floor’ for the grant years 2021 to 2024 will be subject to Parliamentary oversight and scrutiny, ensuring transparency for providers.

 

Once the Job-ready Graduates Package has been fully implemented, a Table A provider’s MBGA ‘floor’ for higher education courses will then be set at the MBGA for the previous grant year. That is, from 2025 onwards, the provider’s MBGA for higher education courses for a grant year must not be less than the MBGA specified in the provider’s funding agreement for the preceding year for those courses.

 

Table A providers - maximum basic grant amount for designated higher education courses

 

New subsection 30-27(5) provides that the MBGA for a Table A provider for a grant year for designated higher education courses must not be less than the amount worked out for the year for those courses using the method statement set out in paragraph 33-5(3)(b) with the following modifications:

(a)   read a reference in step 1 of that statement to places provided by the provider in a funding cluster as a reference to places allocated under section 30-10 to the provider in that funding cluster;

(b)   disregard paragraph (a) of that step.

 

This subsection has the same effect as current subsection 30-27(2) as it means that the provider’s MBGA for a year for designated higher education courses must not be less than the amount worked out based on the number of CSPs allocated to the provider for those courses. The changes to this subsection are required to reflect the changes being made to section 33-5.

 

Maximum basic grant amount for non-Table A providers

 

New subsection 30-27(6) provides that, subject to new subsection 30-27(7), a funding agreement for a higher education provider that is not a Table A provider may specify an amount as the MBGA payable to the provider for a grant year. 

 

New subsection 30-27(7) goes on to provide that the MBGA for a non-Table A provider for a grant year must not be less than the amount worked out for the year using the method statement set out in paragraph 33-5(7)(b) with the following modifications:

(a)   read a reference in steps 1, 2 and 3 of that statement to places provided by the provider in a funding cluster or a grandfathered funding cluster part as a reference to places allocated under section 30-10 to the provider in that funding cluster or grandfathered funding cluster part;

(b)   disregard paragraph (a) of each of those steps.

 

This new subsection has the same effect as the current subsection 30-27(4) as it means that the provider’s MBGA for a year must not be less than the amount worked out based on the number of CSPs allocated to the provider for the relevant funding cluster. The changes to this subsection are required to reflect the changes being made to section 33-5.

 

Items 10, 12, 21, 22, 24, 25, 31 and 40 - Paragraph 33-1(1)(a), Subdivision 33-B (heading), Section 33-37 and Subclause 1(1) of Schedule 1

 

Items 10, 12, 21, 24, and 25 change references to ‘basic grant amount’ to ‘total basic grant amount.’ This change clarifies that a provider’s ‘total basic grant amount,’ as calculated under section 33-5, is:

(a)   for Table A providers, the sum of an amount up to the MBGAs for higher education course, designated higher education courses and demand driven higher education courses for the year; and

(b)   for non-Table A providers, their MBGA for the year or an amount worked out using the method statement in paragraph 33-5(7)(b).

 

These changes clarify the use of the term ‘total basic grant amount’ only, and have no substantive effect on the operation of these provisions.

 

Item 31 repeals the definition of ‘basic grant amount’ and item 40 inserts a new definition of ‘total basic grant amount’ (which has the meaning given by section

33-5), to give effect to this change in terminology.

 

Item 22 amends subsection 33-37(1) to clarify that a provider’s total basic grant amount is reduced under this provision for a ‘year’ rather than a ‘grant year.’ These are technical amendments which clarify the operation of this subsection.  

 

Item 13 - Section 33-5

 

Item 13 replaces section 33-5 with a new section that sets out how a provider’s total basic grant amount will be calculated. The amendments to this section are technical, and are required to reflect the introduction of the funding envelope for Table A providers and the grandfathering arrangements for existing students (see items 14 and 35). These amendments will ensure that a provider’s total basic grant amount can be correctly calculated by the Department.

 

Total basic grant amount for Table A providers

 

New subsection 33-5(1) provides that the total basic grant amount for Table A providers is the sum of the following amounts:

(a)   the amount for higher education courses as calculated under subsections 33-5(2);

(b)   the amount for designated higher education courses as calculated under subsections 33-5(3) and (4);

(c)   the amount for demand driven higher education courses  as calculated under subsections 33-5(5) and (6).

 

This new subsection reflects the new terminology that will be used in HESA to implement the funding envelope for Table A providers and the new concept of demand driven higher education courses.

 

Table A providers - amount for higher education courses

 

New subsection 33-5(2) provides that, for the purposes of paragraph 33-5(1)(a), the amount for higher education courses is the lesser of:

(a)   the MBGA for the year for those courses that is specified in the Table A provider’s funding agreement; and

(b)   the amount worked out for the year using the following method statement:

 

Step 1. For each funding cluster in which the provider has provided places in those courses in respect of non-grandfathered students, multiply:

(a)   the number of CSPs provided by the provider in those courses in that funding cluster in respect of those students; by

(b)   the CCA for a place in that funding cluster.

 

This first step relates to the calculation of amounts for non-grandfathered students; that is, students that are not grandfathered students (generally new students commencing on or after 1 January 2021). The CCAs that apply for a place in a funding cluster for non-grandfathered students will be the new CCAs that apply from 1 January 2021 - see new subsection 33-10(1) being inserted by item 14.

 

Step 2. For each funding cluster (other than the first funding cluster and the second funding cluster) in which the provider has provided places in those courses in respect of grandfathered students, multiply:

(a)   the number of CSPs provided by the provider in those courses in that funding cluster in respect of those students; by

(b)   the CCA for a place in that funding cluster.

 

This second step relates to the calculation of amounts for grandfathered students that are not affected by the increased maximum SCAs that will apply to funding cluster one and the Visual and Performing Arts part of funding cluster two. That is, students who fall within one of the four categories outlined in the definition of ‘grandfathered student’ at item 35 (generally current students who commenced a course of study (including an enabling course or undergraduate certificate) before

1 January 2021), who will get the benefit of the new maximum SCAs. The CCAs that apply for a place in a funding cluster for these grandfathered students will be the new CCAs that apply from 1 January 2021 - see new subsection 33-10(1) being inserted by item 14.

 

Step 3. For each grandfathered funding cluster part in which the provider has provided places in those courses in respect of grandfathered students, multiply:

(a)   the number of CSPs provided by the provider in those courses in that grandfathered funding cluster part in respect of those students; by

(b)   the grandfathered Commonwealth contribution amount for a place in that grandfathered funding cluster part.

 

This third step relates to the calculation of amounts for grandfathered students that are affected by the increased maximum SCAs that will apply to funding cluster one and the Visual and Performing Arts part of funding cluster two. That is, students who fall within one of the four categories outlined in the definition of ‘grandfathered student’ at item 35 (generally current students who commenced a course of study (including an enabling course or undergraduate certificate) before 1 January 2021), who will not have to pay the new maximum SCAs for funding cluster one and the Visual and Performing Arts part of funding cluster two. The CCAs that apply for a place in a funding cluster for these grandfathered students will be the new ‘grandfathered Commonwealth contribution amounts’ - see new subsection

33-10(2) being inserted by item 14.

 

Step 4. Add together all of the amounts worked out under steps 1, 2 and 3.

 

New subsection 33-5(2) will operate in a very similar way to existing subsection

33-5(5). However, due to the proposed grandfathering arrangements, there are now three additional steps that need to be applied when calculating the amount for the year under this new subsection.

 

Existing subsection 33-5(6) of HESA (which is being repealed by this item 13) provides that, if a MBGA is not specified in a provider’s funding agreement in relation to ‘non-designated courses of study’, the amount for non-designated courses of study is the amount worked out under existing paragraph 33-5(5)(a). A similar provision is no longer required for new ‘higher education courses’ due to the changes being made to section 30-27 (see item 9) - these changes mean that funding agreements for Table A providers must now always specify an MBGA for higher education courses.

 

Table A providers - amount for designated higher education courses

 

New subsection 33-5(3) provides that, for the purposes of paragraph 33-5(1)(b) and subject to subsection 33-5(4), the amount for designated higher education courses is the lesser of:

(a)   the MBGA for the year for those courses that is specified in the Table A provider’s funding agreement; and

(b)   the amount worked out for the year using the following method statement:

 

Step 1. For each funding cluster in which the provider has provided places in those courses, multiply the CCA for a place in that funding cluster by the lesser of the following:

(a)   the number that is the sum of the number of CSPs provided by the provider in those courses in that funding cluster in respect of non-grandfathered students and in respect of grandfathered students;

(b)   the number of CSPs allocated to the provider for that funding cluster.

 

Step 2. Add together all of the amounts worked out under step 1

 

New subsection 33-5(4) provides that if no MBGA is specified for the year for the designated higher education courses in the Table A provider’s funding agreement, the amount for those courses is the amount worked out for the year using the method statement set out in paragraph 33-5(3)(b).

 

New subsections 33-5(3) and (4) operate in a very similar way to existing subsections 33-5(3) and (4). However, to ensure a provider’s MBGA is correctly calculated new subsections 33-5(3) and (4) need to reflect the two new calculations that need to be undertaken under section 33-30 - one for grandfathered students and another for non-grandfathered students (see items 15, 17 and 18).

 

Table A providers - amount for demand driven higher education courses

 

New subsection 33-5(5) provides that, for the purposes of paragraph 33-5(1)(c) and subject to subsection 33-5(6), the amount for demand driven higher education courses is the lesser of:

(a)   the MBGA for the year for those courses that is specified in the Table A provider’s funding agreement; and

(b)   the amount worked out for the year using the following method statement:

 

Step 1. For each funding cluster in which the provider has provided places in those courses in respect of non-grandfathered students, multiply:

(a)   the number of CSPs provided by the provider in those courses in that funding cluster in respect of those students; by

(b)   the CCA for a place in that funding cluster.

 

Step 2. For each funding cluster (other than the first funding cluster and the second funding cluster) in which the provider has provided places in those courses in respect of grandfathered students, multiply:

(a)   the number of CSPs provided by the provider in those courses in that funding cluster in respect of those students; by

(b)   the CCA for a place in that funding cluster.

 

Step 3. For each grandfathered funding cluster part in which the provider has provided places in those courses in respect of grandfathered students, multiply:

(a)   the number of CSPs provided by the provider in those courses in that grandfathered funding cluster part in respect of those students; by

(b)   the grandfathered Commonwealth contribution amount for a place in that grandfathered funding cluster part.

 

Step 4. Add together all of the amounts worked out under steps 1, 2 and 3.

 

New subsection 33-5(6) provides that if no MBGA is specified for the year for demand driven higher education courses in the Table A provider’s funding agreement, the amount for those courses is the amount worked out for the year using the method statement set out in paragraph 33-5(5)(b).

 

New subsections 33-5(5) will operate in the same way as new subsection

33-5(2) (see explanation above), except that this new subsection relates to calculating the grant amount for demand driven higher education courses. New subsection 33-5(6) will operate in a similar way to existing subsection 33-5(6).

 

Total basic grant amount for non-Table A providers

 

New subsection 33-5(7) provides that, subject to subsection 33-5(8), the total basic grant amount for a higher education provider, that is not a Table A provider, for a year is the lesser of:

(a)   the MBGA for the year that is specified in the provider’s funding agreement; and

(b)   the amount worked out for the year using the following method statement:

 

Step 1. For each funding cluster in which the provider has provided places in respect of non-grandfathered students, multiply the CCA for a place in that funding cluster by the lesser of the following:

(a)   the number of CSPs provided by the provider in that funding cluster in respect of those students;

(b)   the number of CSPs allocated to the provider for that funding cluster in respect of those students.

 

This first step relates to the calculation of amounts for non-grandfathered students. That is, students that are not grandfathered students (generally new students commencing on or after 1 January 2021). The CCAs that apply for a place in a funding cluster for non-grandfathered students will be the new CCAs that apply from 1 January 2021 - see new subsection 33-10(1) being inserted by item 14. The amount calculated under this step will be the CCAs for a place in the relevant funding cluster multiplied by the lesser of the number of non-grandfathered students in CSPs either provided by the provider or allocated to the provider.

 

Step 2. For each funding cluster (other than the first funding cluster and the second funding cluster) in which the provider has provided places in respect of grandfathered students, multiply the CCA for a place in that funding cluster by the lesser of the following:

(a)   the number of CSPs provided by the provider in that funding cluster in respect of those students;

(b)   the number of CSPs allocated to the provider for that funding cluster in respect of those students.

 

This second step relates to the calculation of amounts for grandfathered students that are not affected by the increased maximum SCAs that will apply to funding cluster one and the Visual and Performing Arts part of funding cluster two. That is, students who fall within one of the four categories outlined in the definition of ‘grandfathered student’ at item 35 (generally current students who commenced a course of study (including an enabling course or undergraduate certificate) before 1 January 2021), who will get the benefit of the new maximum SCAs. The CCAs that apply for a place in a funding cluster for these grandfathered students will be the new CCAs that apply from 1 January 2021 - see new subsection 33-10(1) being inserted by item 14. The amount calculated under this step will be the CCAs for a place in the relevant funding cluster multiplied by the lesser of the number of grandfathered students in CSPs either provided by the provider or allocated to the provider.

 

Step 3. For each grandfathered funding cluster part in which the provider has provided places in respect of grandfathered students, multiply the grandfathered Commonwealth contribution amount for a place in that grandfathered funding cluster part by the lesser of the following:

(a)   the number of CSPs provided by the provider in that part in respect of those students;

(b)   the number of CSPs allocated to the provider for that part in respect of those students.

 

This third step relates to the calculation of amounts for grandfathered students that are affected by the increased maximum SCAs that will apply to funding cluster one and the Visual and Performing Arts part of funding cluster two. That is, students who fall within one of the four categories outlined in definition of ‘grandfathered student’ at item 35 (generally current students who commenced a course of study (including an enabling course or undergraduate certificate) before 1 January 2021), who will not have to pay the new maximum SCAs for funding cluster one and the Visual and Performing Arts part of funding cluster two. The CCAs that apply for a place in a funding cluster for these grandfathered students will be the new ‘grandfathered Commonwealth contribution amounts’ - see new subsection

33-10(2) being inserted by item 14. The amount calculated under this step will be the grandfathered Commonwealth contribution amounts for a place in the relevant funding cluster multiplied by the lesser of the number of grandfathered students in CSPs either provided by the provider or allocated to the provider.

 

Step 4. Add together all of the amounts worked out under steps 1, 2 and 3.

 

New subsection 33-5(8) provides that, if no MBGA is specified for the year in the funding agreement of the higher education provider referred to in subsection

33-5(7), the total basic grant amount for the provider is the amount worked out for the year using the method statement set out in paragraph 33-5(7)(b).

 

New subsections 33-5(7) and (8) operate in a very similar way to existing subsections 33-5(7) and (8). However, to ensure a provider’s MBGA is correctly calculated new subsections 33-5(8) and (9) need to reflect the two new calculations that need to be undertaken under section 33-30 - one for grandfathered students and another for non-grandfathered students (see items 15, 17 and 18).

 

Item 14 - Section 33-10

 

The Commonwealth pays certain amounts to eligible higher education providers, known as Commonwealth contribution amounts (CCAs), based on the number of CSPs the provider provides during a year, or is allocated, in each funding cluster. The amount for a place in each funding cluster is the amount set out in the table at section 33-10.

 

Item 14 replaces the table at section 33-10, which specifies the current CCAs for each funding cluster, with two new tables that specify the new CCAs that will apply to the funding clusters from 1 January 2021 and the ‘grandfathered Commonwealth contribution amounts’ that will apply in respect of certain parts of funding clusters referred to as ‘grandfathered funding cluster parts.’ This reflects the redesign of the funding clusters that was announced as part of the Job-ready Graduates Package.

 

New subsection 33-10(1) provides that the new CCA for a place in a funding cluster is the amount specified in the following table. These amounts are different to the amounts currently paid to providers - some amounts are increasing, and some amounts are decreasing. The current CCAs for each funding cluster are also set out in the table. 

 

Funding cluster

New Commonwealth contribution amount (applies from 1 January 2021)

Current Commonwealth contribution amount (applies before 1 January 2021)

1. Law, Accounting, Administration, Economics, Commerce, Communications, Society and Culture

$1,100

(a) for a place in Law, Accounting, Administration, Economics or Commerce - $2,237;

 

(b) for a place in Communications - $13,547;

 

(c) for a place in the Social Studies and Behavioural Science subparts of the Society and Culture part of the first funding cluster - $11,015; or

 

(d) for a place in any other subpart of the Society and Culture part of the first funding cluster - $6,226.

 

2. Education, Clinical Psychology, English, Mathematics, Statistics, Allied Health, Other Health, Built Environment, Computing, Visual and Performing Arts, Professional Pathway Psychology, Professional Pathway Social Work

$13,250

(a) for a place in Education - $11,462;

 

(b) for a place in English - $6,226;

 

(c) for a place in Clinical Psychology, Allied Health or Visual and Performing Arts - $13,457; 

 

(d) for a place in Mathematics, Statistics, Other Health, Built Environment, Computing, Professional Pathway Psychology or Professional Pathway Social Work - $11,015.

3. Nursing, Foreign Languages, Engineering, Surveying, Environmental Studies, Science

$16,250

(a) for a place in Nursing - $15,125;

 

(b) for a place in Foreign Languages - $13,547;

 

(c) for a place in Engineering, Surveying or Science - $19,260; or

 

(d) for a place in Environmental Studies - $24,446.

4. Agriculture, Medicine, Dentistry, Veterinary Science, Pathology

$27,000

 

$24,446

 

 

The changes made by Schedule 1 mean that the former ‘Humanities’ part of current funding cluster two will now be included in the Society and Culture part of funding cluster one. The former ‘Social Studies’ and ‘Behavioural Science’ parts of current funding cluster three will now be included as subparts of the Society and Culture part of funding cluster one. The Society and Culture part of funding cluster one has been described in this way to ensure that the correct CCA is paid to providers in respect of grandfathered students undertaking units of study in the fields of Social Studies and Behavioural Science. However, the maximum SCAs for all grandfathered students undertaking Society and Culture units of study will be the same i.e. grandfathered students will pay a maximum SCA of $6,804 (see

Schedule 2).

 

The funding clusters have been redesigned to better align funding per student place to the cost of delivering university education and to rebalance contributions across fields of study to address a number of growing economic imperatives because:

  • the relative costs of delivering different courses have changed over recent years; and
  • the economy is changing and there is a need to increase the level of support going to fields of study that will contribute to national priorities and future prosperity.

 

Funding reform is needed to create room for further growth in places, which is critical if Australia is to maintain attainment rates and growth in productivity to support a globally competitive economy into the future.

 

To ensure that current students will not be affected by the increases in maximum SCAs being made by Schedule 2 in relation to certain parts of funding clusters one and two (being the ‘grandfathered funding cluster parts’), Schedule 2 provides that certain ‘grandfathered students’ who enrol in a unit of study after 1 January 2021 which would have a higher maximum SCA as a result of the Bill, maintain their current maximum SCA. Item 14 also ensures that, with respect to these grandfathered students, who will pay up to the current maximum SCAs, providers will continue to receive the same amount of CGS funding. That is, for places in a ‘grandfathered funding cluster part’ (being parts or subparts in funding clusters one and two - see item 35), providers will be paid the ‘grandfathered Commonwealth contribution amount’ for that place (being the current CCAs).

 

To enable this, new subsection 33-10(2) provides that the ‘grandfathered Commonwealth contribution amount’ for a place in a ‘grandfathered funding cluster part’ is the amount specified in the following table:

 

Grandfathered funding cluster part

Grandfathered Commonwealth contribution amount

Law, Accounting, Administration, Economics or Commerce

$2,237

Communications

$13,547

The Social Studies or Behavioural Science subpart of the Society and Culture part of the first funding cluster

$11,015

Any other subpart of the Society and Culture part of the first funding cluster (formerly known as Humanities)

$6,226

Education, Clinical Psychology, English, Mathematics, Statistics, Allied Health, Other Health, Built Environment or Computing

$13,500

Visual and Performing Arts

$13,547

Professional Pathway Psychology or Professional Pathway Social Work

$11,015

 

By way of example, if a student enrolled in a Bachelor of Communications with a provider before 1 January 2021, and they are a grandfathered student i.e. they continue to enrol in Communications units in that course after 1 January 2021, the provider will receive the grandfathered Commonwealth contribution amount for that student in the 2021 calendar year of $13,547, rather than what would otherwise be the new CCA of $1,100.

 

Items 15, 17, 18, 19, 20 and 26 - Section 33-30 and Subsection 198-5(1) (table item 1)

 

Items 15 and 17 make minor amendments to subsection 33-30(1) to clarify that this subsection now only applies to the calculation of the number of CSPs for ‘non-grandfathered students.’ This change is required to reflect the proposed grandfathering arrangements, and the changes being made by item 18.

 

Item 18 inserts a new subsection 33-30(1A) which provides that the ‘number of Commonwealth supported places’ that a higher education provider has provided in respect of grandfathered students during a particular year is a number equal to the number worked out as follows:

 

Step 1. For each unit of study (other than any unit that is an ineligible work experience unit for a grandfathered student) that the provider provided that had its census date during the year, multiply:

(a)   the EFTSL value of the unit; by

(b)   the number of grandfathered students enrolled with the provider in that unit as Commonwealth supported students.

 

Step 2. Add together all of the amounts worked out under step 1.

 

This new subsection has the same effect as subsection 33-30(1), except that it applies to the calculation of CSPs in respect of grandfathered students.

 

Items 19 and 20 make minor amendments to subsection 33-30(3) to reflect the changes made by item 18 and to reflect the change in terminology required to implement the proposed grandfathering arrangements, the funding envelope and the introduction of demand driven higher education courses. These are technical amendments to clarify the operation of this subsection in the context of the changes made by this Schedule.

 

Item 26 makes a minor amendment to table item 1 at subsection 198-5(1) to make it clear that ‘Commonwealth contribution amounts’ (as defined under subsection

33-10(1)) and ‘grandfathered Commonwealth contribution amounts’ (as defined under subsection 33-10(2)) will be indexed under Part 5-6 of HESA. This is a technical amendment required to reflect the changes made by item 14.

 

Items 16, 30 and 35 - amendments to Subsections 33-30(1) and 238-10(1), and Subclause 1(1) of Schedule 1 to reflect changes for WEI units

 

Item 16 amends the method statement in subsection 33-30(1) to replace the reference to ‘work experience in industry’ units of study with a reference to ‘any unit that is an ineligible work experience unit for a non-grandfathered student.’ New subsection 33-30(1A) (see item 18) also includes a similar reference to ‘ineligible work experience units’ for ‘grandfathered students’.

 

Item 35 inserts the following new definition of ‘ineligible work experience unit’: for a non-grandfathered student or a grandfathered student means a unit of study that the student is enrolled in that meets the following conditions:

(a)   the unit wholly consists of work experience in industry;

(b)   either:

a.     the student is exempt from paying their SCA in relation to the unit; or

b.     the unit does not meet the requirements specified by the Administration Guidelines.

 

These amendments remove the broad exclusion of WEI units of study from CGS funding under subsection 33-30(1), and mean that only certain limited WEI units will be excluded from CGS funding, primarily where the student does not pay an SCA for that unit of study, i.e. where there is essentially no engagement between the provider and the student for that unit of study. This amendment will remove barriers to the availability of this type of learning in higher education and encourage students to gain more work experience in what they learn.

 

Item 30 makes a minor amendment to table item 1 at subsection 238-10(1) to specify that matters in section 33-30 (related to ineligible WEI units) may be included in the Administration Guidelines. This is a technical amendment required as a result of the changes made by items 16 and 35.

 

Item 23 - Subsection 33-37(2) (definition of total places provided)

 

Item 23 amends the definition of ‘total places provided’ which is used for the purposes of calculating a reduction in a provider’s total basic grant amount under section 33-37 if, on one or more occasions during the year, the provider breaches a condition imposed under section 19-37.

 

The new definition specifies that the ‘total places provided’ is the sum of the:

(a)   number of CSPs that the higher education provider has provided in respect of non-grandfathered students for the year;

(b)   number of CSPs that the higher education provider has provided in respect of grandfathered students for the year.

 

This amendment is required to reflect the changes being made to how the ‘number of Commonwealth supported places’ the provider has provided is calculated under section 33-30 (see items 15, 17 and 18).

 

Items 27, 28 and 29 - Subsection 238-10(1) 

 

Items 27 to 29 make minor technical amendments to subsection 238-10(1) to clarify that the Minister may make guidelines under section 238-10 providing for matters required or permitted by, or necessary or convenient to be provided in order to give effect to, a provision (or a term defined in the Dictionary in Schedule 1 that is required for the purposes of the provision) specified in the third column of the table. This amendment clarifies the operation of this subsection in the context of the changes being made by this Schedule. 

 

Items 32, 33, 34, 35, 36, 37, 38, 39 and 40 - updates to definitions in Subclause 1(1) of Schedule 1

 

Items 32 to 40 repeal now redundant definitions, and include new definitions for terms that are required, as a result of the other substantive amendments made by the Bill.

 

Item 32 amends the definition of ‘Commonwealth contribution amount’ to refer to section 33-10(1), which reflects the amendments made by item 14.

 

Items 34 and 37 repeal the definitions of ‘designated course of study’ and ‘non-designated course of study’, and item 35 inserts new definitions of ‘designated higher education course’ (as defined in new section 30-12(1)) and ‘higher education course’ (being a course of study that is not a ‘designated higher education course’ or a ‘demand driven higher education course’). Item 36 also amends the definition of ‘maximum basic grant amount’ to clarify that the MBGA has the meaning given in section 30-27 (noting the amendments made in item 9 to this section). These changes are required to reflect the changes being made to introduce the new funding envelope for Table A providers.

 

Item 35 also includes new definitions of ‘first funding cluster’ (being the funding cluster referred to in table item 1 at new section 30-15), and ‘grandfathered Commonwealth contribution amount’ (being the amount for each funding cluster specified in new subsection 33-10(2)). Item 40 also includes a new definition of ‘second funding cluster’ (being the funding cluster referred to in table item 2 at new section 30-15). These changes are required to reflect the new CCAs and grandfathered Commonwealth contribution amounts specified in new section 33-10 (see item 14).

 

Item 35 also inserts a new definition of ‘grandfathered funding cluster part’ which means:

·          any part of the first funding cluster other than the Society and Culture part of that cluster (that is, the Law, Accounting, Administration, Economics, Commerce or Communications parts of funding cluster one); or

·          the Social Studies or Behavioural Science subpart of the Society and Culture part of the first funding cluster; or

·          any other subpart of the Society and Culture part of the first funding cluster (formerly known as the ‘Humanities’ part of current funding cluster two); or

·          any part of the second funding cluster (being Education, Clinical Psychology, English, Mathematics, Statistics, Allied Health, Other Health, Built Environment, Computing or Visual and Performing Arts).

This new definition is required to ensure that the correct CGS amounts are paid to providers for grandfathered students who will not have to pay up to the new maximum SCAs (see item 14).

 

Item 35 also includes a new definition of ‘grant year’ to clarify that this term has the meaning given by section 30-25(1).

 

Item 39 replaces the definition of ‘number of Commonwealth supported places’ with a new definition to reflect the changes made to section 33-30 by items 15, 17 and 18. This new definition clarifies the meaning of the term ‘number of Commonwealth supported places’ throughout HESA where it is used in relation to either section

30-10 or 33-30.

 

Definition of ‘demand driven higher education course’

 

Item 33 inserts of new definition of ‘demand driven higher education course’ which means a course of study that:

(a)   is undertaken by an eligible Indigenous person for the course of study with a Table A provider; and

(b)   is leading to a higher education award that is a bachelor degree or bachelor honours degree; and

(c)   is not a designated higher education course.

 

‘Eligible Indigenous person’ is defined in item 35 as follows: an Indigenous person is an eligible Indigenous person for a course of study with a Table A provider if, at the time the person first enrols in a course of study with that provider, the person’s permanent residential address is in a regional area or a remote area.

 

‘Indigenous person’ is also defined in item 35 and refers to the definition included in the Indigenous Education (Targeted Assistance) Act 2000 . Under that Act, ‘Indigenous person’ means:

(a)   a member of the Aboriginal race of Australia; or

(b)   a descendant of the Indigenous inhabitants of the Torres Strait Islands.

 

Item 40 also inserts the following definitions:

(a)   ‘regional area’ means an area that is classified as inner regional Australia, or outer regional Australia, under the ABS Remoteness Structure; and

(b)   ‘remote area’ means an area that is classified as remote Australia, or very remote Australia, under the ABS Remoteness Structure.

 

These definitional changes are required to implement the Government’s policy to provide CGS funding on a demand driven basis for Indigenous persons from regional and remote areas who enrol at a Table A provider in a bachelor (or bachelor honours) level course of study (other than a designated higher education course, currently a course of study in medicine).

 

Definitions of ‘grandfathered student’ and ‘non-grandfathered student’

 

Item 35 also inserts a new definition of ‘grandfathered student.’ There are four categories of grandfathered students:

 

1.     Students who started a course of study prior to 1 January 2021 and who:

a.     have not completed that course prior to 1 January 2021; and

b.     are Commonwealth supported in relation to that course; and

c.     enrol in a unit of study in that same course on or after 1 January 2021.

Note: students who change their course of study after 1 January 2021 will no longer be grandfathered students. 

 

2.     Students who completed a course of study before 1 January 2021 and who:

a.     start another course of study that is related to the course they have completed and leads to an honours degree; and

b.     were Commonwealth supported in relation to the course they completed before 1 January 2021; and

c.     enrol in a unit of study in the new course leading to an honours degree, on or after 1 January 2021.

 

3.     Students who are undertaking an enabling course in 2020 and who:

a.     start another course of study leading to a higher education award on or after 1 January 2021; and

b.     are Commonwealth supported in relation to the enabling course; and

c.     enrol in a unit of study in the new course leading to a higher education award, on or after 1 January 2021.

 

4.     Students who are undertaking an undergraduate certificate in 2020 and who

a.     start another related course of study leading to a bachelor degree on or after 1 January 2021; and

b.     are Commonwealth supported in relation to the undergraduate certificate course they are undertaking in 2020; and

c.     enrol in a unit of study in the new course leading to a bachelor degree, on or after 1 January 2021.

 

Item 38 also inserts a new definition of ‘non-grandfathered student’ into HESA. A non-grandfathered student is any person that is not a grandfathered student; that is, any person that does not fall within any of the four categories described at item 35.

 

Part 2 - Application Provisions

 

Item 41 - Application of amendments

 

Item 41 provides that the amendments made by Schedule 1 apply in relation to the following:

(a)   funding agreements entered into under Part 2-2 of HESA in respect of 2021 and later calendar years;

(b)   grants payable under Part 2-2 for 2021 and later calendar years.

 

This provision clarifies that funding agreements entered into with providers for 2020 and earlier years, and any grants made to providers in 2020 and earlier years, are not affected by the Bill.

 

Item 42 - Indexation

 

Item 42 provides that, despite anything in Division 198 of Part 5-6 of HESA, an amount specified in subsection 33-10(1) or (2), as amended by Schedule 1, is not to be indexed on 1 January 2021. However, the indexation provisions in Part 5-6 of HESA will apply to these amounts on and after 1 January 2022.



Schedule 2   Maximum student contribution amounts for places

 

Summary

 

Schedule 2 amends HESA to change the maximum SCA for a place in a unit of study to reflect the changes to funding clusters and CCAs that are proposed in Schedule 1. This Schedule also ensures that ‘grandfathered students’ do not have to pay the higher SCA for a unit of study they enrol in after 1 January 2021, where the SCA for that unit would otherwise increase as a result of the amendments being made by the Bill.

 

Detailed explanation

 

Part 1 - Amendments commencing day after Royal Assent

 

Division 1 - Amendments

 

Higher Education Support Act 2003

 

 

Item 1 - Section 33-35

 

Item 1 replaces section 33-35 with a new section which provides that the CGS Guidelines may specify:

(a)   how to determine, for the purposes of HESA, the funding cluster, or the part of a funding cluster, in which units of study are included; or

(b)   the particular funding cluster, or the particular part of a particular funding cluster, in which a particular unit is included for the purposes of HESA.

 

This amendment is required to reflect the changes being made by Schedule 1 of the Bill, and provides a mechanism for ensuring that there is certainty as to which funding clusters particular units of study fall under.  

 

Items 2 and 3 - Section 87-5 (note 1) and (note 2)

 

Items 2 and 3 make minor technical amendments to the notes at section 87-5 to remove references to the CGS Guidelines dealing with matters arising under section 93-10. These are consequential amendments required as a result the amendments made by item 5.

 

Item 4 - At the end of subsection 93-5(2)

 

Item 6 amends subsection 93-5(2) to clarify that a person’s SCA for a place in a unit must not exceed the maximum SCA for a place in the unit that applies in respect of that person. This amendment reflects that, due to the amendments at item 5, there are now two different categories of SCAs: those that apply to ‘grandfathered students’, and those that apply to ‘non-grandfathered students’.

 

Item 5 - Section 93-10

 

Item 5 replaces section 93-10 with a new section that specifies the new maximum SCAs for places in units of study for each funding cluster that apply to ‘grandfathered students’ and ‘non-grandfathered students’ (as those terms are defined by Schedule 1). Existing subsection 93-10(2) (which currently provides that the CGS Guidelines may specify how to determine whether particular units are in a funding cluster for the purposes of section 93-10) is not included as part of the new section 93-10, as it is no longer necessary due to the changes being made to section 33-35 by item 1.

 

The maximum SCA for a unit of study is the maximum tuition fee that a student studying in a CSP can be charged by their provider for that unit. Students enrolled in a CSP can get a HECS-HELP loan to cover their SCA. The maximum SCA that applies to a student taking a unit of study is based on the part, or subpart, of the funding cluster in which the unit is included (based on the description of each funding cluster in the CGS Guidelines).

 

The changes made by this item mean that ‘non-grandfathered students’ (that is, students that are not ‘grandfathered students’) will pay up to the new maximum SCAs for units of study in the relevant funding cluster that are set out in the following table. For some parts or subparts of funding clusters, the maximum SCAs are increasing, and for some parts or subparts of funding clusters, the maximum SCAs are decreasing - the current maximum SCAs are also set out in the table.

 

 

Funding cluster

New maximum student contribution amounts (that apply from 1 January 2021)

Current maximum student contribution amounts (that apply before 1 January 2021)

1. Law, Accounting, Administration, Economics, Commerce, Communications, Society and Culture

$14,500

(a) for a place in a unit in Law, Accounting, Administration, Economics or Commerce—$11,355; or

 

(b) for a place in a unit in Communications or Society and Culture —$6,804.

2. Education, Clinical Psychology, English, Mathematics, Statistics, Allied Health, Other Health, Built Environment, Computing, Visual and Performing Arts, Professional Pathway Psychology, Professional Pathway Social Work

(a) for a place in a unit in Education, Clinical Psychology, English, Mathematics or Statistics—$3,950; or

 

(b) for a place in a unit in Allied Health, Other Health, Built Environment, Computing, Visual and Performing Arts, Professional Pathway Psychology or Professional Pathway Social Work —$7,950.

(a) for a place in a unit in Education, Clinical Psychology, English, Visual and Performing Arts, Professional Pathway Psychology or Professional Pathway Social Work —$6,804; or

 

(b) for a place in a unit in Mathematics, Statistics, Allied Health, Other Health, Built Environment or Computing—$9,698.

3. Nursing, Foreign Languages, Engineering, Surveying, Environmental Studies, Science

(a) for a place in a unit in Nursing or Foreign Languages—$3,950; or

 

(b) for a place in a unit in Engineering, Surveying, Environmental Studies or Science—$7,950.

(a) for a place in a unit in Nursing or Foreign Languages—$6,804; or

 

(b) for a place in a unit in Engineering, Surveying, Environmental Studies or Science—$9,698.

4. Agriculture, Medicine, Dentistry, Veterinary Science, Pathology

(a) for a place in a unit in Agriculture—$3,950;

 

 

(b) for a place in a unit in Medicine, Dentistry or Veterinary Science—$11,300; or

 

(c) for a place in a unit in Pathology—$7,950.

(a) for a place in a unit in Agriculture or Pathology—$9,698; or

 

(b) for a place in a unit in Medicine, Dentistry or Veterinary Science—$11,355.

 

These changes mean that, for approximately 60 per cent of students, there will be no increase to the maximum SCAs, and, in fact, for many students, there will be a significant decrease in their maximum SCAs.

 

In response to public feedback on the Job-ready Graduates Package, a lower maximum SCA of $7,950 will now apply to psychology and social work units of study for non-grandfathered students from 1 January 2021.

 

However, as noted in the table above, the maximum SCAs for students studying Law, Accounting, Administration, Economics, Commerce, Communications, and Society and Culture (in funding cluster one), and Visual and Performing Arts (in funding cluster two) are increasing. These changes better align funding per student place to the cost of delivering university education and increase the level of support going to fields of study that will contribute to national priorities and future prosperity. Australia’s world-leading HECS-HELP loans system will continue to ensure that eligible students face no up-front cost barriers to higher education attainment.

 

Further, current students will not be affected by this increase in maximum SCAs. The changes made by this item ensure that any ‘grandfathered students’ (as defined by Schedule 1) that enrol in a unit of study after 1 January 2021 do not have to pay the higher SCA where the SCA for that unit would otherwise increase as a result of the amendments being made by the Bill. Grandfathered students in the affected funding clusters will pay the following maximum SCAs:

 

 

Funding cluster part

Maximum student contribution amount

For a place in a unit in Law, Accounting, Administration, Economics or Commerce

$11,355

For a place in a unit in Communications or Society and Culture

$6,804

For a place in a unit in Visual and Performing Arts

$6,804

For a place in a unit in Professional Pathway Psychology or Professional Pathway Social Work

$6,804

 

Three examples are set out below to illustrate how the changes to maximum SCAs will operate for different types of students.

 

Example 1 - ‘grandfathered student’ getting the benefit of the lower maximum SCA

 

Ashley is currently enrolled in a nursing degree as a Commonwealth supported student. Ashley is studying full-time and plans to graduate at the end of 2021.

 

From 1 January 2021, the maximum SCA for a full-time student enrolled in nursing units of study will be $3,950 per year. Before 1 January 2021, the maximum SCA for a full-time student enrolled in nursing units of study was $6,804 per year. Ashley is a ‘grandfathered student’ as they are studying a course of study as a Commonwealth supported student and they did not complete their course prior to

1 January 2021. However, as the maximum SCA for nursing will be lower than the current maximum SCA for nursing, Ashley will pay no more than the new lower maximum SCA for any nursing units of study they enrol in after 1 January 2021 i.e. $3,950 per year. This means Ashley will likely pay $2,854.00 less in student contributions for their final year of study in 2021.

 

Example 2 - ‘grandfathered student’ who will pay the current lower maximum SCAs

 

KC is currently enrolled in a law degree as a Commonwealth supported student. KC is studying full-time and plans to graduate at the end of 2021.

 

From 1 January 2021, the maximum SCA for a full-time student enrolled in law units of study will increase from $11,355 per year to $14,500 per year. KC is a ‘grandfathered student’ as they are studying a course of study as a Commonwealth supported student and they did not complete their course prior to 1 January 2021. As the maximum SCA for law units is increasing, and KC is a grandfathered student, the changes being made by item 5 mean they will pay no more than the current lower maximum SCA for units of study, for the remainder of their degree.

 

Example 3 - ‘non-grandfathered student’ who will pay the new maximum SCAs

 

Khadija is a Year 12 student seeking to enrol in an Arts degree with a major in political science. Khadija is seeking to commence studies in semester 1, 2021.

 

Political science aligns with the Society and Culture part of funding cluster one. From 1 January 2021, the maximum SCA for a full-time student studying Society and Culture units of study is $14,500 per year. Before 1 January 2021, the maximum SCA studying the same units in Society and Culture would have been $6,804 per year. Khadija will be a ‘non-grandfathered student’ as they will not be enrolled in their course until after 1 January 2021. They will need to pay up to the higher maximum SCA for any Society and Culture units of study in which they enrol.

Item 6 - Subsection 198-5(1) (table item 3)

 

Item 6 makes a minor technical amendment to table item 3 at subsection 198-5(1) to replace a reference to ‘Maximum student contribution amounts for places’ with ‘Maximum student contribution amount for a place.’

 

Item 7 - Subsection 238-10(1) (table item 2)

Item 7 amends item 2 of the table at subsection 238-10(1) to remove the reference section 93-10. This is a minor technical amendment required as a result the amendments made by item 5.

 

Item 8 - Subclause 1(1) of Schedule 1 (definition of maximum student contribution amount for a place )

Item 8 makes a minor technical amendment to the definition of ‘maximum student contribution amount for a place’ to refer to section 93-10 rather than subsection 93-10(1). This amendment is required to reflect the amendments being made to section 93-10 (see item 5).

 

 

Division 2 - Application provisions

 

Item 9 - Application of amendments

 

Item 9 provides that the amendments to sections 93-5 and 93-10 of HESA made by Schedule 2 apply in relation to a unit of study that has a census date that is on or after 1 January 2021, whether the unit of study is part of a course of study commenced before, on or after that day.

 

Item 10 - Indexation

 

Item 10 provides that, despite anything in Division 198 of Part 5-6 of HESA, an amount specified in section 91-30, as amended by Schedule 2, is not to be indexed on 1 January 2021. However, the indexation provisions in Part 5-6 of HESA will apply to these amounts on and after 1 January 2022.

 

Part 2 - Amendments commencing 1 January 2021

 

Higher Education Support Amendment (2009 Budget Measures) Act 2009

 

Item 11 - Item 3 of Schedule 5

Item 11 repeals item 3 of Schedule 5 of the Higher Education Support Amendment (2009 Budget Measures) Act 2009 . The repeal of this item effectively ends the 2009 saving arrangements for education and nursing students, and will mean that those students get the benefit of the lower SCAs being applied through this Bill - they currently pay an SCA of up to $4085 and this will reduce to $3,950.

 

The repeal of this provision does not have any effect on the previous operation of this provision, due to the operation of section 7 of the Acts Interpretation Act 1901 .  

 



 

Schedule 3   Other Grants

 

Summary

 

Schedule 3 provides legislative authority for the National Priorities and Industry Linkage Fund (NPILF), and will allow for the transition arrangements required to implement the Indigenous, Regional and Low Socio-Economic Status Attainment Fund (IRLSAF).

 

Detailed explanation

 

Part 1 - Amendments commencing day after Royal Assent

 

Higher Education Support Act 2003

 

 

Item 1 - After paragraph 19-110(3)(c)

 

Item 1 amends subsection 19-110(3) to require that two additional matters must be included in a Table A or Table B provider’s mission based compact for a grant year:

(a)   a statement of the provider’s strategies for engaging with industry; and

(b)   a statement of the provider’s strategies for improving equality of opportunity in higher education.

 

This item will facilitate the requirement for Table A or Table B provider’s mission based compact to devise a three year roadmap outlining how they will meet the objects of the NPILF and the IRLSAF.

 

Item 2 - Application of amendment

 

Item 2 provides that the amendment of subsection 19-110(3) made by item 1 applies in relation to a mission based compact in respect of 2021 and later years. This means that any mission based compact made for 2021 that is finalised in 2020 must include the new requirements inserted into HESA by item 1.

 

Part 2 - Amendments commencing 1 January 2021

 

Higher Education Support Act 2003

 

Item 3 - After subparagraph 2-1(b)(iii)

 

Item 3 amends the objects of HESA included in paragraph 2-1 to provide that one of the distinctive purposes of universities is the engagement with industry and the local community to enable graduates to thrive in the workforce.

 

Universities will be encouraged to leverage better industry relationships to provide more work-integrated learning opportunities for students and be more responsive to industry needs.

 

Items 4 and 5 - Paragraphs 30-25(3)(b), (ca), (d) and (da), Subparagraphs 33-1(1)(b)(i) and (iii)

 

Items 4 and 5 amend subsections 30-25(3) and 33-1(1) to remove references to the regional loading and the enabling loading. These loadings are currently added to a provider’s CGS total grant amount for a year (see section 33-1), as calculated in accordance with the CGS Guidelines.

 

As part of the Job-ready Graduates Package, the regional loading and the enabling loading will no longer be applied to a provider’s CGS grant amount. Rather, the funding currently provided through these loadings will now be provided as grants under the IRLSAF.

 

To further improve equality of opportunity in higher education, the IRLSAF will be established by consolidating a number of smaller programs and loadings to allow universities to use their own funding more flexibly to best serve the needs of their local community, whether through outreach, building aspirations or enabling courses to prepare students for entry into higher education.

 

In regional areas, where demand for places is lower, the IRLSAF will allow universities to engage more with schools and communities to build aspiration for higher education and help build pathways to improve access, directly responding to a recommendation of the 2019 Provider Category Standards Review.  

 

The IRLSAF will be established as a new program under the Other Grants Guidelines for the purposes of table item 1 of subsection 41-10(1). The objective of the IRLSAF is to provide grants to providers to incentivise them to enrol Indigenous, regional and remote, and low socio-economic students.

 

Item 6 - Subsection 41-10(1) (cell at table item 1, column headed “Who is eligible”)

 

Item 6 amends table item 1 at subsection 41-10(1) to provide that bodies corporate that are specified in the Other Grants Guidelines are also eligible for grants made under Part 2-3 (Other Grants) of HESA for the purposes of promoting equality of opportunity in higher education.

 

This is a transitional amendment to ensure that providers, that are not Table A providers and that currently have the regional loading and enabling loading applied to their CGS grant amounts under Part 2-2 of HESA, can receive grants under the IRLSAF for the transition period from 2021 to the end of 2023. The transitional arrangements for the IRLSAF will be implemented through changes to the Other Grants Guidelines.

 

Item 7 - Subsection 41-10(1) (at the end of the table)

 

Item 7 amends the table at subsection 41-10(1) to include a new purpose for which grants may be given to eligible providers under Part 2-3 (Other Grants) of HESA, being to encourage higher education providers to engage with industry.

 

This amendment will provide legislative authority for the NPILF. Grants will be made to Table A providers under the NPILF to incentivise those providers to engage with industry and, thereby, deliver teaching that will produce job-ready graduates.

 

In support of the Australian Government’s initiative to improve the job-readiness of graduates, the NPILF will be established to specifically encourage universities to build on existing industry engagement activities to design courses that better equip students with the skills they require to thrive in the workforce.

 

NPILF grants will drive the creation of courses that focus on innovation and provide the skills and knowledge graduates need for a successful future. The NPILF will allow universities to leverage better industry relationships to provide more work-integrated learning opportunities for students and be more responsive to industry needs.

 

 

 

 

 

 

 

 

 

 



Schedule 4   Student protection

 

Summary

 

Schedule 4 of the Bill amends the Provider Integrity Act to extend various quality and accountability requirements contained in HESA to all higher education providers (now including Table A, B and C universities), and also introduces new student protection measures in HESA (that would again apply to all providers). These amendments will support work being done in the higher education sector around best practice approaches to student enrolment and progression, and will

re-signal the quality of Australia’s higher education sector both domestically and internationally.

 

Detailed explanation

 

Part 1—Amendments commencing 1 January 2021

 

Division 1—Amendments

 

Education Legislation Amendment (Provider Integrity and Other Measures) Act 2017

 

Item 1 - At the end of Part 2 of Schedule 3

 

Schedule 3 to the Provider Integrity Act amended HESA to introduce a range of measures to protect students and prospective students from unscrupulous behaviour by higher education providers, as well as to enhance monitoring and oversight of providers. These measures included:

·          enhanced financial reporting requirements for, and improved assessment of the financial viability of providers by the Department;

·          limits and prohibitions on providers engaging in certain marketing practices, such as offering people inducements to enrol, cold-calling, and misrepresenting the nature of HELP loans (e.g. that courses are ‘free’ or ‘fully paid by the government’);

·          requiring providers to assess prospective students as academically suitable before enrolling them;

·          requiring providers to co-operate with officers of the department and TEQSA undertaking audits;

·          requiring providers to keep records and to publish information specified in the Higher Education Provider Guidelines (including on course costs);

·          applying civil penalties to existing obligations on providers under Division 19 of HESA;

·          precluding providers from imposing financial or administrative barriers to a student withdrawing from study; and

·          imposing additional requirements on students for entitlement to FEE-HELP assistance, including that the student:

o    is a genuine student; and

o    has a satisfactory unit completion rate.

These measures followed on from similar amendments to Schedule 1A to HESA (which governed the operation of the VET FEE-HELP scheme until its closure at the end of 2016) made by the Higher Education Support Amendment (VET FEE-HELP Reform) Act 2015 to address identified inadequacies in the VET FEE-HELP scheme in managing VET provider behaviour. These provider integrity and student protection measures were also reflected in the VET student loans scheme established in 2017 under the VSL Act.

 

Part 2 of Schedule 3 to the Provider Integrity Act contains provisions that set out how the measures mentioned above are to apply. Currently, item 44 of Schedule 3 to that Act provides that those measures only apply to higher education providers approved under section 16-25 of HESA, that is, private, non-university higher education providers. However, the measures do not currently apply to the universities that are listed in Subdivision 16-B of HESA, the Table A (public Australian university), Table B (private Australian university) and Table C (overseas university) providers.

 

Item 1 of Schedule 4 to the Bill inserts a new item 45 at the end of Part 2 of Schedule 3 to the Provider Integrity Act. The effect of new item 45 will be to apply the provider integrity and student protection measures set out in Part 1 of Schedule 3 to that Act to the universities listed in Subdivision 16-B of HESA, with most of those measures coming into effect from 1 January 2021 (the unit completion measure will commence on 1 January 2022 - see Part 2 of Schedule 4). This will ensure that all higher education providers approved under HESA will be subject to the same requirements and subject to the same standards of integrity, and all students studying at any such provider will be provided the same protections.

 

This amendment is intended to dovetail with the further amendments to HESA set out in Schedule 4 to the Bill, that provide further protections for Commonwealth supported students and students in receipt of FEE-HELP assistance.

 

Higher Education Support Act 2003

 

Item 2 - Paragraph 19-10(2)(ab)

 

Item 2 corrects a drafting error in paragraph 19-10(2)(ab) of HESA by inserting the word ‘must’ at the start of the paragraph.

 

Items 8 and 9 - Section 19-80 (heading) and Subsection (1)

 

Section 19-80 of HESA empowers the Minister to arrange for an audit of a higher education provider of its compliance with HESA. Currently, Table A providers cannot be audited under this section. Item 9 amends section 19-80 to enable Table A providers to be audited, and item 8 makes a consequential amendment to the heading of the section.

 

Item 11 - At the end of section 36-5

 

Item 11 inserts new subsections 36-5(5), (6) and (7) at the end of section 36-5 of HESA.  Section 36-5 sets out when a person is a Commonwealth supported student for the purposes of HESA. New subsection 36-5(5) provides that a person is not a Commonwealth supported student if the Secretary is determines that the person is not a genuine student, having regard to any matters specified in the Higher Education Provider Guidelines (see sub­section 36-5(6)).

 

The requirement for a Commonwealth supported student to be a genuine student will mirror the requirement for entitlement to FEE-HELP assistance (currently in paragraph 104-1(1)(ab) of HESA) and the requirement for eligibility for payment of a VET student loan (see paragraph 20(c)(ii) of the VSL Act). This will ensure that people who merely enrol in a unit of study (or who their provider purports to enrol in a unit of study) but who do not actually undertake any study and show no intention of undertaking any study, do not receive Commonwealth financial assistance and do not incur HELP debts for HECS-HELP assistance loaned to them.

 

Subsection 36-5(7) provides that a determination by the Secretary under subsection

36-5(5) is not a legislative instrument. This provision is explanatory only, as such a determination will be an administrative decision in relation to a particular student and unit of study, and not of legislative character.

 

A determination that a person is not a genuine student in relation to a unit by the Secretary under subsection 36-5(5) will be a reviewable decision (see item 32).

 

Item 13 - After paragraph 36-10(1)(b)

 

Item 13 inserts a new paragraph (ba) into subsection 36-10(1) of HESA.

Sub­section 36-10(1) sets out circumstances in which a higher education provider must not advise a person that they are a Commonwealth supported student (which results in them not being a Commonwealth supported student, see paragraph

36-5(1)(b)).

 

The effect of new paragraph 36-10(1)(ba) is that a higher education provider must not advise a person that they are a Commonwealth supported student in relation to a unit unless the person has been assessed by the provider, in accordance with section 19-42, as academically suited to undertake the unit.

 

The new provision mirrors the requirement that students must be academically suitable to undertake a unit of study to be entitled to FEE-HELP assistance for that unit under paragraph 104-1(1)(ac) of HESA (inserted by the Provider Integrity Act), and the requirement that students must be academically suitable to undertake a course to be eligible for a VET student loan for the course under section 12 of the VSL Act.

 

Item 14 - After section 36-10

 

Item 14 inserts a new section 36-12 after section 36-10 in HESA.

 

New section 36-12 puts in place a study load limit on Commonwealth supported students. Under this section a higher education provider must not advise a person that they are a Commonwealth supported student in relation to a unit of study (the ‘new unit’) if the total EFTSL value of all the units the student has studied during the preceding 12 month period (for which the person was or would be entitled to

HECS-HELP assistance or FEE-HELP assistance
but for the previous operation this new section), plus the new unit, is more than 2.

 

A person is only a Commonwealth supported student in relation to a unit of study if the higher education provider with whom they are enrolled has advised them in writing that they are a Commonwealth supported student, and the provider was not prohibited from doing so - see subsection 36-5(1) of HESA. Each unit of study has an EFTSL value, as determined by the higher education provider in accordance with the Administration Guidelines - see sections 169-25, 169-27 and 169-28 of HESA. A full-time study load for a student for a year is 1.0 EFTSL - that is, over the course of the year, the student undertakes units whose EFTSL values sum to 1. Under this new section, if a student’s study load will have an EFTSL value of more than 2, the student will not be Commonwealth supported in relation to the unit unless the exception in subsection (2) applies.

 

Under subsection (2), a higher education provider is able to determine that, notwithstanding that a person’s study load has an EFTSL value of more than 2, the person’s study load is not unreasonable, and hence the provider can advise the person they are a Commonwealth supported student. In doing so, the provider must have regard to whether the person has demonstrated capacity and capability to successfully complete units of study that have a total EFTSL value of more than 2, as well as any other matter specified in the Higher Education Provider Guidelines. Decisions of higher education providers about unreasonable study loads under subsection (2) must be made in accordance with the Higher Education Provider Guidelines (subsection (3)).

 

Subsection (4) provides that a determination made by a higher education provider under subsection (3) is not a legislative instrument. This provision is explanatory, and does not alter the character of the determination, which is an administrative decision relating to a particular person and their circumstances. Such a decision is a reviewable decision under HESA (see item 32).

 

A similar section is being inserted into Division 104 (see item 27), to put in place the same study load limit on students’ entitlement to FEE-HELP assistance.

 

Items 3, 4, 5, 6, 7, 10, 12, 16, 17, 18, 35 and 36 - Amendments consequential to items 14 and 40

 

These items make minor amendments to provisions in Division 36 of HESA as a consequence of the insertion of new section 36-12 made by item 14 and a new section 36-13 made by item 40.

 

Items 3, 4, 5, 6, 7, 16, 31 and 32 amend provisions that refer to decisions being made by providers under the existing section 36-20 of HESA so that they refer to decisions being made under both section 36-12 and section 36-20.

 

Items 10, 17 and 18 amend provisions that refer to the current provisions that set out when a provider must not advise a person that he or she is a Commonwealth supported student, to include all such provisions in Subdivision 36-B (i.e. including the new sections 36-12 and 36-13).

 

Item 12 amends the heading to section 36-10 to clarify that it is a general provision which describes when a provider can advise a person that he or she is a Commonwealth supported student (with sections 36-12, 36-13 and 36-15 setting out additional rules).

 

Item 15 - At the end of section 36-15

 

Item 15 inserts a new subsection (5) at the end of section 36-15 of HESA. New subsection 36-15(5) provides that a higher education provider must not advise a person that they are a Commonwealth supported student in relation to a unit of study if the provider has completed any part of the person’s request for Commonwealth assistance for the unit (or the course for which the unit forms a part) that the person themselves is required to complete.

 

This provision replicates subsection 104-1(4) in relation to a student’s entitlement to FEE-HELP assistance for a unit of study. Subsection 104-1(4) was inserted into HESA by the Provider Integrity Act. Like that subsection, the purpose of the new subsection 36-15(5) is to ensure that a higher education provider does not complete a person’s request for Commonwealth assistance without the person’s knowledge, including those parts of the form where the person acknowledges that they will be receiving a loan from the Australian Government and that they understand their obligations.

 

Item 19 - At the end of subsection 36-30(3)

 

Section 36-30 of HESA requires higher education providers to enrol certain persons as Commonwealth supported students. Paragraph 36-30(1)(b) (which is amended by item 17) makes it clear that a Table A provider does not have to enrol a person as a Commonwealth supported student if the provider is prohibited from advising the person that he or she is a Commonwealth supported student. (A person cannot be a Commonwealth supported student unless their provider has advised them that they are and is not prohibited from doing so - see subsection 36-5(1)).

 

However, there is no equivalent provision for other higher education providers under subsection 36-30(3). This is an inadvertent omission - a higher education provider should not be required to enrol a person as a Commonwealth supported student if the provider cannot legally advise the student that they are a Commonwealth supported student (due to the operation of subsection 36-5(1)). Consequently, item 19 will insert a new paragraph at the end of subsection 36-30(3) to make it clear that a provider that is not a Table A provider does not have to enrol a person as a Commonwealth supported student if the provider is prohibited from advising the person that they are a Commonwealth supported student in relation to the unit.

 

Items 20 and 21 - Sections 90-1 and 90-10

 

Section 90-10 provides that a student is not entitled to HECS-HELP assistance for a unit of study if the unit is part of a course of study that the student will undertake primarily at an overseas campus.

 

In order to be entitled to HECS-HELP assistance for a unit of study, a student must be a Commonwealth supported student in relation to the unit - see paragraph 90-1(c).

 

Subsection 36-15(1A) provides that a higher education provider must not advise a person that he or she is a Commonwealth supported student in relation to a unit of study if the unit contributes to a course of study that the student will undertake primarily at an overseas campus. Under paragraph 36-5(1)(b), a person is not a Commonwealth supported student in relation to a unit of study if their provider is prohibited from advising them they are a Commonwealth supported student.

 

In short, irrespective of section 90-10 of HESA, a person cannot be a Commonwealth supported student in relation to a unit of study if the unit contributes to a course of study that the student will undertake primarily at an overseas campus, and hence cannot be entitled to HECS-HELP assistance for that unit.  Section 90-10 of HESA is duplicative and redundant.

 

Consequently, item 21 repeals section 90-10 of HESA, and item 20 makes a consequential amendment to the text of section 90-1 to remove the reference to section 90-10.

 

Item 22 - At the end of Division 96

 

Item 22 inserts new sections 96-5 and 96-10 at the end of Division 96 of HESA.

 

New section 96-5 describes the effect of a person’s HELP balance being

re-credited under Division 97 of HESA, and new section 96-10 describes the implications for a student’s liability to their higher education provider for SCA if the student’s HELP balance is re-credited under Division 97 of HESA.

 

Section 96-5

 

Subsection 96-5(1) provides that, if a person’s HELP balance is re-credited under Division 97 with an amount relating to HECS-HELP assistance for a unit of study, the provider must pay to the Commonwealth an amount equal to the amount of HECS-HELP assistance to which the person was entitled for the unit. The note under subsection (1) explains that the provider must repay this amount even if the person’s HELP balance is not increased by an amount equal to the amount re-credited. This subsection clarifies the obligations of providers when a student’s HELP balance is re-credited.

 

Subsection 96-5(2) provides that subsection 96-5(1) does not apply to the provider if:

(a)   the person’s HELP balance was re-credited under subsection 97-25(2) (which deals with the main case of re-crediting a person’s HELP balance); and

(b)   the person enrolled in the unit in circumstances that make it a replacement unit within the meaning of the tuition protection requirements (the tuition protection requirements are described in section 16-30).

 

Generally speaking, under the tuition assurance arrangements, when one provider ceases providing a unit of study (e.g. because they have gone into administration), a student can elect to continue their studies with another provider. The replacement provider is unable to charge a SCA for the replacement unit, and does not receive the payment of the student’s HECS-HELP assistance for the replacement unit (which will already have been paid to the original provider). If the student then fails to complete the replacement unit because of circumstances beyond their control (special circumstances), new subsection 96-5(2) will ensure that the replacement provider does not then have to pay the Commonwealth anything.

 

Subsection 96-5(3) provides that the Higher Education Provider Guidelines may, in setting out the tuition protection requirements, specify, in relation to the re-crediting of a person’s HELP balance in circumstances to which subsection 96-5(2) applies:

(a)   the amount (if any) that is to be paid to the Commonwealth; and

(b)   the person (if any) who is to pay the amount.

 

Section 96-10

 

Section 96-10 provides that, if a person’s HELP balance is re-credited with an amount relating to HECS-HELP assistance for a unit of study, the student is discharged from all liability to pay or account for so much of the student’s SCA for the unit as is equal to that amount.

 

The purpose of this provision is to protect students from unscrupulous higher education providers that may seek to recover SCAs from them, where the provider has had to pay an amount back to the Commonwealth.

 

Under subsection 169-15(1) of HESA, a higher education provider must require a Commonwealth supported student to pay their SCA for a unit of study. In turn, if the student is entitled to HECS-HELP assistance for the unit, section 96-1 provides that the Commonwealth must lend the student the HECS-HELP assistance and pay that amount to the provider. In doing so, the payment of the HECS-HELP assistance to the provider discharges the student’s liability to pay their SCA.

 

In the circumstances set out in Division 97, a student’s HELP balance can be re-credited by an amount equal to the amount of HECS-HELP assistance loaned to the student for a unit. Under new section 96-5, when that happens, the higher education provider must pay the Commonwealth that same amount - in essence, the provider must repay the Commonwealth the HECS-HELP assistance that the Commonwealth paid to the provider.

 

Although section 96-1 of HESA also operates to discharge the student’s liability to the provider for their SCA, its operation is contingent on the student being entitled to HECS-HELP assistance. Under new section 97-50 (see item 23), it is possible for a person’s HELP balance to be re-credited where they are not entitled to

HECS-HELP assistance, and the provider is required to repay the HECS-HELP assistance they have received for the student under section 96-5.  Section 96-10 will preclude the provider seeking to recoup that money from the student.

 

Section 96-10 replicates, in relation to HECS-HELP assistance, the operation of clause 51A of Schedule 1A to HESA in relation to VET FEE-HELP assistance.  A similar provision, new section 110-10, will be inserted to deal with attempts by unscrupulous providers to recoup amounts of FEE-HELP assistance from students (see item 30).

 

Item 23 - At the end of Division 97

 

Item 23 inserts new sections 97-45 and 97-50 at the end of Division 97 of HESA.

 

New sections 97-45 and 97-50 include two new situations in HESA where a student’s HELP balance must be re-credited.

 

Section 97-45

 

Subsection 97-45(1) provides that a higher education provider must, on the Secretary’s behalf, re-credit a person’s HELP balance with an amount equal to the amounts of HECS-HELP assistance that the person received for a unit of study if the provider completes any part of the request for Commonwealth assistance in relation to the unit that the person is required to complete. The note after subsection (1) explains that a HECS-HELP debt relating to a unit of study is taken to be remitted if the HELP balance in relation to the unit is re-credited under section 97-45.

 

Subsection 97-45(2) provides that the Secretary of the Department may re-credit the person’s HELP balance under section 97-45 if the provider is unable to do so.

 

This section replicates the operation of subsection 104-44(1) in relation to

FEE-HELP assistance, and complements the amendment made to section 36-15 by item 15. Section 104-44 of HESA was inserted by the Provider Integrity Act. Like subsection 104-44(1), the purpose of section 97-45 is to address the behaviour by unscrupulous providers of completing a person’s request for Commonwealth assistance form with little to no involvement by the person themselves - that is, the provider simply fills in all the forms for the person, including those under which the person receives a HELP loan from the Commonwealth, which they have to repay, without the person ever realising that they are obtaining a HELP loan and incurring a liability to the Commonwealth.

 

Section 97-50

 

Subsection 97-50(1) provides that a higher education provider must, on the Secretary’s behalf, re-credit a person’s HELP balance with an amount equal to the amounts of HECS-HELP assistance that the person received for a unit of study if the provider or the Secretary is satisfied that the person was not entitled to receive HECS-HELP assistance for the unit of study with the provider. The first note under subsection (1) includes the following example to explain this section: a person is not entitled to HECS-HELP assistance for a unit of study if the person is not a Commonwealth supported student in relation to the unit: see section 90-1.

 

Subsection 97-50(2) provides that the Secretary of the Department may re-credit the person’s HELP balance under section 97-50 if the provider is unable to do so.

 

Importantly, this section will enable a person’s HELP balance to be re-credited by an amount of HECS-HELP assistance that the person was not entitled to because the person was not a Commonwealth supported student in relation to that unit. Whether a person is a Commonwealth supported student in relation to a unit is set out in section 36-5 of HESA, and Subdivision 36-B sets out a number of circumstances in which a higher education provider must not advise a person that he or she is a Commonwealth supported student.

 

This section replicates the operation of subsection 104-44(2) in relation to

FEE-HELP assistance. In addition, because a person who is not a genuine student in relation to a unit of study or who has not been assessed as academically suited to undertake the unit cannot be a Commonwealth supported student in relation to the unit (see items 11 and 13), and is therefore not entitled to HECS-HELP assistance for the unit, new section 97-50 also covers the same grounds for

HECS-HELP assistance as section 104-43 and subsection 104-44(3) cover in relation to FEE-HELP assistance.

 

Items 24, 27 and 28 - Subsections 104-1(1), After section 104-1 and At the end of Subdivision 104-A

 

Item 27 inserts a new section 104-1AA into HESA. New section 104-1AA puts in place a study load limit on a student’s entitlement to FEE-HELP assistance. This new section operates in the same way as new section 36-12 (see item 14), except that it relates to entitlement to FEE-HELP assistance.

 

Item 24 makes a minor consequential amendment to subsection 104-1(1), to include reference to the new section 104-1AA as affecting a person’s entitlement to FEE-HELP assistance under that subsection.

 

Item 28 will insert a new section 104-12 that enables the Secretary of the Department to make decisions under subsection 104-1AA(2) (i.e. whether or not a person has an unreasonable study load) if the higher education provider is not able to do so. This is consistent with the other provisions in Division 104 that empower the Secretary to act where a provider is unable to do so - see, for example, subsections 104-25(3), 104-42(2), 104-43(2) and 104-44(4).

 

Items 25, 26 and 29 - Paragraph 104-1(1)(ab), Subsection 104-1(1A) and Paragraph 104-43(1)(b)

 

Paragraph 104-1(1)(ab) provides that, in order for a student to be entitled to

FEE-HELP assistance for a unit of study, the person must be a genuine student. This provision was inserted by the Provider Integrity Act, and is intended to enable amounts of FEE-HELP assistance that have been paid to higher education providers for persons enrolled by them, but who have never undertaken any study, to be recouped and for the person’s HELP debt for the unit to be remitted (see sections 104-43, 110-5 and 137-10 of HESA).

 

The paragraph operates as a criterion for entitlement to FEE-HELP assistance for a unit. However, whether or not a person is a genuine student for a unit is a matter that is generally only capable of being ascertained after the student has enrolled in the unit, the census date for the unit has passed, and an amount of FEE-HELP assistance has already been loaned to the student and paid to their provider. In that sense, whether a person is a genuine student is something that results in an entitlement to FEE-HELP assistance that the person has already received being withdrawn, rather than a criterion for entitlement in the first place.

 

Accordingly, items 25 and 26 amend section 104-1 of HESA to ensure that the genuine student requirement does not have to be assessed before an amount of FEE-HELP assistance is loaned to the person, but can be assessed after that time, by reference to the person’s engagement in the unit of study, and other relevant factors set out in the Higher Education Provider Guidelines.

 

Item 26 will insert new subsections (1AA), (1AB) and (1AC) into section 104-1 that mirror, for FEE-HELP assistance, the operation of new subsections 36-5(5), (6) and (7) inserted by item 11 for Commonwealth support.

 

Item 25 will repeal the now redundant paragraph 104-1(1)(ab). Item 29 amends paragraph 104-43(1)(b) to make it clear that a provider must re-credit a person’s HELP balance where the Secretary of the Department has determined under subsection 104-1(1AA) that the student is not a genuine student in relation to the unit.

 

A determination that a person is not a genuine student in relation to a unit by the Secretary under subsection (1AA) will be a reviewable decision (see item 33).

 

Item 30 - At the end of Division 110

 

Item 30 inserts a new section 110-10 at the end of Division 110 of HESA.

 

New section 110-10 provides that, if, under Subdivision 104-B, a student’s HELP balance is re-credited with an amount relating to FEE-HELP assistance for a unit of study, the student is discharged from all liability to pay or account for so much of the student’s tuition fee for the unit as is equal to that amount.

 

This new provision has substantially the same effect as new section 96-10 (see item 22), except in relation to FEE-HELP assistance.

 

Item 31 - Subsection 137-5(5)

 

Item 31 makes a consequential amendment to subsection 137-5(5) to refer to all of Division 97, noting that additional re-crediting provisions are being inserted by item 23.

 

Items 32, 33 and 34 - Section 206-1 (after table item 1AB), (after table item 1B) and (note 1)

 

Administrative decisions relating to whether a person is a Commonwealth supported student or entitled to FEE-HELP assistance are made by higher education providers and the Secretary under sections 36-5, 36-12, 104-1, 104-1AA and 104-1A as inserted or amended by the Bill.

 

Items 32 and 33 will amend the table in section 206-1 of HESA to provide that those decisions are reviewable decisions under HESA.

 

Item 34 makes a consequential amendment to note 1 of section 206-1 to reflect the changes being made by items 32 and 33.

 

Item 37- Subsection 238-10(1) (table item 6)

 

Item 37 amends item 6 of the table at subsection 238-10(1) to specify that matters in Division 36, Subdivision 104-A and sections 96-5 and 110-5 may be included in the Higher Education Provider Guidelines.

 

 

Division 2 - Application provision

 

Item 38 - Application of amendments

 

Subitems 38(1) and (2) provide that sections 36-5, 36-10, 36-12, 36-15, 97-45, 97-50, 104-1 and 104-1AA, as amended or inserted by this Bill, apply in relation to any unit with a census date on or after 1 January 2021 (including a unit that is part of a course commenced before 1 January 2021).

 

Subitems 38(3) provides that sections 96-10 as inserted by this Bill, applies in relation to any unit of study in respect of which a student becomes liable, on or after 1 January 2021, to pay a SCA (whether the unit of study is part of a course of study commenced before, on or after that day).

 

Subitem 38(4) provides that section 110-10, as inserted by this Bill, applies in relation to any unit of study in respect of which a student becomes liable, on or after 1 January 2021, to pay a tuition fee (whether the unit of study is part of a course of study commenced before, on or after that day).

 

Part 2—Amendments commencing 1 January 2022

 

Division 1—Amendments

 

Education Legislation Amendment (Provider Integrity and Other Measures) Act 2017

 

Item 39 - After subitem 45(7) of Part 2 of Schedule 3

 

Item 39 inserts a new subitem (7A) into item 45 in Part 2 of Schedule 3 to the Provider Integrity Act. The new subitem 45(7A) provides that section 104-1A of HESA (as inserted by the Provider Integrity Act) applies to units of study in which a person enrols with a provider approved under section 16-5 of HESA (i.e. a university) on or after 1 January 2022. Section 104-1A imposes a unit completion requirement on a student’s entitlement to FEE-HELP assistance.

 

Higher Education Support Act 2003

 

Item 40 - After section 36-12

 

Item 40 inserts a new section 36-13 into HESA. New section 36-13 puts in place a minimum unit completion rate for Commonwealth supported students. This section mirrors the existing sections 104-1A and 104-2, which impose a minimum unit completion rate for entitlement to FEE-HELP assistance.

 

Under new subsection 36-13(1), a higher education provider must not advise a person that he or she is a Commonwealth supported student in relation to a unit of study that is part of a course of study if the person has previously undertaken a certain number of units in the same course, and has not successfully completed at least half of them.

 

If the course in question leads to an award of a bachelor degree or higher qualification, once a person has undertaken at least eight units in the course, they must successfully complete at least half of the units in the course (including previous ones) to continue to be a Commonwealth supported student in relation to any subsequent unit in the course. In relation to any other course, once the person has undertaken at least four units in the course, they must successfully complete at least half of the units in the course (including previous ones) to continue to be a Commonwealth supported student in relation to any subsequent unit in the course.

 

However, under subsection 36-13(2), a unit is not to be counted towards the number of units that a person has not successfully completed if the higher education provider has determined that section 36-20 of HESA applies to the unit. Section 36-20 enables a higher education provider to remit a person’s HECS-HELP debt in relation to a unit that the person has not completed due to special circumstances (as defined in section 36-21) applying to the person.

 

New section 36-13 will help to prevent students from being burdened with a significant debt where they have obtained limited or no benefits from study, and seeks to ensure positive educational, training or employment outcomes for all students. While this provision may have the potential to limit a student's ability to access higher education at the margins, the Government aims to reduce barriers to education and to ensure that students are enrolling in appropriate courses for their aptitude and interests.

 

This new section will not penalise students for circumstances beyond their control, and the ability to have units discounted due to special circumstances is important and warranted. As such, new subsection 36-13(2) acknowledges the systems and processes that higher education providers have in place to identify, protect and provide support for vulnerable students who may be experiencing difficulty in their studies or who may not have the academic ability to undertake a specific higher education course.

 

Division 2 - Application provision

 

Item 41 - Application of amendment

 

Item 41 provides that new section 36-13 applies in relation to a unit of study if:

(a)   the unit of study is undertaken as part of a course of study; and

(b)   the student enrolled in the course of study on or after 1 January 2022; and

(c)   the unit of study has a census date that occurs on or after that day; and

(d)   the unit is provided by a higher education provider taken to be approved under section 16-5 of the Act, whether taken to be approved before or after that day.

 

 

 

 

 

 

 



 

Schedule 5   Other amendments

 

Summary

 

Schedule 5 of the Bill includes several miscellaneous amendments to HESA, including:

  • an amendment to subsection 142-1(2) to define a ‘school’ as including a ‘centre-based day care service’ - this change better aligns the legislation with the policy intention relating to very remote HELP debtors;
  • an amendment to remove the University College London (UCL) as a Table C provider, as UCL is no longer an approved higher education provider under HESA;
  • amendments to sections 27-5, 36-55, 51-5, 54-5, 57-1, 57-5 and 238-10 to remove references to the Tuition Fee Guidelines and the Reduction and Repayment Guidelines, as these guidelines have never been made;
  • amendments to the names of certain Table A and Table B providers listed at subsections 16-15(1) and 16-20(1) to better reflect the names of these providers that are included on the TEQSA National Register for Providers and Courses; and
  • an amendment to paragraph 137-10(2)(b) to reduce, for units of study with a census date on or after 1 January 2021, the loan fee for students obtaining a FEE-HELP loan for an undergraduate course of study at a non-Table B provider from 25 per cent to 20 per cent.

 

This Schedule also amends the SS Act to reduce (from six to three) the number of months a student living away from home must be receiving eligible student support payments to be eligible to receive Fares Allowance for a return journey home during the study year.

 

Detailed explanation

 

Part 1 - Amendments commencing on 1 January 2020

 

Higher Education Support Act 2003

 

Item 1 - Paragraph 142-1(2)(a)

 

Item 1 amends the definition of a ‘school’ in subsection 142-1(2) to repeal the current paragraph (a) which refers to ‘an early childhood education and care service that includes a preschool education program,’ and replace it with a reference to ‘an approved child care service (within the meaning of the A New Tax System (Family Assistance) (Administration) Act 1999) that is a centre-based day care service’.

 

This amendment applies retrospectively to better align the legislation with the policy intention relating to very remote HELP debtors from the date section 142 commenced (being 1 January 2020). The amendment is beneficial to students as it extends the concept of a ‘very remote HELP debtor’ to cover a broader range of students.

 

Part 2 - Amendments commencing day after Royal Assent

 

Higher Education Support Act 2003

 

Item 2 - Subsection 16-22(1) (table)

 

Item 2 amends the table at subsection 16-22(1) of HESA to remove the reference to UCL, as UCL is no longer an approved higher education provider under HESA.

 

Items 3, 4, 5 and 10 - Section 27-5, Subsection 36-55(1) (not including the heading), Subsection 36-55(2), Subsection 238-10(1) (table items 9 and 11)

 

Items 3, 4, 5 and 10 amend section 27-5, subsections 36-55(1) and (2), subsection 36-55(2) and table item 11 at subsection 238-10(1) to remove references to the Tuition Fee Guidelines, as these guidelines have never been made.

 

Items 6, 7, 8, 9 and 10 - Section 51-5, Paragraph 54-5(f), Subsection 57-1(1), Subsections 57-1(2) and 57-5(3), Subsection 238-10(1) (table items 9 and 11)

 

Items 6, 7, 8, 9 and 10 amend or repeal section 51-5, paragraph 54-5(f), subsections 57-1(1), (2), subsection 57-5(3), and table item 9 at subsection 238-10(1) to remove references to the Reduction and Repayment Guidelines, as these guidelines have never been made.

 

Part 3 - Amendments commencing on 1 January 2021

 

Higher Education Support Act 2003

 

Items 11, 12, 13, 14 and 15 - Subsection 16-15(1) (table), Subsection 16-20(1) (table)

 

Items 11 to 15 amend the tables at subsections 16-15(1) (which lists Table A providers) and 16-20(1) (which lists Table B providers) to update provider names to better reflect the names of these providers that are included on the TEQSA National Register for Providers and Courses.

 

Item 16 - After subparagraph 137-10(2)(b)(i)

 

Item 16 amends paragraph 137-10(2)(b) to reduce, for units of study with a census date on or after 1 January 2021, the loan fee for students obtaining a FEE-HELP loan for an undergraduate course of study at a non-Table B provider from 25 per cent to 20 per cent.

 

The FEE-HELP loan fee recognises the cost to the taxpayer of the Commonwealth providing HELP loans to cover fee paying undergraduate places. The reduction of the loan fee allows the HELP scheme to remain sustainable, while also reducing the financial burden on students and the total time taken to repay a HELP debt. This change also brings consistency to the tertiary sector by aligning the FEE-HELP loan fee with the 20 per cent VET student loan fee that is applied to VET student loans accessed by full fee paying VET students.

 

Social Security Act 1991

 

Item 17 - Subparagraph 1061ZAAB(c)(i)

 

Item 17 amends subparagraph 1061ZAAB(c)(i) of the SS Act to reduce the amount of time a student living away from home must be receiving either Youth Allowance, Austudy Payment, or Pensioner Education Supplement payments, before they can receive Fares Allowance for a return journey home during the study year, from six months to three months.

 

This measure enables students, mostly from regional and remote areas, to access Fares Allowance earlier in their studies for a return journey home, thereby improving their access to support systems and increasing the likelihood that these students will go on to complete their studies.

 

Item 18 - Application of amendment

 

Item 18 provides that the amendment to the SS Act made by item 17 of this Schedule applies in relation to the 2021 study year and later study years.