Source: https://www.legislation.gov.au/Details/C2017B00114/Explanatory%20Memorandum/Text
Timestamp: 2020-03-31 09:58:21
Document Index: 176373267

Matched Legal Cases: ['art 2', 'art 1', 'art 3', 'art 5', 'art 5', 'art 6']

· providing greater protection of Australian qualifications – this includes clarifying the definition of ‘vocational education and training course’ to make clear that courses which lead to Diplomas, Advanced Diplomas, Graduate Diplomas and Graduate Certificates are required to be accredited under the TEQSA Act or under vocational education laws
· bolstering financial viability and transparency requirements – these include requiring general purpose financial statements for providers of a certain size, and amending the definition of ‘qualified auditor’ to ensure that the auditor of a higher education provider’s financial statements must be a ‘registered auditor’ for the purposes of the Corporations Act 2001 or otherwise be approved by TEQSA.
· introduce more stringent provider application requirements – these include requiring a history of course delivery from the provider, the expansion of the fit and proper person requirement, an application exclusion period of six months after a failed application, and provisions for Commonwealth, State and Territory-established bodies to be exempt from the body corporate requirement
The amendments to the Higher Education Support Act 2003, the Education Services for Overseas Students Act 2000 and the Tertiary Education Quality and Standards Agency Act 2011 have no financial implications.
· providing greater protection of Australian qualifications– this includes clarifying the definition of ‘vocational education and training course’ to make clear that courses which lead to Diplomas, Advanced Diplomas, Graduate Diplomas and Graduate Certificates are required to be accredited under the TEQSA Act or under vocational education laws
· introduce more stringent provider application requirements – these include requiring a history of course delivery from the provider, the expansion of the fit and proper person requirement, an application exclusion period of six months after a failed application, and provisions for Commonwealth, State and Territory established bodies to be exempt from the body corporate requirement
· minimum fair trial guarantees (relating to the imposition of penalty provisions) – Article 15 of the ICCPR
Introducing requirements that students are ‘genuine’ and are assessed by providers as academically suited to undertake their proposed unit of study in order to be entitled to FEE-HELP assistance will protect vulnerable people from being expediently enrolled in higher education courses by less scrupulous providers and incurring a FEE‑HELP debt where they are not in a position to undertake and complete the course.
Imposing FEE-HELP eligibility standards is a reasonable and justifiable limitation designed both to protect students and ensure fiscal accountability and quality output from providers within the sector. Further, the measures in Schedule 3 seek to protect vulnerable people from being signed up for courses they are not academically suitable for, or from enrolling with providers who are unable to provide quality education – as shown by low or no completion rates. These measures are aimed at preventing vulnerable people from exploitation by unscrupulous providers who would leave these individuals with significant debt and no educational outcome. These measures will particularly benefit regional students, the unemployed, culturally and linguistically diverse communities, people with a disability and the elderly. This will enhance their access to higher education by ensuring that only providers who operate high quality courses with integrity are able to access the FEE‑HELP loan scheme.
The civil penalties allow for the punishment of non-Table A or B higher education providers’ misconduct without the need to impose criminal liability.[1] The magnitude of the civil penalties imposed is such that they are sufficient to act as a deterrent, although not carrying the stigma of a criminal conviction.[2]
The Bill creates civil penalty provisions in Divisions 19, 169, 174 and 238 of HESA which need to be assessed for this purpose. 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 disclosure obligation is subject to the statutory protections which apply under the spent convictions scheme in Part VIIC of the Crimes Act 1914. The Commonwealth Spent Convictions Scheme allows an individual to not disclose certain criminal convictions after a sufficient period of good behaviour, and also prohibits unauthorised disclosure and use of this information. It covers convictions for less serious Commonwealth, State (including the Northern Territory and ACT) and foreign offences, with varying protections available according to which type of offence (Commonwealth, State or foreign) gave rise to the conviction. The Scheme also covers pardons and quashed convictions. A conviction for a State offence may also be covered by a spent conviction scheme in the relevant State or Territory. There are some exclusions to the Scheme, but these are very limited.
The types of offences which may pose a risk to the provision of high quality educational services are not limited to those, for example, involving the commission of fraud, misuse of Commonwealth monies or breaches of the Corporations Act 2001. Other serious offences also go to the suitability of participants in the education sector, such as assault and sexual offences. This is so particularly because overseas students are a vulnerable subset within the educational setting. They rely significantly on the guidance and good counsel of associates and high managerial agents within the sector, who have what is tantamount to pastoral responsibilities to students, by assisting them to navigate the system and provide for their welfare. Students entering the sector have a high susceptibility to deceptive conduct and exploitative treatment.
The Bill engages and promotes the rights of the child which is provided for in Article 3 of the CRC. Article 3 provides that ‘in all actions concerning children, whether undertaken by public or private social welfare institutions, courts of law, administrative authorities or legislative bodies, the best interests of the child shall be a primary consideration.’
Items 1 and 2 – Section 7A
Item 3 – At the end of section 7A
Items 4, 5 and 6 – Section 17
· has ever been convicted of an offence under any Commonwealth or State or Territory law (the definition of ‘State’ in section 5 includes the Australian Capital Territory and the Northern Territory) that is punishable by 2 years’ imprisonment or longer, or a fine of 120 penalty units or more at any time during the last 5 years (item 4 – new paragraph 17(1)(aa))
· is or has ever been approved (however described) to provide a program, service or activity on behalf of, or with funding from, the Commonwealth or a State and has ever had their registration cancelled or suspended other than at the associate’s or agent’s own request (item 5 – new paragraph 17(1)(ba))
· is or has ever been approved (however described) to provide a program, service or activity on behalf of, or with funding from, the Commonwealth or a State and has ever had disciplinary, remedial or other compliance action taken in relation to their approval (item 6 – new paragraph 17(1)(da)).
Item 7 – Paragraph 17(1)(e)
Item 8 – At the end of section 17
Item 9 – After section 17
Notice of these changes must be given as soon as practicable before the change occurs, unless (in the case of a change of managerial agent) the change cannot be determined before it takes effect – in which case, the notice must be given within 10 business days of the change taking effect.
Items 10 and 11 – Paragraphs 23(2)(b), 23A(3)(b) and 53D(2)(b)
Item 12 – Section 175 (heading)
Item 13 – After paragraph 175(1)(g)
Item 14 – After subsection 175(1)
The terms ‘enforcement body’ and ‘enforcement related activities’ have the same meanings as in the Privacy Act.
Item 15 – At the end of section 175
Part 2 – Application provisions
Item 16 – Application of amendments
Item 2 – Section 5 (paragraphs (a) to (c) of the definition of qualified auditor)
To strengthen the financial reporting requirements under the TEQSA Act, this item repeals and substitutes the definition of ‘qualified auditor’ in section 5. Under the new definition, a qualified auditor means a registered company auditor (within the meaning of the Corporations Act or a person otherwise approved by TEQSA under subsection 27(4) of the TEQSA Act. Amending the definition of ‘qualified auditor’ ensures a high degree of probity in that auditors of a higher education provider’s financial statements must be a ‘registered company auditor’ for the purposes of the Corporations Act or otherwise be approved by TEQSA.
Item 3 – Section 5 (definition of vocational education and training course)
Item 4 – At the end of Division 3 of Part 1
Subsection 7A(1) provides that in determining whether a person is a fit and proper person for the purposes of this Act, regard may be had to the matters (if any) specified in a legislative instrument made under new subsection 7A(2).
Item 5 – Section 15
Item 6 – Subparagraph 15(a)(iv)
Item 7 – At the end of paragraph 15(b)
Item 8 – At the end of section 15
Item 9 – Subsection 21(1)
Item 10 – After section 25
This item adds a new section 25A titled ‘Condition – fit and proper person’ to the conditions in Division 2 of Part 3 of the TEQSA Act.
Item 11 – Subsection 36(1)
Item 13 – Application of amendments
Item 1 – Section 16-1
Item 2 – At the end of section 16-1
Item 3 – After paragraph 16-25(1)(fa)
Item 4 – After subsection 16-25(2)
The purpose of new subsection 16-25(2A) is to provide guidance to the Minister in considering whether the body, including its key personnel, has the requisite level of experience as an education provider for the purposes of the new paragraph 16‑25(1)(fb), based on its performance record and history of service delivery (including in relation to the scope of courses and the particular qualification levels the provider and its key personnel are proposing to deliver).
Item 5 – After subsection 16-40(1)
By introducing the exclusion period the quality of applications is expected to rise as providers will not wish to run the risk of a six month delay of access to FEE-HELP. Additionally, the exclusion period will encourage providers who fail to gain approval to take adequate time to address the reasons for their non‑approval rather than immediately resubmitting an application.
Item 6 – At the end of section 16-60
Items 7 and 8 – Subsection 19-10(2)
Subsection 19-10(2) specifies the requirements for a financial statement that a higher education provider must give to the Minister, pursuant to subsection 19‑10(1), for each annual financial reporting period in which the provider receives assistance under Chapter 2 or a student of the provider receives assistance under Chapter 3 of HESA.
Item 7 inserts a new paragraph 19-10(2)(ab), which requires that the financial statement must comply with the requirements prescribed by the Higher Education Provider Guidelines.
Item 9 – Section 19-12
Item 10 – After section 19-35
Section 19-36 – Misrepresenting assistance under Chapter 3
Section 19-36A – Offering certain inducements
Section 19-36B – Engaging in cold-calling
New subsection 19-36B(4) enables the Higher Education Provider Guidelines to set out conduct that is deemed to be cold-calling for the purposes of new section 19‑36B.
Section 19-36C – Use of third party contact lists
Section 19-36D – Other marketing requirements
Section 19-36E – Requirements relating to requests for Commonwealth assistance
Item 11 – At the end of subsection 19-40(1)
Item 12 – After section 19-40
Section 19-42 – Assessment of students as academically suited
This provision is intended to deter any less scrupulous providers from undertaking on behalf of students, or assisting students to complete, the academic suitability assessments. For example, if a student does not have adequate English language skills to undertake higher education, they may not be academically suitable for a particular course of study. It is an important policy imperative to ensure students do not incur debts for units of study which are beyond their academic capability. This is reflected in the imposition of a civil penalty of 120 penalty units for contravention of section 19‑42(1). The measure ensures that higher education providers are only enrolling students who have skills and capabilities which are aligned and commensurate to the chosen academic undertaking.
Item 13 – At the end of subsection 19-45(5)
Item 14 – At the end of section 19-70
Item 15 – After section 19-70
Section 19-71 – Co-operation with HESA and TEQSA investigators
Section 19-72 – Providers must keep records
Section 19-73 – Providers must publish information
Items 16 and 17– At the end of 19-75, 19-77 and 19-78(1)
Item 18 – After subsection 19-80(3)
Item 19 – Subsection 19-82(4)
This item repeals existing subsection 19-82(4) (dealing with compliance notices) and substitutes a new subsection (4) which similarly provides that a higher education provider must comply with a compliance notice given under section 19‑82, but changes the treatment of a breach of compliance in this context.
The effect of this change is that a failure to comply with a compliance notice can now be sanctioned by way of the imposition of a civil penalty of 60 penalty units in addition to it being dealt with as a breach of a quality and accountability requirement potentially leading to the suspension or revocation of the provider’s approval in accordance with sections 22-15 and 22-30. This amendment is consistent with reforms under the Bill to enhance the compliance and regulatory frameworks of the sector and align with the policy to extend civil penalty provisions to compliance obligations more broadly. Note that failure to comply with a compliance notice will still be a failure to comply with a quality and accountability requirement, and can still be dealt with under sections 22‑15 and 22-30 of HESA.
Item 20 – At the end of subsection 19-95(2)
Item 21 – At the end of subsection 19-95(3)
Items 22, 23, 24, 25 – Amendments to subsection 104-1
Item 22 – Subsection 104-1(1)
Item 23 – After paragraph 104-1(1)(a)
The purpose of this amendment is to ensure that a person’s ability to satisfy the genuine student criteria (as determined in accordance with new section 104-43) and their academic suitability to undertake a particular unit of study are now factors in order for a person to be entitled to FEE-HELP assistance for a unit of study under section 104‑1(1).
Item 24 – After subsection 104-1(1)
Item 25 – At the end of section 104-1
Firstly, under new subsection 104-1(3) a student is not entitled to FEE-HELP assistance for a unit of study provided, or to be provided, by a higher education provider once the provider has reached a limit of students or FEE-HELP assistance payable – for example, under conditions imposed under section 16-60 (see item 6).
Item 26 – After Section 104-1
Item 27 – Subsection 104-10(4)
Item 28 – Subsection 104-30(1)
Item 29 – At the end of Subdivision 104-B of Division 104
Section 104-43 – Re-crediting a person’s FEE-HELP balance if not a genuine student
Section 104-44 – Re-crediting a person’s FEE-HELP balance if provider completes request for assistance etc.
Items 30 and 31 – Subsections 110-5(1) and 137-10(4)
Item 32 – At the end of section 159-1
Item 33 – After subsection 164-10(1)
Item 34 – After section 169-15
Section 169-17 – Requirements relating to withdrawal from units of study
Item 35 – At the end of subsections 169-25(3) and (4)
Item 36 – After subsection 174-5(1)
This item inserts new section 174-5(1A) which provides for the imposition of a civil penalty if a higher education provider is subject to a requirement under section 174‑5(1) and fails to comply with any of the requirements specified under that subsection. Contravention of section 174-5(1A) attracts a civil penalty of 60 penalty units. This is consistent with the VSL arrangements legislated in 2016.
Item 37 – New Part 5-8
By triggering the Regulatory Powers Act, the new monitoring and investigation capabilities provide greater scope for the department to access, or, if necessary, seize relevant information in cases of suspected non-compliance.
Part 5-8 – Regulatory Powers
Section 215-1 – What this Part is about
Section 215-5 – Monitoring powers
Section 215-10 – Investigation powers
Section 215-15 – Civil penalty provisions
Section 215-20 – Infringement notices
Section 215-25 – Enforceable undertakings
Subsection 215-25(2) specifies who are the authorised persons and which are relevant courts for the purposes of Part 6 of the Regulatory Powers Act as it applies in relation to HESA.
Section 215-30 – Injunctions
Section 215-35 – Appointment of investigators
Section 215-40 – Delegation of regulatory powers
In exercising powers or performing functions under a delegation, a delegate must comply with any directions of the delegator (subsection 215-40(3)). This limitation is to ensure that there are appropriate constraints on the delegate’s exercise of the regulatory powers. An instrument that is a direction to a delegate is not a class of instrument that is a legislative instrument pursuant to section 6(1) of the Legislation (Exemptions and Other Matters) Regulation 2015.
Section 215-45 – Contravening offence and civil penalty provisions
Section 215-50 – Certain references to higher education provider include references to agent
Section 215-55 – Other enforcement action
Item 38 – Before section 238-1
This item inserts a new section 238-1A titled ‘Giving false or misleading information’ before section 238-1 of HESA.
Item 39 – Subsection 238-10(1) (table item 6)
Item 41 inserts a new definition of HESA investigator. The term HESA investigator means a person appointed under new section 215-30.
Item 43 inserts a new definition of TEQSA investigator, which means a person appointed under section 215-35.
Further, there is evidence to suggest that providers who previously gained approval under the VET FEE-HELP program and lost approval upon the transition to VSL are now seeking approval as higher education providers under section 16‑25 of HESA. Should they gain approval, stronger regulatory powers, including enhanced monitoring capabilities, should be sufficient to ensure that similar unscrupulous behaviour does not occur in the higher education sector.
Item 44 – Application of amendments
Subitem 44(7) provides that the amendments of sections 19-75, 19-77, 19-78, 19‑80, 19-82 and 19-95 of HESA made by Schedule 3 will apply in relation to higher education providers approved under section 16-25, whether approved before or after the commencement of the Schedule.
· that are provided by higher education providers approved under section 16‑25, whether approved before or after the commencement of the Schedule.
Subitem 44(12) provides that amendments to sections 169-25 and 174-5 of HESA made by Schedule 3 will apply in relation to providers approved under section 16‑25, whether those providers were approved before or after the commencement of this Schedule.
[1] Australian Law Reform Commission Report 95, Principled Regulation: Federal Civil and Administrative Penalties in Australia, 13 March 2003, Statement of Principle, paragraph 3.110.