House of Representatives

Explanatory Memorandum

(Circulated by authority of the Minister for Education and Training, Senator the Honourable Simon Birmingham)

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

This 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

This Bill makes important changes to key legislation governing higher and international education, to strengthen regulatory controls and student protections in the higher education and international education sectors. This will proactively address instances of unscrupulous providers transitioning operations into the FEE-HELP scheme and international education sector in the wake of reforms to vocational education and training (VET) student loan arrangements.

The Government's actions to address unscrupulous practices in the VET sector have resulted in a surge of VET providers seeking to transition their operations into the higher education and international education sectors. It is clear that amendments to the higher education and international education legislative settings are necessary, when viewed against reforms to enhance regulatory tools and protections in VET Student Loans (VSL).

The Higher Education Support Act 2003 (HESA) is the main piece of legislation providing funding for higher education in Australia, providing for Government subsidies and tuition support for students. The Tertiary Education Quality and Standards Agency Act 2011 (TEQSA Act) provides regulatory enforcement powers and quality assurance mechanisms to assure the reputation of higher education.

The Education Services for Overseas Students Act 2000 (ESOS Act) is the key legislation governing international education to enable the Government to take action to monitor, prevent and address unscrupulous businesses from gaining registration to deliver education services to overseas students. The ESOS Act sets out the legal framework governing delivery of education to international students in Australia on a student visa. The ESOS Act governs the registration process and obligations of registered international education providers, the Tuition Protection Service (TPS) and associated enforcement and compliance arrangements.

The Bill amends HESA, the TEQSA Act and the ESOS Act to protect students from unscrupulous practices of some providers. The amendments will bolster enforcement powers and oversight capabilities of relevant regulators, enabling them to intervene as necessary to prevent malicious practices across the higher and international education sectors.

It is critical to implement measures to ensure an appropriately high standard is in place to assess applications and ensure ongoing compliance by those seeking to enter the higher education and international education sectors, the latter of which is Australia's largest service export worth $21.8 billion in 2016.

There is a corresponding need to ensure that the TEQSA Act provides appropriately stringent controls to protect students from potentially unscrupulous provider actions. The proposed amendments to the TEQSA Act will improve student protection mechanisms by ensuring greater scrutiny of providers in the registration process and during a registration period. The amendments also improve the Tertiary Education Quality and Standards Agency's (TEQSA) capacity to efficiently perform its functions by clarifying that TEQSA may delegate its powers or functions to its Chief Executive Officer.

These measures are intended to target and mitigate unscrupulous behaviour by higher education and international education providers while avoiding interference with the operations of legitimate and reputable providers operating in the sector. This Bill is intended to mitigate similar provider compliance and conduct issues that occurred in the VET sector.

The measures contained in Schedule 1 (amendments to the ESOS Act) will:

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strengthen fit and proper person provisions to increase the scope of matters and persons which may be taken into consideration

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expand reporting of certain events to the ESOS agency

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extend information sharing provisions to allow the Secretary of the department responsible for administering education and training and ESOS agencies to share information with the Overseas Students Ombudsman, as well as any enforcement body to assist with its enforcement activities

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allow the Secretary and ESOS agencies to share and publish information about the exercise of functions of education agents

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amend late payment penalties to ensure the timeframe for payment is appropriate.

The measures contained in Schedule 2 (amendments to the TEQSA Act) will enhance TEQSA's compliance capabilities and introduce more stringent provider application requirements to better equip TEQSA to implement robust student protection mechanisms, by:

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enabling TEQSA, in its regulatory decision-making, to take into account the history of related entities, as well as the history of a provider's delivery of education generally

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introducing a requirement that all registered higher education providers, and key personnel for those providers, must be fit and proper persons

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expanding the scope of matters that providers must notify TEQSA about

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addressing administrative efficiencies by clarifying that TEQSA may delegate its functions or powers to the Chief Executive Officer

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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

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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.

The measures contained in Schedule 3 (amendments to HESA) will:

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enhance student protections by prohibiting unscrupulous marketing practices and barriers to withdrawal from study; and requiring that in order for a student to be and remain entitled to FEE-HELP they must be a 'genuine student', have been assessed as academically suited to undertake the relevant unit of study, and have a reasonable unit completion rate

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improve compliance capabilities including the ability for the Minister to vary conditions of approval for providers, to vary determinations relating to advance payments where there are concerns as to whether a provider is reporting genuine students, the introduction of civil penalties in cases of non-compliance, and adding provisions to ensure HESA is subject to monitoring under the Regulatory Powers (Standard Provisions) Act 2014 (the Regulatory Powers Act)

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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

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increase financial viability and transparency requirements, including mandatory general purpose financial statements for providers of a certain size, amending the definition of an auditor, and introducing revenue diversification requirements for providers.

These measures apply to providers not listed in Table A, B or C of HESA, and to students enrolling at these providers. These are generally private, non-university providers who offer courses of study eligible for FEE-HELP assistance. Providers listed in Tables A-C, primarily universities, are subject to a range of oversights and legislative requirements including through their establishing legislation and under program-specific accountability arrangements. The specific risks targeted by these measures arise in respect of a sub-set of providers which operate outside of the legislative and accountability requirements which apply to universities and which present a significantly higher risk to students and taxpayers in terms of their organisation and business structures, and student outcomes.

Analysis of human rights implications

The Bill engages the following human rights:

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

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the right to education - Article 13 of the ICESCR

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the right to privacy and reputation - Article 17 of the International Covenant on Civil and Political Rights (ICCPR)

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the right to a fair and public hearing and the right to be presumed innocent until proven guilty - Article 14 of the ICCPR

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minimum fair trial guarantees (relating to the imposition of penalty provisions) - Article 15 of the ICCPR

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the rights of the child - Article 3 of the Convention on the Rights of the Child (CRC).

Article 6: Right to work

This Bill engages the right to work which is set out in Article 6 of the ICESCR.

Under Article 6(1) States Parties are required to recognise the right to work, which includes the right of everyone to the opportunity to gain their living by work which they freely choose or accept. Article 6(2) provides that the steps to be taken by States Parties to achieve the full realisation of this right include providing technical and vocational education plans to facilitate access to employment.

This right is engaged by virtue of an objective of the Bill, which is to ensure loans to students are provided for higher education that meets workplace needs and improves employment outcomes. The measures introduced by the Bill are reasonable and proportionate to systemic problems encountered in the FEE-HELP scheme.

This right is limited in that the Bill introduces some measures which may make it more difficult for some prospective students to access the Higher Education Loan Program (HELP), which removes up-front cost barriers to tertiary education by providing income-contingent loans. Such measures include requiring students to be genuine students, strengthening the academic suitability provisions and raising the bar for providers to be approved in the new program. However, these measures represent a reasonable and proportionate limitation on the right to work.

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.

By expanding the ability for the Minister to vary conditions of approval for higher education providers, this Bill also establishes a new framework to limit course eligibility for higher education loans to those courses approved by the Minister and introduces maximum loan amounts or number of places for eligible courses. This measure may limit the right to work by confining the scope of higher education courses that the provider offers for which students are eligible to receive FEE-HELP assistance and, by extension, may discourage students from studying thereby impacting their employability. However, the limitation is justified as it supports the legitimate policy objective of restricting the ability of unscrupulous higher education providers to exploit grants and other payments provided under HESA. It ensures that the focus of the higher education loan program is to provide financial support for genuine students to study, thereby enhancing the opportunities for employment and vocational or professional advancement.

This Bill is compatible with the right to work.

Article 13: Right to education

This Bill engages the right to education under Article 13 of the ICESCR. Article 13 recognises the important personal, societal, economic and intellectual benefits of education.

Article 13(2)(c) 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 intent of the FEE-HELP assistance scheme is to make higher education more accessible to students who may not otherwise have had access. Seeking to bolster regulatory oversight and accountability of approved course providers within the marketplace supports and augments the broader policy objective of enhancing the quality of higher education and the integrity of sector participants responsible for its delivery. These measures engage and promote the right to education as they are designed to enhance oversight of the sector, improve standards of compliance by sector participants and ensure integrity and accountability of operators. In this way the measures serve to maximise educational outcomes by prioritising Commonwealth assistance loans to accord with skills needs and ensuring overall fiscal sustainability for the Commonwealth to effectively regulate the higher education sector.

Measures contained in Schedule 1 (amendments to the ESOS Act) engage the right to education, contained in Article 13 of the ICCPR, insofar as it relates to the provision of education services to international students by education service providers registered under the ESOS Act.

The Australian Government has the overarching responsibility for protecting the reputation of Australia's international education sector, supporting the capacity of the sector to provide quality education and training services, and maintaining the integrity of the student visa program.

The measures contained in Schedule 1 enhance international students' right to education by ensuring the integrity of the Commonwealth Register of Institutions and Courses for Overseas Students (CRICOS) registration processes and ensuring that unscrupulous providers do not gain access to, or maintain their registration in, the international education sector. In particular, measures contained in Schedule 1 enhance the right to education by:

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supporting the effective administration of the ESOS legislative framework by the Australian Government and State and Territory governments

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establishing and safeguarding Australia's international reputation as a provider of high quality education and training by ensuring that education and training for overseas students meets nationally consistent standards

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providing ESOS agencies with the necessary powers to undertake their functions and ensure standards of education to overseas students are maintained

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ensuring the integrity of registered providers.

Schedules 2 and 3 of the Bill contain a number of measures which promote the right to education by strengthening Australia's higher education system and ensuring the ongoing quality and operational integrity of the sector. The enhanced compliance requirements in these Schedules ensure that access to education at high quality higher education providers continues to be accessible for eligible students through FEE-HELP assistance, which can be used to defer tuition fees and be repaid once a student reaches the minimum repayment threshold.

Schedule 3 of the Bill ensures access to higher education on the basis of capacity by requiring providers not listed in Table A, B or C of HESA to properly assess the academic suitability of students who wish to enrol for a course of study. By mandating that students meet requisite academic suitability standards, access to (and the ability of students to benefit from) higher education is promoted by ensuring courses undertaken are commensurate with academic capability. This promotes academic empowerment and fulfilment in education yielding important developmental benefits to students in accordance with, and in furtherance of, the principles contained in Article 13.

In addition, minimum registration and trading history requirements will be introduced for non-Table A, B or C higher education providers who are applying for approval under HESA. This is intended to enhance the integrity of the scheme, and preserve the quality of the higher education sector by ensuring that all providers are suitably experienced and able to provide quality education.

Measures such as the prohibition of certain marketing practices and the prohibition on withdrawal fees promote the right to education by ensuring that the higher education sector does not come into disrepute. In particular, the Bill implements strengthened measures in relation to marketing of higher education courses and Commonwealth student loans to address actual and anticipated unscrupulous behaviour by higher education course providers. Without adequate understanding of what students are signing up to, or through pressure sales tactics, a Commonwealth student loan can represent a significant financial liability to the student. This may negatively impact the student's future ability to engage in education courses suited to the student's interests and abilities.

Further, measures which extend the circumstances in which a student can seek re-credit of their FEE-HELP loan debt balances and remission of a debt similarly engage and promote the right to education and support students' access to education. The circumstances include if the student is not a genuine student or if the provider has failed to comply with certain obligations under the Bill and the failure has adversely affected the student. Re-crediting of a FEE-HELP loan debt will continue to be available in special circumstances and if there has been unacceptable behaviour by a higher education provider at the time of the student's application for a loan. These measures increase protections available to students, which is consistent with, and promotes, the right to education.

The above measures collectively affirm and promote the right to education as they are directly aimed at enhancing the probity and efficacy of higher education service delivery. In particular, the measures are legitimately aimed at maximising educational outcomes through a series of protective provisions to ensure that higher education providers are not able to subvert the intention of the FEE-HELP loan framework. This is achieved, for example, through: more stringent financial viability reporting obligations for providers (including revenue diversification requirements); bolstering the fit and proper person test for approved provider eligibility; and increasing monitoring capabilities and expanding regulatory powers exercisable by TEQSA and the department under HESA to investigate instances of non-compliance by approved providers.

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

Eligibility requirements and academic suitability may limit accessibility to certain units of study or higher education courses

Amendments to section 104-1 of HESA (items 22 to 25 of Schedule 3) will require students to meet certain eligibility requirements and satisfy academic suitability standards to be entitled to FEE-HELP assistance for higher education units of study.

Requiring providers to develop and apply appropriate student entry procedure requirements to ensure that a student is properly assessed as being academically suitable for a higher education course before enrolling, or that the student meets the requirement of being a 'genuine student' may technically limit a student's ability to access education in a higher education course. However, the limitation is a reasonable and proportionate response directed to protecting vulnerable students who do not have the academic ability to undertake a higher education course from being burdened with a significant debt with limited or no prospects for a positive educational or training outcome. 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.

More robust eligibility requirements will be introduced in respect of providers seeking approval as higher education providers, such as the introduction of a requirement that consideration will be given to whether a higher education provider has sufficient experience in delivering higher education (items 3 and 4 of Schedule 3). This is intended to enhance the integrity of the HELP program by ensuring that providers are properly scrutinised to ensure they have experience in providing higher education, satisfy financial viability requirements and meet governance and management standards.

To the extent that this measure may limit a student's ability to access higher education, that limitation is reasonable, proportionate and supports the legitimate policy objective to improve the integrity, demonstrated performance and regulatory compliance of the sector.

Limiting FEE-HELP eligibility may limit the scope of Commonwealth loan assisted courses

New subsection 16-60(3) of HESA (item 6 of Schedule 3) allows the Minister to impose, as a condition of a higher education provider's approval, a maximum value of loans that may be offered by that provider, or impose a limit on the courses that the provider offers for which students are eligible to receive FEE-HELP assistance. These conditions may be imposed at the same time as initial approval or as a condition of continuing provider approval.

This measure could be regarded as limiting the right to education to the extent that the proposed conditions may limit students' access to FEE-HELP eligible courses delivered by particular providers and thereby confine course choice. This limitation is a proportionate response to the broader policy objective of mitigating the ability of higher education providers to exploit grants and other payments provided under HESA. It seeks to promote quality output from providers and build in a high level of accountability and transparency across the sector, by requiring providers to meet more rigorous financial and operational standards in order to gain and maintain their approved status.

Overall, the loan cap determination measure promotes the right to education in that it enhances the Commonwealth's power to act in response to unscrupulous behaviours on the part of approved providers, where factors such as the adverse outcomes of compliance audits undertaken under section 19-80 of HESA, the conduct of the body, its lack of compliance with its responsibilities as an approved provider and misreporting of course information and student estimates, can be taken into consideration in determining ongoing access to subsidised loan revenue via FEE-HELP.

Importantly, the imposition of a cap on a provider's loan threshold does not displace students' eligibility if all eligibility criteria are satisfied. There is also an express statutory safeguard against the cap being set at a lower level than the provider's current student load or total value of loans currently being incurred by students enrolled in a course through a particular provider. This supporting measure ensures that students already subscribed to a course or eligible for a student loan are not disadvantaged.

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.

This Bill is compatible with the right to education in that the measures which promote that right or, to the extent any such measures limit, or purport to limit, that right, are reasonable, proportionate and are in furtherance of legitimate policy objectives to improve and enhance integrity of the sector and maximise the quality of educational outcomes for students.

Articles 14 and 15: Right to fair and public hearing/ right to be presumed innocent until proven guilty and minimum procedural safeguards

This Bill engages with Article 14(1) and 14(2) of the ICCPR, which state that 'everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law' and 'everyone shall have the right to be presumed innocent until proved guilty according to law'.

The Bill triggers the regulatory powers contained in the Regulatory Powers (Standard Provisions) Act 2014 (Regulatory Powers Act). This approach allows for a streamlined and consistent approach with other Commonwealth legislation with respect to regulatory powers. Further, in triggering the Regulatory Powers Act, the intention is to also establish consistency from a human rights perspective with a whole of Government approach to civil enforcement mechanisms.

Parts 2 (monitoring powers), 3 (investigation powers), 4 (civil penalties), 5 (infringement notices), 6 (enforceable undertakings) and Part 7 (injunctions) of the Regulatory Powers Act are triggered and are part of a multifaceted approach to ensure the integrity of the HELP program and protect the program and students against unscrupulous conduct by providers. Each of the regulatory powers triggered by the Bill are appropriately limited, by ensuring a narrow scope of who is an authorised person, who is an authorised applicant, who may be appointed as an investigator and what is a relevant court. This ensures the powers will only be used in defined circumstances.

Civil penalty provisions and infringement notices

The Bill engages the right to a fair and public hearing through the imposition of civil penalty provisions for non-compliance by higher education providers with HESA and through the incorporation of an infringement notice 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]

Establishing a strong civil enforcement regime protects the integrity of the program to ensure providers provide quality education and training, and that students obtain value and quality outcomes for their investment in higher education. The serious nature of some of the civil penalty provisions justifies the existence of these powers and their exercise from time to time. The monitoring and investigation powers are also subject to the implied privilege against self-incrimination at common law. The protections pertaining to the right to a fair and public hearing provided for in the Regulatory Powers Act are expressly invoked by reference to that Act's enforcement provisions.

An infringement notice can be issued by an infringement officer for contraventions of a civil penalty provision of the Bill. The Bill triggers Part 5 of the Regulatory Powers Act, which creates a framework for using infringement notices in relation to provisions in the Bill and attendant safeguards. Moreover, the right of a person to a fair and public hearing by a competent, independent and impartial tribunal is preserved by the Bill as its provisions invoke the powers in the Regulatory Powers Act which allow a person to elect to have the matter heard by a court rather than pay the amount specified in the notice.

The provisions of the Regulatory Powers Act also specify requirements for what must be included in an infringement notice issued with the civil penalty, ensuring that a person issued with an infringement notice is aware of their right to have the matter heard by a court. Further, the Regulatory Powers Act relies on the common law presumption against the abrogation of core rights to preserve the privilege against self-incrimination and legal professional privilege. Sections 17 and 47 of that Act are intended to make certain that the privilege against self-incrimination and legal professional privilege have not been abrogated. These protections contained in the Regulatory Powers Act guarantee the fair trial rights protected in articles 14(3)(d) and (g) of the ICCPR by limiting the operation of the questioning powers to authorised officers under that Act.

Triggering of the civil penalty and infringement provisions in the Regulatory Powers Act is compatible with the right to liberty and security of the person and freedom from subjection to arbitrary arrest or detention, as set out in Article 9 of the ICCPR.

The right of a person to a fair and public hearing by a competent, independent and impartial tribunal is preserved by the Bill as its provisions invoke the powers in the Regulatory Powers Act which allow a person to elect to have the matter heard by a court rather than pay the amount specified in the notice.

The Bill is compatible with the right to a fair and public hearing, and the right to be presumed innocent until proved guilty according to law.

Criminal process rights (Articles 14 and 15 of the ICCPR)

The Parliamentary Joint Committee on Human Rights' Practice 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 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 purpose of these penalties is to encourage compliance and by extension deter non-compliance with HESA. The penalties only apply to the regulatory regime of HESA rather than to the public in general. Further, the imposition of the civil penalties is not dependent on a finding of guilt. These factors all suggest that the civil penalties imposed by Bill are civil rather than criminal in nature. The severity of the relevant civil penalties should be considered low. They are pecuniary penalties, there is no sanction of imprisonment for non-payment of penalties and only courts may apply a pecuniary penalty. The pecuniary penalties are set at levels which are consistent with the nature and severity of the corresponding contraventions. On this basis, they are rightly characterised as civil as opposed to criminal penalty provisions for the purposes of international human rights law.

Article 17: Right to privacy and reputation

This Bill engages with Article 17(1) and 17(2) of the ICCPR, which states that 'no one shall be subject to arbitrary or unlawful interference with their privacy, family, home or correspondence, nor to unlawful attacks on his honour and reputation' and that 'everyone has the right to the protection of the law against such interference or attacks'.

The right to privacy under Article 17 can be permissibly limited in order to achieve a legitimate objective and where the limitations are lawful and not arbitrary. In order for an interference with the right to privacy to be permissible, the interference must be authorised by law, be for a reason consistent with the ICCPR and be reasonable in the particular circumstances. In this case, the legitimate end is the protection of students, the efficacy of educational outcomes and the accountability of providers as a part of the broader policy to ensure a high level of performance and integrity across the higher education sector.

The following measures in Schedule 1 engage the right to privacy:

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new paragraph 17(1)(aa) of the ESOS Act which provides that registered providers must notify their ESOS agency (which under section 6C of the ESOS Act are TEQSA, the National VET Regulator, the Secretary of the department or another entity determined by regulation) of convictions for serious criminal offences by an associate or high managerial agent which occurred up to 5 years ago

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new subsection 175(1) of the ESOS Act which provides that information obtained or received for the purposes of the Act may be shared with enforcement agencies if the Secretary or ESOS agency is satisfied that giving the information is reasonably necessary for one or more enforcement related activities conducted by, or on behalf of, the enforcement body.

Obligation on associates and high managerial agents to notify ESOS agency of convictions for recent past serious convictions

New paragraph 17(1)(aa) (item 4, Schedule 1) broadens the obligations on registered providers under section 17 of the ESOS Act to notify their ESOS agency of serious offences that an associate or high managerial agent (being an employee, agent or officer) of the provider has been convicted of. This provision limits the right to privacy by requiring higher education providers to disclose to an ESOS agency sensitive personal information about prior convictions recorded against associates or high managerial agents of that provider which occurred up to 5 years ago.

The obligation to disclose recent serious convictions is sufficiently confined in scope as to be reasonably proportionate to the policy objective and should not be regarded as an arbitrary interference with a high managerial agent's or associate's right to privacy. This is because:

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the offences which are notifiable under new paragraph 17(1)(aa) are at the serious end of the spectrum (attracting a minimum of 120 penalty units or a term of imprisonment of two or more years). Convictions for summary offences or low level regulatory infractions such as minor traffic offences would not be reportable

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only convictions imposed by a court of law are reportable (as opposed to mere charges)

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the reporting obligation is limited to recent convictions (5 years or less). This means convictions for crimes committed over 5 years prior do not need to be notified under the new subsection

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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.

Any limitation on the right to privacy and reputation is reasonable and proportionate to achieve a legitimate policy objective. Namely, to ensure the integrity and fitness of those seeking prominent and influential positions in the international education sector and who are given responsibility for assisting current and prospective overseas students. These students are vulnerable in that they are new to, and unfamiliar with, the Australian education setting, and are heavily reliant upon associates and high managerial agents of providers for guidance not only in relation to their education, but their broader welfare and transition to life in Australia. Serious convictions in recent history by an associate or high managerial agent, however characterised, have genuine bearing on whether such persons are capable of fulfilling their obligations under the ESOS Act, in terms of compliance with their regulatory responsibilities but also being a person who can credibly operate in a relationship of trust with overseas students, as a vulnerable student group within the sector.

It is important that ESOS agencies are made aware of serious convictions on the part of agents and associates of providers they register. Agents and associates directly represent providers who are considered fit and proper to operate in the sector on the basis of their registered status. Requiring a provider to notify the ESOS agency of the suspension, cancellation or other regulatory action against a high managerial agent's or associate's previous approval for a Government service, program or activity is a necessary and targeted provision to monitor unscrupulous persons moving between sectors and will support the Government to protect the integrity of international education.

Overseas students (many of whom have English as a second language, and some of whom are minors) may be regarded as a group highly susceptible to the effects of unscrupulous practices. Associates and high managerial agents are, for all practical purposes, in a position of trust and confidence in terms of monitoring students' welfare and taking appropriate steps to ensure fair and equitable treatment in an unfamiliar educational setting. To that end, information about serious convictions (especially for crimes such as fraud, embezzlement, offences against the person such as assault, aggravated assault or child sexual offences) is critically important to enable ESOS agencies to properly assess and evaluate the probity of high level operators entering the sector who will have a significant degree of influence and control over decision making processes involving overseas students, especially where such students are minors.

Including a broader range of offences than those currently provided for in the ESOS Act is a legitimate objective, particularly in circumstances where in practice the class of offences is not sufficiently broad to capture conduct which is jeopardising the integrity of the provision of educational services to overseas students.

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.

Sharing of information about convictions with enforcement agencies

Items 13, 14 and 15 of Schedule 1 broaden the ability of information to be shared under section 175 of the ESOS Act.

In particular, new subsection 175(1A) (item 14) will permit information obtained or received for the purposes of the ESOS Act to be given by the Secretary or an ESOS agency to an enforcement body (as that term is defined under the Privacy Act 1988 (Privacy Act)) if the Secretary or ESOS agency is satisfied that the giving of the information is reasonably necessary for one or more enforcement related activities (within the meaning of the Privacy Act) conducted by, or on behalf of, the enforcement body.

For example, this allows the department to initiate sharing of relevant student information with the Fair Work Ombudsman (FWO) to assist in combating student worker exploitation, without needing the FWO to make a request. This provision will give students a better study experience and ensure Government is agile in identifying and responding to unscrupulous practices occurring across its programs and services.

The right to privacy is engaged by this measure because it authorises the on-sharing of personal information. However this is reasonable and proportionate and aligned with the legitimate policy objective of ensuring that the Secretary or an ESOS agency may make an informed assessment of the probity of a provider and their suitability to provide educational services to overseas students. That is, ensuring the integrity, optimal performance and accountability of the higher education sector and its key personnel.

Facilitating information sharing within the limited confines of enforcement agency disclosure for a defined policy purpose is neither arbitrary nor an unreasonable interference with the privacy of providers. Providers of education to overseas students engage with a particularly vulnerable subset of students as many are from non-English-speaking backgrounds and some are minors. In this regard, providers registered to deliver education to overseas students have responsibilities for the student which extend to welfare and pastoral care, not just delivering a service.

A key constraint on the operation of the information sharing provisions which goes to the permissibility of the limitation on privacy resulting from this measure is that information will only be released to a trusted set of 'enforcement bodies', as defined under the Privacy Act.

Further, the purpose of disclosure is strictly circumscribed to enforcement related activities conducted by or on behalf of the enforcement agency. An additional safeguard on the operation of the provisions is that information will only be disclosed where it is reasonably necessary for one or more enforcement related activities. 'Reasonable necessity' is not a low threshold. For example, it would not be 'reasonably necessary' for the Secretary or an ESOS agency to disclose information if it is merely helpful or expedient in exercising powers or performing functions under the ESOS Act. As such, the scope of permissible disclosures of personal information directly mirrors Australian Privacy Principle (APP) 6.2(e) in the Privacy Act.

In addition, enforcement bodies are governed by stringent statutory obligations around the use, handling, on-sharing or secondary disclosure of sensitive and personal information under the Privacy Act and under Acts which establish them as enforcement agencies. To that end, in addition to obligations under the Privacy Act, they are obligated to treat information, including that which is highly sensitive, in accordance with stringent requirements under their authorising legislation. For example, under section 69A of the Australian Federal Police Act 1979 (Cth) personnel must comply with their obligations under the Privacy Act in addition to secrecy provisions which apply to enforcement activities under applicable legislation.

Information sharing relating to the exercise of functions by education agents of providers

Item 15 of Schedule 1 to the Bill amends section 175 of the ESOS Act by adding new subsections 175(3), (4) and (5).

The new subsection 175(3) provides that the Secretary or the ESOS agency for a provider or registered provider may give information relating to the exercise of functions by education agents of providers to registered providers, or publish such information, for the limited purpose of promoting compliance with the ESOS Act, the National Code of Practice of Providers of Education and Training to Overseas Students 2017 (National Code), the English Language Intensive Courses for Overseas Students Standards and the Foundation Program Standards or with the conditions of a particular student visa or visas, or of student visas generally.

The new subsection 175(4) provides that the Secretary may also publish information relating to the exercise of functions by education agents or providers.

Such information as set out in subsections 175(3) and (4) may include (without limitation):

•

the number of applications for student visas made by or on behalf of students recruited or otherwise dealt with by an agent that have been either granted, refused, withdrawn or are invalid

•

the number of student visas granted to students recruited or otherwise dealt with by an agent that have been cancelled or have ceased to be in effect

•

the number of students accepted for enrolment in courses provided by registered providers by students recruited or otherwise dealt with by an agent

•

the completion rates of accepted students recruited or otherwise dealt with by agents.

The purpose of new subsection 175(3) is to enable the limited release of information the Secretary holds about education agents in the form of performance reports to providers, including, for example, education agent performance data linked to outcomes or completion rates of students they help to enrol for an expressly defined purpose. This supports due diligence by enabling providers to make an informed choice about which agents they work with, and assisting providers to meet their obligation to work with ethical education agents under Standard 4 of the National Code.

Permitting the publication of information relating to education agents of providers under new subsection 175(4) similarly engages and limits the right to privacy. However, this limitation is also reasonable and proportionate and consistent with the legitimate policy objective of ensuring that those permitted to provide services to overseas students are compliant with their obligations under the ESOS Act and associated codes and standards. The publication of information is for a strictly limited purpose. This is for promoting compliance with the ESOS Act, the National Code, the ELICOS Standards and the Foundation Program Standards, or promoting compliance with the conditions of a particular student visa or visas, or of student visas generally. It will only apply where there is a nexus between the provision of this information and the exercise of their functions as agents of providers or registered providers.

Provisions which allow the Secretary or ESOS agency to share information about the functions of education agents with providers, or broadly publish information, for the purposes of promoting compliance with the ESOS Act or student visas will significantly increase the transparency of education agents' performance and assist both international students and education providers to identify and use high quality agents. This will protect Australia's continued reputation as a high quality study destination.

Further, information shared or published about education agents will be done in a manner consistent with APP requirements, since this information is classified as personal information for the purposes of the Privacy Act.

As required by APP 5, which concerns the notification of the collection of personal information, reasonable steps are being taken to notify education agents of the matters referred to in APP 5.2, or to otherwise ensure the individual is aware of any such matters. This has been done through amending the privacy notice on the department's Provider Registration and International Student Management System (PRISMS), where the information is held, to state that users' personal information may be collected and disclosed. Education providers are also being encouraged to include a similar statement in their written agreements with education agents.

The use and disclosure of personal information about agents is consistent with the requirements under APP 6.2(b), which allows the disclosure of information for a purpose other than the purpose it was collected for (i.e. a secondary purpose) without obtaining the individual's consent if that use or disclosure is required, or authorised by, or under an Australian law or a court/tribunal order.

To the extent that the measures in the Bill limit the right to privacy, this is necessary and proportionate to the legitimate policy objective.

The measures in Schedules 2 and 3 to the Bill enhance the existing fit and proper person requirements in HESA and the TEQSA Act. A determination that a person is not fit and proper will be undertaken within the Government or Government agencies such as TEQSA. The details of the determination, including personal information, will not be distributed or disclosed to the public. This measure will not limit a person's right to privacy and reputation.

Additionally the enhanced monitoring powers under Schedules 2 and 3 to the Bill may have implications for the right to privacy. The Secretary is granted the ability to request information from a provider.

The minimum amount of personal information required will be collected, and there are strict limitations on use and disclosure of such information in HESA and the TEQSA Act. As the use and disclosure of this potentially personal information is for the purposes of ensuring the quality of providers in the higher education sector, any limitation on the right to privacy is reasonable, necessary and proportionate to the policy objective.

The Bill is compatible with the right to privacy and reputation.

Article 3: Rights of the Child

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.'

The Bill protects vulnerable minors by requiring students to be assessed by a course provider as academically suitable to undertake the course concerned. This measure seeks to protect children to ensure that they are only signed up to higher education courses where they are academically suited to the course.

The Bill also contains strengthened measures in relation to marketing of higher education courses and student loans to address unscrupulous behaviour of course providers. Without adequate understanding of what they are signing up to, or through pressure sales tactics, a loan can represent a significant financial liability for a child. By preventing such behaviour from occurring, the rights of the child are being preserved.

The Bill also requires enhanced reporting by international education providers of serious criminal convictions of their agents and associates (see above under 'Right to Privacy and Reputation'), which can provide additional protection for vulnerable minors. This measure enhances protections for students under the age of 18 by ensuring that providers notify the relevant ESOS agency where they become aware a high managerial agent, associate, or other significant decision-maker has been convicted of a serious offence under Commonwealth or State or Territory law, as described in the Bill. This ensures that ESOS agencies will be aware if key persons involved with a provider that enrols minors have been convicted of serious offences, and can actively consider if the provider is fit and proper to continue teaching minors. This measure provides additional protection to vulnerable minors in the international education setting.

This Bill is compatible with, and promotes, the rights of the child.

Conclusion

The Bill is compatible with human rights because, to the extent that it may limit human rights, the limitations are reasonable, necessary and proportionate.