House of Representatives

Explanatory Memorandum

(Circulated by authority of the Minister for Employment, Skills, Small and Family Business, Senator the Hon Michaelia Cash)

Statement of Compatibility with Human Rights

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

EDUCATION LEGISLATION AMENDMENT (TUITION PROTECTION AND OTHER MEASURES) BILL 2019

The Education Legislation Amendment (Tuition Protection and Other Measures) Bill 2019 ( 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 principal purpose of the Bill is to amend the VET Student Loans Act 2016 ( VSL Act ) and the Higher Education Support Act 2003 ( HESA ) to implement a new tuition protection model for students participating in the VET Student Loans program, and for students accessing FEE-HELP or HECS-HELP assistance, to provide greater tuition protection to students.

Tuition protection aims to ensure students are protected and supported in the event that their course provider defaults - that is, where the student has not withdrawn from the course and either:

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the provider fails to start to provide a course or a part of a course to the student on the day on which the course or part was scheduled to start; or

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the provider ceases to provide a course or a part of a course to the student on a day after the course or part starts but before it is completed.

The proposed tuition protection arrangements are modelled on the successful Tuition Protection Scheme ( TPS ) arrangements for international students under the Education Services for Overseas Students Act 2000 ( ESOS Act). For many years now, Australia has been a world leader in supporting international students studying in Australia if their provider closes. The expansion of the successful TPS model to the VET Student Loans program and students in receipt of FEE-HELP and HECS-HELP at private and TAFE education providers is part of the Government's ongoing commitment to safeguarding the integrity and reputation of its domestic income contingent loan programs. The Bill provides for the new tuition protection arrangements to commence on 1 January 2020. Consistent with previous tuition assurance arrangements, the arrangements do not apply to Table A providers and students enrolled with Table A providers are not included in the scope of the tuition protection model, since those providers are assessed to have a low risk of default. This does not prevent Table A providers from enrolling displaced students as replacement providers.

The Bill provides the new VET Student Loans, FEE-HELP and HECS-HELP tuition protection arrangements will:

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each be administered by a Tuition Protection Director with functions specific to the sector, but for the VET Student Loans Tuition Protection and HELP Tuition Protection Directors to be the same person as the independent TPS Director appointed under the ESOS Act;

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each be supported by a separate Tuition Protection Fund Advisory Board but with the same members as those appointed to the TPS Advisory Board. The relevant Board will provide advice and make recommendations to the relevant Tuition Protection Director. The members of the Boards are a combination of sector and government representatives to ensure there is a diverse range of views factored into decision making;

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require non-exempt providers to contribute annual levies, commensurate with their size and risk, under the accompanying VET Student Loans (VSL Tuition Protection Levy) Bill 2019 and Higher Education Support (HELP Tuition Protection Levy) Bill 2019. The levy system ensures the new arrangements are sustainable and can respond to trends in each sector;

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establish two new separate special accounts: the VET Student Loans Tuition Protection Fund and the HELP Tuition Protection Fund. The special accounts will be used to make payments in relation to the arrangements to support displaced students of that sector and for the remuneration and allowances of the Director and Board;

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wherever practical, VET Student Loans students will be provided assistance to enable them to continue their studies in the same or similar course with a replacement provider, and where there is no suitable replacement course, be provided with a re-credit to their HELP balance in respect of tuition fees paid for part of their original course which was not completed due to the provider's default;

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HELP students will be able to choose between continuing their studies in the same or similar course with a replacement provider or a re-credit of the amount of FEE-HELP assistance or HECS-HELP assistance received by the student for the affected unit. This reflects historical arrangements for this sector and its small and diverse nature which can mean that it is unlikely for a student to find a suitable replacement course.

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impose obligations on defaulting providers to notify the relevant Tuition Protection Director and students of the default in a timely manner, and cooperate with the Tuition Protection Director;

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impose obligations on replacement providers to enrol students as soon as practicable, give the student course credits in recognition of their prior completed studies as appropriate, and not charge students for the replacement component of the replacement course. These requirements facilitate efficient and fair treatment of students to allow them to continue their studies with minimal disruption.

A minor amendment is also proposed to the VSL Act to enable the Secretary of the department administering the VSL Act to refuse to revoke an approval on request if certain compliance action is being taken.

Analysis of human rights implications

The Bill engages the following human rights:

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the right to education - Article 13 of the International Covenant on Economic, Social and Cultural Rights (ICESCR)

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

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the right to a fair and public hearing - Article 14 of the ICCPR

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the right to be presumed innocent - Article 14 of the ICCPR

As the Bill also triggers Parts 4 and 5 of the Regulatory Powers (Standard Provisions) Act 2014 ( Regulatory Powers Act ), this Statement of Compatibility with Human Rights also considers the human rights impact of the Regulatory Powers Act in conjunction with the Bill.

Right to Education

The Bill engages the right to education, which is set out in Article 13 of the ICESCR. Article 13 recognises the important personal, societal, economic and intellectual benefits of education.

Article 13 provides that secondary education in its different forms, including technical and vocational secondary education, shall be made generally available and accessible to all by every appropriate means.

The intent of the Bill is to implement a new tuition protection model for students participating in the VET Student Loans program, and students who are in receipt of FEE-HELP or HECS-HELP assistance for higher education studies. The Bill aims to ensure that students are protected and supported in the event that their approved course provider or higher education provider defaults - that is where the student has not withdrawn from the course and:

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the provider fails to start to provide a course or a part of a course to the student on the day on which the course or part was scheduled to start; or

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the provider ceases to provide a course or a part of a course to the student on a day after the course or part starts but before it is completed.

The Bill establishes the offices of the VSL Tuition Protection Director and the HELP Tuition Protection Director, who have the role and function of facilitating tuition protection for students and managing and administering the VSL Tuition Protection Fund and the HELP Tuition Protection Fund respectively.

The measures in the Bill promote the right to education as they are designed to ensure that in the event that a student's provider defaults, the student will be assisted to continue his or her studies in a suitable replacement course or receive a re-credit to his or her HELP balance in respect of the affected part of the course. Where students receive a re-credit, they will be able to independently seek to continue to undertake further education or training.

The Bill also imposes obligations on providers in the event that they default - such as a requirement to notify students and the Tuition Protection Director of the default. It also imposes obligations on providers in their capacity as replacement providers - such as to enrol the students in the replacement courses as soon as practicable, to give them course credits as appropriate and to not charge them tuition fees for the replacement component of a course.

This Bill is compatible with and promotes the right to education.

Right to Privacy

The Bill engages the right to privacy which is set out in Article 17 of the ICCPR. Article 17 provides that no one shall be subjected to arbitrary or unlawful interference with their privacy, family, home or correspondence, nor to unlawful attacks on their honour and reputation.

The VSL Tuition Protection Director, the HELP Tuition Protection Director, and the members of the Tuition Protection Fund Advisory Boards are Commonwealth officers. Thus the scope of the existing provisions in the VSL Act and HESA that deal with the use and disclosure of personal information collected under those Acts are extended in their application to these persons.

Extending the rights and powers regarding the use and disclosure of relevant personal information to these persons is necessary to ensure that they have the information they need to carry out their powers and functions in relation to the tuition protection arrangements. In the case of the Directors, this includes assisting students whose provider has defaulted; and in the case of the Board members, this includes providing advice to the Director regarding the tuition protection levy.

These persons are subject to the same limitations and offences in respect of the use of information set out at Part 9 of the VSL Act and Division 179 of HESA that apply to other Commonwealth officers. This protects the personal information of students and other parties.

The Bill is compatible with and promotes the right to privacy by ensuring that appropriate safeguards and limitations apply to persons who use and disclose personal information collected under the VSL Act and HESA.

Right to a Fair and Public Hearing

Article 14 of the ICCPR ensures that everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law.

The Bill engages the right to a fair and public hearing, including through incorporation of an infringement notice scheme. An infringement notice can be issued by an infringement officer for contraventions of an offence provision or a civil penalty provision in the proposed new Part 5A of the VSL Act and the proposed new Part 5-1A of HESA. 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 a matter heard by a court rather than pay the amount specified in a notice.

The provisions of the Regulatory Powers Act which are invoked also specify requirements for what must be included in an infringement notice, ensuring that a person issued with an infringement notice is aware of the person's right to have the matter heard by a court.

The Bill also invokes the provisions of Part 4 of the Regulatory Powers Act for the enforcement of civil penalty provisions. The civil penalties allow a course provider or higher education provider to be sanctioned for misconduct without the need to impose a criminal penalty. The size of the civil penalties capable of being imposed is sufficient to act as a deterrent.

The Bill also introduces new strict liability offences, including in relation to:

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giving notice to the VSL Tuition Protection Director or the HELP Tuition Protection Director (as relevant) and students in relation to a default;

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when providing a replacement course to students: granting students course credits as appropriate, not charging them tuition fees for the affected part of their course; and enrolling them in the course as soon as practicable;

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complying with requests for information from the VSL Tuition Protection Director or the HELP Tuition Protection Director (as relevant).

Compliance by providers with these provisions is necessary to ensure the integrity of the tuition protection arrangements. Applying strict liability to these offences is consistent with the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers.

The Bill is compatible with the right to a fair and public hearing.

Right to be Presumed Innocent

Article 14 of the ICCPR requires that, in the determination of any criminal charge, everyone shall be entitled to a set of minimum guarantees and that anyone convicted will have the right to review and compensation if the conviction is not upheld. Article 14 of the ICCPR also requires that anyone charged with a criminal offence shall have the right to be presumed innocent until proved guilty according to the law.

The Bill triggers, in a limited and proportionate manner, relevant regulatory powers contained in the Regulatory Powers Act. This approach allows for a streamlined and consistent approach with other Commonwealth legislation in 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.

This Bill triggers Parts 4 (civil penalties) and 5 (infringement notices) of the Regulatory Powers Act.

Each of the regulatory powers triggered by the Bill is limited appropriately, by ensuring a narrow scope of who is an authorised applicant, an infringement officer and a relevant chief executive, and to which Parts of the VSL Act and HESA these powers apply, ensuring that the powers will only be used in appropriate circumstances.

There are also strict liability offences that apply to factual scenarios, including in relation to:

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giving notice to the VSL Tuition Protection Director or the HELP Tuition Protection Director (as relevant) and students in relation to a default;

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when providing a replacement course to students: granting students course credits as appropriate, not charging them tuition fees for the affected part of their course, and enrolling them in the course as soon as practicable;

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complying with requests for information from the VSL Tuition Protection Director or the HELP Tuition Protection Director (as relevant).

These offences are proportionate to the value of maintaining adequate safeguards in relation to the students' and providers' participation in the legislative tuition protection arrangements. It is considered reasonable in these cases to impose strict liability offences to ensure the integrity of the tuition protection arrangements and to facilitate students being able to continue their education with minimal disruption in the event of their provider defaulting. Each of these offences is subject to the infringement notice scheme. Applying strict liability to these offences is consistent with the Guide to Framing Commonwealth Offences, Infringement Notices and Enforcement Powers.

Establishing a strong civil enforcement regime better facilitates students obtaining value and quality outcomes from their investment in education and training and allows them to continue their education with minimal disruption in the event of a provider default.

The Bill is compatible with the right to be presumed innocent.

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.