House of Representatives

Explanatory Memorandum

(Circulated by authority of the Minister for Vocational Education and Skills, the Hon Luke Hartsuyker MP)

Statement of Compatibility with Human Rights

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

HIGHER EDUCATION SUPPORT AMENDMENT (VET FEE-HELP REFORM) BILL 2015

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 .

The purpose of the Higher Education Support Amendment (VET FEE-HELP Reform) Bill 2015 (the Bill) is to amend the Higher Education Support Act 2003 (the Act) to:

•

give effect to the Government's decision to strengthen the administration of the VET FEE-HELP loan scheme;

•

respond to inappropriate market practices;

•

introduce complementary actions to improve the quality of outcomes for students; and

•

protect students, public monies and the reputation of the broader vocational education and training (VET) sector.

The VET FEE-HELP loan scheme is an income contingent loan scheme that helps students to pay for higher level VET courses. Higher level VET qualifications are at the diploma level and above, with a limited trial extending to specified Certificate IV level qualifications until December 2016.

This Bill enacts a series of measures to strengthen the administration of the VET FEE-HELP loan scheme and improve the quality of outcomes for students while protecting students, public monies and the reputation of the broader VET sector.

The Bill introduces new requirements for VET FEE-HELP approved training providers (VET providers) to develop and apply appropriate student entry procedure requirements. These measures seek to ensure that a student is properly assessed for academic suitability, including demonstrated language, literacy and numeracy requirements, before being admitted to enrol in a VET course of study for which they are entitled to receive a VET FEE-HELP loan. The measures contained in the Bill will increase the protection of vulnerable Australians by protecting students (and intending students) who do not have the capacity to undertake the course in which they are enrolled.

The Bill enhances the protection of students under the age of 18 by requiring a parent's approval before the student can request a VET FEE-HELP loan.

The Bill further strengthens the protection of students by broadening the circumstances in which a student can seek a re-credit of their VET FEE-HELP loan debt balance and remission of a debt where it is proven that as a result of unacceptable behaviour by the provider (or their agent) the student enrolled with the provider and subsequently received a VET FEE-HELP loan.

The Bill introduces a minimum registration and trading history requirement as additional eligibility criteria for admitting new VET providers to the VET FEE-HELP loan scheme. This will enhance the integrity of the scheme by ensuring all providers are suitably experienced and have had the chance to demonstrate they are quality education and training operators.

The Bill will enhance the Commonwealth's power to deal with unscrupulous behaviours by introducing an infringement notice scheme attached to civil penalties aimed at VET providers who engage in inappropriate marketing behaviours and administrative practices and are found to be contravening civil penalty provisions in Schedule 1A to the Act. Introducing an infringement and a civil penalty regime engages Parts 2 to 5 of the Regulatory Powers (Standard Provisions) Act 2014 (Regulatory Powers Act).

The infringement and civil penalty scheme will support the enhanced compliance regime to be implemented with the assistance of additional funding for the department provided for in the 2015-16 Budget, which will go further to strengthen the administration of the programme, prohibit inappropriate market practices and protect vulnerable students, taxpayers and the reputation of the national vocational education and training sector.

It is intended that an infringement and civil penalty regime with direct and immediate consequences for unacceptable behaviour will go further to stamp out abuse in the market, strengthen the integrity of the scheme and increase protections for students as well as improve educational quality by strengthened compliance enforcement on measures that assist a refocus on student progression.

Each civil penalty provision in Division 5A of Schedule 1A is subject to an infringement notice under Part 5 of the Regulatory Powers Act. A person who is given an infringement notice can choose to pay an amount as an alternative to having court proceedings brought against the person. If the person does not choose to pay the amount, proceedings can be brought against the person in relation to the contravention.

Further, the expected consequential outcomes of implementing the measures in the Bill include the protection of public monies from misuse and ensuring the reputation of Australia's quality VET sector is protected.

The Bill will also extend the Commonwealth and the National VET Regulator's powers with respect to monitoring and investigation. The Bill does this by making the civil penalty provisions and relevant information subject to monitoring by the department and the National VET Regulator under Part 2 (Monitoring) of the Regulatory Powers Act. Similarly, the civil penalty provisions are also made subject to investigation under Part 3 (Investigation) of the Regulatory Powers Act by the department and the National VET Regulator.

This will ensure that the National VET Regulator and the department have sufficient monitoring and investigation powers under the Act to monitor and investigate compliance and purported compliance with respect to the civil penalties in Subdivision 5A-A. The Bill also provides that each of the civil penalty provisions is enforceable by the department under Part 4 of the Regulatory Powers Act.

The Bill also provides for minor technical amendments to be made which are intended to improve the clarity of some requirements of providers.

Human Rights Implications

The Bill engages the following human rights:

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

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

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

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

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.

The Article sets out 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 VET FEE-HELP loan scheme is to make technical and vocational secondary education more accessible to students who may not otherwise have had access.

The Bill contains a number of measures which promote the right to education. The measures in the Bill strengthen the protection of students as they seek out educational opportunities within Australia. For instance, the Bill contains measures which broaden the circumstances in which a student can seek re-credit of their VET FEE-HELP loan debt balance and remission of a debt where this has been incurred as a result of unacceptable behaviour by a VET provider. The measures in the Bill also require VET providers to develop and apply appropriate student entry procedure requirements to ensure that a student is properly assessed as being academically suitable for a course, including by meeting demonstrated language, literacy and numeracy requirements, before being admitted to enrol in a VET course of study for which they are entitled to receive a VET FEE-HELP loan.

In addition, minimum registration and trading history requirements will be introduced in respect of new VET providers entering the VET FEE-HELP loan scheme. This is intended to enhance the integrity of the scheme by ensuring that all providers are suitably experienced and able to provide quality education and training. The Bill will also enhance the Commonwealth's power to deal with unscrupulous behaviours by providers by introducing an infringement notice scheme attached to civil penalties. These measures are intended to enhance the integrity of the VET FEE-HELP loan scheme and ensure that students are best protected in seeking out and undertaking educational opportunities from VET providers.

To the extent that the Bill requires students to meet certain student entry requirements which could potentially limit a student's ability to access education in a VET course of study, that limitation is justifiable. The measure seeks to protect vulnerable students who have been signed up to the VET FEE-HELP loan scheme and who do not have the academic ability to undertake the course, leaving them with significant debt and no educational or training outcome. These measures will particularly benefit regional students, the unemployed, culturally and linguistically diverse communities, people with a disability and the elderly.

This Bill is compatible with the right to education.

The 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 his privacy, family, home or correspondence, nor to unlawful attacks on his honour and reputation.

The Bill includes a measure allowing for the disclosure of VET personal information to assist State and Territory regulators to ensure the quality of VET in their state or territory. There are already existing provisions in the Act to allow the sharing of VET personal information with other regulators. This amendment expands this disclosure to State and Territory VET regulators, which also serves to assist with resolving complaints submitted by individuals. It should be noted that only the minimum amount of personal information required will be shared or disclosed. The disclosure allowed will not be arbitrary and will in each case be reasonable, necessary and proportionate to the objective.

Therefore, to the extent that the measures in the Bill limit a person's right to privacy with regard to sharing information with State and Territory VET regulators, this is justifiable because sharing this information is ultimately for the purposes of ensuring quality education and training in the VET sector. This disclosure is intended to protect future students, the individual whose VET personal information has been shared and the broader reputation of the VET sector in Australia.

The Bill also contains measures which extend the Commonwealth and the National VET Regulator's monitoring and investigation powers. The Bill does this by making the civil penalty provisions and relevant information subject to monitoring by the department and the National VET Regulator under Part 2 (Monitoring) of the Regulatory Powers Act. Similarly, the civil penalty provisions are also made subject to investigation under Part 3 (Investigation) of the Regulatory Powers Act by the department and the National VET Regulator.

This will ensure that the National VET Regulator and the department have sufficient monitoring and investigation powers under the Act to monitor and investigate compliance (and purported compliance) with respect to the civil penalties in Subdivision 5A-A. The consequent obligations imposed on VET providers that are approved under Schedule 1A to the Act relate to:

infringement notices

monitoring and investigation powers (including entry, search and seizure)

civil penalty provisions.

The Bill protects against arbitrary abuses of power by invoking the provisions of the Regulatory Powers Act. The Regulatory Powers Act contains information gathering powers which are conditional upon provisions of that Act being met. As a result, adequate safeguards are in place which protect the right to privacy. These powers are reasonable, necessary and proportionate to achieve a legitimate objective. Adequate safeguards and limitations on the use of regulatory powers ensure that such lawful interferences are not arbitrary or at risk of abuse.

The Bill is compatible with the right to privacy.

The 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 through the creation of an infringement notice scheme. An infringement notice can be issued by an infringement officer for contraventions of a strict liability offence provision or a civil penalty provision that is enforceable under Part 4 of the Regulatory Powers Act, with Part 5 of the Regulatory Powers Act creating a framework for using infringement notices in relation to provisions in the Bill.

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 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 their right to have the matter heard by a court. Other Regulatory Powers Act provisions invoked regarding limiting the operation of the questioning powers include protections which guarantee the fair trial rights protected in articles 14(3)(d) and (g) of the ICCPR.

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 for the punishment of VET provider 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 conviction2.

For the purpose of assessing their compatibility with Australia's human rights obligations, civil penalty provisions should only be considered to be criminal in nature where there is the possibility of a truly penal consequence, that is, imprisonment or, in the rare case, a pecuniary penalty of some magnitude which may impact on other rights such as the right to privacy3.

The civil penalties set out in the Bill are exclusively pecuniary and operate to create a debt to the Commonwealth in the cases of breaches of provisions and are in intended as a deterrent to continued non-compliance. The protections to the right to a fair and public hearing (provided for in the Regulatory Powers Act) are invoked by reference to its enforcement provisions.

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

The Rights of the Child

The Bill engages the rights of the child which are 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 contains a measure which introduces a requirement that where there is a responsible parent of a person who is under 18, that person is required to be an additional signatory on a request for Commonwealth assistance. The additional signature is not required where the person has been separately assessed as independent and capable of managing their own affairs - the amendments set out that where a person is receiving, or has received youth allowance (within the meaning of the Social Security Act 1991 ) on the basis that the person is independent (within the meaning of Part 2.11 of that Act), the additional signatory is not required.

To the extent that the Bill prescribes that a person under the age of 18 must have a parent or guardian sign their request for Commonwealth assistance form and the potential of this to limit entry into a VET course of study, that limitation is justifiable.

The measure seeks to protect vulnerable students who have been signed up to the loan scheme, which can represent a significant financial liability to the student, without an appropriate understanding of what they are signing up to or through pressure sales tactics. It does not exclude a person from the loan scheme; it simply puts in place protections to ensure certain minors are not exploited for economic gain.

This Bill is compatible with the rights of the child.

Conclusion

This Bill is compatible with human rights.