Bills Digest 16 1996-97 Higher Education Funding Amendment Bill (No. 1) 1996


Numerical Index | Alphabetical Index

WARNING:
This Digest is prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments.

This Digest was available from 9 August 1996.

CONTENTS

Passage History

Higher Education Funding Amendment Bill (No. 1) 1996

Date Introduced: 26 June 1996
House: House of Representatives
Portfolio: Employment, Education, Training and Youth Affairs
Commencement: Amendments outlined in this Bills Digest commence on Royal Assent

Purpose

The major amendments proposed by the Bill:

  • vary levels of grants for higher educations institutions for the years 1996-1998; and
  • provide for advances of grants for expenditure for operating purposes to higher education institutions.

Background

Under the Higher Education Funding Act 1988 (the Principal Act) the Commonwealth provides funding to higher education institutions. Funding is provided on a rolling triennium basis, which means that the level of funding is known for the next three years. The Principal Act also establishes the Higher Education Contribution Scheme (HECS) and the Open Learning Deferred Payment Scheme.

Commonwealth expenditure on higher education has been increasing steadily over recent years. Operating grants for higher education institutions are estimated to total:

  • $4 908 742 million in 1996;
  • $4 987 138 million in 1997; and
  • $5 019 941 million in 1998.(1)

Commonwealth funding for higher education for the 1996-98 triennium, which comprises total operating grants, research programs, open learning initiative, capital program, evaluations and investigations, and civic and citizenship education is estimated to total $5 339 455 million in 1996, $5 413 614 million in 1997 and $5 450 644 million in 1997.(2)

Liberal and National Parties' Higher Education Policy

During the 1996 election campaign, the Liberal and National Parties gave a number of commitments in relation to Commonwealth funding of higher education, including:

The Coalition ..., will at least maintain the level of Commonwealth funding to universities both in terms of operating grants and research grants.(3)

The Coalition will continue the practice of funding universities on a rolling triennium basis but will modify the mechanism for the allocation of Commonwealth funds, putting less emphasis on a formula funding model.(4)

..., the Coalition recognises that new funding must supplement and not replace the public contribution. The Coalition does not intend to change the public structure of our universities.(5)

The Coalition additionally supports the existing Higher Education Contribution Scheme ... .(6) </ ul>

The major provisions of this Bill are substantially the same as those contained in the Higher Education Amendment Bill (No. 3) 1995. That Bill, which was introduced by the previous Government on 29 November 1995, lapsed with the dissolution of Parliament for the 1996 election.

Main Provisions

Item 3 of Schedule 1 - Section 17 of the Higher Education Funding Act 1988 (the Principal Act) sets out the total grants payable to higher education institutions as recurrent grants for operating purposes. Item 3 varies the maximum grants payable for:

  • 1996 from $3 781 575 000 to $3 803 406 000;
  • 1997 from $3 834 297 000 to $3 855 623 000; and
  • 1998 from $3 844 309 000 to $3 860 016 000.

Item 4 of Schedule 1 - A new paragraph 18(1)(f) is substituted in the Principal Act by item 4 which provides that financial assistance is granted to an institution on condition that it gives the Minister, no later than 30 June in the following year, a financial statement for that year in an approved form, and a report on that statement by a qualified auditor.

Note: Currently paragraph 18(1)(f) provides that financial assistance is granted to an institution on condition that it gives the Minister, no later than 30 June in the following year, a statement by a qualified auditor, in an approved form, on the expenditure of the institution for operating purposes or for limited operating purposes, for that year.

The rationale given by the Government for the amendment proposed by item 4 is that it 'clarifies that financial statements are to be submitted by a qualified auditor'. The amendment makes it clear that the institution is to prepare a financial statement and the auditor is to comment on the statement.

The amendment proposed by item 4 was not contained in the Higher Education Funding Amendment Bill (No. 3) 1995. </ ul>

Item 7 of Schedule 1 - Section 20 of the Principal Act sets out the maximum grants payable to higher education institutions for superannuation expenses. Item 7 varies the maximum grants payable for:

  • 1996 from $73 009 000 to $95 000 000;
  • 1997 from $73 009 000 to $95 000 000; and
  • 1998 from $73 009 000 to $95 000 000.
Note: Item 5 of Schedule 1 of the Higher Education Funding Amendment Bill (No. 3) 1995 proposed to vary the maximum grants payable under section 20 of the Principal Act for:
  • 1996 from $73,009,000 to $59,757,000;
  • 1997 from $73,009,000 to $59,757,000; and
  • 1998 from $73,009,000 to $59,757,000.
</ ul>

Item 8 of Schedule 1 - A new section 20A, dealing with advances of grants for expenditure for operating purposes to higher education institutions, is substituted in the Principal Act by item 8. Under proposed section 20A the Minister is accorded a discretion to advance a higher education institution, for expenditure for operating purposes, such financial assistance as the Minister determines. The total of advances in a year must not exceed the total grants payable to institutions as recurrent grants for operating purposes for that year.

A grant for expenditure for operating purposes payable to a higher education institution under section 15 or 16 of the Principal Act will be reduced by an amount equal to an advance.

Determinations and reductions must be in accordance with guidelines issued under proposed section 20B. Proposed section 20B, which is also inserted in the Principal Act by item 8, provides the Minister with power to issue such guidelines. Determinations and guidelines are subject to disallowance by Parliament (items 53 and 54 of Schedule 1)

Note: The amendments proposed by items 8, 53 and 54 are identical to those proposed by items 7, 38 and 39 of Schedule 1 of the Higher Education Funding Amendment Bill (No. 3) 1995.

Item 16 of Schedule 1 - Section 23C of the Principal Act sets out the maximum grants payable to enhance the quality of higher education, projects of national priority, promotion of equal opportunity, special research assistance and advanced engineering. Item 16 varies the maximum grants payable for:

  • 1995 - from $441 397 000 to $432 147 000;
  • 1996 - from $492 195 000 to $496 250 000;
  • 1997 - from $476 196 000 to $477 793 000; and
  • 1998 - from $453 482 000 to $451 081 000.

Note: Item 13 of Schedule 1 of the Higher Education Funding Amendment Bill (No. 3) 1995 proposed to vary the maximum grants payable under section 23C of the Principal Act for:

  • 1996 - from $492 195 000 to $493 665 000;
  • 1997 - from $476 196 000 to $477 779 000; and
  • 1998 - from $453 482 000 to $454 531 000
</ ul>

Item 18 of Schedule 1 - Section 27 of the Principal Act deals with grants for special capital projects. Item 18 varies the maximum grant payable for:

  • 1996 - from $36 893 000 to $ 36 927 000;
  • 1997 - from $36 893 000 to $36 927 000; and
  • 1998 - from $36 893 000 to $36 927 000.

Note: The amendments proposed by item 18 are identical to those proposed by item 15 of Schedule 1 of the Higher Education Funding Amendment Bill (No. 3) 1995. </ ul>

Item 34 of the Schedule 1 - The effect of the amendment proposed by item 34 is to require the Open Learning Agency not to allow a client to continue to be enrolled in, or undertake, a unit of study where they do not appear to have a tax file number.

Note: The Open Learning Initiative, which was announced in the 1992 93 Budget and established in 1993, provides access to higher education opportunities for those otherwise excluded from on campus study by, for example, work or family responsibilities.

The Open Learning Agency of Australia (OLA) is a private company, formed by Monash University. OLA's board comprises five Monash University nominees, representatives from Charles Stuart University, Curtin University of Technology, Deakin University, the University of South Australia and two nonuniversity nominees.

In 1995, the OLA offered over 230 undergraduate units from 21 universities from 21 universities and over 30 TAFE units from five TAFE providers. Study unit registrations for 1995 were around 21 700.(7)

Currently, section 106AA of the Principal Act requires the OLA to notify the Minister when a client does not appear to have a tax file number. The amendment proposed by item 34 is identical to an amendment proposed by item 23 of the Higher Education Funding Amendment Bill (No. 3) 1995. </ ul>

Item 39 of Schedule 1 - The effect of the amendment proposed by item 39 to section 106E of the Principal Act is to require the OLA to give the Minister, where he/she so requires, any statistical and other information relating to clients undertaking units of study in a study period.

Note: Currently, section 106E requires the OLA to give the Minister, where he/she so requires, any information in its possession relating to clients undertaking units of study in a semester (other than the name or address of a client) that he/she reasonably requires for the purposes of the Open Learning Deferred Payment Scheme.

The amendment proposed by item 39 to section 196E is identical to an amendment proposed by item 27 of the Higher Education Funding Amendment Bill (No. 3) 1995. </ ul>

Item 40 of Schedule 1 - A new section 106FA, dealing with an annual statement of the Chief Executive Officer of the OLA, is inserted in the Principal Act by item 40. Proposed section 106FA requires the Chief Executive Officer of the OLA to provide the Minister before the end of each calendar year with a statement as to whether the OLA has complied with the requirements under Chapter 5 of the Principal Act (the Open Learning Deferred Payment Scheme Chapter) of the Principal Act and details of any breaches.

Note: The Higher Education Funding Amendment Bill (No. 3) 1996 did not propose an amendment similar to that proposed by item 40.

Endnotes

  1. Minister for Employment, Education and Training, Higher Education Funding Report for the 1996-98 Triennium, January 1996, p. 4
  2. ibid.
  3. Liberal and National Parties' Higher Education Policy, Quality, Diversity and Choice, February 1996, p. 6.
  4. ibid.
  5. ibid., at p. 8.
  6. ibid.
  7. Minister for Employment, Education and Training, Higher Education Funding Report for the 1996-98 Triennium, January 1996, p. 18.

Contact Officer and Copyright Details

Ian Ireland Ph. 06 277 2438
7 August 1996
Bills Digest Service
Parliamentary Research Service

This Digest does not have any official legal status. Other sources should be consulted to determine whether the Bill has been enacted and, if so, whether the subsequent Act reflects further amendments.

PRS staff are available to discuss the paper's contents with Senators and Members and their staff but not with members of the public.

ISSN 1323-9032
© Commonwealth of Australia 1996

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1996.

This page was prepared by the Parliamentary Library, Commonwealth of Australia
Last updated: 8 August 1996 WARNING:
This Digest is prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments.

This Digest was available from 9 August 1996.

CONTENTS

Passage History

Higher Education Funding Amendment Bill (No. 1) 1996

Date Introduced: 26 June 1996
House: House of Representatives
Portfolio: Employment, Education, Training and Youth Affairs
Commencement: Amendments outlined in this Bills Digest commence on Royal Assent

Purpose

The major amendments proposed by the Bill:

  • vary levels of grants for higher educations institutions for the years 1996-1998; and
  • provide for advances of grants for expenditure for operating purposes to higher education institutions.

Background

Under the Higher Education Funding Act 1988 (the Principal Act) the Commonwealth provides funding to higher education institutions. Funding is provided on a rolling triennium basis, which means that the level of funding is known for the next three years. The Principal Act also establishes the Higher Education Contribution Scheme (HECS) and the Open Learning Deferred Payment Scheme.

Commonwealth expenditure on higher education has been increasing steadily over recent years. Operating grants for higher education institutions are estimated to total:

  • $4 908 742 million in 1996;
  • $4 987 138 million in 1997; and
  • $5 019 941 million in 1998.(1)

Commonwealth funding for higher education for the 1996-98 triennium, which comprises total operating grants, research programs, open learning initiative, capital program, evaluations and investigations, and civic and citizenship education is estimated to total $5 339 455 million in 1996, $5 413 614 million in 1997 and $5 450 644 million in 1997.(2)

Liberal and National Parties' Higher Education Policy

During the 1996 election campaign, the Liberal and National Parties gave a number of commitments in relation to Commonwealth funding of higher education, including:

The Coalition ..., will at least maintain the level of Commonwealth funding to universities both in terms of operating grants and research grants.(3)

The Coalition will continue the practice of funding universities on a rolling triennium basis but will modify the mechanism for the allocation of Commonwealth funds, putting less emphasis on a formula funding model.(4)

..., the Coalition recognises that new funding must supplement and not replace the public contribution. The Coalition does not intend to change the public structure of our universities.(5)

The Coalition additionally supports the existing Higher Education Contribution Scheme ... .(6) </ ul>

The major provisions of this Bill are substantially the same as those contained in the Higher Education Amendment Bill (No. 3) 1995. That Bill, which was introduced by the previous Government on 29 November 1995, lapsed with the dissolution of Parliament for the 1996 election.

Main Provisions

Item 3 of Schedule 1 - Section 17 of the Higher Education Funding Act 1988 (the Principal Act) sets out the total grants payable to higher education institutions as recurrent grants for operating purposes. Item 3 varies the maximum grants payable for:

  • 1996 from $3 781 575 000 to $3 803 406 000;
  • 1997 from $3 834 297 000 to $3 855 623 000; and
  • 1998 from $3 844 309 000 to $3 860 016 000.

Item 4 of Schedule 1 - A new paragraph 18(1)(f) is substituted in the Principal Act by item 4 which provides that financial assistance is granted to an institution on condition that it gives the Minister, no later than 30 June in the following year, a financial statement for that year in an approved form, and a report on that statement by a qualified auditor.

Note: Currently paragraph 18(1)(f) provides that financial assistance is granted to an institution on condition that it gives the Minister, no later than 30 June in the following year, a statement by a qualified auditor, in an approved form, on the expenditure of the institution for operating purposes or for limited operating purposes, for that year.

The rationale given by the Government for the amendment proposed by item 4 is that it 'clarifies that financial statements are to be submitted by a qualified auditor'. The amendment makes it clear that the institution is to prepare a financial statement and the auditor is to comment on the statement.

The amendment proposed by item 4 was not contained in the Higher Education Funding Amendment Bill (No. 3) 1995. </ ul>

Item 7 of Schedule 1 - Section 20 of the Principal Act sets out the maximum grants payable to higher education institutions for superannuation expenses. Item 7 varies the maximum grants payable for:

  • 1996 from $73 009 000 to $95 000 000;
  • 1997 from $73 009 000 to $95 000 000; and
  • 1998 from $73 009 000 to $95 000 000.
Note: Item 5 of Schedule 1 of the Higher Education Funding Amendment Bill (No. 3) 1995 proposed to vary the maximum grants payable under section 20 of the Principal Act for:
  • 1996 from $73,009,000 to $59,757,000;
  • 1997 from $73,009,000 to $59,757,000; and
  • 1998 from $73,009,000 to $59,757,000.
</ ul>

Item 8 of Schedule 1 - A new section 20A, dealing with advances of grants for expenditure for operating purposes to higher education institutions, is substituted in the Principal Act by item 8. Under proposed section 20A the Minister is accorded a discretion to advance a higher education institution, for expenditure for operating purposes, such financial assistance as the Minister determines. The total of advances in a year must not exceed the total grants payable to institutions as recurrent grants for operating purposes for that year.

A grant for expenditure for operating purposes payable to a higher education institution under section 15 or 16 of the Principal Act will be reduced by an amount equal to an advance.

Determinations and reductions must be in accordance with guidelines issued under proposed section 20B. Proposed section 20B, which is also inserted in the Principal Act by item 8, provides the Minister with power to issue such guidelines. Determinations and guidelines are subject to disallowance by Parliament (items 53 and 54 of Schedule 1)

Note: The amendments proposed by items 8, 53 and 54 are identical to those proposed by items 7, 38 and 39 of Schedule 1 of the Higher Education Funding Amendment Bill (No. 3) 1995.

Item 16 of Schedule 1 - Section 23C of the Principal Act sets out the maximum grants payable to enhance the quality of higher education, projects of national priority, promotion of equal opportunity, special research assistance and advanced engineering. Item 16 varies the maximum grants payable for:

  • 1995 - from $441 397 000 to $432 147 000;
  • 1996 - from $492 195 000 to $496 250 000;
  • 1997 - from $476 196 000 to $477 793 000; and
  • 1998 - from $453 482 000 to $451 081 000.

Note: Item 13 of Schedule 1 of the Higher Education Funding Amendment Bill (No. 3) 1995 proposed to vary the maximum grants payable under section 23C of the Principal Act for:

  • 1996 - from $492 195 000 to $493 665 000;
  • 1997 - from $476 196 000 to $477 779 000; and
  • 1998 - from $453 482 000 to $454 531 000
</ ul>

Item 18 of Schedule 1 - Section 27 of the Principal Act deals with grants for special capital projects. Item 18 varies the maximum grant payable for:

  • 1996 - from $36 893 000 to $ 36 927 000;
  • 1997 - from $36 893 000 to $36 927 000; and
  • 1998 - from $36 893 000 to $36 927 000.

Note: The amendments proposed by item 18 are identical to those proposed by item 15 of Schedule 1 of the Higher Education Funding Amendment Bill (No. 3) 1995. </ ul>

Item 34 of the Schedule 1 - The effect of the amendment proposed by item 34 is to require the Open Learning Agency not to allow a client to continue to be enrolled in, or undertake, a unit of study where they do not appear to have a tax file number.

Note: The Open Learning Initiative, which was announced in the 1992 93 Budget and established in 1993, provides access to higher education opportunities for those otherwise excluded from on campus study by, for example, work or family responsibilities.

The Open Learning Agency of Australia (OLA) is a private company, formed by Monash University. OLA's board comprises five Monash University nominees, representatives from Charles Stuart University, Curtin University of Technology, Deakin University, the University of South Australia and two nonuniversity nominees.

In 1995, the OLA offered over 230 undergraduate units from 21 universities from 21 universities and over 30 TAFE units from five TAFE providers. Study unit registrations for 1995 were around 21 700.(7)

Currently, section 106AA of the Principal Act requires the OLA to notify the Minister when a client does not appear to have a tax file number. The amendment proposed by item 34 is identical to an amendment proposed by item 23 of the Higher Education Funding Amendment Bill (No. 3) 1995. </ ul>

Item 39 of Schedule 1 - The effect of the amendment proposed by item 39 to section 106E of the Principal Act is to require the OLA to give the Minister, where he/she so requires, any statistical and other information relating to clients undertaking units of study in a study period.

Note: Currently, section 106E requires the OLA to give the Minister, where he/she so requires, any information in its possession relating to clients undertaking units of study in a semester (other than the name or address of a client) that he/she reasonably requires for the purposes of the Open Learning Deferred Payment Scheme.

The amendment proposed by item 39 to section 196E is identical to an amendment proposed by item 27 of the Higher Education Funding Amendment Bill (No. 3) 1995. </ ul>

Item 40 of Schedule 1 - A new section 106FA, dealing with an annual statement of the Chief Executive Officer of the OLA, is inserted in the Principal Act by item 40. Proposed section 106FA requires the Chief Executive Officer of the OLA to provide the Minister before the end of each calendar year with a statement as to whether the OLA has complied with the requirements under Chapter 5 of the Principal Act (the Open Learning Deferred Payment Scheme Chapter) of the Principal Act and details of any breaches.

Note: The Higher Education Funding Amendment Bill (No. 3) 1996 did not propose an amendment similar to that proposed by item 40.

Endnotes

  1. Minister for Employment, Education and Training, Higher Education Funding Report for the 1996-98 Triennium, January 1996, p. 4
  2. ibid.
  3. Liberal and National Parties' Higher Education Policy, Quality, Diversity and Choice, February 1996, p. 6.
  4. ibid.
  5. ibid., at p. 8.
  6. ibid.
  7. Minister for Employment, Education and Training, Higher Education Funding Report for the 1996-98 Triennium, January 1996, p. 18.

Contact Officer and Copyright Details

Ian Ireland Ph. 06 277 2438
7 August 1996
Bills Digest Service
Parliamentary Research Service

This Digest does not have any official legal status. Other sources should be consulted to determine whether the Bill has been enacted and, if so, whether the subsequent Act reflects further amendments.

PRS staff are available to discuss the paper's contents with Senators and Members and their staff but not with members of the public.

ISSN 1323-9032
© Commonwealth of Australia 1996

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1996.

This page was prepared by the Parliamentary Library, Commonwealth of Australia
Last updated: 8 August 1996

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