Reference
1.1
On 18 October 2018 the Senate referred the provisions of the Higher Education Support (Charges) Bill 2018 (the Charges Bill) and the Higher Education Support Amendment (Cost Recovery) Bill 2018 (the Cost Recovery Bill) to the Education and Employment Legislation Committee for inquiry and report by 23 November 2018.
Conduct of the inquiry
1.2
Details of the inquiry were made available on the committee's website. The committee also contacted a number of organisations inviting submissions to the inquiry. Eighteen submissions were received, as detailed in Appendix 1. The committee decided to conduct the inquiry on the papers.
Structure of the report
1.3
This chapter describes the administrative arrangements for the inquiry and provides an overview of the bills.
1.4
Chapter 2 provides background information and sets out the details of the key provisions of the bills.
1.5
Chapter 3 sets out the government's rationale for the proposed changes, and looks at several issues raised in submissions.
Overview of the bills
1.6
The Charges Bill would introduce an annual charge on all higher education providers whose students are entitled to HECS-HELP assistance or FEE-HELP assistance under the Higher Education Support Act 2003 (HESA or the Act).
1.7
According to the Explanatory Memorandum the annual charge would be imposed as a tax. The Charges Bill does not set the amount of the annual charge, which would be prescribed by the regulations or worked out in accordance with the manner prescribed in the regulations.
1.8
The Cost Recovery Bill would amend HESA to implement an application fee for higher education providers seeking approval as a higher education provider under the Act to offer FEE-HELP. The amount of the application fee would be set in the Higher Education Provider Guidelines 2012.
1.9
The Cost Recovery Bill would also provide for the administration of the proposed annual charge.
Compatibility with human rights
1.10
The bills' Explanatory Memoranda state that the bills are compatible with human rights because they do not raise any human rights issues.
1.11
The Parliamentary Joint Committee on Human Rights considered the bills in its Scrutiny Report 11 of 2018. No concerns were identified.
Financial impact statement
1.12
The 2018-19 Budget reported that the government expected to raise $30.7 million over the forward estimates from the annual charge and the application fee. The government has since revised this figure. The Explanatory Memorandum for the Charges Bill states that the annual charge is expected to deliver a saving of $13.8 million over the forward estimates (2019-20 to 2021‑22). The application fee is expected to deliver a saving of $0.3 million over the forward estimates. Together, these measures would provide an estimated saving of $14.1 million over the forward estimates.
1.13
Since the introduction of the bills, the total figure has been further refined in the Department of Education and Training's draft Cost Recovery Implementation Statement to $11.3 million over the forward estimates.
Scrutiny of Bills Committee
1.14
The Senate Standing Committee for the Scrutiny of Bills (Scrutiny of Bills Committee) considered the bills in its Scrutiny Digest 12 of 2018. The Scrutiny of Bills Committee considered that some guidance on 'the method of calculation of a maximum charge should be provided on the face of the primary legislation'. The Scrutiny of Bills Committee also considered that 'significant matters, such as the amount of a penalty or the review of decisions relating to the collection and recovery of the higher education provider charge, should be included in primary legislation unless a sound justification for the use of delegated legislation is provided'.
1.15
The Scrutiny of Bills Committee sought the minister's advice on the following matters:
'why there are no limits on the charge specified in primary legislation and whether guidance in relation to the method of calculation of a maximum charge can be specifically included in the bill';
'why it is considered necessary and appropriate to provide that the rate of a penalty for late payment and the right of review of decisions made in relation to the collection or recovery of higher education provider charges may be set out in delegated legislation';
'why, if it is considered appropriate to leave such matters to delegated legislation, the bill does not require that the Guidelines make review rights available'.
1.16
At the time of writing, the Scrutiny of Bills Committee is yet to publish a response from the minister.
Acknowledgement
1.17
The committee thanks the various stakeholders who contributed to the inquiry by preparing written submissions.