EXPLANATORY STATEMENT
Subject:- Education Services for Overseas Students Act 2000
2011 Contributions Criteria
Background – ESOS Assurance Fund
Part 5 of the Education Services for Overseas Students Act 2000 (the Act) is about the ESOS Assurance Fund (the Fund). Sections 58 to 65 of the Act concern annual Fund contributions.
The Fund was established under the Act to protect the interests of overseas students on student visas or intending overseas students, who are studying or about to study in Australia.
The Fund can be used to place the student in a suitable alternative course, or, failing that, to pay the student a refund in circumstances where:
- a student does not receive a course for which they have paid; and
- the provider does not provide a refund of course fees or cannot arrange for a suitable alternative course; and
- the student is unable to be placed in a suitable alternative course by the provider’s Tuition Assurance Scheme (TAS) or other primary assurance mechanism.
All providers registered on the Commonwealth Register of Institutions and Courses for Overseas Students, other than those exempt under the Act (which includes providers that are administered by a state education authority or receive Commonwealth recurrent funding), must pay an annual contribution to the Fund. The Fund is managed by a Fund Manager. The contracted Fund Manager is PricewaterhouseCoopers.
Contributions Criteria
The Contributions Criteria are determined by the Contributions Review Panel (the Panel) which is established under subsection 54 of the Act.
Under section 59 of the Act, the Fund Manager must give the Panel a set of draft contributions criteria, which the Panel must either accept without alteration or ask the Fund Manager to revise.
In accordance with section 59 of the Act, the Panel determined the Contributions Criteria on 17 December 2010. The Fund Manager must make this information publicly available, in accordance with section 62 of the Act.
The 2011 Contributions Criteria apply from 1 January 2011 – 31 December 2011. This instrument commences on 1 January 2011.
The criteria apply to all non-exempt providers registered on the Commonwealth Register of Institutions and Courses for Overseas Students at any time during 2011. The criteria set out the base premium and additional premiums that apply to providers.
Each provider’s contribution is assessed based on their estimated overseas student fee income for the period 1 January to 31 December 2011.
The Criteria also set out the consequences of a provider not submitting required information to the Fund Manager.
Consultation
The Panel is a 10 member Panel appointed by the Minister responsible for administering the Act. The Act requires that at least 5 of the members must be people who, in the Minister’s opinion, represent the interests of providers who are liable to pay annual Fund contributions. At least 4 of the 5 must be people who, in the Minister’s opinion, represent the interests of providers who are members of tuition assurance schemes. There is consultation with industry regarding Panel appointments.
The Fund Manager developed the draft contributions criteria and the Panel determined the criteria in accordance with the process set out in section 59 of the Act.
Commencement
This instrument commences on 1 January 2011.
Overview
The Education Services for Overseas Students Act 2000 (ESOS Act) was enacted to address the need for a regulatory framework to protect the interests of overseas students studying in Australia. It established the ESOS Assurance Fund (the Fund), which is designed to provide financial protection to overseas students in cases where the educational provider fails to deliver the agreed course or refund fees, and where no other primary assurance mechanisms are available. The ESOS Act requires all eligible providers to contribute to the Fund annually. This legislation is administered by the Commonwealth Parliament and aims to ensure that the interests of overseas students are safeguarded through a dedicated funding mechanism.
The 2011 Contributions Criteria, which apply from 1 January 2011 to 31 December 2011, were determined by the Contributions Review Panel established under the Act. These criteria establish the base and additional premiums for providers based on their estimated overseas student fee income for the specified period. Providers must contribute to the Fund according to these criteria, and failure to submit required information may result in consequences as outlined in the Criteria. The process for setting these criteria involves the Fund Manager developing draft contributions and the Panel reviewing and determining the final criteria, ensuring a transparent and consultative approach to the funding process.
Scope and Application
The Education Services for Overseas Students Act 2000 (ESOS Act) pertains to the ESOS Assurance Fund, which is designed to safeguard the interests of overseas students in Australia, particularly those on student visas or intending to study here. This Act applies to all providers registered on the Commonwealth Register of Institutions and Courses for Overseas Students, except those exempt under the Act, which includes providers administered by a state education authority or receiving Commonwealth recurrent funding. The Act's geographic reach is national, ensuring a consistent application across all jurisdictions in Australia. The Act mandates that these providers make annual contributions to the Fund, managed by PricewaterhouseCoopers, to facilitate the placement of students in suitable alternative courses or provide refunds in cases where a student does not receive the paid course and the provider cannot offer a suitable alternative. The 2011 Contributions Criteria, determined by the Contributions Review Panel established under the Act, outline the base and additional premiums applicable to providers based on their estimated overseas student fee income for the period from 1 January to 31 December 2011. These criteria, which became effective from 1 January 2011, also specify the consequences for providers who fail to submit required information to the Fund Manager. The process for determining these criteria involves consultation with industry and adherence to the procedures outlined in section 59 of the Act.
Key Provisions
The Education Services for Overseas Students Act 2000 (the Act) establishes the ESOS Assurance Fund (the Fund), which aims to safeguard the interests of overseas students in Australia. Sections 58 to 65 of the Act detail the annual contributions providers must make to the Fund. The Fund is intended to place a student in an alternative course or to refund their fees if a provider fails to deliver the agreed course and cannot offer a suitable alternative. Providers on the Commonwealth Register of Institutions and Courses for Overseas Students, excluding those exempt by the Act, must contribute annually to the Fund. This contribution requirement ensures that the Fund can provide financial support to students in the specified circumstances. The Fund is overseen by a Fund Manager, currently PricewaterhouseCoopers.
Providers must adhere to the criteria set out for annual contributions to the Fund. Section 59 of the Act mandates that the Fund Manager submit draft contributions criteria to the Contributions Review Panel (the Panel), which is established under section 54. The Panel, composed of ten members appointed by the Minister responsible for the Act, must then accept or request revisions to the draft criteria. The Panel's determination of the criteria, as per section 59, was finalized on 17 December 2010. The Fund Manager must then make this information publicly available in accordance with section 62. These 2011 Contributions Criteria apply from 1 January 2011 to 31 December 2011, affecting all non-exempt providers registered during this period. Providers' contributions are based on their estimated overseas student fee income for the 2011 period. The Criteria also outline the repercussions for providers who fail to submit the required information to the Fund Manager.
The Act imposes specific obligations on registered providers. They must pay their annual contributions to the Fund, calculated based on the criteria set by the Panel. Failure to submit the necessary information by the specified deadlines can result in adverse consequences outlined in the Criteria. Additionally, the Act mandates consultation with industry stakeholders during the appointment process for Panel members, ensuring representation of both the interests of providers and those involved in tuition assurance schemes. These obligations are crucial to maintaining the Fund's effectiveness and ensuring it can fulfill its purpose of protecting overseas students.
Failure to comply with the obligations and criteria set out in the Act can lead to various consequences. Section 62 stipulates that the Fund Manager must publicly disclose the contributions criteria, underscoring the importance of adherence. Providers not submitting the required information may face penalties or other consequences as outlined in the Criteria. While specific penalties are not detailed in the Act, non-compliance can potentially result in financial liabilities or other administrative actions. The Act's provisions are designed to ensure that the Fund can reliably support overseas students, and thus, compliance is critical for all registered providers.