Commonwealth of Australia Explanatory Memoranda

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EDUCATION AND OTHER LEGISLATION AMENDMENT (VET STUDENT LOAN DEBT SEPARATION) BILL 2018

                             2016-2017-2018




     THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA




                     HOUSE OF REPRESENTATIVES




  EDUCATION AND OTHER LEGISLATION AMENDMENT (VET
      STUDENT LOAN DEBT SEPARATION) BILL 2018




                 CORRECTION AND ADDENDUM TO THE

                     EXPLANATORY MEMORANDUM




(Circulated by authority of the Assistant Minister for Vocational Education
              and Skills, the Honourable Karen Andrews MP)
    EDUCATION AND OTHER LEGISLATION AMENDMENT (VET
        STUDENT LOAN DEBT SEPARATION) BILL 2018
NOTES ON CLAUSES

This Correction and Addendum corrects a typographical error and responds to
concerns raised by the Senate Standing Committee for the Scrutiny of Bills in
Scrutiny Digest No. 5 of 2018.

On page 33 with respect to item 20 of Part 1 of Schedule 1 - Section 23FE Failures
to comply with section 23ED - change the sentence reading "This is modelled on
section @154-90 of HESA" to "This is modelled on section 154-90 of HESA" (to
correct a typographical error) and then insert the following:

"The effect of new section 23FE is that a failure to comply with new section 23ED,
which deals with notices required to be provided to the Commissioner in specified
circumstances, is an offence of absolute liability, subject in the first instance to a
fine not exceeding 20 penalty units (see sections 8C and 8E of the Taxation
Administration Act 1953). Where a person has been previously convicted of two or
more relevant offences, the penalty is a fine not exceeding 50 penalty units or
imprisonment of no longer than 12 months, or both. However, a person does not
commit an offence if the person is not capable of complying with new section 23ED
(see subsection 8C(1B) of the Taxation Administration Act 1953).

When an offence is one of absolute liability, it will be established if it can be proven
that the person engaged in certain conduct, without having to prove the person's
fault (that is, that the person intended this, or was reckless or negligent).

An offence of absolute liability is appropriate for a failure to comply with new section
23ED as it provides the necessary deterrence to support the effective
administration of the tax system, particularly in the context of the self-assessment
system, by ensuring people take some care to understand and comply with their
taxation-related obligations.

More specifically, in this particular situation, failure to notify the Commissioner in a
timely manner as required under new section 23ED would undermine the
effectiveness of the framework and policy regarding the VET Student Loans
program, once it is administratively separated from HELP. Therefore, new section
23FE would support the effectiveness of the enforcement regime relating to the
administration of VET student loan debts. Importantly, a person would not be
penalised under the criminal law if the person was simply incapable of complying
with the requirements in new section 23ED.

The operation of section 23FE does not represent a substantive change from the
existing arrangements for VET student loan debtors. As noted above, a similar
provision is contained in HESA (see section 154-90) and currently applies to VET
student loan debtors by virtue of VET student loan debts being HELP debts. New
section 23FE maintains the same penalties that apply now but under separate
arrangements for VET student loans given their separation from other forms of
HELP debts. This ensures consistency with the treatment of other HELP debts."