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1998-1999-2000-2001
THE
PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF
REPRESENTATIVES
INNOVATION AND EDUCATION
LEGISLATION AMENDMENT BILL 2001
EXPLANATORY
MEMORANDUM
(Circulated
by authority of the Minister for Education, Training and Youth Affairs the Hon
Dr David Kemp MP)
ISBN: 0642 46877X
INNOVATION AND EDUCATION LEGISLATION AMENDMENT BILL
2001
OUTLINE
The Higher Education Funding Act 1988 (HEFA) makes provision for
grants of financial assistance to higher education institutions and other bodies
for higher education purposes, establishes the Higher Education Contribution
Scheme (HECS) and the Open Learning Deferred Payment Scheme (OLDPS) and makes
provision for the repayment of monies lent by the Commonwealth to students under
those schemes.
The Australian Research Council Act 2001
establishes the Australian Research Council (ARC) as a body which, among
other things, make high quality recommendations to the Minister on the funding
of research programs and the administration of such schemes, as well as
establishing a funding regime to support research programs. This funding is
appropriated under section 49 of the Act.
The funding schemes
administered by the ARC support individuals and teams who perform excellent
research. Proposals for funding are competitively assessed through a process of
peer review. The Government, in Backing Australia’s Ability, has
announced its commitment to double the funding available for these schemes
administered by the ARC over the next five years.
The Bill amends the
Higher Education Funding Act 1988 to:
• vary the maximum
amount of financial assistance payable to higher education institutions for the
funding year 2002 to provide additional funding of $45.073 million for higher
education project specific research infrastructure;
• vary the
maximum amount of financial assistance payable to higher education institutions
for the funding year 2002 to provide funding of $25.714 million to establish a
new programme to support systemic research infrastructure;
• vary
the maximum amount of financial assistance payable to higher education
institutions under section 17 and section 23C (a transfer of funding between the
sections) in 2001 and 2002 to make provision for the Research Training
Scheme;
• vary the maximum amount of financial
assistance payable to higher education institutions under Section 17 to provide
additional funding of $13.046 million in 2002 (the non-HECS component) for an
additional 2000 targeted undergraduate places for higher education institutions
listed under Table A of Section 4(1);
• include provisions
to allow for an income contingent loan scheme for postgraduate non-research
course tuition fees, being the Postgraduate Education Loan Scheme
(PELS);
• include provisions to give the Minister discretion to cap
the total level of indebtedness an individual can accrue in aggregate under the
HECS, OLDPS and PELS;
• allow higher education institutions more
flexibility in accepting electronic communications, including a signature from
students, and to provide that higher education institutions may issue students
with written notices electronically provided that the student has access to the
appropriate information technology.
The Bill amends the Australian
Research Council Act 2001 to:
• vary the maximum amount of
financial assistance payable to higher education institutions for the funding
year 2002 under paragraph 49(b) to provide additional funding of $18.601 million
for research schemes administered by the Australian Research Council as
announced in the policy statement Backing Australia’s
Ability.
The States Grants (Primary and Secondary Education
Assistance) Act 2000 introduced changes to targeted programmes from 2001,
including replacing special education per capita grants with a single
strategic assistance amount. The Bill seeks to ensure that
non-government schools will not be disadvantaged by this change in funding
arrangements. The Bill also seeks to increase the amount of establishment
assistance for new schools in line with current estimates of demand.
The Bill amends the States Grants (Primary and Secondary Education
Assistance) Act 2000 to:
· correct an error in the funding amount
provided for non-government school students with disabilities in Schedule 8,
Part 2, column 3 for each of the years 2001 to 2004 (the correct per capita
amount for each year should have been $561);
· replace the amounts shown
in Schedule 8, Part 1, column 2, which details the amount available for
‘Strategic Assistance’ for government and non-government schools for
each of the years 2001 to 2004, to ensure independent and non-systemic Catholic
schools are not disadvantaged by the introduction of new arrangements for
special education per capita funding introduced in the Act;
and
· replace the amounts shown in Schedule 7, column 2, detailing the
amount available for ‘Establishment Grants’ for each of the years
2001 to 2004 . This amendment brings the funding in line with the current
estimates of new schools seeking establishment assistance.
In relation to the Higher Education Funding Act 1988 and the
Australian Research Council Act 2001, the Bill provides
for:
• additional funding of $102.434 million in 2002 for
additional research funding, research infrastructure funding and targeted
university places;
• a transfer of $14.792 million in 2001 and 2002
from section 17 to section 23C of HEFA for the Research Training
Scheme.
In relation to the States Grants (Primary and Secondary
Education Assistance) Act 2000, the Bill provides:
• Increased
funding of $2.662 million over the program years 2001-2004 for non-government
school students with disabilities in Schedule 8, Part 2, column 3
‘Strategic Assistance’;
· Increased funding of $190,000 for
each of the four years 2001-2004 (a total increase of $760,000) in Schedule 8,
Part 1, column 2 for the student outcomes programme; and
· Increased
funding of $9.534 million over the program years 2001-2004 in Schedule 7, column
2 for establishment assistance for new schools.
INNOVATION AND EDUCATION LEGISLATION AMENDMENT BILL
2001
NOTES ON CLAUSES
Clause 1 - Short title
Provides for the Act to be cited as
the Innovation and Education Legislation Amendment Act
2001.
Clause 2 - Commencement
Provides for the Act to
commence on the day on which it receives the Royal Assent.
Clause 3 -
Schedule(s)
Provides that each Act that is specified in a Schedule is
amended or repealed as set out in the applicable items in the Schedule and that
any other item in a Schedule has effect according to its
terms.
Higher Education Funding Act 1988
Item
1
Section 17 sets the maximum aggregate funding levels for operating
grants that may be paid to higher education institutions under sections 15 and
16 of the Act. Item 1 amends paragraph 17(m) to vary the maximum aggregate
funding level for 2001 to reflect a transfer of funds to subsection 23C(2) to
make provision for the Research Training Scheme and amends paragraph 17(n) to
vary the maximum aggregate funding levels for 2002 to reflect a transfer of
funds to subsection 23C(2) to make provision for the Research Training Scheme
and extra funding for additional targeted places.
Section 49 sets out the total research funding limits for each year
specified in section 48. Item 2 amends paragraph 49(b) to vary the maximum
aggregate funding level for 2002 to reflect additional funding provided for
higher education research.
Higher Education Funding Act
1988
Item 3
Subsection 23C(2) limits the total
funds available for grants that may be approved under sections 21, 21B, 22, 23,
23A and 23B for various years. Item 3 amends paragraph 23C(2)(i) to vary the
maximum aggregate funding level for 2001 to reflect the transfer of funds from
section 17 to make provision for the Research Training Scheme and amends
paragraph 23C(2)(j) to vary the maximum aggregate funding level for 2002 to
reflect the transfer of funds from section 17 to make provision for the Research
Training Scheme and additional funding provided for project specific research
infrastructure and systemic research infrastructure.
States Grants (Primary and Secondary Education Assistance) Act
2000
Replaces the table in Schedule 7 to provide additional establishment
assistance for new schools for each of the years 2001 to 2004 to bring funding
into line with current estimates of new schools seeking establishment
assistance.
Part 2 – Extra strategic assistance for
educationally disadvantaged students
States Grants (Primary and
Secondary Education Assistance) Act 2000
Amends the table in Schedule 8, Part 1 to provide additional strategic
assistance for educationally disadvantaged students for each of the years 2001
to 2004 to ensure independent and non-systemic Catholic schools are not
disadvantaged by the introduction of new arrangements for special education per
capita funding.
Replaces the table in Schedule 8, Part 2 to provide additional funding
for non-government school students with disabilities for each of the years 2001
to 2004, to correct an error in a previous update of funding amounts from 1999
final prices to 2000 final prices.
Higher Education Funding Act 1988
Amends the definition of “year to which this Chapter applies”
in section 3 to reflect the introduction of the post-graduate education loan
scheme from the year 2002 by item 5.
Amends paragraph 60(1)(a) to reflect the introduction of the
post-graduate education loan scheme by requiring that money paid to the
Commonwealth under proposed Chapter 4A be transferred from the Consolidated
Revenue Fund to the Higher Education (HECS) Reserve.
Amend paragraph 61(1)(a) to permit money in the Higher Education (HECS)
Reserve to be applied for the purposes of proposed Chapter 4A.
Inserts a new Chapter 4A providing for a new post-graduate education loan
scheme.
(NOTE: proposed section is abbreviated as ps)
ps98A Definitions
This proposed section inserts a definitions clause which gives
particular meanings to words and expressions used in proposed Chapter 4A (unless
there is a contrary intention apparent). Expressions used in proposed Chapter
4A that are defined in Chapter 4 have the same meaning in proposed Chapter 4A
(unless a contrary intention is apparent). Section 37 and subsection 39(2)
apply in relation to the expressions semester and standard student
load in Chapter 4 as if the references in section 37 and subsection 39(2) to
institution were references to institution within the meaning of Chapter
4A.
Expressions used in the Income Tax Assessment Act 1936 have
the same meaning in proposed Chapter 4A as they have in that Act (unless the
contrary intention appears).
Student fees paid to an institution by a
person other than the student are deemed to be payment to the institution by the
student.
ps98B Eligible student
This proposed section
specifies the citizenship or residency requirements to qualify as an eligible
student for the purposes of proposed Chapter 4A.
ps98C Additional condition
This proposed section provides
that financial assistance is granted to an institution on the condition that the
institution complies with the requirements of proposed Chapter 4A in addition to
the conditions specified in any other part of the Act.
ps98D Making an application for a PELS loan
This proposed
section provides that a person enrolled in or proposing to enrol in an eligible
post-graduate course of study for a semester at an institution may make an
application for a post-graduate education loan scheme loan in the form and
manner specified in proposed section 98D. An applicant makes only one
application for each course of study.
ps98E Tax file number of
student
This proposed section provides that sections 41A, 41B and
42-53 apply in relation to the tax file number of a student in the manner
specified in proposed section 98E.
ps98F Notice by
institution
This proposed section has the effect of providing that an
institution must give each student enrolled in an eligible post-graduate course
at the institution who has made an application for a loan under proposed section
98D, a written notice under proposed subsection 98F(1). Proposed subsections
98F(1)-(6) set out the timing, content and purpose of such a written notice.
Proposed subsection 98F(7) provides that section 55 applies to a subsection
98F(1) notice as if references in that section to student were references to
student within the meaning of Chapter 4A, references in subsections 55(1) and
(4) to section 54 were references to section 98F and the reference in subsection
55(3) to the liability of the student to pay the contribution were a reference
to the liability of the student to pay fees charged by the
institution.
ps98G Commonwealth to discharge students’
liabilities
This proposed section provides that if an eligible
student has made an application under proposed section 98D before the census
date for a semester for an eligible post graduate course of study for that
semester, is enrolled in that course at the institution and has not paid the
full amount of the fees charged by the institution for the course of study being
undertaken, the Commonwealth must lend the student the amount of the fees
outstanding immediately after the census date and apply the amount so lent in
making a payment to the institution in discharge of the student’s
liability for the fees outstanding. Proposed subsection 98G(3) provides that
the Commonwealth may advance an institution an amount that is expected to become
payable to the institution under proposed section 98G.
ps98H
Commonwealth not liable where person does not have a tax file
number
This proposed section provides that if an institution receives
a notice from the Commissioner of Taxation under subsection 42(3) or (5) (as
applied by proposed section 98E) to the effect that a person who has applied for
a loan under proposed section 98D does not have, or no longer has, a tax file
number and after 28 days the institution has not been notified of a number the
institution is satisfied is the person’s tax file number, the Commonwealth
is not liable, and is taken never to have been liable, to lend an amount to the
person under proposed paragraph 98G(2)(a) or to making a payment to the
institution under proposed paragraph 98G(2)(b).
Proposed subsection
98H(3) provides that regulations may set out procedures for the institution to
notify persons who may be affected by proposed subsection
98H(2).
ps98J Institution to provide information to
Minister
This proposed section provides that an institution must give
to the Minister on request such statistical and other information relating to
students in relation to eligible post-graduate courses of study as the Minister
reasonably requires for the purposes of proposed Part 4A.3, other than
information as to the name and address of a student.
ps98K Secrecy
The proposed section extends the application
of the secrecy provisions of section 78 to proposed Chapter
4A.
ps98L Annual statement
The proposed section imposes
an obligation on the chief executive officer of an institution to provide an
annual statement of compliance with proposed Chapter 4A requirements on or
before 31 December in each year and setting out the particulars of any instances
of non-compliance.
ps98M Electronic communications between
students and institutions
Proposed subsection 98M(1) inserts an
explanatory table and provides that proposed sections 56C, 56D and 56E apply for
the purposes of Chapter 4A as if a reference in those sections to a person,
thing or provision mentioned in the second column of an item in the table were a
reference to a person, thing or provision mentioned in the third column of the
table for that item. Proposed subsection 98M(2) clarifies that proposed section
98M is not intended to otherwise affect the application of proposed sections
56C, 56D and 56E.
Amends the heading to Chapter 5A to reflect the introduction of the
post-graduate education loan scheme by item 5.
Inserts a definition of PELS semester debt in subsection
106H(1).
Amends paragraph (b) of the definition of semester debt in
subsection 106H(1) to include a PELS semester debt.
Amends subsection 106H(2) to reflect the introduction of the
post-graduate education loan scheme by item 5.
Amends section 106I by inserting a new paragraph (aa) so that the objects
of Part 5A.1 reflect the introduction of the post-graduate education loan scheme
by item 5.
Inserts a proposed new section 106JA specifying the nature of a PELS
semester debt.
Amend section 106N to include debts incurred under the post-graduate
education loan scheme when calculating an accumulated HEC debt.
Amends paragraph 106O(1)(b) to provide that debts incurred under the
post-graduate education loan scheme are discharged by a person’s
subsequent accumulated HEC debt.
Inserts a new subsection 106R(4) to require an institution to give such
data in its possession relating to students in relation to eligible
post-graduate courses of study at the institution as the Commissioner of
Taxation reasonably requires for the purposes of Chapter 5A.
Amends subparagraph 106Y(2)(e)(i) to include debts incurred under the
post-graduate education loan scheme when applying payments made by a person who
has not given any directions.
Amends subsections 118(1) and (2) to exclude proposed Chapter 4A (which
provides for the establishment of the post-graduate education loan scheme) from
appropriations under the Act, but without excluding by implication the
application of any existing appropriation in relation to Chapter 4A.
A transitional provision which provides that guidelines made under
paragraph 42A(1)(b) operate on and after commencement of this Schedule in
relation to proposed paragraph 98H(1)(b) as if they had been made under that
paragraph and paragraph 42A(1)(b). This item is not intended to prevent the
amendment or repeal of the guidelines.
Higher Education Funding Act 1988
Amends the definition of institution in section 3 to also exclude
proposed Chapter 5B from the meaning given to the term by section 4.
Inserts a new Chapter 5B providing for a limit on total student
indebtedness to the Commonwealth under the Act.
(NOTE: proposed section is abbreviated as ps)
ps106ZB
Definitions
Inserts a definitions clause which gives particular
meanings to words and expressions used in Chapter 5B (unless there is a contrary
intention apparent). Expressions used in Chapter 5B that are defined in Chapter
4, 4A, 5 or 5A have the same meaning in Chapter 5B (unless a contrary intention
is apparent).
This proposed section adds compliance with Chapter 5B to the conditions
an institution referred to in section 4 must comply with to be eligible for
financial assistance under the Act.
ps106ZD Minister may determine maximum permitted debt
This
proposed section provides that the Minister may make a determination specifying
the maximum permitted debt for the purposes of Chapter 5B.
ps106ZE Commissioner to give loan limit notice
Proposed
subsection 106ZE(1) provides that the Commissioner of Taxation must give a
notice, known as the loan limit notice, to a person if the person’s
total indebtedness under the Act exceeds the maximum permitted debt determined
under proposed section 106ZD. Proposed subsections 106ZE(2) and (3) specify the
form and content of a loan limit notice and that it must be given to the
person to whom it relates, while proposed subsection 106ZE(4) provides that,
unless the loan limit notice has been cancelled under proposed section
106ZF, the Commissioner must give a copy of the notice to each specified
institution or the agency, as applicable.
Proposed subsection 106ZE(5)
further provides that the Commissioner of Taxation must also give a statement in
writing to the person to whom the loan limit notice relates specifying
the maximum permitted debt and the person’s total indebtedness under the
Act at that time.
ps106ZF Cancelling loan limit
notice
This proposed section provides that a person issued with a
loan limit notice may ask the Commissioner of Taxation to give a notice,
known as the cancellation notice, cancelling the loan limit
notice. The Commissioner must give the cancellation notice to the person if
their total indebtedness under the Act no longer exceeds the maximum permitted
debt. Proposed subsection 106ZF(3) sets out the form and content of a
cancellation notice.
ps106ZG Consequences of loan limit
notice – no amounts payable by Commonwealth
Proposed subsections 106ZG(1) and (2) of this proposed section provide that
if the Commissioner of Taxation has given a person a loan limit notice in
accordance with proposed section 106ZE that relates to that person, the
Commonwealth is not liable (and is taken never to have been liable) to lend an
amount to the person in relation to a course of study for a semester under
subsection 57(3), paragraph 57(3A)(e), subparagraph 57(3B)(b)(i) or proposed
paragraph 98G(2)(a); or to make a payment to an institution under subsection
57(2), subsection 57(3), paragraph 57(3A)(e), paragraph 57(3A)(f), subparagraph
57(3B)(b)(ii) or proposed paragraph 98G(2)(b).
Proposed subsection
106ZG(3) specifies what constitutes a “course of study for a
semester” for the purposes of proposed subsection 106ZG(2).
Proposed subsections 106ZG(4) provides that, in relation to a unit of study
for a study period covered by proposed subsection 106ZG(5), the Commonwealth is
not liable (and is taken never to have been liable) to lend an amount to the
person under paragraph 106D(1)(a) or to make a payment to the Open Learning
Agency of Australia Pty Ltd under paragraph 106D(1)(b).
Proposed
subsection 106ZG(5) specifies what constitutes a “unit of study for a
study period” for the purposes of proposed subsection 106ZG(4).
Proposed subsection 106ZG(6) provides that the regulations may set out
procedures for an institution or the Open Learning Agency of Australia Pty Ltd
to notify persons who may be affected by proposed subsections 106ZG(2) or
(4).
ps106ZH Commissioner must give suspension notice
This
proposed section has the effect of providing that the Commissioner of Taxation
must give an institution a written notice (known as a suspension notice)
under proposed subsection 106ZH(1) in relation to a person where a HECS debt has
been reported for a student after a loan limit notice has already been
issued. Such an event will only occur where a student changes institution and
does not advise their new institution that they have been issued with a loan
limit notice. It is not necessary to issue a suspension notice where
a PELS or OLDPS debt is reported as the consequences are
different.
Proposed subsection 106ZH(3) provides that the Commissioner of
Taxation must give a copy of the suspension notice to the person to whom
it relates.
ps106ZJ Consequences of suspension notice – HECS
courses
This proposed section has the effect of providing that, where
a suspension notice has been issued to a student, the institution must
dis-enrol the student unless the student makes an up front payment of fees for
the entire semester. The requirement to dis-enrol arises from the requirements
of section 41. In the case of PELS and OLDPS, institutions and the Open
Learning Agency of Australia Pty Ltd have discretion on how to treat students
who have not paid their fees and were not eligible to take out a loan.
ps106ZK Secrecy
The proposed section extends the
application of the secrecy provisions of section 78 to proposed Chapter
5B.
Amends paragraph 110(b) to provide that a determination under proposed
section 106ZD is a disallowable instrument.
Higher Education Funding Act 1988
Insert definitions for electronic communication and information
system in section 3.
Inserts proposed new sections 56C, 56D and 56E at the end of Division 2
of Part 4.2, providing for electronic communications between institutions and
students.
(NOTE: proposed section is abbreviated as ps)
ps56C
Electronic communications from students to institutions
This proposed
section enables a student to communicate electronically with institutions for
the purposes of HECS where the student uses the information system that the
institution has specified. The information system must meet the guidelines
issued by the Minister and the Minister must declare that the information system
meets those guidelines. The guidelines and the Minister’s declaration
will be disallowable instruments. These requirements are in place to ensure
that institutions’ information systems meet security, privacy and legal
requirements. Proposed subsection 56C(2) only applies at a time when section 9
of the Electronic Transactions Act 1999 does not apply because of
regulations made under that Act.
ps56D Electronic signature of
communications by students
This proposed section enables students to
use an electronic signature in relation to an approved document for the purposes
of HECS, where the student uses a method for identification and document
approval that the institution has specified. The method used must meet the
guidelines issued by the Minister and the Minister must declare that the method
used meets those guidelines. The guidelines and the Minister’s
declaration will be disallowable instruments. These requirements are in place
to ensure that institutions’ information systems meet security, privacy
and legal requirements. Proposed subsection 56D(2) only applies at a time when
section 10 of the Electronic Transactions Act 1999 does not apply because
of regulations made under that Act.
ps56E Electronic
communications from institutions to students
This proposed section
allows institutions to communication electronically with students without
specifically seeking student agreement. Institutions may only communicate with
students in this way if the institution provides students with access to the
necessary information systems. There is provision for the Minister to make
guidelines setting out the conditions relating to access.
Inserts proposed new section 106CA at the end of Division 1 of Part 5.2,
facilitating electronic communications between clients and the Open Learning
Agency of Australia Pty Ltd in a similar way in which proposed sections 56C, 56D
and 56E facilitate communications between students and
institutions.
(NOTE: proposed section is abbreviated as
ps)
ps106CA Electronic communications between clients and
Agency
Proposed subsection 106CA(1) inserts an explanatory table and
provides that proposed sections 56C, 56D and 56E apply for the purposes of
Chapter 4 as if a reference in those sections to a person, thing or provision
mentioned in the second column of an item in the table were a reference to a
person, thing or provision mentioned in the third column of the table for that
item. Proposed subsection 106CA(2) clarifies that proposed section 106CA is not
intended to otherwise affect the application of proposed sections 56C, 56D and
56E.
Amends paragraph 110(c) to provide that guidelines issued under proposed
subsections 56C(6) or 56D(6) are disallowable instruments.