Explanatory Memorandum(Circulated by the authority of the Minister for Education, the Honourable Dan Tehan MP)
The purpose of the Education Legislation Amendment (2019 Measures No. 1) Bill 2019 ( the Bill ) is to make higher education more accessible and affordable to students by:
increasing the combined Higher Education Loan Program ( HELP ) loan limit for students undertaking eligible aviation courses on or after 1 January 2020 at higher education providers approved under the Higher Education Support Act 2003 ( HESA ) and vocational education and training ( VET ) providers approved under the VET Student Loans Act 2016 ( VSL Act );
- enabling the Minister to determine the aviation courses for which a person has the higher HELP loan limit;
- providing for all or part of a person's HELP debt to be remitted for their recognised initial teacher education course after they have been engaged as a teacher for four years in a school in a very remote location of Australia from the start of the 2019 school year;
- reducing indexation on a person's outstanding accumulated HELP debt while they are teaching in a school in a very remote location of Australia; and
- allowing the Department of Human Services restricted access to higher education data and VET student loans ( VSL ) data in order to administer student benefits.
HESA is the main piece of legislation governing Commonwealth funding of higher education in Australia. HESA provides for the Commonwealth to give financial support to higher education providers through government subsidies and loans to higher education students to cover their tuition and other fees. The VSL Act provides capped loans to VET students for tuition fees in approved higher-level VET courses.
Schedule 1 to the Bill will make changes to the HELP loan limit. From 2020, students undertaking eligible aviation courses that lead to certification as a Commercial Pilot at higher education providers and VSL providers will be able to access the higher of the two HELP loan limits (the same limit that applies to students studying medicine, dentistry and veterinary science courses). The higher HELP loan limit will be $152,700 for 2020. This reduces the students' barrier for enrolling in aviation courses through increased loan assistance to defer tuition fees for their aviation study.
Schedule 2 to the Bill will introduce two measures to assist teachers working in schools in very remote locations in Australia reduce the HELP debts they have incurred in studying their initial teacher education course. First, teachers working in schools in very remote locations will have the annual indexation of their HELP debt reduced. The amount by which the annual indexation of a teacher's HELP debt will be reduced will be proportional to the period of time during the previous calendar (school) year that the teacher worked in a very remote location; a teacher who works for a full year in a very remote location will not have their HELP debt indexed at all in the following year.
Second, teachers who work for an equivalent of four years' full-time in schools in very remote locations in Australia will have an amount, incurred for their recognised initial teacher education course, up to the value of their outstanding HELP debt, fully remitted.
A school is defined in Schedule 2 to the Bill to be an early childhood education and care service providing a preschool education program, a preschool, or a school providing primary or secondary education. Accordingly, these measures will assist teachers employed in very remote primary and secondary schools, as well as teachers employed in a very remote early childhood education settings.
These measures will also assist schools in very remote locations of Australia to recruit and retain high quality teachers, thereby improving education outcomes for students in these very remote communities.
Schedule 3 to the Bill will introduce a number of other measures to:
- improve the efficiency of the collection of data from higher education and VSL providers by allowing the Department of Human Services restricted access to higher education and VSL data collected by the Department of Education and the Department of Employment, Skills, Small and Family Business in order to administer student benefits, under the Transforming the Collection of Student Information ( TCSI ) initiative;
- clarify that information collected under HESA can be used to administer the VSL program; and
- update higher education provider names and make technical corrections to definitions in HESA.
FINANCIAL IMPACT STATEMENT
This Bill implements the Government's higher education measures from the 2019-20 Federal Budget. The Bill also implements a measure to allow the Department of Human Services restricted access to higher education and VSL data from the 2017-18 MYEFO.
The measure in Schedule 1 to the Bill (higher HELP loan limit for certain aviation courses) delivers a positive impact of $45.9 million in fiscal balance terms over the period from 2019-20 to 2023-24. In underlying cash terms, the measure provides a minor saving of $1.7 million over the same period.
The measures in Schedule 2 to the Bill (HELP debt indexation reduction and HELP debt remittal for teachers working in very remote locations) have a cost of $94.0 million in fiscal balance terms over the period from 2019-20 to 2023-24. In underlying cash terms, the measures come at a cost of $28.7 million over the same period.
The measures in Schedule 3 to the Bill do not have financial implications.