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The Impact of FEE-HELP on Outward Student Mobility Christopher Ziguras, Senior Research Fellow, Globalism Institute, RMIT University Paper presented at the Australian International Education Conference 2006, Perth Convention Centre, 12 October One of the main reasons that so few Australian students study abroad is the difficulty in financing fees for overseas programs. And while the Commonwealth offers generous loans to Australian students enrolling in full fee programs here, these are not available to Australian students who want to study at a foreign university. Extending FEE-HELP to Australian students heading overseas will give students access to overseas study options that are currently unaffordable, and will help to counter the view that Australia’s interest in international education is purely financial. In any case we may have no choice in the matter, since Australia has made a binding commitment through the World Trade Organisation’s General Agreement on Trade in Services not to discriminate against foreign higher education providers. As I will argue below, making FEE-HELP only available for study at Australian universities is clearly discrimnatory and is most likely in breach of Australia’s undertakings. No foreign government has yet publicly challenged Australia’s failure to implement these undertakings, but as competition for students in the region heats up, it is just a matter of time. For example, the Canadian embassy in Canberra has been leading a group of foreign governments who are exploring ways to increase Australian student mobility to their countries. In Australia, we have a higher proportion of foreign students in our higher education universities than any other country, and we are rightly proud of our success in attracting students here. However, less than one per cent of Australian tertiary students study oversees. While international students coming into Australia are exposing themselves to new experiences which enhance their professional and cultural mobility, few local students have similar international exposure through higher education. Reponses to this imbalance have so far focused on semester-long study abroad experiences as part of a local degree program. Various mobility programs funded by the Commonwealth and universities assist students to spend a semester at an overseas university, usually to undertake a structured program. In 2005 the Commonwealth introduced the Overseas Study Higher Education Loan Program (OS HELP), providing full-time undergraduate students in local institutions with loans to cover the cost of undertaking a part of their degree overseas. Many universities invest heavily in fostering outgoing student exchange programs by establishing exchange agreements with overseas universities and providing funds, advice and training for their outgoing students. These are all excellent initiatives, and they would be well complemented by measures that also assist Australian students to undertake whole degrees abroad. In the mid-1990s Australia was a leading player in efforts to establish the World Trade Organisation, and was committed to establishing global rules on trade in services as well as goods. Consequently, our undertakings within the General Agreement on Trade in Services were comprehensive compared with many other countries. The agreement is notoriously complicated, but in summary we committed to open our higher education market to foreign providers, and to not discriminate against foreign providers of ‘private higher education services’. The principle of non-discrimination is referred to as national treatment, and it requires that the foreign provider is treated no less favourably than a local provider. In technical terms, Australia committed to national treatment for private higher education services delivered through cross-border supply (when an Australian student enrols in a foreign program while in Australia such as an online program) and to consumption abroad (when an Australian student goes abroad to study in a foreign instiution). National treatment requires a government to ‘accord to services and service suppliers of any other Member in respect of all measures affecting the supply of services, treatment no less favourable than that it accords to its own like services and service suppliers’. Australia’s GATS commitments apply only to ‘private higher education services’, but there is currently no official definition of what constitutes a private higher education service in Australia. For this limitation to be meaningful, the government would need to be able to demonstrate that such a distinction exists in practice in Australia in order to clarify the scope of its GATS undertakings if another country challenged our discriminatory arrangements. In relation to secondary education, Australia’s GATS commitments apply to private educational institutions rather than services, and such a distinction is a little easier to work with. Clearly, certain tertiary institutions are considered ‘public’ by governments in that they were established under Commonwealth, State or Territory legislation and have been predominantly funded by the Commonwealth, however no such clarity exists for ‘private higher education services’. The most plausible approach would be to argue that public education is broadly understood in the Australian higher education sector as those student places which are allocated to institutions by, and (partly) funded by, government, ie. Commonwealth Supported Places. One could conceivably argue that even though there is a significant private contribution by students, such places constitute public rather than private education services. It would be difficult to argue that ‘fee-paying’ places which are not funded by government are not private higher education services (especially where these places are provided by a private institution). So, in all matters concerning fee-paying places the government is bound to treat foreign providers offering education to Australian students no less favourably than it treats local providers. Australia’s non-discrimination commitments did not apply to foreign campuses in Australia, so the government is free to treat these campuses (such as Carnegie Mellon’s in Adelaide) less favourably than comparable domestic institutions. Even so, Carnegie Mellon was immediately given access to FEE-HELP through an ammendment to the Higher Education Support Act late last year. Now, the Australian branches of overseas higher education institutions are able to access FEE-HELP and OS-HELP if they meet a number of conditions. This brings the higher education into line with most other sectors of our economy, where we encourage foreign investment and do not discriminate between private entities on the basis of nationality of their owners. Only students studying at the Australian campuses of overseas institutions are able to access this financial assistance, while Australian students enrolled with foreign universities through distance education or overseas study are still denied access. To live up to Australia’s commitments, a new category of providers (Table D) would need to be established, along with setting out reasonable conditions to be met by foreign universities in order for their students to be eligible for FEE-HELP loans. If the Australian government is serious about supporting the international mobility of Australian students and introducing more competition into the Australian higher education system, here is the perfect opportunity.
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