Education (Export Education Levy) Amendment Bill

I move, That the Education (Export Education Levy) Amendment Bill be now read a third time. The general purpose of the bill is to further support New Zealand’s export education industry and to ensure that New Zealand continues to be viewed by overseas Governments as a desirable education destination, offering excellent education in quality establishments that operate with business integrity, for their international students. Export education has become a key industry for New Zealand. In order to maintain this major industry, students and their home Governments need to be assured that international students will receive quality education in exchange for their investment. The export education levy introduced by the Education (Tertiary Reform) Amendment Act 2002 was conceived with a view to supporting a range of industry-wide development and risk management activities, to ensure the ongoing quality and sustained growth of the industry. The increased demand from international students for a New Zealand education led many providers to expand their operations and led many new ones to open their doors. Some grew too fast, too quickly, and the closure of some private establishments has focused the export education industry in New Zealand on the risk of negative publicity.

The Government has taken several measures, including those in this bill, to maintain the financial security of international students in their quest for enhancement of their further education in New Zealand. It will continue to do so by holding the appropriate sector accountable should failure occur in the future. The Government will also continue to support the sector providers that act responsibly and with integrity. Specifically, the legislation will achieve its general purpose by enabling international students to be reimbursed. The fund may also be used to recover any consequential expenses incurred by the Government. Immediate action is required to protect the educational and financial interests of international students when a provider of tuition to international students fails. Although there are arrangements in place between the New Zealand Qualifications Authority and the Tertiary Education Commission to place students, statutory security is essential to ensure certainty for those students. Furthermore, when the failure affects international students, the wider dimension of the implication for overseas Governments needs to be addressed quickly, in order to avoid damaging our bilateral relationships and our reputation as an education destination. The Government has acted quickly in that regard in the three failures that have occurred in the past year. The bill will clarify the rights within the process.

A number of submitters to the Education and Science Committee objected to a proposal to increase the percentage component of the levy on private training establishments. The Government took on board the concerns of the education sector. After listening carefully to the feedback, the Minister asked the select committee to remove the clause that specified the increased rate. Sector representatives had wanted more time to adjust to any possible increase to the levy, in order to ensure their viability during a time of market downturn. They also expressed concern about being accountable for the business decisions of particular providers. The Minister also considered it responsible to introduce Supplementary Order Paper 240, to enable the Government to recover its losses in circumstances where there may be the need for additional Crown funding for the levy account in order to make immediate and direct redress to international students.

I thank the members of the Education and Science Committee, and other members, for the contribution they have made to the passage of the bill. In conclusion, I commend the Education (Export Education Levy) Amendment Bill to the House for its third reading.

This will not be the last Education (Export Education Levy) Amendment Bill that this Parliament sees under this Minister. Even though he will be here for only 12 months, I am sure he will find reason to get another such bill in, because he will have to. No one is more responsible for messing up the way our export education industry is perceived by other countries than the current Minister of Education, Mr Trevor Mallard. Every time he goes overseas the student numbers drop. I do not know what he says to the Chinese Government, but it does not like it much, and it does not help. The effect of him going overseas is that the private training institutions to which this bill applies are not listed on the Chinese Government website that sets out options for Chinese students coming to New Zealand. So he has failed.

So if the idea was that Parliament would pass this bill, and that that would reassure overseas Governments that New Zealand was a provider of quality education, then Parliament has wasted its time. That is not actually what has happened. It has not had that effect. I invite the chirping senior whip from the other side to go and have a look at the Chinese Government website, and I tell her that that is what she will find.

What is worrying those overseas Governments is what also worries us—that is, the incompetence of the Minister. When Government representatives meet him, that is what is reinforced in their minds. The incompetence of the Minister is this: public agencies already have a range of mechanisms by which they underpin the viability and equality of the organisations that provide export education—and those public agencies have failed. Everyone agrees with that, actually. I think even the Minister agrees with that. They have failed. They have not used those powers properly, and they have not taken this export industry seriously. It is a billion-dollar earner for New Zealand but the New Zealand Qualifications Authority has been regarded as the place to put people when nothing else can be found for them to do. The authority is meant to be out there ensuring compliance, but in fact it has not been doing that.

So we have this, which is the second export education levy amendment bill this Minister has had to bring in, because he has not done his own job of putting pressure on his own civil servants. And why is that? Not only does he not take export education seriously but he is ideologically and deeply opposed to the private training institutions that are part—only part—of the export education industry. He is very happy to get up and kick them around at every opportunity, impose a levy, and give the New Zealand Qualifications Authority even more powers, such as he has under this bill.

This bill includes the fact that this levy will be used to reimburse the costs of the public agency. Well, we can guarantee that that is not an incentive for careful use of the funds by that public agency, or for careful management of its expenditure.

This bill exemplifies the problems that the Labour Government has created in education. Time and time again when things go wrong, the Government punishes everybody. It does not pick out the people who broke the rules. It does not let people live with the responsibilities of the bad decisions they make—which is often the case in the collapse of those private educational organisations. It does not let people face those responsibilities. What the Government does instead is punish everybody. So this levy is a levy on all the sound, long-term, high-quality operators, in order to pay for some people who messed up.

It is a direct analogy with what the Government has done with our polytechs. Some of them have blatantly and ruthlessly exploited Steve Maharey’s weaknesses as a Minister of Education. But what has the Government done about that? Instead of dealing to the people who ruthlessly exploited its soft rules, it has decided to punish every polytech by cutting the funds of all of them. And that is what this bill does to the private training establishments.

I say to the Government that that leads to bad behaviour. It encourages bad behaviour, and it is a disincentive to good behaviour. It is a disincentive to quality and a disincentive to viability. It is also a disincentive to good operators to keep on being good operators, because if one is a good operator in the export education industry, one just ends up paying a bigger and bigger levy. The longer that that good operator lasts, the more levy it will pay. The better the operator is than everybody else, the more levy that operator will pay. That to the Minister, no doubt, is just common sense, because that is how Labour thinks: if an operator does better, it will try to bring it down; if the operator does badly, it will protect the operator from the consequences of its own decisions. That is the problem at the core of this bill.

There are a number of technical problems that were discussed at the Committee stage. For instance, the bill is retrospective. This Parliament is legislating today to allow for the use of a levy that is quite different from the use for which it was raised. The last education levy bill specified that use; this bill changes that provision.

Debate interrupted.

The House adjourned at 6 p.m.