TPS Levy 2014 Session purpose Informing providers about the TPS Levy 2014 Decision making process Impact on providers Implementation TPS operation summary update

TPS Levy 2014 Decision making process Based on the advice and recommendations from the 1.TPS Advisory Board 2.Expert actuarial advice – the Australian Government Actuary 3.Consultations with sector x 2 4.Discussions with national regulators ASQA and TEQSA

TPS Levy 2014 The TPS Advisory Board guiding principles Additional imposts on industry, such as data collection, should be minimised as far as possible The model should be as simple and transparent as possible Risk premiums imposed should provide incentives for providers to adopt positive behaviours The model for the TPS Levy should reflect gradual change and assist the industry with business planning by providing a stable regulatory environment Advice provided to the TPS Director should reflect the overall risk environment and facilitate the sustainability of the Overseas Students Tuition Fund (OSTF) and the sector

TPS Levy 2014 TPS Levy Components 1.Administrative fee 2.Base fee 3.Risk rated premium 4.Special tuition protection

TPS Levy 2014 Administrative fee component* – $102 plus $2.04 per enrolment for the previous year – Calculations on the same bases as the Annual Registration Charges Base fee component* – $204 plus $5.11 per enrolment for the previous year – Exemptions - for subsection 12(a) of the Act, registered schools that have no international students are exempt from the requirement to pay the base fee component (section 7 of the Act) * Both Administrative and Base Fee have been indexed (All Groups CPI for September 2012 and 2013) for the TPS Levy 2014 – requirement under Part 2 S8 of the Education Services for Overseas Students (TPS Levies) Act 2012.

TPS Levy 2014 Risk rated premium component Positive feedback received from sector on the risk factors identified for the TPS Levy 2013 – no additional factors identified The five risk factors implemented in 2013 retained for 2014 Based on the feedback received from the information sessions in 2013, some minor adjustments to weightings and terminology implemented for 2014

TPS Levy 2014 Risk rated premium component Risk factors and increase factors based on Analysis of the data available from the Provider Registration and International Students Management System (PRISMS) Correlation between a risk factor and previous provider defaults Objective, measurable and transparent information

TPS Levy 2014 Risk rated premium component Risk factors 1.Payments in arrears 2.Length of operation 3.Growth in overseas student numbers 4.Maximum overseas source country concentration 5.Non-compliance history

TPS Levy 2014 Risk factors adjustments for 2014

TPS Levy 2014 Special tuition protection component Payable by all CRICOS providers Special tuition protection – calculated as : Specified percentage rate x overseas students tuition fee income The TPS Advisory Board recommended the specified percentage rate of 0.055% for Following consultations and feedback received from the sector the specified percentage rate for 2014 is zero.

TPS LEVY 2014 IMPACT HOW MUCH WOULD I PAY?

TPS Levy 2014 Risk rated premium component Risk rated premium – calculated as : Specified percentage rate for 2014 is 0.155% - same as for 2013

TPS Levy 2014 TPS Risk Factor Data Report – 2014 TPS Levy

TPS Levy 2014

Implementation 7 March 2014 – Tuition Fee Income for 2013 to be entered into PRISMS April 2014 – TPS Levy invoices sent via PRISMS May 2014 – TPS Levy payment due

Risk Rating Distributions ELICOS (104,101 providers)

Risk Rating Distributions VET (370, 353 providers) Risk Factors Scores

Risk Rating Distributions HE (85, 100 providers) Risk Factors Scores

Risk Rating Distributions Schools (430, 433 providers) Providers Risk Profiles for TPS Levy Risk Factors Scores

Risk Rating Distributions TOTAL (1014, 1083 providers ) Provider Risk Profiles for TPS Levy

TPS Levy 2014 Other matters Stakeholders consultations – November and December 2013 TPS Levy 2014 settings Reporting requirements TPS operations summary

TPS Levy 2014 Stakeholders consultations TPS Levy 2014 settings Activation of the special tuition protection component for 2014 stakeholders feedback: – No universal support form the activation of the component – The sector is still to fully recover from the downturn of the past few years – The growth in the international student sector is patchy. The 2013 TPS Levy settings retained for 2014.

TPS Levy 2014 Stakeholders consultations Reporting requirements TPS commencement in July 2012 accompanied by a number of additional reporting requirements November and December 2013, the TPS consulted with peak bodies and stakeholders Consultations identified three main areas of concern

TPS Levy 2014 Stakeholders consultations Reporting requirements Three main areas of concern: Reporting requirements in relation to student defaults The limit on the collection of pre-paid fees Students being permitted to freely transfer between courses after 6 months of study

TPS Levy 2014 Stakeholders consultations Reporting requirements Issues currently being considered: Removal of student default reporting requirement for universities and other low risk providers Removal of the limit on the amount of pre-paid fees that can be collected by universities and other low risk providers Review of Standard 7 of National Code – relates to the period of time that a student must remain with the initial provider unless a ‘letter of release’ is provided

TPS – operations summary Provider closures 9 provider closures; – displacing 907 international students – 6 required activation of the TPS 226 calls on the Overseas Students Tuition Fund – 172 finalised at 30 June 2013 Further 102 calls made by students whose providers closed prior to 30 June 2012; 77 finalised as at 30 June 2013 (Annual Report – TPS website)

TPS – operations summary Provider closures 64 students placed into suitable alternative course 218 students received payments 63 payments provided to providers (placement payments)

TPS – operations summary TPS Levy collection 2013 – anticipated collection of $7.5 million, however lower provider income resulted in collection of approximately $6.0 million 2014 – anticipated collection of approximately $6.0 million

TPS Levy 2014 Further information Website: – Links to legislation – Frequently asked questions – News

TPS Levy 2014 Questions/Discussion