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Higher Education Trends and Australian Models and Frameworks

The internationalisation of education is increasing in significance with a range of social and economic trends driving the knowledge economy. The Australian higher education sector continues to develop apace as universities shift from a mere international recruitment drive to an integrated internationalisation strategy that incorporates joint ventures, international campuses and collaboration in both teaching and research. However, there remains a dominant theme in the internationalisation of Australian higher education that sees the majority of international students opting to study face to face in Australia. This is has driven many economic, social, labour market and educational benefits (Norton 2012a; Lane and Kinser, 2015; Oxford University, 2015; Altbach, 2016).

Private HEP’s, while market –oriented, seem to lack the ability to engage in the broader strategic internationalisation agenda, focussing instead on localised, country-specific marketing efforts that drive student enrolments. This may be due to the smaller resource pool available to HEP’s and the nature of the supply and value chain considerations highlighted earlier. However, in both quantum and in growth patterns, it is clear that both universities and HEP’s in Australia are experiencing rapid, consistent growth in international student enrolments (Norton, 2012b; Heller and Callender, 2013).

The global trend in higher education enrolments by international students continues to rise reaching almost 5 million enrolments globally in 2014 (Oxford University, 2015). The annual increase in international student enrolments, globally, has been between 8 and 10% since 2005. The Australian higher education market trends are aligned with these figures and are set to grow further in the next decade (Australian Bureau of Statistics, 2016). This trend is likely to continue.
While student destinations have remained stable over the last decade, market shifts are occurring with countries offering lifestyle choices, post-graduation medium-term employment opportunities and workplace internships, becoming more attractive. Australia ranks highly on student desirability lists given its weather conditions, the relatively low Australian dollar and the opportunity to live an educational and social lifestyle that is deemed attractive. The United States remains the most popular international student destination, followed by the United Kingdom and Australia, among the English speaking countries, while France and Germany are the most popular destinations in Europe. The average market share of both Australia and Canada is increasing and this is leading to greater demand on both universities and HEP’s (Oxford University, 2015).

Australian Higher Education Models and Frameworks

Higher education refers to education which usually results in the granting of a Bachelor Degree. As at October 2015, the Australian higher education sector had 43 universities and 129 non-university higher education providers. The legal framework under which Australian higher education providers work is the Higher Education Standards Framework (Threshold Standards) 2011 and the TEQSA Act 2011. TEQSA, thetertiary Education Quality and Standards Agency is the Federal regulator charged with ensuring both universities and HEP’s comply with quality standards, maintain rigorous systems that protect Australia’s reputation as an international educational destination and enhance the innovation of the sector.

TEQSA is responsible for the registration of HEP’s and universities and the accreditation of courses. Universities, in Australia, are granted Self Accrediting Authority (SAA), allowing them to engage in an internal system of quality control, management, review and development, independent of the regulator. Universities report to the regulator and are required to provide evidence of their quality systems.

HEP’s can only be registered through the regulator and an initial registration is an extensive and involved process driven by evidence of quality systems, resources and governance. While the process of registering a HEP is involved and may take 2 years of prior effort, it is built on the principles of risk management, thus favouring applicants with sound management and academic quality infrastructure and systems. This can be a positive opportunity for international educational investors who apply professional management methods to the development of a HEP.

HEP’s are generally non-self-accrediting. However, there are currently three non-university HEP’s with self-accrediting-status, while the remaining 123 are non-self-accrediting.
The State of New South Wales has the largest volume of universities and HEP’s with 67, followed by Victoria (47), Western Australia (18), South Australia (17), Queensland (15), the Australian Capital Territory (3), Tasmania (3) and the Northern Territory (2).
The higher education market in Australia is almost evenly divided between for profit and not-for-profit organisations with 52 institutions being for profit and 65 being not for profit. Faith-based colleges are the largest individual segment of not-for-profit higher education institutions with 24 colleges, followed by the Technical and Further Education (TAFE) colleges of which there are 12 nationally.

A raft of legislative instruments regulate the international student market in Australia, including in the higher education sector, and while these pose a significant investment costs in terms of compliance, they are the sectors guarantee of quality and a major driver for sustaining and enhancing the sectors capacity and outcomes. The Education Services for Overseas Students Act 2000 (ESOS) is a primary instrument that universities and HEP’s must ensure compliance with. It protects international students and provides a quality benchmark with regard to the educational and administrative policies and systems that underpin the organisation.

A further legislative instrument of importance for international investors to consider is the National Code of Practice for Registration Authorities and Providers of Education and Training to Overseas Students 2007, which further specifies how student-institution interactions occur and provides a fair and balanced approach to the administration of universities and HEP’s with respect to international students.

Revisions to the ESOS Act and National Code as well as revisions of the higher education Threshold Standards are planned to occur in 2016 and will most likely come into effect in early 2017, though it is expected that the spirit of these regulations will remain unchanged.
Private HEP’s apply to the national regulator, TEQSA, for the registration of a private higher education provider and the application requires the accreditation of at least one course of study to also be applied for. If the registration is granted, this may be up to seven (7) years in length and may or may not have conditions imposed by the regulator on the registration.

The primary investment area in international education in Australia is likely to be in the Private HEP segment where there is no association with a faith-based organisation or a professional body and where international student recruitment is undertaken primarily off-shore.

Written by: Dr Mo Kader