Onshore commission ban will move poaching underground, say stakeholders

One of the most controversial plans in the incoming ESOS legislation in Australia relates to the plan to ban onshore commission to stop international students switching from one course to another after the six-month window during which immediate course changes are banned.

The theory is that agencies will refrain from “poaching” students if they can’t earn a commission for transferring the student.

But stakeholders The PIE News spoke to in Australia said that an outright ban would just lead to high quality education providers adhering to these rules while others may be tempted to offer rewards “in kind” instead of a commission payment for the transferring student.

While many delegates at The PIE Live Asia Pacific preferred to comment anonymously, there was broad consensus that onshore poaching would not necessarily be stamped out by this move if it is enforced. Tactics such as marketing fees paid or “enrol a student for free – and receive commission” might be seen by some education providers as a way to circumvent the rules, it was suggested.

Another point made was that the allocation of NOSC [new overseas student commencements] to many private sector providers had been so low within the MD-111 framework that to be able to sustain business operations, there was little choice but to hope to attract onshore students.

This included either those finishing programs or others tempted by the opportunity to save money by switching from an elite institution (where visa approval is more likely), for example, to a registered VET provider offering equivalent qualifications.

The perceived ease of getting a visa for a university course was exacerbating a trend of onshore switching to cheaper alternatives, said some.

During a keynote policy panel at last week’s The PIE Live Asia Pacific, Independent Tertiary Education Council Australia (ITECA) CEO Felix Pirie pointed out that while students need to get a new visa to switch from higher education to a VET qualification in Australia, “it’s not been enforced for a long time”.

“There are ways to get around it… They’re the ones that need to be targeted – where students and agents and so forth who work in collaboration with those students who are deliberately trying to gain that part of the system, are getting around it,” he said.

While everyone agreed with the value of the onshore agency market, the majority of stakeholders that The PIE spoke to thought that charging a fee to move programs or requiring a new visa process would limit this activity, removing the opportunistic switch scenario.

While the government is considering forthcoming ESOS policy tweaks, it was still processing new VET college registrations too, it was claimed, without reviewing ASQA and TEQSA compliance capacity.

Akram Mardini, general manager of agency Student World, spoke to The PIE at The PIE Live Asia Pacific conference. He said he thought a no-switch rule (similar to New Zealand’s newly announced rules) or a new visa fee process should be applied in Australia.

He said some of the switching was happening “100%” because students were more likely to get an Australian visa by applying to a university. No switching or a new visa application should be the process, he said.

Therefore, Mardini said more balanced visa approvals across higher education and the private sector should also happen, he advised.

“[International students] are more likely to get a visa going into a more expensive public university,” he said. “So level the field.”

Mardini also pointed to the high visa fee of AUS$2,000 – increased from AUD $1,600 in late June – being so expensive that students didn’t want to risk the reality of having their application rejected – with no refund.

Banning commission is risky and I’m not sure it will achieve the objective it is supposed to
_{^{Mike Ferguson, Charles Sturt University}}

Also speaking at The PIE Live Asia Pacific, Mike Ferguson, pro-vice chancellor international of Charles Sturt University, said he thought most of the ESOS legislation was on the right track but he noted, “I share concerns on the agent commission [policy change]”.

Representing a regional university, he said there were genuine reasons for students wishing to move to a more affordable area to continue studies, for example.

“Banning commission is risky and I’m not sure it will achieve the objective it is supposed to,” he said.

He said he’d like to see the government dealing with non-genuine transfers first. The issue is dealing with “providers who want to do the wrong thing working with agents who want to do the wrong thing,” he clarified.

“Let’s deal with some non-genuine transfers onshore – let’s have a basic visa cancellation campaign,” he said. “I’ve seen nothing in that space and that would send a very clear message. And let’s see some rapid responses from the regulators in terms of standard 7 [requiring six months study before moving].”

Meanwhile, IEAA has argued to government that there is a place for some onshore commission where for example a student wants to go from an undergraduate degree to a masters, for example if they don’t necessarily think the university or the private independent higher education provider they’re with has got the masters course that suits them.

“Then there’s a legitimate role for some onshore commission that we argue to be payable,” said IEAA CEO Phil Honeywood, also at The PIE Live Asia Pacific conference.

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