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How Australia’s new national code could affect the agent-provider relationship

As one of the most regulated industries in the world, Australian international education has, for a long time, concerned itself with the potential ramifications of unscrupulous and unethical behaviour by third parties.

Australia national code international educationAustralia is seeking progress on its legislation and tightening up regulation for providers, who in turn have to monitor their education agents. Photo: Mark R Higgins

"Providers are responsible for taking immediate corrective action against the agent when they have reason to believe that agents are engaged in unethical practices"

Several highly reported cases of malpractice, such as last year’s sudden disappearance of agency Tu Futuro en Australia along with up to $1m of students’ fees, and ongoing concerns over student churn – students switching institutions once onshore – have put education agents in the sights of Australian regulators.

So far trying to regulate offshore agents, who exist outside the reach of Australian enforcers, has proven difficult. But the recently updated National Code of Practice for Providers of Education and Training to Overseas Students takes a different approach, choosing to outline further the diligence providers should practise when using offshore agents.

Effectively it decides, if you can’t regulate the offshore agent, regulate the people who use them.

Walk the line

Implemented on 1 January, the National Code 2018 makes several tweaks to the language of the previous code, as well as including new items in Section 4 relating to education agents – among updates to other standards.

These include what now must be provided in an agency agreement, more formal processes for education agents, and confirmation of provider responsibilities as part of the International Education Agents Data Project.

While seemingly small in the context of the entire code, the changed language sees the regulation trying to walk the line of providing clarity while leaving room for interpretation.

“I think it’s a positive thing to be able to give people information about the quality of an education agent”

Where previously the code said an “agreement must specify the responsibilities of the education agent and the registered provider and the need to comply with the requirements in the National Code,” 2018 is much clearer that the provider is accountable for the actions of their agent.

“The written agreement [with an education agent] must outline… the registered provider is responsible at all times for compliance with the ESOS Act and National Code 2018,” the new legislation reads.

In practical terms, according to a spokesperson from the Department of Education and Training, the more straightforward wording means providers must hold their agents to a higher standard.

“If agents are reviewed and proven to be unsatisfactory, student enrolments will not necessarily be at risk,” explains the spokesperson.

“However, providers are responsible for taking immediate corrective action against the agent when they have reason to believe that agents are engaged in unethical practices.”

Therefore, while providers must require an agent to agree to scrupulous behaviour as part of the National Code, an agent’s failure to do so and the provider’s failure to recognise and then act on unscrupulous behaviour, sees the provider clearly taking the blame in the new code.

But there are areas left for interpretation.

Changes to wording (such as providers must take action if they have ‘reason to believe’ rather than ‘reasonably suspect’ unethical behaviour, or must ‘require’ instead of ‘ensure’ agents have certain information), while small, have potential ramifications not only for how regulators assess provider’s compliance with the code, but how institutions themselves interpret how they must behave.

“It’s how often legislation and regulation get interpreted,” says Navitas chief corporate affairs officer Helen Zimmerman.

Check yourself

Zimmerman stresses that the new code, in her organisation’s opinion, is the regulation shoring up processes that institutions should have already been managing.

“No matter what size [your institution], you have to do your due diligence on agents,” she says.

“Under the previous code, as we’ve interpreted and operated under it, providers have always been responsible for the actions of their agents. That’s one of the reasons that we, and other good providers, invest heavily in training of agents.”

Legislation effectiveness lies only within the consequences placed on those who repeatedly fail to conduct due diligence

But Zimmerman tells The PIE that clarifying the regulations should at least improve the process of establishing a new provider.

“If you’re a new provider starting out then I think this will assist, [but] you can’t get away from the fact that, in ensuring the integrity of a system, you have to do your work and you have to have the relevant contracts with your agents.”

TAFE Directors Australia CEO, Craig Robertson, agrees but says the new code goes further in outlining responsibilities.

“Requiring providers to be more aware of the behaviour of their agent representatives, and to take sanctions against some behaviour, is a reasonable expectation,” he says.

While upbeat, Robertson adds that the legislation effectiveness lies only within the consequences placed on those who repeatedly fail to conduct due diligence.

“The real ‘stick’ in the regulatory chain will be in action taken by Commonwealth agencies against providers who continue to use agents that demonstrate questionable practice for the sake of increased enrolments,” he says.

“TAFEs are hopeful that the strengthened regulations, which is coupled with strong regulatory action against those providers and agents who thwart the system, will lead to strong enrolments in Australia’s TAFE institutes and in demonstrating Australia as a world leader in imparting globally relevant skills for industry.”

Workin’ day and night

There is now more work for both agent and provider.

Providers must ensure agents have a working knowledge of the Australian International Education and Training Agent Code of Ethics, effectively bringing it into law, after serving as a guide for agent behaviour previously.

Changes like this, argues Mark Fletcher, CEO of Cohort Go – a payments and agent management system provider – mean the long-term implications and ongoing enforcement of the National Code 2018 could hit a snag.

He thinks that it could potentially put stresses on the agent-provider relationship.

“This will always favour the strong over the weak,” he posits.

“The strong have marketing power… so when it comes to [larger universities] being able to dictate what they require out of an education agent, they’re going to be a lot more capable of doing that, over a struggling, international education provider.”

Other changes, such as the new requirement that agents declare any conflicts of interest in writing, could potentially ignore the realities of recruiting large numbers of students and having agreements with multiple agencies, he also argues.

“One of the keys will end up being how mandatory this process is,” he explains.

“You will see the larger, stronger institutions adopt [the new elements of the code] because they’ll want to be seen to adopt it, but as you move down the track, there will be less adoption, as you have people running around trying to make their business work.”

Like Zimmerman, he says, the final result will be dictated by how providers and regulators interpret the code. “It will be very interesting to see where the rules end up landing.”

Somebody’s watching me

For institutions, the new workload doesn’t stop at agent oversight, with providers themselves obliged to input and update agency details within the Provider Registration and International Student Management System.

The project’s intent to make agent performance information was of severe concern

This move appears to be the final part of the IEADP agent data project, announced last year, which aims to track and report on agent’s performance so that providers can identify emerging positive and negative trends and make educated decisions on current and potential future partners.

At least when initially announced, however, the agent performance reports met a mixed reception.

The view of many agents and agency representative bodies, especially AAERI in India, was that the project’s intent to make agent performance information “publicly available” – and whether that meant the information would be made available to everyone or restricted to specific parties – was of severe concern due to market sensitivities.

Frustratingly, argues AAERI president Rahul Gandhi, in also using student enrolment outcomes to monitor offshore agents, the reports ignore the interference of onshore agents who use student churn as part of their business model.

“[It] will not reflect the true potential or the true picture, as the onshore agents are poaching the students which are recruited by the offshore agents… understanding the offshore agents’ performance is only possible if the onshore agents are not allowed to recruit the student before completion of their main course,” he says.

Quietly implemented on 30 November 2017 after an amendment to the Education Services to Overseas Students Act 2000, information on agent performance has since been confirmed to be available only to users with Confirmation of Enrolment Administrator permissions, with additional information only available by request.

From an institutional perspective, the reports give them more market intelligence than before.

“The changes put strong regulatory building blocks in place, and with enhanced data collections the regulators will have better evidence to allow them to take action where poor practice continues,” TDA’s Robertson says.

Meanwhile, argues Fletcher, monitoring agent performance and sharing it within the sector means more clarity for everyone.

“I think it’s a positive thing to be able to give people information about the quality of an education agent who might not necessarily be willing to proffer that information themselves,” he says.

But with providers praising the change and agents decrying it, there are potential ramifications for the agent-provider relationship.

IEAA chief executive, Phil Honeywood, who was instrumental in developing the agent code of ethics, in collaboration with ACPET, Australian Government Schools International, the Council of Private Higher Education, English Australia, Independent Schools Council of Australia, TDA and Universities Australia, says that is beside the point.

“Reporting on agent performance, and publishing data as appropriate, will promote greater transparency and accountability in educator-agent relationships and the wider sector,” he says.

“Students and their families deserve greater insights on the performance of their agents.”

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