International students are big business in Australia. Enrolments peaked at a record 543,898 and generated $15.5 billion in export income in 2008.
Nationally, education is now the third largest export-earner, just behind coal and iron. The Victorian government claims almost 160,000 international students were enrolled in a variety of education sectors last year, making it the state's top export industry.
The recent financial collapse of Melbourne International College (MIC) and the cancellation of its education license on July 17 highlights everything that's wrong with the booming private education industry.
The 300-plus displaced MIC students are rightly distraught about their future. Yet they are covered under the "Tuition Assurance Scheme" that guarantees the continuation of their courses with a different college. MIC staff are not so lucky.
91×ÔÅÄÂÛ̳ Weekly spoke to a MIC staff member about the impact the closure has had on the workforce. The staff member spoke on condition of anonymity.
"We are owed many thousands of dollars in superannuation", the worker told GLW. "Even though it is illegal not to pay our super, that's precisely what the director did and there is a high chance we can kiss our money goodbye."
The July 17 Australian reported that MIC director Yarlini Nadarajamoorthy was unable to comment on the collapse of her business until "her father arrived home".
"We think it is strange that a director needs her father to tell her what to say", the worker said. "We believe her father was the real director but because the business was under her name no assets can be claimed from him."
Staff entitlements are secured up to a certain level under the General Employee Entitlement & Redundancy Scheme (GEERS), but it does not cover superannuation.
Even though they pay tax, employees who are not permanent residents are also excluded from accessing GEERS. MIC staff are working with the Victorian Independent Education Union to secure staff entitlements and work out how to get their super.
The staff member said the Victorian Registration and Quality Authority (VRQA), a government monitoring and regulatory body, last audited MIC in April. MIC allegedly failed to meet all requirements but MIC staff had not been sent a report explaining the outcomes.
The July 17 Age said MIC was not one of the 17 colleges undergoing a rapid audit by government authorities for possible migration fraud, student exploitation and education law breaches.
The worker told GLWthat MIC was a "good college" compared with many others, but still left a lot to be desired.
"Most trainers had appropriate qualifications and proper classes were conducted, but it was obvious that management prioritised money and cost savings over education", the worker said.
"MIC offered English as a Second Language courses and a diploma in community welfare. Students paid a hefty $18,000 for the two-year welfare course. The cost of repeating a unit was $900 and students could be hit with a $50 a week late payment fee.
"Even though they already paid so much to study, students were still charged five cents for each photocopy."
Industry insiders believe MIC's financial insolvency combined with the audit outcomes led to the closure of the college. It is also believed the VRQA has been under pressure to be seen to crack down on private training institutions after mounting evidence of shonky providers and illegal activities in the sector.
"Nobody should be surprised that this industry is full of sharks wanting to make money out of international students", the worker said. "And we shouldn't forget this has been encouraged by government policy."
In a new study on the economic contribution of international students released in April, Access Economics found international student enrolments in the private sector rose by 92.6% from 2006 to 2007.
The biggest growth in the private sector was registered in Victoria, where enrolments increased by a whopping 250% that year. In NSW, private enrolments rose by 130%.
The worker told GLW many colleges offered courses in cookery, hairdressing, welfare and others to international students who already held tertiary degrees.
"It is no secret that many students hope that the completion of these courses will help them get permanent residency, which is denied to them through tightly regulated visa programs and severe immigration restrictions."
The MIC staff member said the real problem lies in the privatisation of education in the first place and a lack of government regulation. "The only reason government authorities are starting to investigate this industry a bit more is because of the recent bad press and the courageous actions taken by students to expose the real nature of the industry.
"The export-oriented private education industry is a rogue industry. To clean it up, you have to close it down and ramp up funding of public education places."