PRIVATE EDUCATION BILL

PRIVATE EDUCATION BILL: Order for Second Reading read.

3.02 pm

The Senior Minister of State for Education (Mr S Iswaran): Mr Speaker, Sir, I beg to move, "That the Bill be now read a Second time."

Sir, allow me to first set the context for the Private Education Bill.

The regulatory regime for the private education (PE) sector started with a "light-touch". This was because the industry was nascent in the 70’s and 80’s with little demand and few players. Schools were registered if they met basic requirements such as approval for usage of premises and fire safety clearance and some rudimentary checks on school management and teachers. Registration did not represent endorsement or assessment of the quality of the academic programmes. Students were reminded to do their own due diligence when enrolling in these programmes.

Between 1987 and 1997, the number of private schools registered with MOE doubled from 150 to 305. Consequently, measures were taken to provide a level of quality assurance. The Ministry of Trade and Industry facilitated the establishment of quality assurance schemes which the better private schools could aim to attain. These are the CaseTrust for Education certification, administered by the Consumers Association of Singapore (CASE), and the Singapore Quality Class for Private Education Organisations (SQC-PEO), administered by SPRING Singapore.

Moving forward, even these measures are no longer adequate. The private education sector now attracts a large number of local as well as international students who are drawn by the Singapore brand. The number of private schools quadrupled between 1997 and 2007, from 305 to 1,200. The number of full-time international students enrolled in the private schools also grew in tandem from 9,000 in 1997 to 37,000 in 2007. In 2008, there were about 120,000 students enrolled in these private schools of which 45,000 were from overseas.

The exponential growth of the sector has resulted in a highly uneven spread of academic and governance standards amongst the private education institutions (PEIs). Some were found to have engaged in dubious or unscrupulous practices, which have adversely affected Singapore’s reputation. In the last few years, the closures of a few PEIs have also left their students stranded. It is, therefore, in the interest of all stakeholders that we tighten up standards and accountability under a new regulatory framework which will stand for quality and reliability.

Sir, my Ministry will adopt a three-pronged strategy to strengthen and uplift the private education sector. First, we will put in place a more robust regulatory framework through the enactment of the Private Education Bill. Second, we will step up efforts in consumer education. Third, we will work with industry associations and PEIs to develop the private education sector so as to raise the quality of provision and student welfare over time. Given the diversity of the private education landscape, MOE cannot do this alone and we will need support from industry, consumers, the general public and, indeed, Members of this House.

I will first touch on the new regulatory framework which has three key components:

(a) the Council for Private Education (CPE) to be established as the sectoral regulator and developer;

(b) the mandatory Enhanced Registration Framework (ERF); and

(c) the voluntary EduTrust Certification Scheme.

Let me now elaborate on each of these three components.

Council for Private Education

Hitherto, MOE’s primary mission over the last 40-odd years since our independence has been focused on delivering a world class public education system. MOE’s expertise is largely in this public education domain where the mandate, goals and constraints are substantially different from those within the private education sector. Part II of the Bill, therefore, provides for the establishment of the CPE as a new statutory board, which will allow it to build up the requisite capabilities for a different operating environment in the private sector.

The Council for Private Education (CPE) will comprise a Chairman and between five to 17 members to be appointed by the Minister for Education. The CPE will be supported by a pool of full-time staff to fulfil the regulatory and developmental functions. As the sectoral regulator, the CPE will have authority over matters such as registration, quality assurance certification, and investigations and enforcement action against errant PEIs. The CPE will also have the powers to develop codes of practice relating to private education matters, enter into contracts, form partnerships and companies, and charge fees in the course of its work.

Beyond the regulatory role, the CPE will promote consumer awareness; provide student services; and facilitate industry development. The CPE will drive public education initiatives and enhance the channels that prospective and current students at PEIs can turn to for assistance. The CPE will collaborate with other Government agencies to develop the sector and its capabilities.

Mandatory Enhanced Registration Framework

Sir, Part III of the Bill provides for aspects related to the regulation of Private Education Institutions. The regulatory scope of the Private Education Bill, as defined in the First Schedule, primarily covers PEIs which offer degree, diploma or full-time certification programmes at the post-secondary level, and those which offer full-time preparatory courses for entrance to our mainstream schools, or for external examinations. Such PEIs have a significant impact on the Singapore education brand and involve major investments by the students, both Singaporean and foreign, in terms of course fees and time. About 1,000 of such PEIs will be covered under the new regime.

Online and virtual PEIs operating in and from Singapore and offering the types of courses mentioned above will also be required to be registered with the CPE. This is to guard against Singapore becoming a staging point for online degree mills and other similar virtual setups. Singapore-based private operators who offer accreditation services and examination certification services overseas will also come under the scope of the PE Bill.

Sir, the aim of the Enhanced Registration Framework is four-fold:

(a) raise corporate and academic governance standards;

(b) enhance student protection measures;

(c) compel disclosure of key information by PEIs; and

(d) require PEIs to seek, on a regular basis, fresh approval to renew their registration.

I would now like to highlight key provisions in the Bill that will enable us to achieve these objectives.

Raise corporate and academic governance

Clause 37 of the Bill aims to ensure that sound academic and corporate governance systems are in place for PEIs. The PEI is required to be a registered company or society. It must ensure that its teachers have the relevant qualifications and experience, and that its managers are fit and proper persons.

A key enhancement under the Bill is that the line of accountability for the conduct and practices of PEIs is made clearer in the new regulatory regime. In this regard, Part I of the Bill defines a manager of a PEI as any director, partner or member of its committee of management, and includes any person who has management of the PEI. In line with good corporate governance, this provision in the Bill ensures that accountability for any misconduct by the PEI can be traced back to the actual persons who exert management influence over the PEI.

The managers are responsible for a set of prescribed responsibilities, as spelt out in clause 41 of the Bill. These include the keeping of proper records; providing for students affected by the PEI’s closure to complete their enrolled course or a similar one in another PEI; and furnishing information requested by the CPE within the stipulated duration. The failure of a manager to fulfil his responsibilities without any justifiable reason will constitute a criminal offence. The CPE will also have the power to direct any PEI to suspend or remove any of its managers if they are found to be inadequate in carrying out the responsibilities of managing the school or are unable to discharge their prescribed duties, as provided for in clause 42 of the Bill.

Academic governance will also be tightened under the new regulatory regime. Clause 43 requires PEIs to seek CPE’s permission to offer courses; failure to do so will constitute a criminal offence. In processing these applications, the CPE will verify the authenticity of the qualifications offered and the standing of the institutions issuing them. Additionally, clauses 46 and 47 protect the public from false or misleading advertisements. Clause 43(12) makes it an offence for PEIs or any persons to advertise courses not permitted by the CPE, or solicit or receive any fee from any student in respect of such courses. PEIs found to be committing any of these offences would be liable to be de-registered.

For the purposes of clause 43, regulations will be made for the CPE to also tighten the requirements for any PEIs applying to offer external degree programmes (EDPs). For example, CPE will examine the track record and standing of the foreign institutions issuing the degrees. In addition, these foreign universities will have to commit that the degree programmes offered at the local PEIs are recognised by their home country authorities, are subject to the same academic approval and assurance processes as the programmes offered at their home campuses, and that the graduates here receive equivalent recognition, treatment and privileges as those enrolled in their home campuses.

With these more stringent requirements coming into effect, some PEIs may have to cease offering certain EDPs which do not meet the new criteria. PEIs will be required to provide the CPE with clear plans to address the needs of students currently enrolled in such EDPs, including the possibility of switching to an alternative programme.

Enhanced student protection measures

The Enhanced Registration Framework will also provide for stronger student protection measures. Clause 60 of the Bill empowers the CPE to direct PEIs to issue refund of the fees paid by students should the PEIs fail to deliver the courses which the students have enrolled in. The CPE may also make regulations to stipulate the maximum amount of fees a PEI may collect upfront from the students so as to mitigate the financial impact of sudden school closures.

To ensure that PEIs do not misrepresent themselves or the courses that they offer, clauses 37 and 39 of the Bill restrict any PEI from using names and terms which are false or misleading, while clause 46 of the Bill prohibits any person or PEI from publishing false or misleading statements. Clauses 40 and 47 of the Bill also empower the CPE to direct the PEIs to take remedial action.

Under clause 64 of the Bill, the CPE may prescribe dispute resolution schemes and make regulations to require registered PEIs to participate in such schemes. In doing so, the CPE aims to provide aggrieved students with ready access to cost-efficient and expeditious means of seeking redress in resolving disputes with PEIs.

Disclosure of key information by PEIs

Mr Speaker, Sir, the Enhanced Registration Framework will also compel the private education institutions to disclose key information on their premises, courses and teachers to enable students to make informed choices. The CPE will have the authority under clause 63 of the Bill to publish relevant information on the institutions on the CPE’s website. This includes the list of PEIs which have been de-registered or have had their EduTrust certifications withdrawn owing to the contravention of terms and conditions that were imposed.

In addition, clause 62 of the Bill empowers the CPE to obtain information from the PEIs when the need arises.

_System of renewable registration for PEIs
_

Under the current Education Act, registration for private education institutions is a one-off exercise. Under the new regulatory regime, PEIs will need to be approved by the Council before they can be registered to operate. Registration status will have a specified validity period to be determined by the CPE as provided for under clause 36 of the Bill. The validity period of a PEI’s registration status may vary based on how well the PEI measures up to the registration criteria. This will incentivise PEIs to improve their standards in order to attain a longer period of registration. In addition, the CPE has the power to suspend or cancel the registration status of PEIs under clause 38 of the Bill.

Enforcement, offences and penalties

Sir, even as we place the onus on the private education institutions and their managers under the new regulatory regime to internalise their obligations as responsible education service providers, the Council for Private Education will be stepping up its efforts to monitor the PEIs and, where necessary, undertake enforcement action. In this regard, provisions have been made under clauses 57 and 58 of the Bill for CPE inspectors to have the necessary investigative and enforcement powers to conduct regular audit checks and to investigate any complaints against private education institutions. Clauses 48 and 61 of the Bill also provide for a full range of actions and penalties to allow the CPE to calibrate its enforcement actions.

Some contraventions by the PEIs would constitute a criminal offence with deterrent penalties. For example, a PEI or manager who intentionally makes false statements to the CPE; obstructs or impedes the CPE’s inspection or investigation work; or refuses to comply with the remedial action directed by the CPE, shall be liable for a conviction with a fine or jail term or both.

The Bill also ensures that there is an effective redress mechanism for parties aggrieved by the regulatory decisions or directions of the Council. Such aggrieved parties can appeal to an Appeals Board which will be appointed by the Minister and administered independent of the CPE. Part V of the Bill provides for the establishment of the Appeals Board by MOE.

Transitional arrangements

Sir, this Bill will certainly raise the standards of governance and accountability of PEIs, and the protection they accord to students will correspondingly rise. However, it is in the interest of all stakeholders to ensure a smooth transition from the prevailing regulatory framework. To minimise disruption to students as well as to the operators in the transition to the new regime, clause 74 of the Bill provides for the CPE to make the necessary transitional arrangements for PEIs crossing over to the new mandatory enhanced registration framework. Upon the commencement of the Private Education Act, private education institutions which are currently registered under the Education Act will be accorded "deemed registered" status for a period of 18 months. These PEIs will have to attain registration in compliance with the enhanced criteria of the new regulatory regime, if they wish to continue to operate beyond this 18-month window period.

There is another segment of PEIs which are currently not required to register under the Education Act but will fall under the regulatory scope of the new Bill. These are private schools set up by registered societies and privately-funded vocational schools offering full-time education leading to various forms of certification. Upon the commencement of the new regulatory regime, clause 74 requires these private education institutions to come forward within two months to submit their applications for registration, if they wish to be able to continue to operate until either they attain their registration under Part III, or their application is rejected or withdrawn.

Our aim in this transition is to give PEIs a reasonable period to upgrade and meet the required standards. PEIs who do not meet standards despite this grace period risk non-renewal of registration. Notwithstanding this grace period, the CPE will not hesitate to act against any errant PEIs. This is necessary to maintain high standards for our private education sector.

_Voluntary EduTrust Certification Scheme
_

Sir, I will now move on to the EduTrust Certification Scheme, to be established under clause 49 of the Bill. The EduTrust scheme is a quality mark. It differs from CaseTrust in two important ways. First, it sets higher standards; and second, its coverage is wider. For example:

(a) EduTrust imposes additional requirements on PEIs with respect to their academic, financial and administration processes; student welfare matters; and partnerships with external recruitment agents.

(b) In the area of student welfare, PEIs will be required to have clear policy on fees and refunds, effective complaint resolution procedures, and appropriate student counselling and support services. While CaseTrust mandates fee protection for only international students, the EduTrust scheme mandates fee protection for both international and local students.

(c) PEIs will also need to have qualified academic supervisors and teachers, and well-defined structures for programme development, assessment, progression and performance review.

Therefore, not all PEIs who currently have CaseTrust certification will obtain EduTrust certification. However, the CPE will provide a grace period for such PEIs to upgrade themselves, and provide information to prospective students in the meantime.

Given the higher standards under the EduTrust scheme, making it mandatory will lead to PEIs incurring significant additional costs to attain such certification. Inevitably, these costs will be passed on to the students even if the market may not require such additional measures. For example, there are currently several hundred small non-CaseTrust-certified PEIs, offering short skills-based courses of less than six months catering to specific industry needs. There are several approved training providers under WDA-registered programmes that fall under this category. Instead, a voluntary EduTrust scheme allows better private education institutions a mechanism to differentiate themselves based on quality if they so desire.

The market will recognise the EduTrust mark as a signal of confidence and quality. As such, it is in the interest of genuine education service providers to be EduTrust-certified so as to distinguish themselves as the better players in the sector.

Stepping up consumer education

In tandem with the implementation of the enhanced regulatory framework which I have outlined, the CPE will step up efforts to cultivate consumer sophistication through the provision of accessible and transparent information on the private education sector for all students. The setting up of a Student Services Centre will be key to this effort. The Centre will convey student advisory information and facilitate student support and protection services. The Centre will be the first stop to handle complaints from students. For disputes that require professional services in mediation and arbitration, the aggrieved students and PEIs will be directed by the CPE to resolve their disputes in a formal and responsible manner through CPE-appointed dispute resolution centres.

Developing the private education sector

In addition to its regulatory role, the CPE will also facilitate the development of the industry. The immediate focus of the CPE in this regard will be to work with industry partners to assist PEIs to prepare for the higher standards of the Enhanced Registration Framework and EduTrust Certification Scheme through workshops and forums. Partnering other Government agencies, the CPE will also help private education institutions enhance their system and manpower capabilities through capability development initiatives. The CPE will also look into strengthening the industry association so that it can serve as a key partner in mobilising support amongst industry players.

With the levelling up of the private education sector’s standards over the next few years, the CPE aims to work with industry leaders and associations to create a stronger culture of accountability and responsibility among the PEIs. While legislation will still be employed where necessary, in the long run, this culture of accountability together with a higher level of consumer sophistication will be the foundation of the industry’s development and growth.

Industry and public consultation

Sir, in formulating this Bill, the Ministry of Education has conducted two public consultation exercises to seek feedback on the new regulatory framework from the public and key stakeholders of the sector so as to further refine the regulatory requirements. The first public consultation exercise, conducted over a period of eight weeks from March to May this year, focused on the key principles and requirements of the proposed Enhanced Registration Framework and the EduTrust certification scheme. In this period, my Ministry also conducted industry briefings and focus group discussions with PEIs to facilitate their understanding of the new regime as well as to obtain feedback. This was followed by a second public consultation exercise on the actual draft of the Private Education Bill in July this year.

Overall, there is broad-based support for the Government’s move towards tighter regulation of the private education sector. We have also received unequivocal support from private education providers who welcome the move to preserve and enhance the industry’s integrity and reputation. My Ministry has received useful comments and suggestions from the two public consultation exercises and, consequently, has made a number of modifications to the new regulatory framework and Bill.

Even as we recognise the public support for enhancing the regulatory regime, we are mindful that the transition to a new system with higher standards and expectations will have varying effects on industry players and students. The public should expect and be prepared for some changes in the industry, including closures and consolidation. Our ultimate goal is a strong private education industry that can deliver quality education to students.

Mr Speaker, Sir, I would like to conclude by emphasising that a strong regulatory framework, while necessary, is not a panacea. Regulatory systems in all countries aim to assure consumers of certain quality standards. While risk can be mitigated, it can never be completely eliminated. The new system cannot by itself guarantee student satisfaction, avert school closures or prevent regulatory infringements. We need the support and collective ownership of all stakeholders, including the private education providers and the students, to make the learning experience in Singapore an attractive and enriching one. PEIs must realise the need to constantly upgrade themselves to meet the challenges of an increasingly competitive international education landscape and the rising expectations of students. Students themselves must be more discerning and deliberate in their choice of education pathways and institutions.

Singapore has forged a reputation for excellence in its public education system. Students from all over the world are attracted to Singapore on the strength of our mainstream schools and world-class tertiary institutions. MOE will continue to invest in the public education sector and uphold these standards.

The private education sector will need to level up its standards and be developed further to compete on academic rigour and credibility, rather than on price or expediency. Over time, as the new measures take effect and the students gravitate towards higher quality institutions, the overall standards in the industry will improve. The Private Education Bill is timely in providing for the necessary legislative framework to guide the private education sector in that direction.

Sir, I beg to move.

Question proposed.

3.30 pm

Mrs Josephine Teo (Bishan-Toa Payoh): Mr Speaker, Sir, I rise in support of the Bill.

As explained by the Senior Minister of State, the light-touch regulatory approach for the private education sector needs to be updated. In the past year alone, there have been several instances of closures and these closures have left many students stranded. Sadly, they have also tarnished Singapore’s reputation as a global education hub. There is clearly a need for tighter regulation. Therefore, I welcome the move by the Ministry of Education to establish the Council for Private Education (CPE) as the regulator for the private education sector as well as the Enhanced Registration Framework and EduTrust Certification Scheme.

Sir, I believe that the Bill should address three key areas of concern: first is the protection of students; second is the protection of bona fide private education institutions; and third, the protection of the Singapore brand.

Let me touch on the protection of students. More stringent measures are needed to protect the interests of students. When Brookes Business School was closed recently, students were left stranded with fake qualifications. Their fees were also not covered or inadequately covered by insurance. Under the new regulatory framework, PEIs will also be required to seek the Council's approval before offering their external degree programmes. This is certainly a move in the right direction. With more stringent checks and quality criteria imposed on external degree programmes, we can be confident that degree mills and worthless degrees are less likely to find their way in. However, the approval is not extended to cover diploma or certificate programmes, which are self-developed by the institutions. These diploma and certificate courses can be quite costly and also last quite long. If the concern is over-regulation, could the line be drawn for self-developed courses costing more than, say, $5,000 or lasting longer than six months? This will provide better protection for students. I hope that the Senior Minister of State could comment on this point.

On the point of fee protection, I note that the new fee protection measure under the EduTrust Certification Scheme will now be extended to both local and foreign students. This is a good development. We should not assume that only foreign students are at risk of being left high and dry. In fact, given the high trust level that Singaporeans have of the MOE, the mere mention that a school is MOE-registered often gives potential students and parents a misplaced sense of confidence. They think it means that the school must have somehow passed the gold standards of the MOE!

Hence, I am concerned to note that even with the new law in place, there are PEIs who can continue to offer programmes to locals without coverage under the Student Protection Scheme. This is because the Student Protection Scheme is a feature of the EduTrust Certification programme, which is a voluntary programme. Only the PEIs that wish to enrol foreign students must be EduTrust certified, in order that student passes can be issued to their foreign students. PEIs which enrol only local students do not need EduTrust Certification and, hence, do not automatically offer the Student Protection Scheme. Can the Senior Minister of State explain why the Student Protection Scheme is not a registration requirement for all PEIs?

Notwithstanding the above, I am glad that the Bill requires PEIs to participate in a dispute resolution scheme. In the event of a dispute between the student and his PEI, the relationship between them is an uneven one. Given that the student often has fewer resources to seek redress, such a requirement means that aggrieved students will now have access to cost-effective and expeditious dispute resolution.

Overall, these measures protecting the students are effective only if actively enforced. In that connection, could the Senior Minister of State please tell the House what stage of development the Council is at and whether it has the adequate resources to enforce these new laws?

Sir, I would like to move to the subject of protection of bona fide PEIs. When a "black sheep" operator in an industry sector is not held to account for its actions, the whole sector suffers from loss of public confidence. From the complaints lodged with CASE against the PEIs, it would appear that misrepresentation and mis-selling are not uncommon practices amongst PEIs. Such cases rose from 1,130 in 2006 to 1,368 last year – about 20% increase over a course of two years. Most of these cases involve misrepresentation, failure to honour promises and unsatisfactory services by recruitment agents. So we must put a stop to dubious marketing practices which use untrue or baseless claims. They mislead unsuspecting students and unfairly disadvantage bona fide operators. Therefore, I fully support the provision to curb misleading advertisements by PEIs.

At the same time, the stipulation on disclosure of key information such as course fees, refund policy, course duration and articulation pathways, will enhance the level of transparency in our private education market. This policy has the added advantage of addressing the information asymmetry between PEIs and students. It should be the rule rather than the exception that PEIs provide students with ready access to information on the school or their programmes to help them make informed choices before enrolling in courses. However, as the Minister has noted, these measures are effective only when coupled with consumer education efforts. In this regard, what steps will the Council for Private Education take to help consumers to become more knowledgeable and savvy about the private education market? Could the Senior Minister of State please elaborate?

Third, on the protection of the Singapore brand. There is a need to ensure that PEIs attain and maintain standards in terms of quality of academic delivery as well as professional and ethical conduct. In fact, quality and integrity are the core attributes of the Singapore brand, which we must work hard to protect. In this regard, I support the move to impose regular renewal of registration for PEIs so that they are motivated to upkeep standards on a continual basis. I am pleased to note that in designing the EduTrust Certification Scheme, the Ministry has broadened the coverage to include academic processes, school administration, quality assurance, financial health, corporate governance, student welfare and protection. In doing so, the comprehensiveness of the EduTrust Scheme serves to set a higher quality bar for PEIs to aspire to. For the better PEIs which are successful in attaining the Gold, Silver or Bronze categories of EduTrust certification, it sets them apart in the eyes of prospective students.

I also commend the move to establish clearer accountability for the conduct and practices of PEIs. The Bill clearly defines who a manager of a PEI is and his prescribed duties under the Bill. As a result, accountability for any misconduct by the PEI can be traced back to the actual persons who exert direct control and influence over the PEI. In addition, by stipulating the requirement that managers appointed must be fit and proper persons, we ensure that "bad-hats" who were previously operating errant PEIs would not be able do further harm simply by incorporating another school under a new name. However, what if the "bad hat" names other persons as "managers" and controls the enterprise from behind the scenes? Is the law able to take such cases in hand?

Sir, in conclusion, regulation is only one part of the proposed work of the CPE. I understand the Council will also be responsible for facilitating the development of the private education sector. This is an apt role. I strongly support a CPE that will also invest time and resources to help build up the capabilities of private education institutions. This will help the industry to level up faster, in both academic rigour and quality. I call on the Council to take steps to restore the public confidence in our PEIs, in particular, to restore the credibility of the Singapore brand in overseas markets where it has been tarnished by rogue operators. I am optimistic that the new regulatory framework comprising the Enhanced Registration Framework and the EduTrust Certification Scheme will raise the standards of private education in Singapore.

Sir, I support the Bill.

Mr Speaker: Order. I propose to take the break now. I suspend the Sitting and will take the Chair again at 4.00 pm.

Sitting accordingly suspended at

3.40 pm until 4.00 pm .

Sitting resumed at 4.00 pm

[Mr Speaker in the Chair]:

PRIVATE EDUCATION BILL: Debate resumed.

Mr Inderjit Singh (Ang Mo Kio): Mr Speaker, Sir, I support the Bill. This Bill is well-timed as it moves Singapore to the forefront of education accountability and in doing so, enhances our growing reputation as a regional educational hub. In fact it is about time that we introduced this Bill because we risk diminishing our reputation as an educational hub in light of the recent cases of abuse and fraud in the area of private education and we have seen quite a few in the last couple of years.

Sir, when it was first decided that Singapore would position itself as an education hub, it seems that none of the Government agencies came forward to take ownership of this vision. It was thus left to MTI to drive this forward. While MTI has exercised its efforts to boost the education sector in Singapore, it however lacked the required appropriate structure and the specialised rigour that MOE could provide. This flawed framework potentially endangers the private education sector in Singapore to develop a poor reputation. As we aim to position Singapore as an educational hub, it is crucial that we are not seen as or become a degree mill.

Therefore, in order for us to grow our private education industry while ensuring that quality is not compromised, balance would be needed between attracting enterprises and ensuring adequate rigour is in place to govern the sector. However, just as it applies to any legal framework that regulates the private market, it is important that this Bill does not create negative externalities for private education sector and thus stifle private enterprise. Some of the private education players in Singapore are well-established and reputable institutions, and the foreign ones well-known in their home countries add diversity and depth to the education sector here. While putting in place rigour, the Private Education Bill should therefore also contain an element of flexibility, particularly for the foreign schools and foreign enterprises that are coming here. Therefore, I would like to make some comments on where flexibility may be added in this Bill.

First, registration of Private Education Institutes (PEIs) with respect to clause 34 of the Bill, which specifies that the requirement for the registration of the PEIs. The broad nature of this section also includes schools with no operations here in Singapore. There are many excellent schools around the world with no presence in Singapore and that may not undertake to register here. It is possible that people here in Singapore may wish to engage in the provision of such private education beyond Singapore and not choose to do so within our geographical boundaries. As such, there is no need for him to register in Singapore as he is not catering to the Singapore market. However this clause would deter such people in Singapore from venturing overseas to offer private education and work against Singapore’s broad entrepreneurship strategy of internationalisation. To avoid such implications, I suggest that this section be redrafted by zooming in on the provision of private education in Singapore only.

Section 1 of clause 36 specifies the grounds for refusal to grant or renew the registration of PEIs. This clause states that the Council may refuse to grant or renew the registration of a PEI if its premises "are to be used wholly or in part, for any purpose other than providing private education …" This clause is overly broad. Many private schools, especially the foreign schools in Singapore, are typically used after school hours for many activities, such as sporting, cultural events and for expatriate community activities as well as some other business activities. For many expatriate groups, the school premises provide a focal point for the community. The clause should therefore be revised to permit such use, as long as it does not disrupt the educational activities of the institution.

Clause 42 of the Bill states that permission has to be sought from the Council to offer or provide courses. Sir, it should be noted that the curricula of schools, like the Foreign System Schools (FSS), for example, vary in accordance to their respective home country school systems. The Council has to specify the criteria that it will adopt in determining whether to permit the courses offered by the FSS, and to provide clear guidance to standards that these FSS will have to be measured against. I agree that it is proper for the Council to check on the legitimacy of the courses and subjects offered. So, for example, a PEI providing education in business studies does, in fact, offer such courses, and PEIs do not offer courses from degree mills. So, this, therefore, is necessary.

However, I would like to point out that PEIs, especially the FSS, usually offer unique classes or programmes aligned to their home country's school systems in order to serve the needs of foreigners resident in Singapore. Therefore, to regulate the appropriateness of individual courses based on the Singapore curricula standards may not be a fair measure, as these courses are developed and offered based on standards determined by accreditation agencies or regulatory bodies of the home countries that these schools are governed by.

Moreover, course information from, for example, the German European School (GESS) would be largely in German and, hence, an overly prescriptive regulation of courses offered by the GESS would require a regulator with strong grasp of the German language and the German education system to implement. In search of efficiency, the Council may overlook the need for special resources to effectively evaluate courses offered by PEIs, especially when they are not presented in English.

Next, on advertising for PEIs. Sir, clause 45 explains the circumstances where PEIs are prohibited from advertising. This section states that no person shall issue "any advertisement relating to a private education institution which is false or misleading in a material particular". I can appreciate the Council’s rationale for this prohibition but it raises concerns in terms of how this policy will be administered.

One of the points of this clause also states that "A PEI shall only use the term 'registered with the Council for Private Education' in its advertisements or publications". It is not allowed to use any of the following words: "approved"; "accredited"; "endorsed"; "supported"; "validated" or any other words in association with the Council in its advertising collaterals. While I broadly agree with this and support the regulation to prevent any misrepresentation of the role of the Council and the meaning of being a PEI registered with the Council, I, however, wish to seek clarification that the use of such terms in advertising or collaterals is permitted where reference is being made to a specific agency or agencies of foreign government bodies that do accredit, endorse, support, or validate the programmes and operations of schools where such advertising or statements are not done in a way that is false or misleading in any material in particular. The ability for some of these foreign schools to make such statements (whether false or misleading) is essential, both for schools to attract students and for Singapore-based companies to attract foreign executives and their families to work and live here in Singapore.

Sir, further, it is stated that the Council will not allow schools to display the name of any foreign institutions in any form at their premises to prevent the misleading impression of these foreign institutions being present here in Singapore, given that the PEIs are just providers and facilitators of their foreign partner institutions, that this restriction does not apply to Foreign System Schools and to foreign universities operating a full campus in Singapore, where such schools are extensions of their home institution and operate under the governance of the home institution. For example, the University of Chicago, James Cook University, INSEAD, and New York University Tisch School of the Arts. If it does apply to these schools, then I am afraid that this section may have a built-in deterrent for foreign schools coming to set up here as for many of them, marketing and branding are built around the reputation of their name back home.

Sir, next, on the EduTrust Certification System. The guideline to the assessment criteria of the EduTrust Certification System does provide the PEIs with an adequate understanding of the requirements of the Council in awarding the EduTrust Certification. However, I have got a few points to raise.

First, on note 4 of Criterion 1.1 where it refers to "Defining vision, mission and education goals", what is the definition of a governing board for PEIs? Does the governing board need to be geographically located here in Singapore? Is the Council prepared to recognise existing governing boards from the PEIs home country (for example, the University of Chicago’s Board of Governors in the US) for the campus here in Singapore?

Next, criterion 5.3.2 – "Student selection and admission process" – I agree and support this guideline, which ensures that the PEIs have non-discriminatory policies on student selection, admission, retention and expulsion which are to be effectively communicated to students. This would offer equal opportunities to all students and ensure that they are on even ground when considering their admissions. However, PEIs sometimes are required to give priority admission to certain groups of students, and exceptions should be made for such situations. For example, the Foreign System Schools. They exist here to provide education for expatriate children similar to what their peers will receive in their home country. Therefore, it would be reasonable for schools like the Canadian International School, for example, to give priority admission to Canadian students. In another example, Foreign System Schools may, at some instance, limit the maximum number of students from each nationality group in order to balance the overall population, and yet provide the principal focus on students from the home country. As such, the Foreign System Schools should be given special consideration for this condition especially with regard to nationality of students.

Sir, in conclusion, upon the passing of this Bill, my main concern is how the Council for the Private Education is going to implement the regulations based on clear, fair and practical guidelines that support the legislation. Where it is necessary to review certain guidelines before actual implementation of the regulations, I hope that the Council will hold further public consultation with various stakeholders and take into consideration the vast profiles of these stakeholders that are present in the private education sector here in Singapore.

While the Private Education Bill has to be commended for putting in place a more structured framework in which PEIs will operate, it is important to note the differences that exist across the spectrum of PEIs in Singapore, particularly the foreign schools, and I have mentioned some of the reasons why and, in fact, it may have a counter-productive effect on their operations here in Singapore. This is an important consideration and should be noted before the Bill is implemented.

Sir, on the whole, I support this Bill.

4.12 pm

Mdm Halimah Yacob: Mr Speaker, Sir, I rise in support of the Private Education Bill. This Bill is long overdue and will help to fill a void in the current oversight of the private education sector which has been in the limelight for all the wrong reasons in recent times. The Brookes Business School incident, where fake degrees were peddled with such impunity, is a blot on Singapore’s effort to develop into an education hub for the region. In introducing a new regulatory framework, it is hoped that the Private Education Bill will help to enhance the quality and standards of private education in Singapore. In education, quality is the key and if Singapore wants to compete with other countries, some of which offer foreign degrees to international students at lower costs, it has to make quality the most significant differentiating factor. Singapore could also learn from other countries that have done very well in attracting a good crop of international students, such as Australia which grew its student base from 100,000 in the 1990s to more than 500,000 today. This new regulatory framework also marks the end of the laissez faire , almost completely market based, approach in developing the private education industry which has been given sufficient time to self regulate and develop its own rules but obviously failed to live up to expectations.

Let me now, Sir, raise a few specific issues and points for clarification.

First, the point on plans to develop the private education sector. Sir, the private education sector is really big business and the potential for growth is huge with countries like China and India growing at a rapid pace and lacking the capacity to provide for the education needs of all their people. Private education was one of the sectors identified by the Economic Review Committee with the potential to contribute more to our GDP. This prompted the EDB to set up the Education Excellence Framework in 2004 in order to attract 150,000 international students by 2015 although not all parts of the framework were implemented for whatever reasons. Apart from international students, Singaporeans place a premium on education and more are turning to the private education institutions to meet their needs, which accounts for the proliferation of so many foreign degrees offered today. But if we were to look at the private education industry today, there are many, many small players with very limited capital, resources and capacity to make the kind of quantum leap in standards and quality as well as innovation, which should be the ultimate aim of this Bill. This is also a point expressed under section 6(1)(b) of the Bill which has as one of its objectives "to encourage, promote and facilitate the development of the private education sector in Singapore". So, I would like to ask the Senior Minister of State whether he could share with this House what are MOE’s plans to develop the private education sector to ensure an orderly and sustained growth and to achieve the target of 150,000 international students by 2015.

Second, there is a need for better coordination and integration in the development and delivery of private education in Singapore. One gap in the current system is that there are so many different agencies involved in overseeing the growth of the education hub, such as MOE, Spring Singapore, EDB and STB, with each agency contributing to a specific area under its purview. I would like to ask the Senior Minister of State what are the plans to ensure better coordination and integration among the different agencies so that everyone has a common plan and gaps can be quickly identified and addressed as well as ensuring a holistic delivery of the services.

Third, in the new regulatory oversight system, a distinction is made between schools that take in foreign students and those where the intake is confined to Singaporeans. Schools taking in foreign students face stricter rules and will have to secure a new EduTrust Certification mark which is compulsory and which replaces the current CaseTrust one. I would like to ask the Senior Minister of State whether it is necessary to have this two-tier system. My concern is that this will give the wrong signal that private schools catering to local students can have lower standards and quality. If cost of compliance with the EduTrust mark is the concern, then MOE should consider giving schools catering to locals more time to comply with the EduTrust mark rather then have a two-tier system. Also, are there any plans for the Government to help these small players upgrade and improve their standards such as governance and the quality of the teachers? We see efforts being made to improve the standards of trainers for adult education and also for the kindergarten teachers where concerted efforts are made to engage and guide the industry. Will similar efforts be made to assist the private education institutions?

Fourth, the effectiveness of this Bill depends on how effectively the Council of Private Education can enforce the new regulatory framework considering that there are more than 1,000 private schools in Singapore. This of course requires the establishment of an effective inspection system with sufficient numbers of inspectors to carry out their tasks. The Act mentions about transferring the assets as well as the staff of the Private Education Division of the MOE to the Council. As the current role of this Division is only to register private schools and not to accredit or be responsible for the quality of the schools, it may not need that many staff. However, the new Council would certainly need a lot more resources to perform its expanded role, especially more manpower to carry out inspections and enforce the Act. I would therefore like to ask the Senior Minister of State for his comments on this.

Fifth, section 46 contains a general prohibition against the issue or publication of any advertisements relating to a private education institution which is false or misleading in a material particular. Often in order to bait students, private schools indulge in gross exaggerations or excessively embellish the value of the course or programme that they offer. For example, are advertisements with claims such as "complete degree in one year" or "mastering English in three months" permissible or would it run foul of section 46? I would like to ask the Senior Minister of State whether there would be guidelines to ensure responsible advertising by private education institutions rather than leaving it to ad hoc supervision of these advertisements and the Council acting only when complaints are received?

Sixth, section 60(3) provides that a student or intending student who are affected by the irresponsible acts of the private education institutions, such as, ceasing a course before completion or failure to secure a renewal of its licence, can recover the amount specified in the direction to refund by the Council as a civil debt in a court of law. Instituting civil action is a recourse that is available even before this Bill but it is not practical because it is expensive and time consuming, whereas the students who are affected may not have the money or the time to pursue their claims through the courts. I would like to ask the Senior Minister of State whether MOE can consider other options such as requiring the private education institutions to set aside a sum of money in a fund that can be utilised only to refund affected students.

Seventh, currently private education institutions can choose either to purchase an insurance policy or to deposit fees paid to them with an approved bank. Safeguarding fees should be a paramount concern in order to protect students as some of these programmes cost thousands of dollars. So, allowing schools to purchase an insurance provision scheme is unsatisfactory. Some of the private schools that ran into trouble had insurance coverage but they were grossly underinsured leaving the students with very nominal recovery. Also, when a private education institution collapses, the students' fees are not considered as secured debts. I would like to ask whether MOE could consider requiring the fees to be placed in an escrow account to be released progressively until the course of study is completed as a further safeguard for students. In other words, in my view, do not give private education institutions the choice to covering their liability under an insurance scheme.

In conclusion, Sir, the Private Education Bill is indeed a progressive legislation and I am in full support of the Bill. But in my view also, at the end of the day, the most important aspect of the Bill is to ensure its implementation and enforcement.

4.21 pm

Mr Calvin Cheng: Mr Speaker, Sir, I rise in support of the Bill.

Firstly, I would like to applaud the measures taken in the Private Education Bill to regulate the private education industry in Singapore. This Bill is extremely timely given the spate of unfortunate incidents involving private schools in recent months. Singapore has spent a long time building a reputation of reliability in general, and a place where sterling education can be obtained in particular. It takes a long time to build a good reputation, and a moment just to destroy it and we should guard and protect this reputation zealously. It is important that we do not let a few bad apples tarnish the excellent image that Singapore has as a hub of quality education.

I have, however, a few minor concerns about the Bill.

Firstly, with regard to the measures that the Council may impose on errant private education providers, I fear that the financial penalty is too low. As it stands, the Council may, I quote, "impose a financial penalty of such amount, not exceeding $5,000". Given that the course fees per student can in many instances already exceed this amount, and the annual turnover of these private institutions can be in the hundreds of thousands if not more, a financial penalty of such a low quantum can hardly be a deterrent. Although the Council is also empowered to censure or subject the errant institution to more stringent terms to retain its registration and also has the power to de-register the institution, it is my opinion that a more deterrent financial penalty would be also useful. I would like to suggest that a penalty based on a percentage of the errant institution’s turnover would be appropriate, as it would subject the right amount of deterrent punishment on institutions of different sizes.

Secondly, I am concerned that the definition of private education in the First Schedule does not cover several types of private education providers in Singapore. Firstly, the definition seems to only cover full-time education, with the exception of education leading to an award or a degree or a diploma, which presumably can also be pursued part-time. However, this does not take into consideration private education providers who primarily provide part-time education, many to working adults who pursue weekend or night classes. I also wonder whether language schools are covered under the definition in the First Schedule. Language schools sometimes offer courses that lead to an award of a certificate, such as the TOEFL certificate, but often do not. Instead, they may issue their own certificates of completion to their students, who may take these courses as part of self-improvement, or as pre-requisite for attending other courses that may lead to an award of a certificate, diploma or degree. These courses can also be pursued part-time, and neither can they accurately be considered secondary or post-secondary education – I thus wonder which category these schools may belong to.

Of particular concern to me are English Language schools, which are popular with foreign students. As I already mentioned, although some may offer courses that lead to an internationally recognised certificate such as the TOEFL, many merely offer proficiency classes in English. In my experience, these schools are particularly subject to abuse by foreign nationals who want a foreign student visa in order to stay and illegally work in Singapore. I sincerely hope that the Ministry of Education can ensure that these schools do not exploit any possible loopholes or fall in-between any regulatory gaps that may exist.

Finally, I would like to address the issue of the establishment of a voluntary accreditation scheme. I am worried that the existence of a separate voluntary accreditation scheme, on top of registration by the Council, may be confusing to potential students. Already in the English language, some explanation is needed and admirably demonstrated by the Senior Minister of State to differentiate an institution registered with the Council, and accredited by the Council or EduTrust; what more when translated to a foreign language such as Mandarin? I fear that even if websites and information are clearly laid out to explain the difference, this may be too subtle in practice for the foreign student looking for a school in Singapore. A foreign student looking for a school in Singapore may be sufficiently satisfied by a school stating that it has been registered with the Council of Private Education of Singapore, to be much bothered about whether it is also accredited by a scheme set-up by the Council. It may also be too complicated to explain the difference, especially to a foreign student from a foreign country where such schemes do not exist. For example, in China, where many foreign students in Singapore come from, educational establishments have to either be registered with the Ministry of Education for academic and language courses, or the Ministry of Labour for vocational training. To my knowledge, no separate accreditation scheme exists. In fact, registration in China is arguably also accreditation; it is thus my opinion that there is a good chance that foreign students will not be able to tell the difference.

I would go so far to even argue that for all practical purposes, for private education providers, registration by the Council of Private Education is accreditation enough. By this I mean that if I were to be the owner of a private education institution, being registered by the Singapore's Council of Private Education is enough for me to market it to students. Such is the power of Singapore's brand. I would personally find it superfluous to get separate accreditation, especially if I have to spend time and resources – costs to a business – to explain to my potential customers, especially in foreign countries, what accreditation is and how it is different from registration. We should thus make the barriers to being registered by the Council as high as possible, and to make the requirements as stringent as possible. The "registered by the Singapore Council of Private Education" stamp will thus be the only accreditation that an institution will want and need. Separately, instead of an accreditation scheme, the Council could implement an Awards or Commendation scheme that institutions can voluntary participate in, that would commend and award institutions that provide quality education consistently. This would thus very clearly differentiate the two – registration, which I have argued is for all practicable purposes and savvy businessmen accreditation enough, and commendation, for registered/accredited institutions who meet certain standards consistently.

Other than these points, Mr Speaker, Sir, I support the Bill.

4.28 pm

Mr Christopher de Souza (Holland-Bukit Timah): Mr Speaker, Sir, thank you for allowing me to join in this debate and lend my support to the Bill.

The introduction of this Bill is timely. We now have a comprehensive and detailed framework to regulate the private education sector.

Before providing the reasons why I support the Bill and several recommendations on how the regulatory framework can be further enhanced, I wish to share a heartfelt experience which one of my Ulu Pandan residents went through.

This is a personal encounter with a resident, I do not think it is an unfamiliar story encountered by many Members in this House. This student went to polytechnic so that she could earn sooner. A university is not an option for her because she could not afford to spend time in a full-time course. She needed to study as well as work to pay for household expenses and pay towards the family income. She did well in polytechnic, she got a job, she worked hard at it and she saved up enough money to go into a part-time degree course at an external university. The external university required upfront payment, so she had to take a loan from a bank. Having paid the downpayment in full for the whole academic year, she soon realised that the school syllabus was not up to expectation. It was far beyond any benchmark, I would imagine. She wanted to stop, the school refused to return her the money and the interest was piling up with the bank. I looked at it and thought that it could be a possible offence of cheating. So I referred the matter to the authorities and we muscled back the money for her. There are many vulnerable students who are possibly in the same situation, who have to do part-time courses as they need to work. Hence, I support this Bill for putting in a comprehensive, strong and muscular regulatory framework to address these loopholes and to deter future unscrupulous behaviour by PEIs.

However, there are good private education providers in the market. They should be encouraged – the framework in the Bill will give them platforms to distinguish themselves as good institutions from the other weaker ones. The higher standards and the introduction of a watchdog will divide the good institutions from the weaker ones, thereby giving the prospective student clearer insight before deciding which institution to enrol in and pay tuition fees to.

Hence, I am glad that the Government has decided that industry self-regulation will not suffice. Neither will the piecemeal approach to regulating different aspects of the sector – for example, with CaseTrust being responsible for student protection and fee protection, SPRING Singapore taking charge of the organisational component, MOE dealing with the registration of the PEIs, etc. This results in loopholes and students falling through the cracks.

Under the new framework, the Council for Private Education will be responsible for many aspects of the private education sector. I welcome this. Now that Singapore is growingly recognised as an international education hub, this Bill is timely. I have had the chance to meet a number of foreigners who live in my constituency who moved here to provide their children with a better education. They see value in our system because it is not just our schools or educational institutions per se but rather our entire environment which attracts them. They think that our mix of East and West provides excellent international exposure. Other characteristics which enhance the education experience in Singapore are our political stability, safety and security, good healthcare – all these contribute to a conducive environment for learning. Hence, I feel very strongly that we must not let our national reputation be sullied by unscrupulous parties in any field, least of all, education.

Being educated in Singapore comes with the consequence of being immersed in Singapore education culture – diligence, sizing up the student's capabilities and giving him or her the best opportunities to reach his or her potential. This has translated into Singaporean and non-Singaporean students who have studied in Singapore doing well, some even topping universities around the world. So, we must protect this image of Singapore as a country that is endowed with an exceptional education system. This means ensuring that the PEIs do not tarnish this reputation. This Bill will assist us in achieving this.

The Bill went through two rounds of public consultation where some good points were raised. I would like to build on this and offer two suggestions on how to make the regulatory framework tighter and more effective.

The first point is regarding the composition and qualifications of the members of the academic and examination boards. Taking into account the feedback that the original requirements were overly prescriptive, this requirement was withdrawn by MOE. However, I do think we need people who have requisite experience on the board. Therefore, the original proposed requirement of "5 years relevant industry experience related to the courses offered" should be reconsidered. It would help ensure that people who have the relevant experience to decide on a sufficient educational standard or benchmark are part of the regulatory framework. The framework will be run by people – decisions on what is sub-standard are subjective. People with sufficient experience are needed to ensure that those subjective decisions are proper, reasonable and balanced.

The second suggestion is that I find the penalties for the failure of PEIs to seek permission to offer courses, and to advertise un-registered courses or solicit or receive fees from any student for such courses, too light. Currently, the punishment is just $10,000 and/or a jail term of 12 months. Where the fine is concerned, ie, a cap of $10,000, I believe that that is much too light and would not sufficiently deter fraudsters and is certainly not punitive enough.

I say this for two reasons:

First, if a PEI is out to cheat a student, it is rare that it would only cheat one student in the school. It is likely that the whole cohort would suffer from a bad syllabus, absent teachers or even the sudden closure of the PEI altogether. If the cohort comprises 20 students, the money the PEI would stand to gain from a dishonest cheating enterprise could easily exceed $100,000. The maximum fine of $10,000 is an insufficient deterrent. The $10,000 lacks bite. PEIs could well consider it a business cost, and one which justifies taking the risk of embarking on an unscrupulous exercise to cheat vulnerable students. A fine of up to $100,000 seems a more robust deterrent. Would the Minister consider raising the bar? If it is not possible at this stage, would the Minister consider emphasising, in his response, that it is Parliament's intention that the punishment meted out should be aimed at, one, deterring unscrupulous cheating exercises by PEIs and importantly, second, preserving Singapore's growing identity as a first-class education hub. Such emphasis in Hansard reports will send a clear signal to the Judges as to what sentences ought to be meted out in order to give effect to Parliament's intentions vis-a-vis these provisions, and permutations between jail sentences and fines would also be a possibility.

The second reason why I believe a maximum fine of $10,000 is insufficient is because the quantum of the fine does not match the gravity of the offence, ie, destroying a student's education, the tuition fees for which were likely derived from hard-earned part-time work. The scar of being let down by a PEI may even deter the promising student from enrolling for another course in another PEI. Therefore, in cases where it so merits, the punishment meted out should not only be aimed at deterring the PEI and other PEIs from doing the same (ie, general and specific deterrence) but should also be punitive in nature due to the serious negative impact it creates on a budding student.

In closing, Sir, I reiterate my support for the Bill as it is a strong initiative by MOE to bite the bullet, regulate private education and, in so doing, preserve the integrity of education in general in Singapore.

Sir, I support the Bill.

4.36 pm

Mrs Mildred Tan (Nominated Member): Mr Speaker, Sir, I thank you for allowing me to speak on this topic. I must first say that this is a very comprehensive Bill that is sufficiently broad to achieve two aims – one is to protect consumers and second is to strengthen the industry. However, I feel that there is a third part that is more important and perhaps more difficult to achieve. I feel that the Government has to set high standards in the education industry and, in this instance, we ought to mediate this viewpoint that "education is yet another commodity that can be bought in the marketplace, and let the buyer beware if the education he buys is what he pays for."

First, let me say that the Bill represents two very positive steps in the right direction. The first is that this Bill offers increased protection for the consumers. The new law will require private schools to get permission from the authorities before they can offer any course to the public. More importantly, they will undergo a strict quality assurance scheme in order to enrol any students.

Second, I believe this Bill will strengthen the industry. Now, I think it would be inaccurate to say that the label of "CaseTrust" has taken a beating. The Consumers Association of Singapore (CASE) – has said that there is only so much that they can do to regulate private schools. The Straits Times , for example, has reported that CASE has said that it is not its job to conduct academic checks. And I quite agree.

Therefore, this brings me to my third point. CaseTrust is primarily a consumer-based scheme. Under the proposed law, it will be replaced by EduTrust. This latter scheme spells out a list of almost 30 different criteria, including academic quality, student welfare and soundness of finances, that the schools have to satisfy. But here is what I feel we ought to be thinking about. That is to say, it really has to work on regaining people's trust. And the way to do so is by changing the philosophy of private schools – and this has to do with both private providers, regulators as well as the students.

As continuous learning becomes part of our lives, we ought to regard private education as part of mainstream education. We ought to hold both education providers as well as ourselves as students to a higher standard. Education providers are professionals. They ought to be respected – and to respect themselves – as such.

This regard needs a clearer recognition in the law. As mentioned, the number of private schools in Singapore has grown from 305 in 1997 to 1,200 today in 2007. But only about 350 of these are CaseTrust-certified. Even though we expect the majority of these are expected to opt for the voluntary EduTrust scheme, this still means that the majority of private schools here are relatively unregulated. Can the Senior Minister of State tell us how these schools will be regulated? Should they be called schools at all, if they operate differently from those who have the EduTrust mark? What protection is there for students in these schools? Today's Straits Times reported that local students have a different level of protection from foreign students. Can this anomaly be addressed?

Second, can the Senior Minister of State tell us what are some signs that MOE has that the law has worked? That is, what would a good state of affairs look like? What are the key performance indicators (KPIs)? Would they include a lower number of complaints about private education providers? Or is it the result during the quality review? Would the number of sign ups to the EduTrust mark be made a KPI too? Or better still, can we make it compulsory to all PEIs?

We can, of course, let the market decide, and let consumers distinguish between the good and the bad. Here, too, I feel that we ought to move away from market forces. People sign up for these courses not as consumers but as students. They ought to regard themselves, not as buying a degree but gaining an education. Can the Senior Minister of State tell us if students will be given some guidance on what they ought to look out for? Can the Government set up a helpline for foreign students? This will not only protect the students but also preserve the integrity of Singapore's reputation as an education hub.

Sir, that is the crux of the issue. With the Brookes Business School affair, as well as a string of other failures of regulation, Singapore has lost some ground in her reputation. Let us now work towards regaining this trust by ensuring not just stricter but more widespread compliance in enforcement with higher standards and therefore protect and ensure Singapore's reputation and brand abroad as a centre of education and academic excellence remains intact.

Mr Speaker, Sir, I support the Bill.

4.41 pm

Ms Denise Phua Lay Peng (Jalan Besar): Sir, I stand in support of the Private Education Bill.

The strategy to turn Singapore into "a world-class education hub or a global school house" is a brilliant one that leverages on our country's stellar reputation in public education. The strategy not only serves an economic agenda to bring in additional revenue, if executed well, it will helpattract foreigners who, hopefully, will remain in Singapore as employees and citizens and will also draw more world-class R&D programmes here. It will even help to meet demands by local students who have not been able to attend Singapore's public universities and cannot afford to study abroad.

However, the execution of this brilliant strategy had left much to be desired. Singapore's ambitious goal to build a world-class education hub has been dealt many blows – the latest being the peddling of fake degrees by and closure of private school, Brookes Business School, leaving more than 400 local and foreign students in the lurch. Over the years, rising complaints of these private schools ranged from poor quality programmes, forged signatures on student pass applications, bogus attendances and illegal employment of student-pass holders and, beyond the school walls, cheating of students by some unscrupulous hostel or HDB flat owners.

In my view, this less than ideal state of affairs is due to several root causes. First, under-estimating the critical success factors required to be a world-class player in a competitive global marketplace. A time bomb was created when MTI's EDB and STB diligently pronounced the aspiration of the global school house and started promoting Singapore as an education destination. This proceeded without enough consideration of the quality of slate of offerings and such is the flaw of key performance indicators (KPIs) that stress quantity and not quality. The second root cause relates to the lack of buy-in from the content expert player, the Ministry of Education, which had traditionally perceived itself as a provider of non-profit mainstream education with little to do with enterprise and other non-mainstream education. For many years, MOE has kept a distance from the private schools other than registering them as long as basic statutory requirements, such as building and fire safety requirements, are met. And, third, the Ministry's light touch strategy has led to an over-reliance on self-regulation in a sector characterised by more than a thousand PEIs of varying degrees of technical competence and financial strengths.

Sir, having MOE finally come on board does not guarantee the success of Singapore's global school house business plan since the core strength of civil servants does not usually lie in enterprise. However, the entry of MOE due to its reputation as an excellent public education provider is much needed to restore the confidence and trust in private education. It is better late than never.

I have four specific inputs to offer regarding the proposed Bill and the setting up of a Council for Private Education to register, regulate, audit and discipline errant providers.

The first concerns the Council’s power to direct errant Private Education Institutions (PEIs) to refund course fees and offer alternative placements.

Sir, currently, by the time a court orders an errant PEI to refund or place its students with an alternate institution, the guilty party may already not be in a financial position to do so. Student victims may also not be in a state to pay the new fees, especially if they had already lost the fees paid in the preceding year. One of my residents, who has been affected by the Brookes Business School saga, had taken up a bank loan to pay for his education. With no money now to pay for a similar course at another private school and no money to pay for legal costs to take action against Brookes, he has asked for my help to appeal for a deferment of the repayment of his private loan. It was taken up with the private bank and the appeal for deferment was successfully approved.

Clause 60 of the Bill aims to provide teeth for the Council to direct errant providers to refund course fees paid by students and offer alternate placements at another PEI. Elsewhere, at the MOE website, it is written that the EduTrust scheme will also provide for the protection of student money.

In reality, PEIs cannot possibly run their operations by putting up hefty dollar deposits into escrow accounts or pay hefty student insurance premiums. I seek clarification from the Ministry to ensure that there is indeed protection for victims in scams that lead to the entire closure of a private school or bankruptcy of the owners.

Sir, in the case study of Brookes Business School where the owners received some $8 million in fees, can the Senior Minister of State advise what would be a reasonable sum that will balance the two seemingly opposing aims of consumer protection and good business sense?

In addition, I would like to request the Senior Minister of State to ensure that service standards are also set up especially on response times to give alerts on errant providers, as it is a known fact that the Government was alerted as early as 2007 to the case of Brookes Business School but action was delayed.

My second input relates to quality assurance. In this respect, I beg to differ from my colleague, Mr Calvin Cheng, who deems that PEI registrations are sufficient to guarantee quality.

Sir, quality must remain a key unique differentiator of Singapore’s private education sector if we wish to rise above the crowd in an industry where countries with similar aspirations can easily adopt a copycat strategy. The weakness of this Bill lies in what appears to be a wasted opportunity to inject quality into the DNA of the private education sector by making it compulsory for all PEIs to join a reasonably-tiered certification scheme. Part IV clause 49 states that the Council may establish one or more voluntary accreditation or certification schemes. I understand that a voluntary six-category EduTrust certification scheme will be launched by the Council to incentivise PEIs to improve their quality.

Instead of making it voluntary, the Council should make membership in the Scheme compulsory and ensure all providers meet a set of minimum basic standards within 18 months of registration. To nurture industry players, a tiered roadmap to move from minimum basic to a Gold Standard should be developed and training and consulting solutions be made available to the players. Compulsory membership in a quality certification scheme with a development roadmap will not only inject quality into the sector but, over time, will also nurture high-potential smaller players to play leading roles in the industry.

Thirdly, Sir, it is crucial for the Council to reinforce consumer education and awareness and provide transparency to both prospective students and employers in the industry. The current MOE website listing of only company names and contacts of private schools is grossly insufficient for consumers to make any informed choices.

The independent US Office of Non-Public Education, which is part of the US Department of Education, for instance, publishes regular reports in several areas of state regulation of private schools. The topics include the status of private schools on registration, accreditation, licensing, teacher certifications, professional development, and so forth.

In other countries, Education Departments have gone to the extent of ‘naming and shaming’ repeat offenders in order to deter unscrupulous operators.

MOE, through its home page on private schools, has cautioned students to be selective and find out more about programmes and institutions before making any commitment but has offered no consolidated information on these bodies. It is welcome news that the new Council will adopt the best practices of other progressive countries and publish regular reports on key quality and financial benchmarks. These can help students, parents and employers to access key information of the registered PEIs before they decide to enroll or to employ. I commend and applaud the Ministry for addressing this need for consumer education and even setting up a student services centre for this.

Finally , Sir, I would also like to highlight to the Ministry on the coverage of PEIs supporting students with disabilities or special needs. As stated in the First Schedule, the proposed Bill covers only students with physical or intellectual disabilities. It omits those afflicted by the three highest developmental disabilities, such as ADHD, autism and dyslexia. Many of these students do not suffer from a physical or intellectual impairment and are not protected currently by the proposed Bill. I seek the Senior Minister of State's help to correct this particular clause to reflect the profile of this segment of the student body.

In conclusion, Sir, the clean-up and consolidation of the private education industry is long overdue. Many students, both local and international, have been hurt in the last few years due to the lack of execution excellence of a brilliant strategy. The proposed Bill is critical not only to protect the current and future students; it serves to ensure that Singapore’s and MOE’s positive brand equity is not further dented and, if implemented well, this strategy and development may well be an important component to make Singapore’s dream of becoming a world-class education hub come true.

Sir, I support this Bill.

Mr Zainudin Nordin (Bishan-Toa Payoh): Sir, we have, over the past years, been attempting to build up our reputation as an education hub for the world. Unfortunately, our attempts have, time and again, been thwarted by unscrupulous business operators who choose to make a fast buck out of the students all in the name of private education. We could have been more proactive in our response, as we all know that with reputation, it takes just five minutes to ruin what takes years to build.

Mr Zainudin Nordin (Bishan-Toa Payoh): 4.54 pm

Hence, the Ministry of Education's introduction of the Private Education Bill and the new voluntary quality qualification scheme, EduTrust, are things we should have introduced when we began to embark on our plans to become an education hub under our vision of Singapore as a "Global Schoolhouse".

Allow me, Sir, to raise some concerns and also suggestions on how we could make the overall framework for the Bill more effective.

I am confident that this Bill will raise standards of PEIs and safeguard Singapore's education brand and reputation. Specifically, there should be a greater focus on academic process and quality assurance, such as more stringent record keeping, the setting up of academic and examination boards to ensure quality of teaching, and periodic external audits to promote compliance.

I am happy to hear from the Senior Minister of State that the Bill will also safeguard the interests and welfare of local and international students. PEIs have to upkeep standards with the mandatory registration framework that calls for registration renewals at regular intervals. Teachers must be able to deliver the lessons in a manner to enable the students to learn and absorb the facts. And sometimes we hear of complaints that the teachers merely regurgitate from textbooks and read them aloud. The students would then be better off studying in their own homes rather than attend private classes. I hope we will see an improvement in the quality of the trainers with the new Bill.

Like many, Sir, we all hope that the new regulation framework will also incentivise PEIs to upgrade and set higher standards through EduTrust certification. PEIs will be graded and differentiated into three tiers of excellence. Potential students will be able to make informed decisions on the choice of school. We could also give some form of star ratings for the schools on the basis of the lecturers, the administration and the reputation of the institutions collaborating with them.

Sir, we also heard feedback and concerns about the Bill from the operators. The PEIs highlighted that there could be an increase in costs, as the implementation of the Bill will result in costs to be passed on to the students. Concern was raised that higher costs would reduce Singapore's attractiveness to international students as compared to countries, such as our neighbour. PEIs also requested for clarification on which authority they ought to approach when applying for exemptions or waivers. Thus, if we want to be a reputable regional education hub, we need to strike a balance and remain competitive while guaranteeing quality education in Singapore.

It was also noted that a large volume of information was required to be prepared for the registration and application for EduTrust certification. Preparation is expected to be a tedious process for most PEIs. In addition, most PEIs requested for greater details on the mechanics of the audit system to be provided, as they expect to take some time for the preparation.

Another point, Sir, is that EduTrust will be stipulated by the Immigration and Customs Authority (ICA) as one of the pre-requisites for the issuance of student passes to foreign students enrolled with PEIs. Thus, the importance of regular and thorough audit to be conducted to ensure PEIs who have fallen short of standards will be penalised accordingly. There were past instances of CaseTrust-certified PEIs whose standards might have dropped but were not discovered due to a lack of external audits. These PEIs could continue getting foreign students, as the relevant agencies did not communicate regularly on such matters. So the communication channels between agencies of concern is very important. When standards are found to be wanting, all agencies concerned must be alerted, so that the effectiveness of the system will be even better than what we have seen in the past.

Sir, as an overall effort to further improve the private education sector, I believe that we need to also go beyond the Private Education Bill. There must be concerted and strategic plans to maintain quality and standards. I would like to ask whether there is a possibility to implement more specific guidelines on academic quality assurance process and procedures in respect of areas such as course review periods, assessment methods, grading scales, and so on. And also there could be the implementation of minimum standards for contact hours for programmes and entry requirements. A benchmark could be established across the industry.

One more point that could be considered is the effort to promote fair employment in the private education sector. The Private Education Bill cannot make PEIs treat their workers better. The philosophy has to be adopted full-heartedly by the organisation in order for them to tap the full potential of their workers for the benefit of the individual company and the industry. A lot of attention was drawn to the plight of the students, which I think is right, but a lot of workers that are also left stranded when companies misbehave. Naturally, the unions will assist members if they are affected. If the companies in the industries do not come together to embrace fair employment, then the talent will naturally shy away and go into other industries where they can get better treatment and benefits. At the end of the day, the private education sector will also suffer.

I do not know how much damage has been inflicted on our reputation, but I sense that parents overseas would be wary to send their children to study in PEIs now. Let us all work together to improve the situation. For the PEIs, their zeal for recruitment of students must be equally matched with good management of the schools and the quality of the teaching. Then we would all have a better report card for Singapore.

Sir, in conclusion, I am confident that this Bill will now open a new chapter in our quest to be an education hub, as all parents and adult learners will be watching how PEIs perform hereafter.

Sir, I support the Bill.

5.00 pm

Mdm Cynthia Phua (Aljunied): Mr Deputy Speaker, Sir, this Bill is long overdue. In fact, it should have been introduced when we began talking about making our country a global education hub in 2003.

When I read the reports of students left in the lurch because of malfeasance by the operators of so-called educational institutions, my heart goes out to them. The mechanism that we had prior to the introduction of this Bill was weak and easily exploited. Public records show the weaknesses. Schools with poor quality teachers, schools with no proper system to administer the running of the academic delivery, schools which offer themselves as a front for students to moonlight in other activities and the latest is one that issues fake university degrees. It is heart wrenching when the students use their hard earned money or their parents' money trying to improve themselves, only to be duped. Instead, the heat went to CaseTrust. The focus became the recovery of monies paid.

While the broad sweep of the Bill will certainly straighten things out at these private schools, I would like the Ministry to look into some of these concerns. When we discuss Private Education Institutions (PEIs), there are four main areas of concern: one, the quality and recognition of the courses; two, the quality of teachers/lecturers; thirdly, the facilities of the PEIs; and fourthly, the management of the PEIs.

The management of the PEIs is governed under this Bill and the quality aspect is governed under the voluntary EduTrust. Why do we allow the main concerns of the PEIs to be addressed under a voluntary EduTrust scheme? Why is the EduTrust scheme not compulsory as in the registration of the PEIs under this Bill? The Bill does not stipulate the qualifications of the teachers nor does it stipulate the quality of the courses except that permission must be sought before the course could be offered and that the teachers could be allowed to teach. Whether these submissions are subject to detailed checks are not mentioned or are they merely regulatory, ie, information submitted and not assessed?

Two, once the PEIs are registered and the quality of the courses offered is deemed acceptable, our Civil Service must recognise these courses in the employment of public officers. We must have confidence in our own registration system. Let me quote the aspiration of a young lady who wrote to me yesterday in Facebook when I asked people to share their concerns. She took a part-time diploma with Singapore Polytechnic and went on to take a two-year part-time marketing degree course and got a Second Upper Class degree. She later realised that the Civil Service does not recognise the degree and she expressed her disappointment. I quote:

"It is really disappointing. It takes one to be very determined in order to manage both work and studies. Amidst that fake cert scam, there should be proper recognition for private education. Presently, many people like me are feeling deflated and thought it is very ironic, since the Government encourages people to take lifelong learning and upgrading seriously. Not many are blessed with the chance of progressing full-time at local or overseas universities."

Clause 38 sets out that the Council may suspend or cancel the registration or reduce the period of registration of any PEIs. My concerns are for the students again. I hope that there is a platform where the existing students can be informed as soon as possible when there is a possibility of change in the status of registration of the PEIs. Under clause 60 (b)(i), a minimum of 14 days is given, which is insufficient for an overseas students to make the necessary preparation for arrangement of an alternative course or to change plans in the course of studies.

Under clause 60, it sets out that the Council has the power to direct the PEIs to refund each student or intending student in part or in whole of the course fee when the course did not start on time or did not complete or worse, the PEIs' registration is cancelled. This is an excellent recourse for the students; however, as most of these are overseas students, the investigation process must be swift and decisive. If not, we would end up like the foreign workers – many are waiting to get their claims addressed and end up living in the streets or in poor accommodation and without finances.

Consider requiring the schools to have a minimum number of administrative staff and add on with a ratio of administrative staff to the number of students enrolled if the PEIs are huge. I know that many schools keep recruiting students but their administrative departments are not expanded to meet the rise in demand. As a result, they end up with students complaining of lost assignments, lost examination scripts, mix-up in time-tables, and all sorts of administrative mis-management. These students are voiceless. They cannot complain to MOE or the Council nor can they write to the press. To do so may mean they will end up getting an expulsion and a disruption of their studies, especially the foreign students. There must be a minimum number of management staff strength regardless of whether the PEIs are conducting one or two courses. This will ensure a basic support to the staff and students of the PEI and also the quality of the PEI is met under the regulatory framework and the EduTrust scheme.

Although there are clauses that ensure that the advertisement materials should not be misleading or false, there is no clause that deals with the marketing team. We have learnt from the sale of the Lehman Brothers Minibonds. We should look into the system where schools' marketing teams are rewarded commissions for every student recruited. I have nothing against them, but I think there must be some safeguards, as the so-called "counsellors" would sometimes get the students enrolled into courses that they would never have gotten into. For example, for students who cannot write, they are enrolled into mass communication. Or they make a Polytechnic diploma-holder enrol in another diploma course and wasted a year, when this student could have proceeded to an advanced diploma course. I think this is somewhat like a financial institution’s relationship manager giving wrong advice to prospective buyers of risky financial products.

Presently under the Bill, there is no direction or provision spelling out the facilities for the students, for example, library, multi-media resources, multi-purpose halls for the well-being of the students. For courses that cover Engineering or Sciences, basic laboratories are essential.

There are concerns that funds under the PEIs should not be allowed to be transferred to sister companies, or associated companies or even a holding company. This is to ensure that the interests of the students for the long three to four years courses are protected. If there is a need, a maximum retention of fund must be stipulated. All accounts of PEIs must be subjected to financial audits and annual reports be submitted and made available for public viewing.

Presently, there are schools that require the prospective applicants to sign up as members of their association. If they are to be enrolled as students, there should be a clear distinction between wanting to join an association and subscribing to its values and principles, and wanting to sign up for the courses that are run by the association. We do not ask parents to sign up as PAP members if their children want to study in PCF Kindergarten. But there are schools which make signing up with their associations a pre-requisite to study.

There are many management consultants offering short courses or modules of courses that are not registered as PEIs. The question is: are these management consultants subject to the provisions of this Bill? If they are not, how are we to ensure that the quality of these courses conducted outside the ambit of the Bill, but operating like PEIs, is satisfactory? The suggestion is that even if they are not registered under the PEIs, they must go under the ambit of the EduTrust scheme to ensure quality of the content and curriculum.

Before I conclude, I would like to caution that we should not over regulate the PEIs. We have switched from one of no control to one of total control. Section 43 directs that every course offered by the PEIs must have the written permission of the Council. The world is always changing, we must ensure that the PEIs are able to be creative and nimble to create courses that meet the demands of the changing world. The Council must be opened to new course contents and must have the platforms to listen to the PEIs. In addition, the process should be objective and simplified so that approval is fast and not draggy. In addition, section 44 directs that for every person to teach any course, his/her particulars must be informed, and the qualifications must meet the requirements stipulated by the Council. Is this too tall an order to follow or should there be a minimum percentage of teachers who can meet the stated requirements?

The tightening of rules and regulations for private schools and institutions is good also for our own Singaporean children, some of whom may find it more affordable to study here rather than overseas. The advantage of staying back to study is obvious. They incur lower costs, are close to their parents, and they can even work in the day and study at night. Furthermore, if fewer students go abroad, it will also be good for our economy as we are able to reduce the outflow of funds.

Sir, I support the Bill.

5.11 pm

Assoc. Prof. Paulin Tay Straughan: Thank you, Mr Deputy Speaker. I rise in support of this Private Education Bill. As we continue to position Singapore as a global education hub, this Bill will convey the strong commitment of the Government to provide regulation in an increasingly complex market.

Indeed, this Bill is both timely and significant in light of the recent incidence of rogue players in the private education scene, the latest being Brookes Business School. This Bill will raise consumer confidence among current as well as potential private school students and their families. With this Bill, the professionalism of private school education in Singapore will also be enhanced, and will result in a win-win situation for all involved. However, as with the advent of all regulatory processes for an existing market, there are inevitable concerns on impact and disruption to current practices.

With the exception of a small group of rogue operators, private education providers have played a significant and important role in shaping the education landscape in Singapore. Therefore, we should ensure that this Bill be implemented with minimum disruption to current private education institutions and their students. It is with this in mind that I raise the following four concerns.

My first concern relates to the process of achieving a registered status. I cannot pretend to understand all the processes spelt out in this Bill. But I do know that when this Bill is passed, all private education institutions will have to step-up the documentation of administrative processes and records. It is important that we strive to minimise disruptions to existing operators who are adhering to best business practices. I am pleased to note in section 74 that transitional grace periods have been provided for existing private education providers, to help them to continue operations as they prepare for registration.

Can the Senior Minister of State comment on the proportion of existing private education institutions that will likely be able to secure registration status with minimum disruption to their business operations? What other measures have been put in place to help existing private education institutions achieve registration as required by this Bill? Knowing the expectations of this registration initiative will help allay the apprehension of both operators and current students at these institutions. Particularly so from the students’ perspective as many must worry about the operation status of their respective schools once this Bill is passed.

My second concern relates to the cost involved in the registration process. One concern raised by small operators is related to the cost involved in meeting regulation requirements. This was reported in the Straits Times , 12th March 2009. The worry for students registered in these agencies is that a significant portion of the cost may be passed on to them.

Can the Senior Minister of State comment on how much the process of achieving registration is likely to cost – say, for a small operator who has to now expend resources to meet more stringent registration requirements? Does the Ministry expect the cost factor to have a significant impact on both consumers as well as service providers? While market forces will likely monitor how much these operators can raise their fees, my immediate concern is with students who are already committed to long-term engagement with these institutions. They may not be in a position to switch institutions should the terms change against their favour. Will we have any provisions in place to protect the interest of these students?

My third point relates to concerns on fee protection.

From the recent closure of Brookes Business School, we learn of the difficulties local students face when the private education institution they invest their savings in, fails to fulfil the contract. These students fell in the loophole because existing norms prescribe fee protection insurance as compulsory only for foreign students in private schools but as an option for students who are Singaporeans. We now know that this option comes at a very high cost for our local students. I am pleased to note that under EduTrust certification, there will be a fee protection system. Can the Senior Minister of State please elaborate on this?

As regulation encompasses a move towards providing greater assurance to consumers of private school education in Singapore, will the Ministry consider incorporating a fee protection scheme for all private school students as a basic requirement under this new Bill? This will cover all students including those in PEIs that are not seeking EduTrust certification. On EduTrust certification, like Ms Denise Phua and Mdm Cynthia Phua, I, too, feel that EduTrust certification should be made compulsory – why have two grades of private education institutions? If we feel that EduTrust certification is important and it will raise the level of professionalism, then make it compulsory for all.

Finally, I note that private education regulations in some other countries require the operators to furnish a security, to be held in trust by the Ministry of Education. For example, in Canada, the security is based on the total revenue from tuition fees estimated in the institution's annual budget for the first school year of the period of validity of the permit. This security serves as an added assurance to students that the private education provider would not cease operations prematurely. I would like to ask the Ministry if we would consider adding a security clause in the Bill.

Thank you, Sir, for allowing me to share my thoughts.

5.17 pm

Mr Lim Biow Chuan: Sir, allow me to declare my interest as the Vice-President of the Consumers Association of Singapore (CASE).

Sir, CASE has been involved in the accreditation scheme – CaseTrust for Education – since 2004. At that time, EDB was trying to develop Singapore as a "Global Schoolhouse" and CASE was invited to be involved in introducing student protection policies and this was part of the objective of CASE in looking after the interests and welfare of student consumers.

The CaseTrust for Education scheme was meant to assist in protecting student's interest and welfare. This is done by ensuring that all CaseTrusted private schools had a set of good practices, like proper student contract, clear fees policies, well-defined student redress practices and, very importantly, a student protection scheme. CaseTrust was never intended and certainly did not have the means to ensure academic excellence by the private schools. As a consumer body, CASE did not have the expertise to investigate or ensure that private schools were offering proper degree programmes.

However, Sir, notwithstanding the best efforts and intentions, voluntary industry self-regulation will not work if rogue businesses are determined to exploit the loopholes in the scheme. There is a limit to what voluntary industry self-regulation can achieve and it will never be as effective as a strong government regulatory regime. A breach of the CaseTrust conditions can only result in either suspension of the school's CaseTrust status or the school's explusion from CaseTrust.

Hence, Sir, for the past five years, CASE has been advocating for a more comprehensive framework to protect students' interests. We welcome the introduction of the Private Education Bill which we feel is long overdue.

Sir, there are about 1,000 private education institutions catering to a potential target of close to 100,000 students. These schools have varying standards and every year, the Consumers Association of Singapore receives many complaints about the poor quality standards of some of these schools.

The two main concerns of many students are as follows:

Firstly, is that private schools are poorly managed and financially unsound. Thus, when the schools close due to financial difficulties, students who had paid their fees risk losing their fees which were paid in advance. For many of these students, these fees represent their hard earned savings and investment. Some students also take on bank loans to finance their education. For some of these students when the schools close, it will also mean the end of their dreams to a brighter future because they are unable to fulfil their plans of completing their further education.

The second main concern of many students is that the students will not receive a recognised degree or diploma issued by these private schools.

Over the past years, we have read of the closure of the AIT Academy in 2005, the closure of Froebel Academy in 2007, Britannia School of Education and Goro Global School just this year and in the last few few months, Brookes Business School. Each time a private school closes due to financial difficulties or becomes bankrupt, many students fear that their fees which were paid in advance are lost. The case in point would be the AIT Academy and Unicampus as well as Froebel Academy. Students also worry that the degrees or diplomas which they had obtained or had studied for are worthless. And two years ago, Straits Times had to report about Preston University, allegedly being a degree mill, churning out worthless degrees. Recently, many students were hurt when they found out that the degrees purportedly issued by Brookes Business School from RMIT are also fake degrees.

Sir, many students come to Singapore to further their studies because of our country's reputation as a clean and honest country with low tolerance of unethical behaviour. Adverse publicity where students were cheated of their student fees or where they had obtained worthless paper qualifications could undo all our efforts at building Singapore into a global education hub.

I support the Government's actions to regulate and develop the private education sector by making it compulsory for every private education institution to register if they wish to provide private education in Singapore.

I also support the measures that require the PEIs to seek permission from the Council for Private Education before they can offer a course by itself or in association or collaboration with another person; or offering a course leading to the award of a degree or a diploma in its own name. It is indeed assuring that the Council would be taking steps to ensure that courses provided by the PEIs are vetted for academic quality and that the degree mills in Singapore would, hopefully, be a thing of the past. Such tighter regulations would signal to all parties who wish to be involved in the private education industry that they have to take their duties and responsibilities seriously.

I also applaud the measures to establish the EduTrust certification scheme which would take over the CaseTrust for Education scheme. It is an important part of the regulatory framework to ensure that PEIs take measures to protect the student fees from being dissipated when the schools close due to financial difficulties or poor management.

Sir, there are some queries and clarifications on the Bill which I would wish to seek from the Senior Minister of State.

Sir, Part III, section 34(6) provides that the Council may by written direction direct an unregistered PEI to refund each student the whole course money paid. Sir, where the Council issues a direction to the unregistered PEI to refund course fees or money, may I ask whether it is intended for one direction per student or one direction for all the students of the unregistered PEI? In section 34(8), it is an offence for the manager not to comply with the direction of the Council. However, under section 61(2), the fine is only up to a maximum of $10,000. Thus, if there is only one written direction to refund, say, $100,000 to many affected students of the unregistered PEI, surely it may be worth the while for the manager of the unregistered PEI not to comply with the Council's directions and to pay the maximum fine of $10,000. How does the Senior Minister of State intend to overcome such a situation?

Next, Sir, section 34(9) talks about it being a defence for any person charged with an offence to prove that he has reasonable excuse for failing to comply with the written direction. Is the lack of funds or bankruptcy of an unregistered PEI considered a reasonable excuse for failing to comply with the written direction of the Council?

Next, Sir, if I may refer the Senior Minister of State to section 37(1)(f). Do you require a manager to have prior experience before he can set up a Private Education Institution? What does "fit and proper" mean?

Next, Sir, is section 41(1)(d)(iii). After the manager informs the Council of legal proceedings against the PEI, what action is the Council expected to do? Having heard of the litigation suits against it, would the Council take action to suspend or ask the PEI to show cause? How does the Council intend to deal with situations where the students change their minds after registration but decide to take legal action against the PEI anyway without reason? Sir, I would urge the Council to be mindful that they must be fair to PEIs who run a fair and legitimate business.

Next, Sir, is about section 43(1). Before granting permission for a course, will the Council check on the academic quality of the university? How does the Council ensure that a PEI is not peddling degrees from degree mills? Would the Council be carrying out its own investigation or is the Council relying on declarations made by the manager of the PEI? Would the manager of a PEI be liable for cheating or some criminal offence if he knowingly sells degree or diploma programmes which are fake.

And where the Council has granted permission for such a course, will the Council conduct constant checks to ensure that the PEI is able to maintain that relationship with the foreign university? How will the Council monitor whether the university continues to support the degree programme offered by a local PEI and that such a university will not terminate the partnership mid way. So, for example, if RMIT enters into a partnership with a local PEI and midway they decide to terminate that relationship, would Council be aware of it?

Next, Sir, under section 44(1)(a), does the Council intend to verify the minimum qualifications of the teacher or lecturer? What if the lecturer or professor is described to have a doctorate but the doctorate is from a degree mill? Would the Council check the university from which the lecturer obtains his degree?

Finally, Sir, section 49(f). It provides for the establishment of one or more accreditation scheme and provides that members of the scheme shall enter into a student fee protection scheme. May I ask the Senior Minister of State what are the penalties for breach of the student fee protection scheme? Will such a breach be considered a criminal offence, for example, if they failed to take up a student protection scheme or failed to insure the entire fees paid, just as in Brookes Business School? What are the intended penalties for such a breach?

Sir, I would urge the Government to ensure that breaches of this nature attract a more severe penalty because such irresponsible action could destroy the future of many students.

I would also urge the Senior Minister of State to consider mandating that PEIs furnish a performance bond to ensure that students who have lost their fees when a rogue PEI shuts down its business, will still have some form of recourse to seek compensation.

Sir, finally, despite all the regulations that may be in place, it does not mean that no PEIs will ever close down due to financial difficulties. It also does not mean that no PEI will not try to offer dubious degrees requiring short-term study. The Council would have to work hard to educate and encourage students to be more conscientious and to carry out their due diligence when they sign up for such degree or diploma courses.

With this, Sir, I support the Bill.

Mr Iswaran: Thank you, Mr Deputy Speaker, Sir.

First of all, let me thank all Members who have risen and spoken in support of the Private Education Bill. I think it has been variously described as "welcome", "timely" and I think some said that "it is long overdue". But whatever the adjective, I think there is a general consensus that this Bill will contribute to preserving Singapore's education brand name and upholding the position of Singapore as a global education hub. And, indeed, the Ministry of Education shares many of the concerns and, certainly, view of the Members.

Sir, the Members have raised quite an exhaustive set of issues. Some have spoken about the need for maintaining standards and quality. And yet we have also expressed concerns about being overly dirigistic in the way we regulate the industry. There has been talk about the need to maintain and provide for adequate student protection. But we also expressed concerns about excessive costs. And I think these are important points because they illustrate the inherent tensions in the industry and the challenges that we face in this new endeavour that we are embarking on. So I would say that this is precisely why the Ministry of Education needs all parties involved on-hand to help because it is not just about MOE or the Council for Private Education embarking on an effort to implement a piece of legislation. It is actually a collective effort where the industry players have to rise to the challenge, the students and consumers have to play their part and acknowledge that they have a role to play and being sophisticated, knowledgeable consumers, and, in general, the public as well as the Members of this House in ensuring that we are vigilant and we are alive to possible problems that we might face.

Sir, I will endeavour to address some of the key points or principles and policies that Members have raised. But I would also beg the Members' indulgence that on some of the more specific issues which I think I do not go to the heart of the Bill, but they are more about specific implementation issues, I will refer them to the CPE to take up in their regulations and follow-on implementation. Firstly, on the whole issue of the private education sector where the CPE is involved, Mrs Josephine Teo, Mdm Halimah Yacob and Ms Denise Phua among others, have asked about the vision for the CPE, in terms of the private education sector, and what is its roles and functions. Let me elaborate on this.

The vision is really for the private education sector to be a complementary pillar, which augments Singapore's strong public education system and it will support Singapore's position as a global education hub. The new Private Education Bill provides the legislative framework for the CPE to uplift the standards in the sector. And over time, as the private education institutions improve on their current level of academic and service qualities, they will be better able to provide additional avenues for aspiring Singaporeans, as many Members have spoken about, to attain higher qualifications and, indeed, also for us to attract foreign talent to Singapore.

There have been a series of questions on what actually is the coverage of specific examples cited. I will just address a few of them and I think we can cover them in greater detail through communication to specific Members. One of the questions asked, I think by Mrs Josephine Teo, was: what about self-developed diplomas? The answer is yes, they are covered by the Bill. Mr Calvin Cheng asked about part-time diplomas, they are also covered by the Bill. Ms Denise Phua asked about special education schools and to be more generic in the definition, so that it is all inclusive. The answer is basically all SPED schools, which are not Government-funded are covered by the Bill. So I think in terms of coverage, there is quite a lot there. The intent, at the end of the day, as I said earlier during the Second Reading of the Bill, is to cover those courses that are leading towards certification, diplomas, degrees and which entail significant time and money cost for our students.

As I mentioned earlier, the CPE will also undertake additional responsibilities of promoting consumer awareness, providing student services and facilitating industry development. And this is to ensure that a balanced and holistic approach is taken towards developing a quality private education sector that benefits students and raises standards in the sector over time. To be a credible education hub, we have to guard against players who aim to capitalise on Singapore's reputation, to market their courses overseas, whatever their quality. That is why the Bill requires any private education institution registered as a company in Singapore, to also register with the CPE, even if some or none of its courses are operating in Singapore.

Mr Inderjit Singh raised this point. The issue here is the flexibility that can be accorded to private enterprises and education service industry against the reputation that they are capitalising on, ie, Singapore's reputation in this instance. If an entity is incorporated in Singapore, for the purpose of providing education services, and even if it does not provide those services in Singapore, the fact is it has chosen to be incorporated in Singapore, because it recognises that there is a certain value that accrues to it from that registration and to be able to say that. And, therefore, it is incumbent on us to ensure that it does the work to serve the minimum standard that we impose on the sector. So that is the context of it, not to be overly burdensome because, if indeed the intent is to wholly and exclusively provide education services in a third country, then the entity should just incorporate there and do so. We do not need an incorporation in Singapore for that purpose.

I agree with Mdm Halimah Yacob that there are currently different Government agencies overseeing various aspects of Singapore's growth as an education hub. The CPE, as a new sectoral regulator, will work with these agencies to complement existing efforts. Mrs Mildred Tan asked a question: what is the KPI for the CPE and indeed for this entire effort? I would say that the single biggest contribution that the Council for Private Education, through this legislation, can make is really to ensure that our private education sector rests on a very firm foundation of quality, trust and reliability. That I think is a fundamental thing. Because if you do not have that, no amount of capability development and marketing is going to make a difference. Because it will give lie to the claim that the product is of quality. So that is the primary objective and indeed this is where the CPE should be channelling most, if not almost all, of its resources certainly in the earlier years. But beyond that, it is true that there is coordination needed among the agencies. The Ministry of Trade and Industry has various bodies that are involved in aspects such as SPRING, EDB, IAE and STB. So, clearly the CPE will have to have close collaboration with them, to ensure that, first, the quality standards are maintained as its primary function and, secondly, to ensure that in the communication, particularly overseas, the message is put up clearly and students and any other facilitators who reside overseas, will be able to internalise that information in guiding students to make choices about education options in Singapore.

Being a new statutory body, the CPE itself will also need time to grow and expand its regulatory and development functions for the private education sector. Mdm Halimah is right in pointing out that the CPE will require a sufficient pool of manpower, with the relevant skills-set, to perform its roles effectively.

Let me assure the House that, perhaps, in anticipation of the resounding support of Members, the preparation for the set up of the CPE has already been under way for quite some time. To oversee transitional arrangements to the new regime, a Pro-tem Council was formed in January 2009, headed by Mr Lim Cheng Ton, the former Principal and CEO of Nanyang Polytechnic, whose academic experience and leadership skills are well-known among Singapore educationists and business leaders. The Pro-tem Council members are individuals with expertise in the field of education, quality assurance and business. The secretariat to the Pro-tem Council was set up in July last year, as a new division within the Ministry of Education, to incubate this new capability. And it comprises officers overseeing inspection, assessment, policy and industry development roles for the private education sector. From a handful of officers, the staff strength of the secretariat has grown to around 60 officers currently. And I foresee that the organisation will continue to grow as it expands on its roles and responsibilities, and takes on new challenges in the years ahead.

But we also want to strike a balance, because we anticipate that in the immediate one, two or three years, there will be a significant amount of resources and activities required of the CPE. But once we clear this hump, then we will be in a steady state where the system can then sustain itself. Therefore, the intention is to make sure the CPE remains lean and efficient. The core group in the CPE will be supported by a pool of adjunct inspectors and assessors to augment the full-time team with the relevant industry knowledge, especially in niche areas.

Mr Christopher de Souza, Mr Lim Biow Chuan and Mr Calvin Cheng have asked that a higher quantum of fines be considered in the Bill. Essentially the question is whether the fines are of sufficient magnitude to have enough bite, as Mr de Souza put it. Mr Deputy Speaker, Sir, the fines imposed need to be viewed in the context of the overall graduated range of penalties for the contraventions of varying seriousness, which the Bill provides for. For example, if a PEI fails to deploy teachers of qualifications and experience as prescribed for in the Bill, the CPE could censure the PEI, impose additional conditions of registration, in addition to imposing a financial penalty of $5,000. Contraventions requiring strong deterrence would constitute criminal offences. For example, any private education institution, or person who provides false or misleading advertisements, may be liable for a fine of up to S$5,000 or a jail term of up to six months, or both. For more serious offences, such as the failure of the PEI to seek the Council's permission to offer courses or advertising and soliciting fees from students for unpermitted courses, the penalties would comprise a fine of up to $10,000, or a jail term of up to one year, or both. So does it have bite? I would argue, yes, because while the fee or fine is one component, the threat of imprisonment is a major deterrent. I think this is seen not just in the context of this Bill but in any other piece of legislation. So, we need to take that into account.

Secondly, Mr Lim Biow Chuan raised this point, whether charges will be pressed individually or collectively. Mr Lim is a lawyer and I think at the end of the day, this will rest in the hands of the prosecutor's office. But, at the end of the day, the important point I want to register is this – the CPE will enforce, and enforce vigorously, because the intent really is to make sure that having established this regulatory framework, we must ensure compliance and that the standards are upheld. So, enforcement is a critical part of this. In enforcing it, it will expect that right through the system, the gravity of the offence will be reflected in the kind of penalties that are meted out.

Persons who have been previously disqualified, will also be barred from holding the position of managers for a period of five years. If there is evidence of such persons continuing to assert management influence, behind the scenes or through proxy, as some Members have suggested, on any PEI, the CPE will investigate and take appropriate action against the PEI and the individuals involved.

On the issue of the impact on businesses, I agree with the observation made by Mr de Souza and others that there are good private education providers in the market and that they should be encouraged to grow. Mr de Souza, together with Mrs Josephine Teo, Mdm Cynthia Phua, Assoc. Prof. Paulin Straughan and Mr Zainudin, have raised concerns over the impact on genuine private education providers, and we share their concerns. The CPE will provide transitional arrangements that will give genuine private education providers time to adjust to the new regime. The CPE will also provide information to assist them in their applications. The idea is really that we have a new regime, we understand that some organisations may need more time and help, and we will allow for that. In addition, the CPE will be working with SPRING Singapore to provide capability development assistance to PEIs, so as to make their transition into the new regime as smooth as possible. But as I said in my Second Reading speech, even though we are giving grace periods, notwithstanding that, the CPE will enforce especially when negligent practices come to light.

Mdm Halimah Yacob also pointed out that there are many small players in the PEI sector with very limited capital, resources and capabilities to enable them to make a quantum leap in standards and quality. This was one of the considerations MOE took into account when deliberating and fine-tuning the new regulatory framework. The regulatory approach will be taken as a calibrated one, aimed at uplifting the standards of the PEIs over a graduated period of time, in order not to cause sudden market consolidation or disruption, which may cause quite significant dislocation to the studies of existing students.

Let me assure Mr Inderjit Singh that it is not the CPE's intent to impose Singapore curriculum or standards per se on foreign system schools or to be overly rigid in applying the restriction on the use of PEI premises for activities which are compatible with education. If a foreign system school is providing curriculum and preparing the students for an examination or certificate from their home country, then they just need to produce the evidence to support that from their home country. That would be sufficient and they do not need to meet Singapore's standards on the particular curriculum.

Similarly for activities in their premises, as long as they are compatible with education and the core function there, it should be something that the CPE will look upon favourably. This is really more to guard against illegitimate or disguised uses which run contrary to the core declared mission of education. Similarly, the Council will exercise discretion in dealing with the foreign university seeking to operate a branch campus in Singapore. Due consideration will be given to universities who meet certain quality criteria and are substantively involved and committed in local operations. So the test really is – is this foreign university here engaged, significantly committed, in terms of its resources and substantively involved in the running of the programme? If the answer to all these questions is yes and it fulfils the key criteria set out by the CPE, then the CPE should be able to allow them to display their names. So that is the test.

There have been several comments among Members about the Enhanced Registration Framework and EduTrust certification scheme that they create a two-tier system and that they should be combined and made mandatory. I want to take this opportunity to clarify this and make it absolutely clear. There is only one regulatory tier in this system. There is only one regulatory standard and that is the Enhanced Registration Framework. That sets the bar and all our entities in the private education sector have to meet that bar in order to be able to continue their business.

The question was asked – should we merge the EduTrust requirement into the basic Enhanced Registration Framework? Sir, I would like to draw an analogy with the corporate sector so that Members get a sense of the framework we are operating in. In the Companies Acts, for example, companies are registered, they are required to fulfil a certain set of Government requirements and a certain set of other requirements set out by the Registrar. Now, some companies may go beyond that, to acquire ISO certification, Singapore Quality Class certification and other forms of additional voluntary certifications in order to differentiate themselves. And this is a common practice in the industry. That does not mean that the companies that do not have such certifications are somehow deficient. They do meet the standards that have been set out. They meet those requirements. But this is really an attempt to distinguish yourselves, to set a higher bar and say that I have actually aspired to and attained something higher and presumably entities want to do this in order to have market advantage.

So being a quality mark, it is also reasonable to expect that not every registered private education institution will be able to attain EduTrust certification. To mandate EduTrust certification for all PEIs, including the student protection schemes, will translate into additional cost for PEIs and students. There are two arguments here really. One is cost. If you mandate something, and it is a much higher bar than what we have already raised the basic bar to, then the cost will be passed on and either the PEI or the students, or both, will bear it. But there is another element which is, you do not always need this EduTrust certification. For example, there are courses, as I mentioned in my Second Reading speech, which are conducted within the context of a particular industry, ie, short courses which have WSQ certification, and so on. In these instances, the consumers, which are the industry players, the students and the service providers, all know each other very well, they know that the quality is vouched for, and there is no need to go into this additional EduTrust certification or other kinds of quality assurance certification.

The point about information asymmetry has been highlighted. Mrs Josephine Teo and Mr Calvin Cheng made the point that registration on its own can be used by a business as a statement that says "I have, therefore, met the standards of the Singapore Quality mark implemented and I can, therefore, market myself". That is precisely why even under the Enhanced Registration Framework, we have significantly higher standards. We are raising corporate and academic governance standards; we are enhancing student protection measures, perhaps not to the same extent as under EduTrust, but still significantly higher; compelling disclosure of key information and also requiring periodic renewal – in other words, you have to apply and renew your registration. It is not a case of once you have passed the post, that is it. So, that is why it is important that we keep this in context. There is only one registration scheme. All our PEIs will be required to meet that standard and those who so desire can aspire to the voluntary EduTrust certification scheme.

I appreciate the concerns of some Members that the pre-requisite of requiring a foreign student to enrol in an Edutrust-certified PEI might be misconstrued as according more protection to foreign students. As I have clarified before and I want to clarify again, there is no differential treatment between Singapore students and foreign students.

Members may be well aware that student passes are easily susceptible to being exploited as a means for foreigners to work illegally here in Singapore, and this was alluded to by some Members. One approach in mitigating such immigration risks is to be selective in who we let in under a student pass. From an education perspective, it would not be unreasonable for the immigration authorities to seek certain assurance by pegging eligibility to the quality of the PEI offering enrolment. So EduTrust certification is useful as one signal as CaseTrust has been in the past. But that does not mean that we are differentiating between foreign and local students. A Singapore student applying and enrolling in an EduTrusted PEI would enjoy the same level of protection and the same services as a foreign student, and there is no difference there.

Members have asked if the new regulatory regime will provide for sufficient protection of students studying in the private education institutions. Let me assure the House that the new regime will strengthen student protection measures. Managers of private education institutions must fulfil their responsibilities in the event of a school closure, including issuing fee refunds to students. Under the Enhanced Registration Framework, the Council will also stipulate the level and mode of protection and the maximum amount of fees that the PEI can collect upfront under the Enhanced Registration Framework. So, there are some very specific provisions. What is the maximum amount of fees a PEI can collect? That is an important element and beyond that, the other elements of student protection and information provision. These are aspects that we have to bundle together and look at in totality.

Now, should this extend to various ideas that have been put forward by Members – escrow, performance bonds or insurance, although some Members expressed some concern about it. The reality is, if you have a well administered insurance scheme, students will generally be well protected. A performance bond and escrow type arrangement imposes significantly higher cost compared to an insurance scheme. But whichever the mechanism, at the end of the day, the CPE must be satisfied that proper student protection schemes are put in place, both in the case of EduTrust and also in terms of the Enhanced Registration Framework.

The CPE will take firm action against PEIs who seek to mislead through their advertisements or other publications. Mr Inderjit Singh asked: can they put in their advertisements that they are accredited by foreign bodies? The answer is, yes, they can if that is the truth. And then students have to judge. But as far as the Singapore elements are concerned, they can say what we have allowed them to say.

Even with such protection measures in place, I want to reiterate that risks can only be mitigated, we cannot eliminate the risks. Even in very mature jurisdictions, in this case, like in New Zealand and Australia, you continue to see recent cases where you have egregious players who have sought to dupe students and indulged in fraudulent activities. So our consumers, our students, must be aware and take appropriate diligent steps even after that, with this regulation and legislation, there may still be instances that might be problematic. But the consumers need to be savvy in their decision-making process, taking into account the length of time students have to invest in the public institutions and private institutions in order to acquire similar qualifications.

If you go to an autonomous university – NUS, NTU or SMU – and it takes you four years to get a Degree, and somebody comes along and offers you the same Degree in one or two years, I think it would be appropriate to ask some questions and not take it at face value. We are talking about students who are looking at tertiary education, who are going to invest a significant portion of either their families' resources and their time in something like this. I would imagine that the students would be quite motivated to satisfy themselves that they are getting value and quality for what they are doing.

It is also important for us to keep the balance, between students and the PEIs. Yes, we want to guard against unscrupulous practices of private education institutions. But we also want to make sure that students do not game the system and take advantage, in order to get maximum benefit for themselves. Several Members have touched on this point. And that is exactly why in enforcing these rules and taking action, the CPE will have to judge each case on its merits and decide how to go forward.

To conclude, I wish to reiterate that the Private Education Bill is a necessary move towards uplifting the standards of the sector. The CPE will work with other Government agencies and the industry players in implementing the new regulatory regime. With the passing of the Bill, we will have stronger legislative and regulatory levers to raise the quality of the private education sector overtime. But we need to ensure that the other elements – information provision, consumer sophistication and education, and industry development – are all in place as well if we have to take the sector to a higher level. I, therefore, urge all Members to give the CPE your full support and we look forward to raising the bar for the private education sector in Singapore.

Mrs Josephine Teo: Mr Deputy Speaker, Sir, I thank the Senior Minister of State for his clarifications. There is one point that I hope he can respond to more fully. On the fee protection for our local students, is it not important enough that the MOE would consider making it a requirement for registration of all PEIs, rather than leaving it as a feature of the EduTrust certification, which not all PEIs are required to pursue? Could he please comment on that?

Mr Iswaran: Sir, the Member raises a good point. I think we are quite clear about the EduTrust elements. So I think we can leave that aside. The question now is, because of the thousand or so institutions, we are looking at a vast majority who may not go for EduTrust and they are operating as registered private education institutions in Singapore.

What we have today, as envisaged under the Bill and in the intended regulations, is to cap the amount of fees that the institution can collect in advance. One of the problems today is that the PEI could potentially collect one year's fees in advance and then this collection is not backed by adequate protection. In the scheme that we envisage, going forward, there would probably be a cap of perhaps two to three months of fees to be collected in advance. That automatically limits the financial risk exposure for the students, because you are paying at the most, three months in advance. We could consider allowing these registered PEIs – because they have a capital requirement and they may want to find ways to generate more capital – a greater upfront fee collection if it is commensurate with a higher level of protection afforded to the students in some form.

This is what we need to explore and discuss with the industry because at the end of the day, if you make it mandatory, the cost will flow right through and the students will pay more. The question is, is that what we want to do? MOE's primary focus is at least in the first year to minimise the risks and we evaluate from there and see whether there is a need to do anything further, in discussion with the industry.

Mr Christopher de Souza: I would like to thank the Senior Minister of State for his reply. On the issue of the fine, the reason behind my concern is that if you read clause 61, it is actually a default punishment provision. It says that if there is no other penalty prescribed under the provisions, then if there is an offence under the Act, you either get up to $10,000 fine or up to 12 months' imprisonment. Sir, it is a provision that is going to be used a lot because it is the default provision. I understand that it is MOE's position that there is bite in this permutation but I think it would be helpful if the Senior Minister of State gave an indication that it is the intention of MOE that these provisions both deter and punish – the punishment being tarnishing the brand name of education in Singapore. I think that would be helpful, certainly to the courts.

Mr Iswaran: I would be happy to give that assurance once again. The intention is very clear. The reason why there is a criminal offence with possible jail sentence that goes with some of these more extreme offences is really to underscore the point that we are not just talking about a particular student or a particular institution, we are talking about the system. And that the system takes a hit when one player misbehaves, and therefore it is fully the intent that when we go about the work of the CPE, there will be vigorous enforcement and the more egregious the case, we will press for more deterrent punishment.

Mr Calvin Cheng: I would like to thank the Senior Minister of State for his clarifications. I am not so much worried about local students in Singapore because I think they are savvy enough to go on their own to do due diligence and at the end of the day, they actually live in Singapore. I am particularly worried about foreign students. When translated into foreign languages, they cannot catch the nuances and the distinctions between registration and EduTrust and the regulatory framework. Can the CPE perhaps consider making sure that all information is available in the languages of countries that foreign students would come from? And also perhaps play the role of the British Council, in educating foreign students who may want to come to Singapore to study and to provide information in those countries for those students wanting to come to Singapore to study.

Mr Iswaran: First of all, I am not sure that all Members here would agree that Singapore students are all savvy and not in need of protection. I think that was in fact the point of some discussion today. The intention really is not about whether you are a student from overseas or from Singapore, all students are worthy of full protection under this Bill if it is enacted. And that is the way we will go forward. But having said that we do recognise that for the students who come from overseas, apart from language differences, there are cultural differences and they may therefore miss the nuances and therefore not be able to appreciate all the details. So apart from its own website, information services and the students' service centre that it is going to set up – these are going to be important elements – I think the CPE will be engaging students from overseas. Most would normally have a point of reference in their own missions here. That would be an important point of contact for our CPE officials in order to fully apprise them of what is happening so that they can, in the language that is most comfortable for the students from their home country, explain this with more clarity. This will also be extended to the home country itself, particularly where large numbers of our students from overseas are coming to Singapore. So, the point is acknowledged. We have to look for different ways of dealing with that problem.

Mdm Halimah Yacob: I thank the Senior Minister of State for his very comprehensive reply. Just one point, under section 63 of the Act, it is stated that if the Council orders a private education institution to refund fees to the students, the students can recover that fee as a civil debt from the Court. There are two problems with this. Firstly, it is –

Mr Deputy Speaker: Mdm Halimah, is that a new speech?

Mdm Halimah Yacob: No, it is not a new speech, Sir. I am just explaining why I am asking the follow-up question.

Mr Deputy Speaker: So it is a clarification from you?

Mdm Halimah Yacob: It is a clarification, Sir. The first problem is that the private education institution may not be solvent, so to recover the refund may not be a feasible idea. Second point is, to take legal action is also very costly and time-consuming for students already struggling to pay for their fees and have made tremendous losses. Is there any other recourse that can be considered? I suggest that perhaps a part of their fees could be set aside in order to reimburse students for refunds ordered by the Council but I think that point has not been addressed.

Mr Iswaran: Thank you, Mr Deputy Speaker. There are two parts: one is, what is the kind of protection? I think the Member's point is that students would rank quite low in the list of creditors who would be reimbursed if a PEI were to go under and therefore how does the students' interest get protected. That is precisely why we will look to find ways that insulate the students' exposure. Certainly under EduTrust, if you are going to have the insurance scheme, it would be outside the general action that will follow a bankruptcy and creditors' claims. Secondly, providing adequate protection, and some Members raised the example of Brookes. The problem with Brookes was not that there was no insurance; it was under insurance. So the key thing is to make sure that insurance coverage is adequate, so that students are well-protected. As for students having a cost-effective means of seeking redress, this is not just about fees but I think in general about other disputes. This is precisely why CPE intends to have dispute resolution mechanisms. Whether it is through our mediation centres or other mechanisms, CPE will designate those so that the students can then avail themselves of these without having to go through a more costly civil suit exercise. That is the intention.

Assoc. Prof. Paulin Tay Straughan: Thank you, Sir. If I am a student who is in the midst of my programme right now and I have two more years to go, what would the Senior Minister of State advise? They are thinking, "I am watching this, I am really concerned, I do not know whether I will be able to complete my degree course in due time". What would be the best advice the Senior Minister of State could give to students in this kind of position while they await the registration outcomes?

Mr Iswaran: I would tell them to study hard, do well in their course and get their degree completed because there is no reason to think that the course they enrolled for is in anyway suspect. But if, in fact, it turns out that there are some problems, then there would be remedies instituted, whether it is for the student to complete his course or to find some alternative deployment for him or her to complete the course.

Question put, and agreed to.

Bill accordingly read a Second time and committed to a Committee of the whole House.

The House immediately resolved itself into a Committee on the Bill. – [Mr Iswaran].

Bill considered in Committee; reported without amendment; read a Third time and passed.