Education Services for Overseas Students (TPS Levies) (Risk Rated Premium and Special Tuition Protection Components) Instrument 2025

The central concept is the risk rated premium component, which functions as a risk-based levy adjustment. The specified percentage of 0.05% is a base rate that applies to all non-exempt providers, but the actual levy paid is the product of that rate multiplied by the sum of the relevant risk factor multipliers. The risk factors are designed to increase the levy for providers that present higher risk to the Tuition Protection Service, either through short operating history, rapid fluctuation in enrolments, over-reliance on a single source country, or past non-compliance.

The base risk factor is a flat multiplier of 1.0 for every non-exempt provider, ensuring every provider pays at least the base levy. The length of operation factor reduces the levy for providers that have been registered longer: less than one year pays an additional 1.0 multiplier (so effectively double the base), one to two years pays 0.5, and two years or more pays 0.0 (no length penalty). The volatility in overseas student enrolments applies only to providers with at least two years of operation and either 20 or more enrolments or $400,000 or more in tuition fee income in 2025, and only if overseas students are at least 20% of their total student population. The factor is calculated by comparing 2025 enrolments to 2024 enrolments using a formula: (2025 enrolments / 2024 enrolments - 1) × 100. The result is a percentage that maps to a multiplier in a table. Growth of 120% or more attracts a multiplier of 3.5; negative growth of 60% or more also attracts 3.5. There is a zero-multiplier band for changes between negative 15% and positive 30% (item 8). For providers with less than five years of operation, the volatility multiplier is reduced: 100% reduction if less than two years, 75% if two to three years, 50% if three to four years, and 25% if four to five years (section 9(5)).

The maximum overseas source country concentration applies to the same threshold group (20 enrolments or $400k fees, overseas students at least 20% of total). The multiplier increases as the largest source country’s share of enrolments increases: less than 25% gets 0.0, 25% to less than 50% gets 0.3, 50% to less than 80% gets 0.7, and 80% or more gets 3.1. The non-compliance and registration renewal factor applies to all non-exempt providers. It uses a weighted late payment measure combining late payments for CRICOS charges and TPS levies across the three most recent years, weighted 0.7 for 2025, 0.2 for 2024, and 0.1 for 2023 (section 11(2)). Late payment of 30 days or more yields a 2.0 multiplier; 15 to 29 days yields 0.9; 1 to 14 days yields 0.7; fewer than 1 day (including zero) yields 0.0. Separately, the factor also adds 1.0 if the provider had action taken under section 83 of the ESOS Act in 2025, 1.0 if registration renewal was due to risk management resulting in a shorter period, and 1.0 if at least one student default led to a TPS Director refund in 2025. Where multiple items in the table apply, the multipliers are summed (section 11(4)), which can produce a large cumulative multiplier for a provider with both late payments and compliance actions.

The instrument directly affects all registered providers of education services to overseas students that are not exempted by the Minister under paragraph 12(b) of the TPS Levies Act. That class includes private and public universities, private colleges, TAFE institutes, English language schools, and vocational education providers that hold CRICOS registration. Small providers with fewer than 20 overseas students or less than $400,000 in tuition fee income may be exempt from the volatility and concentration risk factors (sections 9(1)(b) and 10(1)), but they remain subject to the base and length of operation factors and the non-compliance factor. Providers with overseas students comprising less than 20% of their total student body are also exempt from the volatility and concentration factors (sections 9(2) and 10(2)).

The instrument has an indirect effect on overseas students, though it does not directly regulate them. Students are affected to the extent that higher levies may be passed through to tuition fees or may influence provider behaviour regarding enrolment strategies, source country diversification, and compliance timeliness. Students whose providers default may benefit from the TPS fund that is capitalised by these levies, but the instrument itself adjusts only the levy calculation, not the substantive protections.

The TPS Director and the ESOS agency are affected as administrators. The TPS Director calculates the levy for each provider using the factors set out in this instrument. The ESOS agency’s risk management decisions under section 10E(2) of the ESOS Act can trigger the 1.0 multiplier in item 6 of the non-compliance table, meaning the agency’s decisions directly increase the provider’s levy. That creates an administrative feedback loop: a decision to grant a shorter renewal period due to risk management not only shortens registration but also increases the provider’s cost of operation.

Providers that amalgamated registrations in 2025 will have their risk factors recalculated under section 12, which aggregates data across all component registrations. This may produce a higher or lower overall multiplier depending on the mix, but the method of summing weighted late payment measures and compliance events (section 12(d)) means that a provider with one non-compliant registration among several will still carry that 1.0 multiplier into the amalgamated result, even if the overall entity is otherwise compliant.

The instrument does not create new duties; it specifies the formula for calculating an existing levy obligation under the TPS Levies Act. The duty to pay the risk rated premium component is imposed by the Act; this instrument merely quantifies it for the 2026 levy year. Providers have a right to know the factors that apply to them and to verify the data used in the calculation. The instrument provides the formula for each factor, which is deterministic based on the provider’s enrolment data, fee income, late payment history, compliance events, and length of registration.

Providers have a right to be exempt from the volatility and concentration factors if their overseas student population is below 20% of their total enrolments, or if they fall below the 20 enrolment or $400,000 fee thresholds. There is no discretion: if the criteria are not met, the factor does not apply. Providers with fewer than two years of operation receive a 100% reduction to the volatility factor (section 9(5) item 1), which effectively eliminates that factor for the first two years. That reduction recognises that start-ups lack a meaningful two-year enrolment comparison and should not be penalised for volatility that is a natural result of low base numbers.

The instrument also provides a right of recalculation for amalgamated registrations under section 12, which treats the amalgamated entity as if it had always operated as a single entity for the purposes of length of operation and aggregates enrolment data across all years. This prevents providers from being penalised for fragmentation that was subsequently consolidated.

There is no provision for individual provider-specific adjustments, waivers, or appeals within this instrument. Any challenge to the calculation would likely proceed under the administrative law framework applicable to decisions made under the TPS Levies Act. Providers do not have a right to opt out of any factor if the statutory criteria are met.

This instrument does not itself contain penalty provisions. Penalties for non-payment of TPS levy, late payment, or failure to provide information are found in the Education Services for Overseas Students (TPS Levies) Act 2012 and the ESOS Act. The instrument’s enforcement relevance lies in its non-compliance and registration renewal factor (section 11), which directly increases the levy for providers that have late payment histories, section 83 ESOS Act actions, risk-managed renewals, or student defaults leading to TPS Director refunds. The factor operates as an automatic financial penalty embedded in the levy calculation, not as a discrete fine.

The weighted late payment measure gives greater weight to recent non-compliance: 70% weight on 2025, 20% on 2024, and 10% on 2023. This means a single late payment in 2025 can significantly increase the levy, while a pattern of lateness across all three years is further magnified. Because the factor is cumulative (section 11(4)), a provider that had a section 83 action (1.0), a risk-managed renewal (1.0), and a student default (1.0) would have those added to any late payment multiplier, potentially yielding a combined non-compliance multiplier of 4.0 or more. Applied to the 0.05% base rate, that is still a small absolute percentage, but for a large provider with high tuition fee income the dollar amount could be substantial.

The special tuition protection component is set at 0% for 2026, meaning no levy is payable under that component. That has no enforcement consequences for 2026, but it leaves the TPS fund’s special component reserve entirely dependent on the risk rated premium component and on any draw on government appropriations.

The instrument is made under sections 9 and 10 of the Education Services for Overseas Students (TPS Levies) Act 2012, which is the primary statute creating the framework for TPS levies. Section 9 of that Act provides for the risk rated premium component and section 10 provides for the special tuition protection component. This instrument fills in the details that the Act leaves to delegated legislation: the specified percentage and the risk factors. Any amendment to the Act would override the instrument to the extent of inconsistency.

The instrument interacts directly with the Education Services for Overseas Students Act 2000 (ESOS Act), which governs registration of providers, CRICOS, and the tuition protection framework. Several terms are defined by reference to the ESOS Act, including overseas student, provider, registered provider, tuition fees, and TPS levy. The instrument also incorporates sections 10D, 10E, 10G, 47A, 50B, and 83 of the ESOS Act by reference for the non-compliance factor. Section 83 deals with sanctions including suspension and cancellation; section 47A defines student default; and section 50B deals with TPS Director refunds. A decision under any of those provisions triggers the 1.0 multiplier under item 5, 6, or 7 of the non-compliance table.

The instrument also references the CRICOS annual registration charge under the Education Services for Overseas Students (Registration Charges) Act 1997 (section 4 definitions and section 11(2)). Late payment of that charge feeds into the weighted late payment measure. This creates a cross-act enforcement link: failing to pay a different charge on time increases the TPS levy burden.

The instrument repeals the 2024 instrument from 1 January 2026 (Schedule 1). That repeal is substantive because the 2024 instrument had different tables and thresholds. For example, the 2024 instrument had different volatility brackets and different multipliers for source country concentration. Providers must base their 2025 levy year calculations (paid in 2026) on the 2025 instrument, not the repealed 2024 instrument.

No interaction with state or territory laws is mentioned. The instrument operates within the Commonwealth’s foreign affairs and external affairs power through the ESOS scheme. It does not create liability for directors or officers personally; it is a registered provider obligation only.

This instrument is a standalone instrument that replaces the Education Services for Overseas Students (TPS Levies) (Risk Rated Premium and Special Tuition Protection Components) Instrument 2024, which was repealed effective 1 January 2026 by Schedule 1. The 2025 instrument was made on 3 December 2025 by the Acting TPS Director, Katherine Tagg, and commences in two stages: Parts 1 to 3 commence on 31 December 2025, and Schedule 1 (the repeal of the 2024 instrument) commences on 1 January 2026. The instrument is made under sections 9 and 10 of the TPS Levies Act, which require the TPS Director to make an instrument each year setting the percentages and risk factors. This is therefore an annual instrument, and the 2024 version was the first such instrument made after the commencement of those provisions. No previous versions were cited or amended. The note in section 2 clarifies that the commencement table relates only to the instrument as originally made and will not be amended for later amendments, implying that subsequent amending instruments may be separately made.

There is no amendment history within this instrument because it is a new instrument. Any future changes will appear in later instruments. The 2024 instrument was the only predecessor, and its repeal is the only amendment history disclosed. The 2025 instrument changes the risk factor tables from those in the 2024 instrument, but the 2024 instrument is not reproduced in the source, so a direct comparison of factors is not possible from this document alone. However, the fact of annual renewal suggests that the percentages and factors are subject to annual review and adjustment, introducing year-to-year variability that creates compliance planning uncertainty for providers.

The source text for this instrument does not record any litigation. The instrument itself is delegated legislation, not a primary statute, and litigation against such instruments would typically arise under the Administrative Appeals Tribunal or the Federal Court on grounds such as jurisdictional error, ultra vires, or procedural impropriety. No case law is cited in the instrument or in the definitions. Because the instrument was made on 3 December 2025 and commences on 31 December 2025, it is very recent and unlikely to have generated any litigation to date.

The absence of litigation history does not mean the instrument is immune to future challenge. The discretionary elements of the non-compliance factor (risk management renewal under item 6) could be contested if a provider argues that the ESOS agency’s classification of a renewal as risk-managed was erroneous. Similarly, the aggregation rule for amalgamated registrations (section 12) might be litigated if a provider disputes the treatment of enrolment data from prior registrations that are not part of the amalgamated entity. However, the instrument’s formulaic nature reduces the scope for factual disputes; most of the inputs are objective (enrolment numbers, dates of payment, etc.). The key risk is whether the instrument itself is within power. Given it is made under sections 9 and 10 of the TPS Levies Act, and those sections explicitly authorise the specification of percentages and risk factors, an ultra vires challenge would need to show that the specified factors go beyond what the Act permits, for example by being arbitrary or not genuinely related to risk. No such challenge is recorded.

Several traps exist for the unwary provider. The first is the cumulative effect of the non-compliance factor under section 11(4). Unlike other factors where only the highest applicable item is used, the non-compliance table requires adding the multipliers for every item that applies. A provider that paid the CRICOS charge 20 days late (0.7), had a student default (1.0), and received a risk-managed renewal (1.0) would have a non-compliance multiplier of 2.7, not merely the highest single item. That can dramatically increase the levy for an otherwise sound provider that made one late payment and had one regulatory event.

The second trap is the volatility factor’s treatment of negative growth. Most providers intuitively understand that rapid growth attracts a higher multiplier, but the table also penalises steep enrolment declines: a drop of 60% or more attracts a 3.5 multiplier, the same as a 120% growth surge. This asymmetry means providers that lose a substantial portion of their international student cohort (for example, due to visa policy changes or source country disruptions) face a levy increase at a time when their fee income is falling. The pro-cyclical effect exacerbates financial stress.

The third trap is the volatility reduction for young providers (section 9(5)). While designed to be beneficial, the reduction percentages are fixed and do not take into account the magnitude of volatility. A provider with only one year of operation gets a 100% reduction, but that provider might have such low base enrolments that a small absolute change produces a huge percentage swing. The reduction helps, but the provider still pays at least the base length-of-operation multiplier of 1.0 (if less than one year) or 0.5 (if one to two years). There is no cap on the combined total of all risk factors, meaning a provider that is short-lived, has high growth, high source country concentration, and two compliance items could have a combined multiplier exceeding 10, although the 0.05% base rate keeps the dollar impact small for most.

The fourth trap is the source country concentration factor’s sharp jump at 80%. A provider with 79% concentration pays a 0.7 multiplier; one with 80% pays 3.1, a 4.4x increase. That step-change creates an incentive for providers to stay just below 80% by adjusting enrolments, but it also penalises providers that may have legitimate reasons for a high concentration (for example, a language college specialising in students from one country). The factor does not consider tuition fee income weighting; it is calculated purely by enrolments.

The fifth trap is the definition of “length of operation” in section 4: it begins at the time the provider was “last registered”. If a provider’s registration lapsed and was re-registered, the clock resets. Providers that had a prior registration but let it lapse will be treated as a new provider for the length factor, potentially putting them in the less-than-one-year band with a 1.0 multiplier. The definition does not credit prior registration history unless the registration has been continuous.

Finally, the assessment period is calendar year 2025 for input data (enrolments, fees, late payments) but the levy is payable in 2026. Providers must calculate their levy based on data that is not finalised until after 31 December 2025, which creates a short window for verification and payment.

A provider subject to this instrument must, in the first instance, determine whether it is a non-exempt provider. If the Minister has granted an exemption under paragraph 12(b) of the TPS Levies Act, the provider is not liable for the risk rated premium component and can disregard this instrument. All other registered providers must calculate their risk rated premium component for 2026.

The calculation involves five steps. First, confirm the specified percentage: 0.05% (section 6(1)). Second, determine the length of operation as at 31 December 2025. If less than two years, note the applicable multiplier from section 8 (1.0 for less than one year; 0.5 for one to two years; 0.0 for two years or more). Third, determine whether the volatility factor applies: the provider must have been operating for at least two years, have at least 20 overseas enrolments or $400,000 in tuition fee income in 2025, and overseas students must be at least 20% of total enrolments. If so, calculate the percentage change from 2024 to 2025 using the formula in section 9(3) and then apply the table in section 9(4) and any reduction under section 9(5). Fourth, determine whether the source country concentration factor applies using the same thresholds. If it does, calculate the percentage share of the largest source country and look up the multiplier in section 10(4). Fifth, determine the non-compliance factor. This requires a weighted late payment measure: for each of 2023, 2024, and 2025, calculate the number of days late for both CRICOS annual registration charge and TPS levy, sum them, and apply the 0.7, 0.2, and 0.1 weights respectively. Then apply the table in section 11(3) to get a multiplier for late payments. Additionally, check whether any of items 5, 6, or 7 apply (section 83 action, risk-managed renewal, student default refund). Add all applicable non-compliance multipliers together. There is no cap on the total.

The total risk rated premium component is then: 0.05% × (base factor 1.0 + length factor + volatility factor + concentration factor + non-compliance factor) times the provider’s tuition fee income (or wherever the Act defines the base for multiplication). Note that the instrument does not restate the formula from the Act; it only provides the percentages and factors. Compliance requires correctly matching these factors to the Act’s calculation method, which is defined in section 9 of the Act. Providers should obtain the Act text and follow the full formula.

For providers that amalgamated registrations in 2025, section 12 sets out special rules. The length of operation is taken from the longest-running registration. Enrolments are summed across all amalgamated registrations for both years. Late payment measures are summed. Compliance events (items 5, 6, 7) for any component registration apply at a flat 1.0 for the amalgamated entity (section 12(d)(ii)). Providers in this situation should aggregate their historical data accordingly.

A practical compliance burden is that the volatility factor requires overseas enrolment data for both 2024 and 2025. A provider that did not maintain granular enrolment records by source country and year will need to reconstruct this. Similarly, the weighted late payment measure requires exact payment dates for CRICOS charges and TPS levies over three years. Providers should establish internal reporting systems that track payment timelines and roll up data to the registration level, not the legal entity level, because CRICOS registration is the unit of analysis. The instrument does not provide for transitional adjustments or waivers for data errors, so careful record keeping is essential. Given the annual renewal cycle, providers should monitor the DETE or TPS website for the 2026 instrument to anticipate changes to factors for the following year.