After 40 years of building an international education sector that is now worth $36.4 billion, the government is embarking on a risky program to cut the number of international students who enter the country. Since 2005, the number of students has grown consistently by about 6% a year, but growth has exploded post COVID. In the context of an upcoming election where Opposition Leader Peter Dutton is falsely blaming migration for the housing crisis and crime, the Labor government’s response is as much a political safeguard as it is a genuine attempt to fix a broken migration system.
The government’s plan puts universities in a dangerous bind. On the one hand, Liberal and Labor governments have slashed direct funding to the tertiary sector, which forced universities to rely on other revenue sources. On the other hand, they are now targeting the money universities have learned to rely on. SRC President Harrison Brennan summarised the problem, telling Honi Soit that “in Australia, the government spends under 1% of its GDP on direct funding for higher-ed institutions.”
Ministers have tried to frame the reforms as measured tweaks to the visa system that improve integrity of international students we enrol. These reforms include small changes like banning tourists from also applying for student visas, to larger ones like a crackdown on vocational colleges that are largely a front to get people into the workforce. However, with the government not on track to meet its 2025 targets before the budget, the reforms became increasingly harsh. On 1 July, the Australian Government made an announcement that application fees for student visas will be increasing from $710 to $1600effective immediately, representing a 125% increase. Australia already has one of the highest student visa application costs in the world. By comparison, New Zealand’s cost is $343, the USA, $277 and the UK, the highest before this announcement, at $900 (AUD).
In the budget speech, Treasurer Jim Chalmers announced that a cap would be placed on how many international students can enrol at each institution. The cap is expected to correspond with the size of the institution and would be limited to specific courses. While universities have cautiously supported other reforms, the backlash against a hard cap has been swift. Economic modelling commissioned by the University of Sydney suggests the cuts to the number of international students could cause a $4.1 billion hit to the Australian economy and cause 21,992 job losses in 2025. Victorian universities estimated the sector itself was bracing for a $1.1 billion deficit in 2025 with 63,500 fewer international students expected.
Higher education expert Andrew Norton believes that these estimates are conservative, but even if they forecasted a worst case scenario, the data should be concerning for students, as even a small reduction in revenue to universities could result in a higher student-teacher ratio, larger class sizes, and less funding for research grants. According to the University of Sydney’s submission to the government, “for every full-time Australian citizen who studies medicine or veterinary science, the University of Sydney needs to find more than $10,000 in additional funding each year — funding sourced largely from international student fees.” A university spokesperson stated they “appreciate the need to manage moderate growth of international students over time,” but noted that these policies “could harm the broader sector and Australia’s reputation internationally.”
The reliance Australian universities have on international student revenue cannot be underestimated. Last year, 975,229 international students enrolled and 46% of all USyd students came from overseas according to the last annual report. Over a billion dollars,—44% of the university’s total revenue last year — came from those fees. Despite these numbers, USyd is not the most dependent university in the tertiary sector, with over 72.5% of student income at the University of Queensland coming from international students in 2023, despite comprising 38.9% of the cohort. Despite substantial visa delays, and universities extending their Semester 2 enrolment deadlines, international student numbers are still growing. Spokespeople for USyd, UQ, and UNSW told Honi that Semester 2 enrolment was either remaining consistent or growing compared to last year.
The impact on international students is often lost in the debate and they bear the brunt of an increasingly transactional education. Their interests are not protected by politicians, and they don’t have large lobby groups supporting them. Studying in Australia is already challenging. Beyond the existing cost of living pressures, international students face an even higher bill. Ineligibility to receive student concession rates on public transport and temporary visa holders being unable to attain HELP/HECS loans and the requirement to pay large amounts upfront for courses, generally between $20,000 to $50,000 per year for undergraduate students, adds up fast. Student groups and universities have been foregrounding these problems for months. In its own submission, SUPRA argued “these changes mark a concerning shift in the perception of, and approach to, international students in Australia.” Vice Chancellor Mark Scott agreed, telling ABC Radio that “if you send a message to international students that they’re not welcome, they have many other options.”
Honi has spoken to dozens of international studies this year who have all reported a climate of increasing pressure. Just last week, Dutton appeared on popular radio show, 2GB, to claim that international students should not receive student services like FoodHub which should only be for “citizens.” The new visa restrictions also have targeted students from certain countries disproportionally. Indian and Pakistani students are having their visas refused at more than double the rate of Chinese students, often because their education agents are less established and struggle to adapt to new regulations. Brennan called the policies “outrageously racist,” and argued the university sector treats international students “like cash cows”
The only way universities can increase their cap is by building more student accommodation. Almost all universities Honi spoke to said that this was in their plans. A UQ spokesperson told Honi they were planning on delivering 1,000 extra beds in the next few years, and a USyd spokesperson said they intend “to offer an extra 2000-3000 accommodation spots over the next five years.” However, whether universities will actually be able to deliver on these goals is unclear. Many universities have sold accommodation in droves over the last decade, and as a UNSW spokesperson noted, “opposition by local councils to these types of developments can make it difficult for universities.”
Canada and the UK have already undertaken similar reforms of imposing caps and maximising visa restrictions.The results from these reforms have been troubling. Mass redundancies across the tertiary sector in the UK have dominated headlines in recent months.
A spokesperson for the Department of Home Affairs defended the reforms telling Honi that visa fees have always been comparatively high in Australia and the changes “focused on strengthening the integrity of the Student visa program to ensure that visas are granted to genuine students who can contribute to Australia’s managed and sustainable economic growth.”
The University Accord report provided the mandate for governments to make an argument to the Australian people that funding universities was in the public interest. The government is yet to make that argument or grant what many student activists, like Brennan advocate for: a return to fee free education.
