Limiting International Student Number Will Dampen Australia’s Reputation: Education Group

International students were an invaluable asset to the Australian economy, tertiary representatives argued.

A general view of University of Technology Sydney campus in Sydney, Australia, on April 6, 2016. Brendon Thorne/Getty Images

The education sector has pushed back against the Australian government’s move to limit the number of new international students admitted by education providers.

According to a media release on May 11, the legislation will allow the education minister and the minister for skills and training to cap international student enrolments to “support the integrity and sustainability of the international education sector.”

The government said the move would ensure the sector is managed more strategically over the long term and crackdown on un-genuine agents, but Australian university representatives argued it would cost jobs, reduce funding and damage research in the country.

Critics Argue International Students Invaluable To Economy

Phil Honeywood, chief executive of the International Education Association of Australia (IEAA), said education providers deserve at least “six or seven months to cut their cloth according to any new government policy framework.”

“We’ve got to acknowledge that, whether it’s a public university or a quality private college like an English-language college, they’ve got staffing issues, they’ve got leases on commercial buildings, they’ve got business plans,” he told AAP.

In a statement on its website, Mr. Honeywood said the latest measure will “send all the wrong messages, yet again, of Australia’s reliability as a welcoming study destination country.”

“Coming on top of the recently announced changes to financial capability requirements ($24,000 to $29,000), visa processing slowdowns and backlogs, prospective students, and our education agents will feel incredibly let down,” Mr. Honeywood said on May 11.

“Other measures, such as big increases in student visa fees, are also anticipated in this week’s budget.”

According to the National Australia Bank, half of Australia’s GDP growth in 2023 was attributable to the spending of international students.

International students contribute $34 billion (US$22.47 billion) in export income across all sectors, according to the government’s figures (pdf).

In February 2024, there were 703,245 enrolments by international students, a significant increase compared to the same period in 2019, with 578,930 international students.

Meanwhile, the Independent Tertiary Education Council Australia said the government should improve the migration system rather than target education providers, arguing the cap will cost jobs.

The sector acknowledged the unprecedented growth in international student numbers was unsustainable but warned chronic underfunding had forced public institutions to become reliant on lucrative student income.

The opposition education spokeswoman Sarah Henderson has argued the sharp increase in international student numbers has worsened housing affordability and added pressure to already-strained infrastructure.

However, a report released in April by the Student Accommodation Council revealed there was limited evidence showing the connection between the rising number of international students and the soaring rents.

“Between 2019 and 2023, median weekly rent increased by 30 percent. Over the same period, student visa arrivals decreased by 13 percent,” the report noted

The research noted that international students make up only 4 percent of all renters in Australia while domestic students make up 6.2 percent.

It also found that the majority (74 percent) of international students don’t live in housing most in demand in Australia—detached houses suitable for couples or families—but live in student accommodation close to universities.

Student Accommodation Council (SAC) executive director Torie Brown argued that international students have been “unfairly blamed for the rental crisis, yet this report shows that long-term structural issues in Australia’s housing market are the real cause for rental pressures.”

The report said the housing shortages in Australia were caused by a number of factors, including the rise of smaller and solo-person households, intrastate migration, rising construction costs, planning delays, and more.

What Is the New Cap?

The new legislation is part of a broader overhaul that will also prevent education providers from owning education agent businesses. It will pause applications for registration from new international education providers and of new courses from existing providers for periods of up to 12 months.

In addition, the government will prohibit agent commissions on student transfers between providers in Australia.

Education providers have been accused of lowering admission standards and using incentives for education agents to bring in foreign students. The government said the new move will remove the incentives for ungenuine agents to “poach” international students.

Under the new law, new education providers will need to provide a track record of quality education delivery to domestic students before they are allowed to recruit international students. Meanwhile, providers under serious regulatory investigation will be banned from recruiting new international students.

The government will also cancel dormant provider registrations to prevent them from being used as a “market entry tool by unscrupulous actors.”

“International students are back but so are the shonks seeking to take advantage of them,” said Education Minister Jason Clare.

“These reforms are designed to ensure the integrity, quality, and ongoing sustainability of this vitally important sector.”

Meanwhile, Minister for Skills and Training Brendan O’Connor said there is “no place for dodgy operators who undermine the strong reputation of the sector, we are making it tougher for bottom-feeders to take advantage of international students for a quick buck.”

AAP contributed to this report.