Raising the Bar on Student Migrants Could Backfire, Property Council Warns

A woman walks past a sign offering assistance to international students who want to get into any of the various Australian universities in Melbourne, on Oct. 30, 2023. (Susan Mortimer/The Epoch Times)

The federal government’s Migration Strategy, which aims to lure skilled migrants to Australia while cracking down on “non-genuine international students” and migrant worker exploitation, could easily damage the economy, the Property Council of Australia has warned.

Foreign students are affected in several ways by the strategy: A new “Genuine Student Test” will apply; the savings threshold for visa applicants has been raised, with $24,505 (US$16,113) now required, an increase of 17 percent; there will be tougher English-language requirements; some post-study work rights have been reduced; and education providers considered “high risk” can expect slower visa processing or more extreme consequences.

The Department of Home Affairs will now have a “student visa integrity unit,” which will receive initial funding of $19 million (US$12.45 million).

The international education sector was the nation’s top service export and contributed $40 billion to economic output before the pandemic.

The sector is only slowly recovering from the effect of border closures: In 2022 it was worth $26 billion, up from $22 billion the previous year.

All states and territories have been affected by the downturn, but the greatest falls have been experienced in the eastern states.

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Education export incomes have fallen across all states and territories since borders were closed during the pandemic. (Australian Federal Department of Education)

The Business Council of Australia supported the policy change, saying “Australia’s prosperity, our jobs, our living standards and the strength of our economy are all directly linked to a successful, efficient, and well-targeted migration program and these changes get the balance right,”

But the Property Council’s Student Accommodation Division, which constructs purpose-built student accommodation (PBSA), has warned that the strategy must focus on raising the quality of international student visas and closing existing loopholes, not just arbitrarily reducing numbers. 

Property Council Group Executive Policy representative Matthew Kandelaars pointed out that international students spend approximately $4,000 per month in Australia’s economy, and attract 300,000 visitors to the country each year, which bolsters tourism numbers.

The Council believes that PBSAs are a better solution to housing international students without having them compete for beds in the broader rental market, saying the answer is “hiding in plain sight but needs the support of state and territory governments.”

“State planning and tax systems have either ignored [its] benefits ... or used it as a cash cow to prop up budgets in massive structural deficit,” Mr. Kandelaars said.

He points out that the student accommodation sector takes nearly 80,000 people each year out of the wider rental market, reducing demand and easing affordability for other renters.

But instead of prioritising the construction of more PBSA facilities, the Council says the sector is discouraged by foreign investor taxes and increases to council rates that “deter investment in high-community benefit housing.”

“In a globally competitive environment for the best and brightest, we need to cultivate the brainpower essential for driving Australia’s future prosperity and preserving our status as a destination of choice for international students,” Mr. Kandelaars said.

Some estimates say the overall strategy will halve Australia’s net migration within two years.

It currently sits at a record high of 510,000 people a year.