Vice chancellors say they are being forced into a “scandalous” act of self-harm that threatens to break the $48 billion university sector’s funding model for the sake of populist politics ahead of the next federal election.

Education Minister Jason Clare on Tuesday declared Labor’s annual student visa caps would not crash the hugely successful higher education sector, and sought to allay worries while insisting change was necessary to ensure universities maintained their “social licence” with the community.