Alarm from within as colleges face collapse under Labor’s foreign student crackdown

A federal government agency has warned that training colleges could collapse and domestic students could be left out of pocket under Labor’s controversial plan to cap international student numbers.

In a paper released on Monday, Australian National University higher education expert Andrew Norton said it was clear the government had not thought through how the caps would be implemented by education providers or the government itself.

Colleges face collapse under planned international student caps. Credit:

He said submissions from multiple government departments and agencies showed there were internal concerns with the implementation process, including Home Affairs noting it would require “significant development” of inter-agency sharing of data.

The Australian Skills Quality Authority, the country’s vocational education regulator, said it was conscious of concerns that the financial hit of the cap could lead to the closure of providers.

“Should this outcome eventuate, the consequent impact on displaced students (both international and domestic) will need to be managed,” its submission to a government inquiry said.

The authority said while affected international students may be able to access assistance from the Tuition Protection Service in the event of closures, the same scheme was only available to domestic students who had VET Student Loans. These students are only a small proportion of all domestic VET students.

Separately, the higher education regulator warned it would need to increase compliance measures to ensure institutions that come under financial pressures because of the legislation are still meeting their obligations.

The government’s plan to cap international students as a key mechanism of driving down migration has been fiercely opposed by almost all universities and training providers, with the Group of Eight institutions labelling it an “unjustifiable risk to the nation”.

They warn tens of thousands of enrolments are in limbo for next year, and the implementation timeframe, which would introduce as-yet-unspecified caps from January 1, is unworkable.

Education Minister Jason Clare maintains the government is set on starting the reforms from the beginning of next year.

A Senate inquiry will begin hearings into the proposed international education reforms on Tuesday, with almost all of the 68 submissions into the bill raising significant concerns about the student cap.

Victoria, Western Australia, South Australia, NSW and ACT Labor governments have all criticised the proposed legislation, warning it risked affecting Australia’s international reputation and economic standing.

Greens senator Mehreen Faruqi said Labor was crushing universities in a bid to look tough on borders and compete with Opposition Leader Peter Dutton.

“Such unprecedented ministerial intervention and micromanagement of universities and international students is a terrible approach which compromises both teaching and learning needs,” she said.

“While Labor seems intent on making bad legislation, I urge [Tony Burke] to use the opportunity, as the new immigration minister, to swiftly reset this unfair decision and scrap the caps entirely.”

Norton’s paper said the nine migration changes the government has already introduced have had a significant effect on vocational education, and show signs of having slowed higher education international student numbers.

He argued the government should wait and see the full impact of their already implemented migration reforms before rushing into caps.

“For many vocational education providers the caps may not make much difference. Due to migration policy they will not be able to fill their student places anyway,” he said.

“Consultation with other government agencies was so unsatisfactory that the vocational education regulator, the higher education regulator and the department responsible for issuing student visas have all, via their Senate inquiry submissions, gone public with their concerns.”

The Tertiary Education Quality and Standards Agency, the government’s higher education regulator, said the caps may incur “substantial financial pressures” for some providers.

“Resultingly, TEQSA will be required to undertake increased regulatory monitoring to ensure registered providers maintain compliance with their obligations under the Threshold Standards and the ESOS Act,” it said.

“In addition, TEQSA will need to manage risks associated with a potential increase in third-party partnerships or transnational education.”

Clare said the student caps – which would set limits for every university, higher education and vocational education provider – would help international education in Australia maintain its “social licence”.

“We are consulting with leaders from the international education sector to make sure we get the design and implementation of these critical reforms right, with the implementation to begin from January 1, 2025,” he said.

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