International student caps would cost Australia billions, university sector warns

Australian universities are warning of dire consequences if a plan to cap the number of international students goes ahead.

University lobbyists have slammed the Albanese government’s plan to cap international students as “rushed policy” and “a political smokescreen”.

The Education Services for Overseas Students Amendment (Quality and Integrity) Bill 2024 seeks to cap international students and give extra powers to the Education Minister to interfere with courses.

Speaking at a senate committee hearing on Tuesday, University Australia chief Luke Sheehy said the 39 members of his organisation supported maintaining “integrity and sustainability” in Australia’s tertiary education sector but accused the government of dog whistling on immigration.

Universities Australia chief Luke Sheehy said the government’s plan to cap students was a ‘political smokescreen’.

“We believe the Bill drafted is more a political smokescreen than an instrument of good policy as the government seeks to gain an upper hand in the battle of migration ahead of the next election,” he said.

Mr Sheehy warned the bill could deal a $4.3bn blow to the economy and cost the sector more than 14,000 jobs,a prospect that has drawn ire from the National Tertiary Education Union (NTEU).

The NTEU said university managements and the government “must rule out any job cuts,” but took aim at Mr Sheehy for using job cuts as a “bargaining tool”.

“Threatening to slash 10 per cent of the university workforce as a bargaining tool against the federal government is a cruel and callous way to treat staff,” NTEU President Alison Barnes said in a statement.

“It’s absolutely outrageous for the vice-chancellors’ lobby group to be threatening the jobs of 14,000 academic and professional staff who are an indispensable part of our higher education system.”

She also said the government should take student caps off the table.

The government has justified its plan by blaming international students in part for the rental crisis hitting Australia’s capitals and saying it needs to weed out dodgy operators in the sector.

Group of Eight head Vicki Thomson said the “rushed and poorly framed legislation is a classic example of retrofitting policy to suit dubious politics”.

Group of Eight chief Vicki Thomson said the Bill was ‘rushed and poorly framed’.

She said the government’s rationale for shaking up the sector “chops and changes” and accused it of falsely painting Australian institutions as “shonks and crooks”.

She said the plans to cap students and give extra ministerial powers were “draconian, interventionist and amount to economic vandalism”.

The sector is worth nearly $50bn to Australia’s economy.

Though, with international students filling jobs right around the country, their contributions to Australia’s economy extend far beyond visa and study fees.

Hospitality industry leaders hit out at the government last year after it reintroduced hour caps for overseas students, limiting them to just 48 hours of work a fortnight.

Universities are warning the government’s Bill to crack down on the number of overseas students could cost thousands of jobs. Picture: NewsWire / Simon Bullard.

The Business Council of Australia (BCA) has criticised the government’s proposal for detracting from “real solutions” to Australia’s soaring house prices and threatening the broader economy.

In a submission to the Senate committee, BCA said international student revenue “provides considerable income for businesses, delivers higher revenues to governments, supports universities to offer high-quality education for domestic students, is critical to maintaining our research capacity, and is a major channel for soft diplomacy, especially in the Asia Pacific region.”

Study visa approvals have already dropped after former home affairs minister Clare O’Neil issued a direction to prioritise applications for Australia’s top universities.

Originally published as International student caps would cost Australia billions, university sector warns