University sector key to economy

Analysis by NAB economists Taylor Nugent and Brody Viney revealing that spending by international students accounted for more than half of Australia’s economic growth in 2023 underlines the importance of the sector to the national economy.

Spending of $48bn by 787,000 international students last year – a 27 per cent increase in numbers over 2022, when the effects of the pandemic were still being felt – was responsible for a 0.8 per cent increase in GDP, more than half of the tepid 1.5 per cent economic growth recorded, Tim Dodd reported on Saturday. About 60 per cent of the spending was on goods and services and 40 per cent on tuition fees to universities, colleges and schools. Without that spending, the nation would have come closer to falling into recession. Education is one of Australia’s biggest export earners, behind iron ore, coal and natural gas.

High numbers of international students have been blamed for accommodation shortages, rising migration and rents. And some education agents and colleges have rorted the student visa system, for the benefit of students looking for a backdoor way to stay in Australia long term. As a result, the Albanese government has put on the brakes, slowing the issuing of student visas. While ensuring immigration laws are followed, it is in the nation’s interests, and those of our higher education sector, to continue to welcome international students.

The Albanese government is seeking to increase university attendance among Australians following the review of higher education led by Mary O’Kane. For that reason, the financial health of institutions will influence their ability to increase places and offer HECS relief.

For those reasons, the University of Sydney, which emerged ­financially strong from the ­pandemic, has made a wise choice in appointing a new chancellor with strong business credentials. Former Telstra chief executive and CSIRO chairman David ­Thodey, who is chair of Ramsay Health Care and accounting technology company Xero, will take over when Belinda Hutchinson steps down in July after more than a decade in the role.