Budget 2024: Coalition will prioritise reducing international student numbers at Go8 universities to cut migration

The Coalition has revealed its focus for cutting migration as a leading economist questions why the Opposition doesn’t also look at curbing negative gearing and the Capital Gains Tax discount.

International students at Go8 universities will be a focus of the Coalition as it formulates policies to slash the net overseas migration rate to 160,000.

The Coalition will target inter­national students at Group of Eight universities – and particularly those in Sydney and Melbourne – as it attempts to slash the net overseas migration rate to 160,000, with Nationals leader David Littleproud declaring the opposition parties wouldn’t “take away” from the regions.

The opposition’s safeguarding of the regions can be revealed as Jim Chalmers said Peter Dutton’s steeper migration cuts would cost the economy billions of dollars, amid a post-budget stoush that will run through to the federal election over which party’s ­migration and housing policies will take the most pressure off the market while building skills required in critical sectors like construction, health and aged care.

Nationals leader David Littleproud. Picture: Penny Bradfield/AUSPIC/DPS

Labor wants to cut net overseas migration to 260,000 next financial year and reduce the permanent migration intake to 185,000; the Coalition plans 160,000 targets for both measurements.

As Mr Littleproud demanded the regions be allowed to keep their international students and vowed to reinstate the agriculture visa and extend the Pacific Australia Labour Mobility scheme, Coalition sources said they would be looking at what was happening in universities in Sydney and Melbourne rather than going after the University of Tasmania.

Nationals leader David Littleproud has demanded the regions be allowed to keep international students, and vowed to reinstate the agriculture visa. Picture: Roy VanDerVegt

There would be a “big focus” on Go8 universities that had experienced large increases in inter­national students since the Covid pandemic. “We’ve also made sure there’s a nuance here about supporting regional universities, and regional universities rely heavily on overseas students,” Mr Littleproud told Sky News’ Sunday Agenda program.

“It’s important we don’t take that away from them. We continue to underpin that.”

The Australian understands the Coalition will also home in on asylum-seekers found not to be owed asylum and foreigners with skills easily replaced by Australians, such as accountants.

Dr Chalmers said cutting migration would only help Australia’s housing crisis “at the margins at best”, and the Opposition Leader’s smaller targets would result in lost activity and affect the skills base. “It’ll cost the economy billions of dollars, but even the kinds of estimates that you will see are conservative because it’s not possible to fully capture the damage that Peter Dutton would do to the skills base of this country, to our hospitals, on our building sites, the sorts of things that he hasn’t thought through,” he told the ABC’s Insiders program.

“We’ve struck the most effective and most appropriate balance which recognises that we need to get that net overseas migration number down and the permanent number down a little bit as well. But we can do that in a way that doesn’t smash our economy and doesn’t smash the skills base of our economy.”

Opposition assistant home ownership spokesman Andrew Bragg said by reducing demand, the Coalition would help alleviate short-term pressure on housing stock. He labelled Labor’s housing policies – including a target “they know will never be delivered” to build 1.2 million houses by 2029 – “callous and cold”.

Independent economist Saul Eslake said the Coalition would be able to help many more Australians enter the housing market if it targeted local investors buying established homes as well as its proposed two-year ban on foreign investors and temporary residents purchasing existing homes here.

According to the latest available data, foreign investors bought 1339 established dwellings in 2021-22 – 0.2 per cent of 595,283 established properties that transferred hands that year – compared to 171,727 established homes purchased by Australian investors.

“If it’s right that stopping a bit over 1300 foreign investors would help homebuyers, surely stopping 172,000 Australian investors would help a hell of a lot more?” Mr Eslake said. “Why isn’t the opposition advocating winding back negative gearing and the capital gains tax discount for investors who purchase established dwellings, if they’re serious about helping first-home buyers?”

Mr Eslake said cutting the net overseas migration rate would help alleviate pressure in the housing market by reducing demand for properties, and the Coalition’s steeper cuts would reduce pressure even more so, but there wasn’t a huge difference between the major party’s policies.