Election 2025: International student ‘30pc flat caps to cost $4bn’

The peak body for universities says a proposal to cap international student numbers at a percentage of total enrolments could cost the economy $4bn and cut almost 55,000 students.

Universities Australia CEO Luke Sheehy. Picture: NewsWire / Martin Ollman

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The peak body for universities says a proposal to cap inter­national student numbers at a percentage of total enrolments could cost the economy $4bn and cut almost 55,000 students.

Amid speculation that the ­Coalition may adopt a flat percentage cap on international students as part of its federal election platform, Universities Australia chief executive Luke Sheehy has warned that such an approach would inflict significant damage to the $52bn sector and to the economy.

Mr Sheehy will use his keynote address at an ITECA conference on Wednesday to urge the Coalition against adopting a flat percentage cap as its official policy to slash international student numbers in a bid to cut net ­migration.

UA predicts that restricting international student numbers to 30 per cent of enrolments would cut 54,577 students, limiting numbers to 33 per cent would reduce enrolments by 37,503 students and a 35 per cent cap would reduce students by 28,534 students.

The modelling, based on 2023 enrolment numbers, revealed that capping foreign students to 30 per cent would inflict a $3.96bn economic hit, restricting to 33 per cent would cost $2.72bn and a 35 per cent scenario would cost $2.07bn.

Mr Sheehy will address speculation the Coalition is considering a 30 per cent cap, cautioning against adopting further measures that would cut university funding.

“What we stand to lose in future revenue is far greater,” he will say.

“This all begs a few questions. Is this all worth a few votes at the ballot box? Is this all worth the economic hit?

“Is this all worth inflicting financial pain on universities?”

Mr Sheehy will also call on whichever party wins the election on May 3 to plug the funding shortfall once covered by revenue generated by international education. “The boom in international education has papered over these cracks,” he will say.

“But the revenue this once­­reliable source provided is no longer guaranteed. Universities Australia has been calling for full and proper funding for our sector in light of this.”

A 35 per cent flat cap on internationals students was also estimated to cost institutions $1.6bn directly. International students enrolled at universities contribute $72,600 to the economy on average, with $30,200 going directly to providers.

The Australian revealed last month that the Coalition had been consulting on a range of options to cap international students, including a proposal to cap overseas students at a percentage of total enrolments.

Another approach canvassed was to cap foreign students to a percentage below a previous year’s enrolments.

The Coalition has promised to pursue steeper student caps than Labor but is yet to unveil details of its policy platform.

Liberal frontbenchers have previously said they wanted to target metropolitan universities, especially in Sydney and Melbourne, while seeking to bolster foreign student numbers at ­regional providers.

The Coalition torpedoed Labor’s legislation capping international students to 270,000 in November over concerns the framework was “chaotic and confused”, vowing to unveil its own policy in due course.

The Australian Technology Network of Universities floated a proposal in July for a flat cap of 35 per cent of total enrolments.