Student cap policies ‘wilfully weakening economy’: UA chair

Universities Australia chairman David Lloyd blamed ‘underfunding’ for forcing universities to rely on revenue from fee-paying international students.

A Senate committee is due to report next week on the Albanese government’s controversial legislation to cap the intake of international students. Picture: iStock

Universities Australia has blasted both sides of politics for “wilfully weakening’’ the economy by capping international student numbers, as private colleges warn of 300 closures.

UA chairman Professor David Lloyd criticised Labor and the Coalition for “underfunding’’ teaching, research and infrastructure, forcing universities to rely on revenue from fee-paying international students.

He said politicians are “treating universities as political footballs in the electoral game’’.

“Successive governments from both sides of politics have underfunded university teaching and research and shut down programs designed to fund university infrastructure,’’ Professor Lloyd will tell the National Press Club in his keynote address on Wednesday.

“Elected officials have directly intervened in what were independent, peer-reviewed research grant processes.

“And now … they are using international students as scapegoats to blame the housing crisis on.’’

A Senate committee is due to report next week on the Albanese government’s controversial legislation to cap the intake of international students, after numbers surged to a record 800,000 last year.

Universities Australia chairman Professor David Lloyd

The Albanese government wants to cap new enrolments in 2025 at 270,000, with individual quotas set for every university and training provider.

The richest research universities, the Group of Eight, will lose 22,000 students, potentially stripping them of $1 billion in fee revenue.

Regional universities will be given higher quotas in a bid to offset the loss of nearly 60,000 international students this year as a result of Ministerial Direction 107, which has slowed or stopped student visa approvals from countries considered high-risk for overstays, including India, Nepal and Pakistan.

Private training colleges – which have been hit hardest by the visa crackdown - are planning to protest at Parliament House in Canberra on Wednesday.

The Independent Tertiary Education Council Australia (ITECA) has warned that college closures are “inevitable’’.

“The impact of these cuts on the number of international students able to come to Australia is staggering with up to 300 independent colleges expected to close,’’ said Troy Williams, ITECA chief executive.

“Their employees will lose their jobs, as will other employees in colleges that will have to scale down to survive.’’

Professor Lloyd – who is vice-chancellor of the University of South Australia – will criticise the “poll-driven attack’’ on international students.

He said two-thirds of publicly funded universities were in deficit in 2022 and 2023.

“As if that isn’t enough financial pain, the Albanese Government and the Peter Dutton-led Coalition are now out-doing one another in their rush to reduce the number of overseas students studying at Australia’ universities,’’ he will say.

Professor Lloyd will criticise Ministerial Direction 107, which had made university applications from foreign students “akin to buying a lottery ticket’’.

“So many Australian businesses are directly benefiting from overseas students at a time when skills shortages are biting hard across the economy,’’ he says in his speech.

“In wilfully weakening our economy by capping international student numbers, the government needs to consider how many businesses it is wilfully putting at risk and how much damage to the economy it is knowingly prepared to do at the very time when our economy is stalling.’’

Universities received $20.7bn in taxpayer funding through the federal Education Department this year – 9 per cent more than in 2023.

The funding includes $16.8bn for teaching and learning, and $3.9bn for research.

Opposition education spokeswoman Senator Sarah Henderson said that “the capping of foreign students to fix Labor’s immigration chaos is vital, but the Albanese government’s scheme is riddled with incompetence, uncertainty and unfairness’’.