Unpacking the Coalition’s plans for international education

On Sunday the Coalition outlined their plans for international education in a joint media release. These were the details:

Subsequently, after Labor issued a media release pointing out, as I did last year that a cap calculated as a percentage of enrolments could be circumvented (and lead to an overall increase in the number of international students) if universities increased their domestic student enrolments, the Australian Financial Review reported that the Opposition Leader claimed that in government they would use “ funding agreements with universities to prevent them increasing the number of domestic students to game the 25 per cent limit.”

In terms of unpacking how this cap might work, there are four elements:

1. A cap on new overseas student commencements at public universities equivalent to 25% of total commencements (with the aim of limiting NOSC to 115,000)
2. A combined limit of 125,000 NOSC at private universities, other higher education providers, and public and private VET providers (not set as a percentage cap because some private providers teach exclusively international students)
3. An increase in student visa application fees, and
4. Limits on the number of domestic students that public universities can enrol – to prevent universities circumventing their 25% caps.

Taking these in turn:

1. A cap on new overseas student commencements at public universities equivalent to 25% of total commencements (with the aim of limiting NOSC to 115,000)

The aim is to reduce new international students at public universities to 115,000.

Taking the 2023 new overseas student commencements (NOSC) data supplied by the Department of Education during the Senate inquiry into the government’s proposed international student caps, I have compared it with the number of domestic commencing students at each public university in 2023.

The analysis shows that in 2023 international students made up more than 25% of all new commencing students at about two-thirds of our public universities. And across the sector as a whole international students made up 29% of all commencing students in 2023.

Therefore to reduce international students to 25% of all commencing students at public universities –would require a drop in new international students of 21,022 to a new total of 125,198. That is 10% higher than the 115,000 new international students assumed in the Coalition’s modelling.

1. A combined limit of 125,000 NOSC at private universities, other higher education providers, and public and private VET providers

As noted above (and in my previous analysis) any cap imposed outside the public university sector based on international students as a proportion of all enrolments becomes more difficult because some providers currently have very low levels of international student enrolments (eg most TAFE Institutes with CRICOS approval enrol fewer than 10% international students and could look to grow their international student enrolments significantly ‘up’ to 25% if given such a cap), and other private VET and higher education providers enrol exclusively international students.

The Coalition have therefore said they will determine the calculation of the cap for this part of the sector after the election and after consultation with the sector. However they have committed to limiting NOSC in this part of the sector to no more than 125,000.

In 2023 the Department of Employment and Workplace Relations reported to the Senate that there were 133,698 NOSC in VET. And the Department of Education reported 42,268 NOSC in private universities and non-university higher education providers.

Collectively NOSCs in VET and the private higher education sector totalled 175,966 in 2023. To limit them to 125,000 would require a 29% decrease.

2. An increase in student visa application fees

More damaging for VET providers than a proposed cap on new international students which is 29% lower than their 2023 enrolment levels, is the proposed increase in international student visa application fees.

Before unpacking what they mean for VET and higher education – it is important to point out that it appears that these new fees will impact all international student visa applications – including the schools sector and crucially the English language (ELICOS) sector.

It is in the English language sector where the increased visa fee will have the most impact. Students coming to Australia to learn English for a few weeks, and while they are here enjoy some time in the sun and spend money in the local economy, will not be prepared to pay $2,500 to apply for a student visa for a 10-12 week course that typically costs only $4,000 – $5,000. Particularly when applying to for a visa to study in Canada, the UK or New Zealand is so much cheaper (less than AUD $1,000).

The VET sector will also be badly impacted by this increase in student visa fees – both TAFEs and private providers.

Firstly VET providers are still facing high rates of visa refusals, following the introduction of the Genuine Student test last year with new requirements on students proving how their studies will benefit their future careers and earnings – a much harder proposition for students coming to study VET qualifications in Australia because they don’t deliver the same increased earning potential as Australian university degrees when students return to their home countries.

In January and February 2025 visa grant rates were back up at 90 to 100% for higher education student visa applicants from most key countries. That was not the case in VET:

VET visa grant rates January – February 2025[1]

VET providers, both TAFEs and private providers, also charge much cheaper tuition fees than higher education providers because their courses are typically shorter and as institutions they have less international prestige.

With VET providers charging between $7,000 – $20,000 for courses such as the Advanced Diploma of Engineering ($15,800), Certificate III in Light Vehicle Manufacturing ($18,000), Certificate III Individual Support ($9,200), Diploma of Accounting ($7,145), the Certificate III in Health Services Assistance ($10,920), or the Certificate IV in Information Technology ($15,285) – deciding to spend $2,500 on applying for a visa when you face the very real prospect of having your application rejected and losing your $2,500 becomes a gamble most students won’t want to take, as Monash University’s Prof. Andrew Norton recently pointed out.[2]

I differ from Prof. Norton and others in the sector though because, while I do not support the fee increases proposed, I do not think they need to have a material impact on prospective higher education students.

As I noted above, the higher education sector has finally adapted to the new Genuine Student test and there are now relatively few visa refusals for all key source countries for higher education applicants. So the issue of the visa application being a “gamble” will not be front of mind for most prospective international higher education students.

The extra cost they are being asked to pay for their visa application is likely to be what weighs most heavily on their minds. But even here I think public and private universities and specialist private higher education providers can mitigate these student concerns.

Higher education providers typically charge annual international tuition fees of $30,000 – $60,000pa, so a 3 year Bachelor of Commerce earns a university between $90,000 – $180,000 in tuition fees (based on fees published on the Commonwealth Register of Institutions and Courses for Overseas Students).[3]

 

With tuition fees at these levels, universities and other higher education providers can readily afford to subsidise students’ visa application fees by offering modest tuition fee reductions and making that explicit to prospective students.

3. Limits on the number of domestic students that public universities can enrol – to prevent universities circumventing their 25% caps

As noted above, although not included in their media release when announcing this international student policy, the media is reporting that the Opposition leader has clarified that his government would prevent universities from enrolling more domestic students (and thus also being able to ‘game the caps’ and enrol more international students). They would do this by imposing new conditions in the funding compacts public universities have with the Commonwealth government.

For some years now there has been bi-partisan support for limits on the amount of Commonwealth Supported Places funding the government provides to universities for their undergraduate students (following the end of the ‘Demand Driven’ system). So it is unsurprising that the Coalition intends to limit the number of domestic university student places it will fund if it wins government, which will prevent universities increasing the number of government-funded students they enrol.

However I find it hard to imagine that a government would look to impose limits on the number of Australians who can pay their own university tuition fees if they want to enrol in postgraduate study.

At a time when the world of work is rapidly changing and all forecasts predict an increased need for tertiary education and for more upskilling and reskilling across our working lives – how will a government stop people choosing to undertake more study when their courses are not being subsidised by the government?

My analysis late last year of enrolment trends at some of the universities which were publicly reported to be planning staffing cuts – shows the shift in domestic postgraduate enrolment patterns at different universities.

Looking at two universities in close geographic proximity with very different trajectories over the last few years shows that between 2019 and 2023, the ANU saw a decline in domestic postgraduate student commencements of 50% (down from 1,959 in 2019 to just 989 in 2023). By contrast the University of Canberra saw an 82% increase in domestic postgraduate enrolments in the same time period – up from 953 in 2019 to 1,731 in 2023.

One of the key differences between the universities’ postgraduate offerings is that UC changed their postgraduate course offerings and thuse far the ANU hasn’t. The ANU still offers a traditional model of study for domestic postgraduate students ie their students enrol to study full degrees in a predominantly on-campus mode.

Post-pandemic, and with job roles changing, many people are looking for shorter forms of learning offered predominantly online – and that is what UC has expanded into offering. The popularity of these new offerings is evident in the enrolment data. Here’s the relevant table from my earlier analysis:

Based on the reported comments from the Opposition leader, it appears that the Coalition is suggesting that universities like the ANU would be prevented from potentially moving to offer new courses to domestic postgraduate students, courses which do not receive government subsidies and which have proven popular at other universities as people seek to keep learning as their careers change, because in offering more popular courses for postgraduate domestic students they would also be allowing the university to enrol more international students.

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[1] https://data.gov.au/dataset/ds-dga-324aa4f7-46bb-4d56-bc2d-772333a2317e/details?q=

[2] https://www.smh.com.au/politics/federal/coalition-vows-5000-visa-fee-for-international-students-at-sandstone-universities-20250406-p5lpjx.html

[3] https://cricos.education.gov.au/default.aspx