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Oct 14, 2010

Visa changes expose higher education funding problems

For too long we've funded higher education through a reliance on foreign students. Now the costs of that reliance are becoming clear.

Monash University’s budget cuts, and staff reductions of up to 300, have made concrete what has been predicted for months — that the international education sector faces a serious shake-out.

The culprits are commonly agreed: a high Australian dollar, greater competition from other, slower-growing Western countries keen to attract foreign students, and the fallout from the government’s changes to visa requirements to end the use of the international education sector as a back door to permanent residency.

As Paul Rodan noted in a perceptive piece in The Australian a month ago, it’s hard to believe other, higher-profile industries could face such looming turmoil without politicians mobilising to do something, or at least be seen to be doing something, for fear of the political consequences. And Rodan was right to suggest that it’s partly because primary and secondary industries continue to be regarded as more “real” than service industries.

But the international education industry is a peculiar beast. It is a product of immigration, education and training policies and, in trying to serve three different priorities often ends up serving none well. The changes to visa requirements to end the permanent residency rort have exposed the reliance of the sector to a contradictory set of policy priorities.

The Monash story in the Fairfax press quoted (entirely self-interested) research by IDP Education that, in the words of the journalist (IDP hasn’t made the research available online), “40% of Indians and more than a third of the Chinese questioned whether Australia was the place to study after new visa rules made it harder for some to get residency”.

Something’s gone badly wrong if the primary marketing tool of our international education sector is permanent residency, rather than, say, quality or international recognition. Apart from anything else it outsources our immigration policy to educational providers.

Tertiary institutions have been forced to rely on income from overseas students as higher education funding per student from the federal Government over the past 15 years has dropped markedly. This was partly thanks of a reliance on CPI-based indexation that badly trailed salaries growth in the sector. There are constant claims of dumbing down, via lower academic and English language standards that often leaves foreign graduates unemployable in their chosen speciality. The long-term decline in tertiary funding was partly rectified by the Rudd government in its second Budget (including the issue of indexation), but much of the benefit is yet to materialise and Labor had also banned another source of revenue, full-fee paying local students, albeit with partial replacement funding of $250 million over four years.

The Gillard government, as demonstrated by the rather childish spat over the original omission of ‘education’ from Chris Evans’s portfolio title, also seems obsessed with seeing higher education entirely through the prism of skills and training. One runs the risk of looking like an ivory tower-inhabiting loon arguing for the non-economic benefits of higher education, particularly in subjects that teach the basic skills of critical thinking, but someone has to do it. The focus on vocation-related higher education and the decline in academic standards engendered by low funding will eventually have a nebulous but nonetheless real impact on civic life in a policy that should value scepticism, analysis and effective communication.

Concomitant with the decline in long-term funding of higher education has been a decline in support for students. We seem to have adopted a policy of making tertiary education as much of an ordeal as possible for students, particularly from low-income backgrounds, by minimising income support. Students have to prioritise work obligations over academic ones, necessarily affecting academic performance as students struggle to work enough hours to pay the rent and eat.

The Bradley Review recommended a set of changes to student income policy, particularly around personal and parental income taper rates, but was ignored by the government — another case of higher education lacking the political clout of other sectors. That’s especially the case when those most affected are students with poor English language skills.

As more universities follow Monash, if not quite as far, in cutting jobs in response to the fall in international student numbers, politicians might finally realise that the easy options for higher education funding have disappeared.

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3 thoughts on “Visa changes expose higher education funding problems

  1. Mark Duffett

    The focus on vocation-related higher education and the decline in academic standards engendered by low funding will eventually have a nebulous but nonetheless real impact on civic life…

    The only thing wrong with this statement is the tense. The decline in critical thinking on display in civic life has been apparent for some time.

  2. Clytie

    The utilitarian argument definitely leaves a critical shortfall in education. When I’m teaching “skills”, first I need to teach the attitude to learning. It’s about opening doors, not marching in column. And those doors lead not only to measurable skills, but to greater understanding and the ability to go on learning.

  3. Gavin Moodie

    1 Altho Monash gains 18% of its revenue from international student fees I suspect that Monash is using the highly publicised *predicted* falls in international student enrolments as cover for redundancies that it wants for other reasons, probably to improve its research. Even if Monash University’s intake did fall precipitously in 2011, it would retain at least two-thirds of its international student revenue cos this year’s first and second year students would re enrol in 2011 to complete their program.

    2 I agree that the link between international education and immigration should be broken. But only 34% of international university students gained permanent residence in 2004-05 (the rate was much higher for vocational students). In addition to the Australian Government breaking the link between international education and immigration the Department of Immigration and Citizenship is increasing obstacles and slowing processing of applications for visas for students who want to study, not immigrate.

    3 Labor did not ignore Bradley’s recommendation to reform student income support. It presented well conceived legislation to Parliament in 2009. The Coalition blocked it cos it stopped a rort which allowed students of rich parents get income support after a gap year. Then education minister Gillard managed to negotiate passage of a compromise Bill on 18 March 2010. While the compromise Act isn’t quite as good as the initial Bill, it nonetheless implements Bradley’s recommendations substantially.