Last year, the Coalition made the surprise decision to oppose Labor’s plans for new international student caps.
On Sunday, Opposition Leader Peter Dutton proposed an even more radical policy of his own to limit the number of international students in Australia.
He announced a combination of tighter enrolment limits, increased visa application fees and changes to temporary graduate visas, which allow some former students to remain in Australia to work.
This is aimed at either deterring potential students from applying or stopping them from going to their preferred university.
What’s the Coalition’s policy?
The Coalition and Labor similarly argue high numbers of international students are putting pressure on housing markets.
But the opposition is also concerned there are too many international students in some courses. They say some courses can have international enrolments of up to 80%.
To address both problems, the Coalition proposes a maximum international student enrolment share at public universities (which is almost all universities in Australia). This would be around 25% of all commencing (or new) enrolments. Other education providers, such as private colleges and TAFEs, would face separate caps.
The Coalition estimates this would result in 30,000 fewer new international students per year than Labor’s policy.
What is happening under Labor?
Last year, Labor wanted to give the education minister wide powers to cap international student enrolments by education provider, campus and course.
Apart from some exempt categories (such as postgraduate research students), vocational and higher education providers would have been allocated 270,000 commencing enrolments between them for 2025. This is compared to 323,000 commencing enrolments in 2023.
But the bill was opposed by the Greens and the Coalition. So Labor had to move to plan B.
Using its migration powers, in December 2024, the government issued a ministerial direction on how the Department of Home Affairs should process applications for student visas. This is arguably a de facto cap.
Immigration officials have been instructed to prioritise student visa applications for all institutions until they near the individual caps that were blocked by the Senate last year.
Once visa applications are at 80% of each provider’s cap, subsequent applications go into a slower visa processing stream.
Signs applications are already down
Prospective international students cannot apply for a visa unless an education provider gives them a “confirmation of enrolment”.
We are seeing signs the ministerial direction is leading to fewer “confirmations of enrolment” and resulting applications.
My analysis below shows student visa applications for January and February 2025 are well down on equivalent months in 2024, 2023 and 2019 (pre-Covid).
In late 2024, demand was below the boom times of 2023 and early 2024, but still above 2019.
What does the Coalition’s plan mean for unis?
Labor’s policy for university caps uses a formula based on past international student enrolments. The Coalition’s caps would be a percentage of total new enrolments. They expect this to be around 25%, but will set the precise number after consultation and receiving the most recent data.
Coalition education spokesperson Sarah Henderson has expressed concerns high concentrations of international students have “not been good for our country or for the education outcomes of Australian students”.
Based on 2023 enrolment data – the latest that also includes domestic students – 35% of new university students in Australia were from overseas. But several universities had international student shares above 50%.
On the Coalition’s estimates, their policy would see no more than 115,000 new international students in public universities each year, down from 139,000 under Labor’s approach.
The Coalition acknowledges this will particularly affect the highly ranked Group of Eight universities, including The University of Melbourne and The University of Sydney. Dutton argues these universities have admitted “excessive numbers” of international students.
Coalition caps for private providers
One reason the Coalition gave for not supporting Labor’s legislation last year was the disproportionate effect on private education providers, which include both vocational and higher education colleges.
Under the Coalition’s plan, private providers will still have caps, but they will be different than those for universities. Exactly how this will work is unclear. Their combined caps will be “at most 125,000”, according to the Coalition. Under Labor’s policy, their combined cap is a little higher, at about 132,000.
A complicating factor here is the government’s existing migration policies have smashed demand for vocational education – as my analysis shows.
This means many vocational education providers may not be able to fully use the places allocated under Labor’s indicative cap. These shortfalls may create space to increase caps for other private education providers.
Visa application fees
Last year, in a bid to cut international student numbers, Labor more than doubled the student visa application fee from A$710 to $1,600. They subsequently reversed this for Pacific Islander applicants.
Under the Coalition, the visa application fee would more than triple to $5,000 for applicants to Group of Eight universities. For students seeking entry to other providers, the fee would be $2,500.
Temporary graduate visas
The Coalition also promises a “rapid review” of the temporary graduate visa program. This would be to prevent its “misuse” as a way to gain access to the Australian labour market and permanent migration.
Labor has already reduced the number of years former students can stay on temporary graduate visas, reduced the age limit to be granted a visa from 50 to 35 years, and increased the minimum English requirements.
Applications for temporary graduate visas are down on past levels.
While Labor’s changes made some potential visa applicants ineligible, recent applications could be the calm before the storm. Large numbers of 2023 and 2024 international students will complete their courses in the coming years, with many of them eligible for temporary graduate visas under current policies.
International education will take a hit regardless
The Coalition’s international student election policy is less of a surprise than its refusal to back Labor’s caps last year. They have foreshadowed tough policies many times in recent months.
But the proposed increased visa application fees and enrolment caps would be painful for both students and education providers.
Universities have repeatedly argued international students are not major causes of the housing crisis. They have also argued international education is a valuable export and it is being undermined by policy changes out of Canberra. But this has had no impact on the stance of either Labor or the Coalition.
So, the number of international students in Australia will fall regardless of the federal election result. The decline is set to be greater under a Coalition government. But regardless of the election result, the days of unlimited international student numbers are over.
Andrew Norton works for Monash University, which is a member of the Group of Eight and would be significantly affected by the policies discussed in this article.
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