Bill Shorten has a message for his former colleagues in parliament: stop messing with the rules about international student visas. “They’ve got to draw a line in the sand now,” says the vice-chancellor of Canberra University. “Enough. I think the tinkering with the policy has to stop.
“Many universities are precariously financed,” the one-time Labor opposition leader tells The Saturday Paper. “The sector is financed by increasing student debt and by overseas students.
“And if [one of] those pillars in the case of higher student debt becomes a disincentive, or if the overseas students market is trashed, then we’re actually damaging the national sovereignty of the country through undermining our post-school education system and our research apparatus.
“We are in the business of international education as a nation. We have historically given away industries to our national detriment. Let’s not repeat the mistake here.”
Less than two years ago, Shorten was on the front bench in the Albanese government. He is speaking out amid an immigration debate that has focused on the large number of people coming to Australia to study at universities and vocational training colleges, many of whom see it as a path to permanent migration.
Labor, the Coalition and One Nation all want to cut overseas student numbers. Although their policies differ in detail, the parties are in lockstep on the need to make it harder for international students to work here after they graduate. They all want, with limited exceptions, to scrap “secondary” visas for students’ partners and children. With varying degrees of severity, they also want to curb people’s ability to apply for a student visa while they are in the country.
In the past few weeks, the parties have been playing a game of policy one-upmanship, but the “tinkering” Shorten refers to goes back a while.
Andrew Norton, professor of higher education policy at Monash Business School, lists 30 new government policies since July 2023 designed to reduce student-related visa numbers.
Shorten doesn’t criticise Labor’s policy on foreign students – he was in cabinet when some elements were announced. “I can understand the changes,” he says, “but I think at a certain point, you go on a diet, you start self-harming.”
Norton has little doubt that universities are facing financial pain. “It’s grim,” he says.
In the past few years, universities have become increasingly reliant on international student fees to fund research. Norton has analysed the latest official figures, which show that direct government grants and money from industry and philanthropy cover not much more than half of universities’ research spending.
“There’s absolutely no way that research on the scale we’ve had over the last 20 years would have been feasible without international education. It’s critically dependent on international student fees,” Norton says.
He says smaller universities and outer-metropolitan and regional institutions that attract higher proportions of students from South Asia are likely to take the brunt of policies to deter foreign students, but the crackdown will be broadly felt.
Yet in the current political climate, the universities are finding few friends.
“I mean, how many votes are there to be won in defending or supporting universities?” asks Chris Wright, professor of work and labour market policy at the University of Sydney Business School. Certainly, few of the voters drifting to One Nation, whose support Labor and the Coalition are desperate to retain, would call this a priority.
“What you can’t help wonder is, how much immigration can we cut? And who are the voters who are actually going to vote for [Labor] ahead of parties who will cut it further anyway?”
Opposition Leader Angus Taylor has all but accused universities of running a de facto immigration racket.
“Sadly, for many years we’ve had universities not selling educational excellence, but selling visas, selling pathways to citizenship, selling migration,” he told Murdoch’s News24 after announcing the Coalition’s migration policy last week.
What Taylor failed to point out is that the universities are operating under a policy largely established by the Coalition. The Howard government engineered the changes to immigration policy that paved the way for an explosion in international student visas.
“It was revolutionary in the context of Australia’s immigration policies,” says Wright, “massively increasing temporary visas and hugely expanding international student visas as part of this, and creating what became a multistage pathway that made it easy to apply for permanent residency.”
This shift in policy is detailed in Mark Cully’s book Waves of Plenty: Immigration and the making of Australia. Cully was chief economist for the Department of Immigration and Citizenship, then for the Department of Industry, Science and Resources and subsequently head of macroeconomic policy in Treasury until 2023.
Although the Hawke Labor government first allowed universities to bring in full-fee-paying foreign students in the late 1980s, he says “the equation originally was, ‘Come to Australia, get a first-world university degree, go back to your home country and use that to get a decent job’ ”.
The subsequent Howard government policies in the late 1990s and early 2000s “turbocharged the international student industry”, Cully says.
In 1999, after lobbying by employer groups, then immigration minister Philip Ruddock oversaw changes to the points test for skilled migration – automatically giving international students maximum credit for proficiency in English if they obtained qualifications in Australia.
In 2001, the Howard government scrapped a requirement that people apply for permanent residency from outside Australia – giving overseas students in the country what Cully calls “a near-seamless transition to ongoing settlement”.
Howard and Ruddock also allowed people to shift from one temporary visa to another without having to leave the country, expanding the scope for what is now derided as “visa hopping”.
Later, the government created a visa that let former students stay in Australia and work for another 18 months after graduation to bolster their chances of gaining permanent residence.
The cumulative changes, Cully notes in his book, “made it possible for a young prospective migrant from, say, India to enrol in an Australian college course in, say, cooking or hairdress-ing – occupations that had been added to the ballooning list of jobs in demand – and acquire sufficient points by the time of their graduation to meet the pass mark for permanent residence”.
Australian universities, he says, also “became thoroughly enmeshed in the migration process, churning out hundreds of thousands of overseas student graduates keen to secure permanent residence as skilled migrants”.
Luring people to study in Australia while dangling the carrot of permanent migration became known as “try before you buy”.
As the Coalition rails against this, Chris Wright is struck by the irony.
“It’s amazing seeing … some of the architects of the reforms to Australia’s migration program 20 to 25 years ago, including to student visas, walk back their support,” he says.
In the Nine newspapers last month, Ruddock urged the Albanese government to push international university graduates out of the country and force them to reapply for visas from overseas.
As a means of attracting full-fee-paying overseas students, the policies Howard pioneered were extraordinarily successful. Wright estimates that the number of international student visas granted by Australia increased 17-fold from 1986 to 2019 – soaring again after the pandemic lockdown. With the possible exception of tiny Luxembourg, Australia has far more overseas students as a share of its population than any other country in the world.
The immigration policies that led to this were at least as much about the labour market as education. International students swiftly became a crucial, flexible supply of low-wage labour for industries such as retail, hospitality and cleaning – and now as couriers and drivers in the gig economy. But their visas afford them no access to Medicare or social security. They are, in Cully’s words, “an underclass, one manufactured by government policy”.
“Australia prides itself on the ethos of the fair go and we’ve now got roughly three million people who are temporary residents here in Australia, many of them able to be exploited by unscrupulous employers and by middlemen, often people from their own communities,” he says.
Wright argues that the embrace of temporary visa holders, including international students, has created something akin to a “guest worker regime” in Australia.
The treatment of international students during the pandemic and its aftermath is illustrative. During the lockdown, they were denied income support. Subsequently, under intense pressure from employers amid labour shortages, the Morrison government scrapped a 40-hour a fortnight cap on paid work hours for international students during semesters and let them work unlimited hours.
“That was an absolute magnet to non-genuine students,” says Norton. “That’s one of the reasons why we’ve now got this group who came in that period, who are basically doing everything they can not to go home.” (Labor reimposed a cap – increased to 48 hours a fortnight – a year-and-a-half later.)
Norton worries that the government may be overcorrecting for a past problem, “which just causes further problems down
the line”.
For decades, universities have been starved of government funds and told to become more entrepreneurial. It’s part of what sociologist Raewyn Connell, professor emerita at Sydney University, calls a backdoor privatisation of universities. They remain public institutions but operate more like corporations – chasing revenue and spending big money on advertising, marketing and swank real estate to help attract the full-fee-paying students from offshore.
Some university staff The Saturday Paper spoke to hope the push to cut international student numbers will lead to a rebalancing. But politicians aren’t offering to fill the income void.
Alison Barnes, president of the National Tertiary Education Union, says, “You get this paradox where universities rely on international student fee income to make up for shortfalls in [public] funding and then international students are used as the kicking ball.
“People say, ‘We’ll cut international student numbers’ with no promise to actually fund universities so that they can carry out their core purposes.”
She is equally worried that international students are being demonised and made “the whipping boy for broader problems in society”.
One Nation is promising deep cuts to international student numbers as part of an immigration crackdown that would drive net overseas migration into reverse for three years – a policy Mark Cully says would almost certainly cause a recession.
In this febrile political environment, Bill Shorten has a further message for his former colleagues on the hill.
“What you can’t help wonder is, how much immigration can we cut? And who are the voters who are actually going to vote for [Labor] ahead of parties who will cut it further anyway?”