Timing quirks determine winners and losers from Australian caps

As the Holmes Institute recovered from Covid-19, it decided to take things slowly. “We were abstemious,” chief executive Stephen Nagle told an Australian Senate committee.

It was 2023. Competitor institutions, anxious to refill their empty classrooms, were paying agents A$4,000 (£2,050) plus a 20 per cent commission for every new international student. “We did not do that,” Mr Nagle told the committee, which is examining federal government legislation to cap overseas enrolments. “In exercising genuine student criteria…we only recruited 1,400 students.”

The caution backfired. Holmes, a 61-year-old private higher and secondary education provider with five campuses in three states, now finds itself limited to 980 new international admissions next year – despite having capacity for 8,800 – because the caps are predicated on 2023 enrolments.

A similar quirk of timing cursed Charles Sturt University (CSU). It overhauled its capital city campuses, which had attracted regulatory sanctions, by cutting ties with a partner provider. This, combined with visa rejection rates that soared from about 5 per cent a few years ago to 30 per cent over the past year, drove its overseas admissions down from more than 3,000 a year to less than 1,000.

That is where they must stay, with CSU limited to 1,000 new international admissions next year. “It’s…where we happened to be standing when the music stopped,” said vice-chancellor Renée Leon. “Everyone is frozen in the position of relative advantage or disadvantage that they happened to have been in…when the caps were set.

“We’ve been given no assurance that we will be able to increase from that number in the future. For the university to be financially sustainable [we need] to return [near] our pre-pandemic volume.”

The Australian Catholic University (ACU) is similarly disadvantaged because its growth spurt happened in 2024. Blessed with the highest immigration risk rating – unlike most universities – it benefited from a reprioritisation of visa processing under ministerial direction 107.

Its students’ visa applications were put in the fast lane, and its international admissions more than doubled from its 2023 tally of 1,580. Now, new foreign enrolments have been capped at 1,700 next year.

The Senate committee, which was due to report its findings on 6 September, instead convened another hearing to examine proposed caps that had been revealed just a day after it last met – “which frankly treated this committee with contempt”, said shadow education minister Sarah Henderson.

Ben Rimmer, deputy secretary of the federal Department of Education, said the capping mechanism would help distribute overseas enrolments more equitably. “What is expected is that all Australian higher education providers have a reasonable opportunity to access the international education market, and to do a very good job at it,” he said.

Mr Rimmer also refuted suggestions that foreign students had no impact on housing availability. “There are some local government areas where international students make up 20 per cent or more of the private rental market. The idea that [international education] has no impact on rents [or] rental supply is false.”

Meanwhile, the Treasury also hosed down suggestions that caps on overseas students would stifle economic progress, despite acknowledging that international education had generated “just over half” of economic growth last financial year. “We don’t anticipate that it will have a material impact on growth,” an official said.

Committee member Mehreen Faruqi, the Greens’ spokeswoman for higher education, said the legislation was a “train wreck” facing “universal” opposition. “The whole policy process is a complete mess,” Dr Faruqi said.

“The government is hell-bent on strangling the higher education sector in their bullish attempt to achieve a migration outcome which has absolutely nothing to do with international education.”

The committee now plans to report on 16 September.

john.ross@timeshighereducation.com