Visa fee hike will stifle demand, Australian universities warned

Australia’s lofty application fee for student visas risks deterring enrolments from some of the country’s biggest and most rapidly growing neighbours, according to educational services company IDP.

An IDP survey of over 1,400 mostly would-be students found that over one in three took visa costs into account in their choice of study destination. That proportion rose to around three in five when participants in the survey, which was conducted in June, were told that a massive visa fee hike was in the wings.

Among the 500-plus respondents who were yet to apply for antipodean university or college places, 22 per cent said a visa fee increase would force them to look elsewhere and another 41 per cent said they “might” reconsider Australia.

Respondents from China and India – the biggest student source countries – appeared relatively relaxed about a possible visa fee hike, with barely 20 per cent saying it would rule Australia out as a study destination. But that figure rose to almost 40 per cent among prospective students from the Philippines and Malaysia, while 87 per cent of respondents from Vietnam said they might reconsider.

“No two markets are the same,” the report says. “Philippines, Cambodia and Indonesia are showing increasing price sensitivity.”

It says a visa fee increase would also stifle demand from students already in Australia. Seventeen per cent said it would scuttle any notion of further study in the country, and another 38 per cent said it might.

The widely anticipated fee hike eventuated on 1 July, when the government announced that the visa application charge would immediately rise from A$710 to A$1,600 (£362 to £817), making it easily the most expensive in the world.

The increase coincided with a decline in Australia’s split of student enquiries, according to IDP’s tracking data, with market share slipping 2 percentage points.

The report says New Zealand-bound students are “more price sensitive” than those headed to its cross-Tasman rival. “Australia’s policy shift will benefit NZ, particularly with students from the Philippines and Pakistan,” it says, although no immediate change was evident in the tracking data.

“Whilst the majority of Australia-bound students appear uninfluenced to switch to New Zealand due to cost differences, this could change. Some markets will vote with their feet quickly if NZ harnesses this opportunity.”

However, any such benefit could be short-lived, with visa fee hikes also under consideration in New Zealand.

john.ross@timeshighereducation.com