PETER VAN ONSELEN: How Anthony Albanese and his team plan to destroy one of our most important money machines with international student caps

Just when you think the Albanian government can’t find any new and inventive ways to impose even more bad policies on the country, Education Minister Jason Clare enters the room.

He came up with the not-so-bright idea of ​​imposing a cap on foreign students attending top universities. In other words, he limits the number of foreign students that Australia’s top higher education institutions can enroll, so that lower-tier institutions can increase their numbers.

The reason the Labour Party is doing this is that its previous policy of restricting international students across the sector has resulted in fewer international students being enrolled at lower-tier institutions than at higher-tier institutions.

This has brought the bottom end of the sector to its knees, creating all sorts of political problems for the Labour Party in marginal constituencies and regional areas where many of these struggling institutions are based.

Don’t take my word for it. Clare said these lower institutions were ‘bleeding’ because of his ‘ministerial direction’.

That is hardly a surprising outcome. The thinkers that this government is, really should have seen it coming.

If you allow fewer foreign students into the country, but do not limit the number of students per institution, the best universities will naturally win and the lower end of the market will collapse.

That’s common sense.

Education Minister Jason Clare has announced a cap on foreign students attending Australia’s top universities

There is a perception that all the foreign students who come here – and we take hundreds of thousands of them every year – want to become Australian citizens. But they don’t want to, at least not most of the foreign students who study at the elite universities.

That is exactly what happened. An unintended consequence, but one that a good government and a good minister should have foreseen. In fact, an average government and an average minister should have predicted it.

Hopeless is the only description. Now Labor is left in the dark about a new policy to repair the damage it has already done.

But what the proposal has achieved is even worse and does not solve the political problem that the original policy was intended to address.

So why did Labour want to reduce the number of foreign students in the first place? It seems foolish to anyone who knows anything about higher education, given that foreign students fund our universities.

For years Australian governments have allowed funding levels to fall for our universities. Compared to institutions of similar standing overseas and compared to per capita funding at home in recent years, funding has fallen.

Universities have filled this gap – and still maintain high international rankings for a medium-sized country like Australia – by attracting full-fee paying international students.

They have funded our quality institutions, not the government, which means that governments of both parties are free to pay for high-quality higher education.

The public probably won’t have a problem with this, given the perception that universities are bastions of activist, urban woke ideology.

That is sometimes true, but not always. For example, there is plenty of that in the arts and social sciences faculties of some institutions, but much less of that in faculties such as engineering, business, and medicine.

And let’s face it, it is largely the renowned faculties that uphold Australia’s reputation for international higher education.

The Labor Party, in its infinite wisdom, is killing the goose that lays the golden eggs with its just announced policy change.

The political problem that Labor faced shortly after coming to power was the concern about mass immigration that would affect access to housing for many Australians. The perception is that large numbers of foreign students contribute to this.

But that is not the case – at least not the students who go to the top institutions, whose student numbers are now being cut.

Foreign students studying in Australia are given access to a visa upon completion and thus a pathway to citizenship. This is obviously a huge draw for many people living in other parts of the world that are not nearly as affluent or aesthetically pleasing as Australia.

So the idea is that all the foreign students who come here (and we take hundreds of thousands of them every year) want to become Australian citizens.

That is not true, at least not for most foreign students studying at the elite universities.

Less than seven percent of international students studying at top universities want to stay in Australia after their studies. They want to return home with their quality qualifications.

This is not the case at the lower-segment institutions, which now retain more students thanks to Clare’s policy.

Much higher percentages of these students stay here. And those are the institutions that Clare’s policy change will allow to enroll more students, not fewer — and precisely the ones who are more likely to migrate.

Which is not really surprising. These students are not attracted by the low quality of the institutions they attended. They are attracted by the path to citizenship that their enrollment offers.

So where does this leave us? Labour HAD a policy of limiting the number of foreign students at lower institutions, with such students more likely to use immigration routes that contributed to population growth, putting pressure on housing. But that is no longer the case.

Previously, top universities could finance their high rankings with a large group of foreign students, who, however, did not contribute much to the immigration figures, as shown in the illustration.

But in its infinite wisdom, the Labor Party is killing the goose that laid the golden eggs with the policy change it has just announced.

It will lead to job losses and funding shortages in our top universities, which in turn will see their rankings fall. And they will likely have to reduce the number of domestic students to cover the cost of losing full-fee-paying overseas students.

It is a blatant change in policy.

So let’s give Labor a round of applause for finding new and inventive ways to damage the Australian economy and higher education, which until now has been our second largest export industry after mining.

Oh, and the Treasury Department hasn’t even modeled the economic impact this policy change will have on the economy.

Even if you tried, you couldn’t make up this level of policy stupidity.