Education agent: International students are immigration pure play

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For years we have argued that Australia’s international education industry is really an immigration scam, whereby migrants effectively purchase access to work and live in Australia by studying at an Australian institution.

The immigration scam has been developed jointly by the federal government and education industry via:

  1. The federal government offering the most generous work rights to students in the world, alongside an easier pathway towards permanent residency; and
  2. Our universities cratering entry and teaching standards so that almost any international student with a pulse qualifies to study, and passing courses is easy.

Anyone doubting our claim about the international education industry being an immigration scam only needs to read the below quote from New Delhi-based education consultant Gauravdeep Bumra:

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“Most Indian students choose to study abroad, often at the cost of thousands of dollars, because they have a long-term goal of getting permanent residency, be it in Australia, Canada or the UK. As a result, most students stuck offshore have deferred their studies instead of choosing to complete their degrees online”…

“The day they open their borders, the student intake numbers will uptick…”

The edu-migration industry is not even trying to hide the scam anymore with universities, education agents and migration agents all now lobbying the federal government to expand migration pathways to increase Australia’s attractiveness as a study destination and to ensure a quick rebound in student numbers as soon as the international border opens up.

The deleterious impacts on domestic students and the broader Australian economy from cratering standards is ignored entirely, with the giant rent-seeking edu-migration industry only concerned with pumping through as many students as possible for maximum profit.

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Prior to COVID, Australia had easily the highest concentration of international students in the world at roughly 2.5 times the UK’s, triple Canada’s, and five times the US’:

Australia’s concentration of international students was extreme prior to COVID.

The federal government must not allow this situation to persist (or worsen) and must force the education industry to compete on quality and value alone. It must stop the industry from debasing standards and profiteering from foreigners pursuing backdoor migration.

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The federal government can achieve these goals by explicitly targeting a smaller intake of higher quality students via:

  1. Raising entry standards to study at Australian tertiary institutions (particularly English-language proficiency);
  2. Significantly lifting financial requirements needed to enter Australia; and
  3. Removing the link between studying, work rights and permanent residency.

Reforms along these lines would provide significant net benefits, including: 1) improved student quality; 2) increased export revenue per student; 3) lower enrolment numbers to levels more akin with international norms; and 4) lifting teaching standards and the experience for domestic students.

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Australia’s tertiary education system must be about ‘higher learning’, not ‘higher earning’.

About the author
Leith van Onselen is Chief Economist at the MB Fund and MB Super. He is also a co-founder of MacroBusiness. Leith has previously worked at the Australian Treasury, Victorian Treasury and Goldman Sachs.