Kylea Tink (North Sydney, Independent) Share this | Hansard source

Let's be clear: as a nation we should be proud to be recognised as a leading provider of international education, with students from over 140 countries educated here in the past 12 months alone. Whilst this success confers significant economic benefits across the board it also ensures our society's enriched by the exchange, and it strengthens our diplomatic ties. But, rather than celebrating these truths, it would seem there are those who wish to use the sector's success as a launching pad for a shallow political debate around immigration, with the end result being a potentially devastating outcome for our country's reputation and, ultimately, the ongoing viability of what is currently our most profitable export sector behind mining.

More than three million people from overseas have benefited from at least part of their education being completed in Australia in the last decade. And, contrary to widespread commentary, the vast majority—80 per cent—went home. The ones that stayed add significant value to our country. They are the emergency doctors who got us through COVID, the nurses who care for our elderly and the engineers who shore up our cybersecurity.

From a bigger picture perspective, international education generated $48 billion in export revenue in just the last year, second only to the mining sector. Yet we stand here tonight having a debate on the Education Services for Overseas Students Amendment (Quality and Integrity) Bill 2024 about removing that export income. I would ask this government: without that income, how will you fund it? How will you provide universities services for the domestic students you keep citing?

The sector supports 250,000 jobs nationally across the education, retail, hospitality and tourism industry environments. After years of reform and diminishing government investment, the truth is that our current domestic education sector relies on international students to remain economically viable and to be able to offer the courses domestic students wish to pursue. Meanwhile, in terms of productivity, international students are an invaluable resource for small businesses, helping to fill gaps across the economy.

This is particularly true in North Sydney, which, with over 28,000 small to medium-sized businesses, is the third-largest business centre in the country. Fascinatingly, nearly half of the owners of the businesses in North Sydney were born overseas, which is significantly more than the average across New South Wales and Australia. Beyond the economic upside, however, is the fact that, as recognised in the foreign policy white paper, international education is also a powerful tool for foreign policy soft power. The changes this bill seeks to make to the international education sector will not only limit the operation of several tertiary education providers in my electorate; it will also negatively impact our small-business community, as labour supply would dry up and demand would diminish. Specifically, businesses offering accommodation services, insurance companies, restaurants, bars and cafes have all reached out to me to express their fears that this reform would affect the livelihood of small-business owners. Certainly quality, integrity and sustainable growth for the sector are all desirable, but the question is: will this bill produce those outcomes, or will this bill, with its unchecked powers that it confers to the minister of the day, risk the sector's ability to operate effectively and within a free-market frame?

The Nixon review identified within the international education sector systemic integrity issues that we do need to deal with. These include collusive business practices between education providers, their agents and non-genuine students who seek to abuse the system for personal gain. The North Sydney community agrees that these issues must be addressed. The community also accepts that international student numbers have returned faster than expected to pre-COVID levels and that the sustainable growth of the sector is genuinely desirable. The bill seeks to address these issues in part by introducing measures around student recruitment and creating a provision that education of domestic students be prioritised ahead of international students. These measures are broadly welcomed by both providers and my community. But these efforts are overshadowed by the government's overreach when it comes to the unprecedented new ministerial powers being proposed.

Ultimately, many in my community are concerned this legislation simply goes too far. Under the guise of quality and integrity, the necessary checks and balances to ensure effectiveness are conspicuously absent. This then leads them to question whether this legislation is in fact a thinly veiled response to a larger political debate around immigration more generally, for it seems the two major political parties are intent on targeting international students in a bid to slash migration in a poll-driven war on the cost of living and on housing. With that frame in mind, then, this legislation fails to strike a balance between improving the quality and integrity of the scheme and ensuring sustainable growth for the sector.

While the ministerial powers are being presented as a mechanism for managing temporary migration and alleviating the fallout of unsustainable growth, my community is unconvinced they will deliver the desired outcome and is concerned any benefit will be outweighed by damage to Australia's largest service export. As the CEO of the International Education Association of Australia said:

While stakeholder consultations are being offered, this latest measure will send all the wrong messages, yet again, of Australia's reliability as a welcoming study destination country. Coming on top of the recently announced changes to financial capability requirements … visa processing slowdowns and backlogs, prospective students and our education agents will feel incredibly let down.

I will be arguing there is real danger of government overreach in this new policy approach. If implemented, the new ministerial powers to unilaterally limit enrolments across entire sectors, institutions, courses and locations create an unprecedented level of government intervention in what is currently essentially a free-enterprise sector. Given this, I share the sector's concerns that these powers lack accountability and will be largely unchecked. The fact that there's no requirement for the minister to consult before issuing a notice to limit international students at a particular institution is unacceptable, as is the fact that the government has offered no indication of how it will calculate enrolment caps for each course or situation. Ultimately, providers are being asked to blindly trust the government on these matters, and, unsurprisingly, education providers, including those in my electorate, are concerned. Giving the minister of the day power to suspend providers who exceed their international student cap by even one student for up to 12 months is an extraordinary and, many would argue, completely disproportionate measure, given the enrolment journey for an international student typically takes 12 months or longer.

Meanwhile, the minister's new powers to arbitrarily suspend or cancel courses deemed not to align with Australia's skill sets, needs and priorities ignore the fact most international students are educating themselves for a career in their own home country rather than in ours, creating yet again a circumstance that seems incongruent. Recognising that a government hell-bent on action is difficult to forestall, some have suggested the setting of caps should only be allowed at the provider level, removing the ministerial power to set caps at the course level. I remain unconvinced that this really is a space and place where ministerial discretion is warranted. Universities already deliver education under strict and mature regulatory and funding arrangements and are increasingly asked to deliver graduates in line with Australia's skill needs, based on advice from agencies including Jobs and Skills Australia. Given this, it would seem self-evident that giving a minister the power to intervene at the course level is a dangerous overreach which would have serious consequences for institutional autonomy, existing regulations and student choices.

Beyond that, for me, it's simply bureaucracy on roids and risks creating a legislative framework that flies in the face of basic free market principles. Why is it that this government believes an education minister will be better placed to anticipate the needs of those seeking and willing to pay to be educated? Capping overall student numbers is one thing, but setting them with respect to specific courses is a completely different scenario, and it's one that neither my community nor I am are comfortable with. Beyond this, many providers also lament that the potential impact of this legislation has been seriously underestimated. They cite the fact that international students commencing in the 2025 academic year are already in the pipeline and receiving offers. They argue it will be politically and diplomatically difficult to influence the 2025 academic year intake—as suggested by this bill—even if the bill is passed in this current parliamentary session.

In addition to this, economically speaking, international student fees account for over a fifth of total university funding. Consequently, universities have come to depend on international student revenue to subsidise their teaching and research efforts, because government funding under both the current and the previous governments has not been there. A cap on international student numbers will place these activities at risk unless additional government funding is found for the sector. Watering down a major source of revenue at a time when universities are being asked to provide more knowledge, skills, opportunities and research will significantly reduce the sector's ability to perform the functions being relied on by the government and all Australians.

The proposed reforms may also have consequences beyond university campuses, as a reduction in export revenue from international education contributes to weaker economic growth, lower employment rates, less investment in essential services and, ultimately, damage to other sectors of the economy. According to Universities Australia, severely curtailing student numbers will see the operating margins of Australia's top-tier institutions quickly compress or flip into small deficits. It's clear that there is more work to do on this legislation to ensure the right settings are in place to bring certainty, stability and growth to this critically important sector.

Consistent with the Universities Accord, under this legislation, tertiary education providers will be able to enrol additional students above their initial international student profile where they establish additional newly built supplies of purpose-built student accommodation. However, it's unrealistic to expect universities to boost the supply of student accommodation on such a short runway, particularly in circumstances where land is simply not available, as is the case in many urban centres. You only need to look as far as the student accommodation debacle unfolding with NIDA and the University of New South Wales to understand that building new accommodation is more difficult than it's being made out to be. Labour shortages to build new housing are already at an all-time low and onerous local council planning rules are a major impediment. This is not to say this measure shouldn't be pursued, but it does need to be better considered, with timelines agreed in consultation with education providers and across all levels of government.

As part of initial announcements expressing the intention to introduce this legislation, the government stated they would 'work closely with the sector to implement this policy and establish transitional arrangements that support the sector to manage this change effectively'. The fact that the sector is already expressing significant concerns about the lack of consultation does not bode well. Attempts to push this legislation through parliament may have significant unintended consequences—to the detriment of our students, culture, diplomacy and productivity. That is why I ask the minister to wait for the completion of the inquiry into this bill by the Senate Standing Committee on Education and Employment—which is due to report this week on 15 August—so those recommendations can be considered accordingly.

Drilling further into the issues related to accommodation, a number of key stakeholders have raised concerns that the provisions in this bill have been proposed before a suite of well-targeted integrity reforms outlined in last year's migration strategy have even had an opportunity to be implemented. In this way, the bill imposes an additional level of regulation before the effectiveness of the initial reforms are even understood. Surely a better approach would be to allow those early reforms to take time to come into effect before considering additional interventions?

The government has committed to halving net overseas migration to 260,000 by July 2025 and then to 235,000 by 2027, while the opposition has said it would cut the numbers from 260,000 to 160,000 in one year. This would mean that, for the government to reach its target, only 95,000 international students would be allowed into the country each year. This is a drop from pre-pandemic levels of 240,000. Under the coalition's proposed cuts, the international student intake would fall even further, to between—wait for it—10,000 and 15,000 students per year. Ultimately, we have to ask ourselves: are international students being used as an easy target in a political battlefield?

Seeking to link high migration to housing supply and affordability ignores several realities which the Treasurer himself acknowledged recently when he stated that the impact of international students on housing prices is marginal. International students make up just four per cent of the rental market. Rising rents are not attributed to migration, especially by international students, as rents have been rising since 2020, which was during the pandemic. Between 2019 and 2023, the median weekly rent increased by 30 per cent, while student visa arrivals decreased by 13 per cent. The Reserve Bank itself has said the cause of high house prices was not an increase in migration but a shortage of housing supply made worse by the pandemic and rampant inflation driving up construction costs. Given everything I've just said, it's clear the claims that international students are a prime or causal factor in rental stress and housing affordability are just not true. Yet the argument is being used to justify this legislation.

In closing, I suggest the powers contained in this bill are a gross overreach and a dangerous precedent. This legislation poses an unjustifiable risk to the sector's future, not to mention to our productivity and culture. We don't need our government to run what is already Australia's second most profitable export sector, behind mining. We need a government that's prepared to enable the industry to continue to grow, supported by targeted legislation that helps those in the sector meet broader community expectations.

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