Visa policies, not ranking, ‘now primary determinant of fees’

Australian universities are increasing foreign students’ tuition fees and reducing scholarship availability, as government policy becomes the primary determinant of fee-setting.

International education analyst Keri Ramirez said the increase in average fees for overseas students had exceeded 5 per cent in 2024 and again this year, in a reversion to the norm before fees were all but frozen during the pandemic.

Meanwhile, the number of scholarship programmes offered by 40 Australian universities had fallen from a mid-pandemic peak of 632 to 494 this year. Scholarships targeting individual nationalities had particularly lost popularity, with fewer than half of universities now offering “country-specific” scholarships for key markets including India, Bangladesh, Thailand and China.

Ramirez said universities had fallen into two distinct camps in their approach to international student recruitment. Fourteen “growth-constrained” institutions – those whose international student numbers were already near the indicative caps set by the federal government last year – had generally raised their fees by more than the remaining 26 universities, which still had plenty of capacity under current visa policies.

Ramirez said some constrained institutions had raised their fees by around 10 per cent this year, and international undergraduate fees at four large Sydney and Melbourne universities now averaged over A$50,000 (£24,000) annually.

Meanwhile, an institution in the other camp had reduced its fees by 17 per cent to about A$25,000 for most bachelor’s programmes, offering an “affordability proposition” not available elsewhere. “Universities are changing their pricing position,” Ramirez told a webinar hosted by his Studymove consultancy.

He said both camps were jettisoning scholarship programmes because neither saw a need for them. Constrained universities were unable to accept many more students anyway, while the other institutions generally felt less competitive pressure to lure students with price sweeteners.

Ramirez said the “correlation” between global rankings and fees had weakened over the past few years, particularly for postgraduate courses, as factors like visa availability became more important in price-setting strategies.

The trends come amid mixed data on international student flows to Australia. An all-time monthly record of 201,490 students entered the country in February, according to provisional estimates from the Australian Bureau of Statistics, suggesting that a dozen or so policies to reduce the nation’s allure have had little impact on arrivals.

Over 707,000 student visa holders were in Australia at the end of February, just 1 per cent fewer than a year earlier. However, the number of student visa applications lodged between July and February was 31 per cent lower than in the equivalent period a year earlier.

For higher education, visa applications from offshore were 32 per cent down on the previous year, although the number of visas granted was just 3 per cent lower and success rates had improved substantially.

The new approach to visa administration, which replaced the controversial “ministerial direction 107”, slows down processing of applications to study at institutions whose commencing overseas student numbers have exceeded 80 per cent of their indicative caps. The Department of Home Affairs said it was “too early to comment” on the degree to which these applications had been delayed.

Ramirez said the impacts of the new approach would become apparent in the second semester this year, and that the “constrained” universities were adjusting their recruitment strategies accordingly. “They know that it’s coming,” he told the webinar.

john.ross@timeshighereducation.com