Slashing PhD prices for international students was a masterstroke

PhD students are critical for all universities – driving excellence, supporting research and under-pinning rankings. 

Attracting these students is highly competitive and this competition for students is intensifying. They are a cornerstone of university and national efforts to lift innovation and promote economic growth. 

Nearly a decade ago New Zealand took an innovative approach to the business of attracting international PhDs; charging international PhD students the same fees as domestic students.

Twelve years on and there’s no doubt the radical policy of more than a decade ago has delivered for New Zealand. 

It has seen more than a trebling in the total number of PhD students in the country and found 25 per cent staying for more than five years. Many post-docs find work in research roles supporting innovation.

The domestic-fees-for-international-PhDs initiative was the only offering of its kind globally when it was launched in 2005. Then, New Zealand’s progressive Labour Government had clear objectives: to increase New Zealand’s competitiveness, innovation and talent acquisition.

Government funding for PhD students was extended to provide the same level of subsidy for all PhD students regardless of citizenship status. 

Universities agreed not to charge supplementary fees. At that point, international PhD tuition fees dropped from $20,000 to $3,000. In addition, work rights were extended to the student and their partner. Their children were exempt from international school fees, which were an average of $9,700 in 2005.

So precisely how has this strategy delivered on the objectives mapped out 12 years ago? Is New Zealand’s international education more competitive? Has it attracted more PhD students and have they stayed to support innovation? Is NZ a more innovative place?

First the sector itself. New Zealand’s international education took off when reform were advanced in 1989-90. For the first five years it was a bumpy ride but the sector stabilised on the back of the 2005 policy for international PhD students. It is now New Zealand’s fourth largest export industry.

As the country’s international enrolments increased so did the actual numbers of international PhD students. Numbers in the country have more than trebled since the fees policy was launched. The ranks of PhD students in New Zealand are now shared in almost equal numbers between domestic and international students.

The New Zealand Ministry of Education measures research impact through citations and by comparing academic research impact with Australia. Both metrics show strong gains for the visibility of New Zealand research.

The increase in New Zealand’s research impact has supported increases in rankings for New Zealand’s eight universities. This is despite a fall in the country’s share of the international education market.

With increased official focus on New Zealand’s growing international education market, officials have produced a significant piece of research that examines stay rates for all international students. There is a frustrating lack of granularity on PhD students but what it does provide is some headline figures, which again highlight the value of the fees policy:

The Ministry of Education reports that 41 percent of all international PhD graduates remain in New Zealand in their first year after graduation, with 25 percent still in the country five years after completion. The domestic-fees-for-international-PhDs has supported the acquisition of talent.

This increase in highly skilled research-focused PhDs has mirrored the growth of the country’s innovation ecosystem. This ecosystem has been built through a range of government policies with recognition that researcher mobility is a contributing factor.

When the policy was launched in 2005 the Government of the day did not set targets to measure its success. 

But what we do know is that the policy has become an intrinsic part of the New Zealand international education offering. Its continued existence is testimony to the value successive governments have attributed to the students who contribute to the country’s wider innovation and economic goals.

That universities on the other side of the world have now chosen to adopt the policy is further testament that the domestic-fees-for-international-PhDs is no longer a radical idea.

Brett Berquist is international director at the University of Auckland. He will be talking about New Zealand’s internationalization strategy at Universities UK’s International Higher Education Forum in Nottingham on 14 March.